Pentagon contractors must now disclose sudden price spikes on sole-source deals
H.R. 5176 — Defense Industry Pricing Transparency Act · Filed by Chris Deluzio (D-PA) · Introduced Sep 8, 2025 · Referred to committee
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What it does
This bill requires defense contractors to report to the Pentagon within 30 days whenever the price of a product or service on a non-competitive government contract rises 25% above the bid price, 25% above what the government paid the prior year, or 50% above what it paid in the prior five years. Contractors who fail to report face public listing in the federal contractor performance database. The bill benefits taxpayers and government procurement officials by creating visibility into price gouging on sole-source and limited-competition defense contracts.
Why we flagged it
The bill's core mechanism is a reporting requirement and reputational consequence for price increases on non-competitive defense contracts. It is a transparency and accountability measure, not a subsidy, deregulation, or carve-out.
What the text implies
- The thresholds (25% and 50%) are fixed and do not adjust for inflation, which may reduce the bill's effectiveness over time as baseline prices rise naturally.
- The bill applies only to non-competitive contracts (sole-source and limited-competition awards), leaving competitive contracts unaffected; contractors on competitive contracts face no reporting duty even if prices spike.
The full analysis lists 4 implications of this text.
Who it affects
The bill creates transparency and accountability mechanisms for defense spending without restricting citizens' rights or imposing costs on the public. Taxpayers benefit from visibility into price increases on non-competitive contracts, which are inherently higher-risk for cost overruns.