Why does reindexDomain state to change BitSize while threshold is not reached?

Running the following command on the global domain:

reindexDomain -d . -analyze

produces this output that appears to be incorrect:

The BitSize has been modified.

Reindex these dimensions:

  Dim Name:            umc
  DimRegistry BitSize: 2
  DimInfo     BitSize: 3
  Capacity        (C): 4
  MaxPhyId        (M): 1
  MaxLogId        (L): 1
  Threshold       (T): 1

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

With only 1 position being occupied with 3 available and the threshold is 1, why is the reindexDomain utility stating the bitsize should be increased?

running this command on a clone of the environment

reindexDomain -d . -dimSpec umc     #to affect only the umc dimension

produces this:

Dim Name:            umc
  DimRegistry BitSize: 3
  DimInfo     BitSize: 3
  Capacity        (C): 8
  MaxPhyId        (M): 1
  MaxLogId        (L): 1
  Threshold       (T): 1