SBA enlarges small business sizes
New rules to classify about 14,000 more businesses as “small”;
Rule says ITVARs must comply with nonmanufacturer rule
The Small Business Administration is expanding the pool of businesses eligible to be considered “small” and to qualify for federal contracts and loans.
The SBA issued four final rules that included multiple changes to size standards. Altogether, the changes would make 10,050 more companies eligible for government contracts and loans, and 4,000 more eligible for federal loans only, the SBA said.
The changes include:
Monetary standards
All monetary small business size standards (including receipts, assets, net worth and net income) were increased by 8.73% to account for inflation since the last adjustment in 2008.
The rule became effective Jan. 25.
SBA estimated that about 8,400 more companies would be classified as “small” as a result.
More information: Federal Register notice:
https://goo.gl/NY0Apm
Manufacturing
SBA expanded size standards for 209 industries in the Manufacturing sector, which is Sector 31-33 under the North American Industry Classification System (NAICS), and modified the barrels-per-day standard for petroleum refiners, effective Feb. 26.
More information: Federal Register notice:
https://goo.gl/aOxuz8
36 Industries
The SBA raised employee-based standards for 30 industries and six exceptions that are not in Manufacturing, Wholesale Trade or Retail Trade, effective Feb. 26.
More information: Federal Register notice:
https://goo.gl/QJ7OqL
ITVAR requirement
The rule also maintained the IT Value-Added Reseller (ITVAR) exception under NAICS 541519 with an 150-employee size standard, but added the requirement that ITVAR contracts must comply with the nonmanufacturer rule. That means the ITVARs, on contracts that are primarily for supplies, are only allowed to supply software made by small businesses and not by large companies such as Microsoft and Oracle (Editor’s note: see
Cy Alba's column in this issue for more details).
More information: Federal Register notice:
https://goo.gl/QJ7OqL
The manufacturing rule, and the rule affecting 36 industries, together would classify 1,650 more businesses as small, the SBA said.
Wholesale and Retail Trade
The SBA increased the number of employees for 46 industries in the Wholesale Trade sector, which is Sector 42 under NAICS, effective Feb. 26.
The government also raised the size standards for one industry in Retail Trade, NAICS Sectors 44-45, effective Feb. 26.
The changes in wholesale and retail would make 4,000 more businesses eligible for federal loans, but would have no impact on contracting, SBA said: “NAICS codes and size standards for the wholesale and retail trade industries do not apply to Federal Government procurement programs and the proposed increases would have no impact on size eligibility for federal contracts,” the Federal Register notice stated.
The SBA also maintained the 500-employee size standard for the federal government's procurement of supplies under the non-manufacturer rule.
The agency decreased the size standards from 500 employees to 250 employees for three industries: NAICS 212113 (Anthracite Mining), NAICS 212222 (Silver Ore Mining), and NAICS 212291 (Uranium-Radium-Vanadium Ore Mining) and eliminated the exceptions for Offshore Marine Air Transportation Services and Offshore Marine Services.
More information: Federal Register notice:
https://goo.gl/Rngv1J
