SBA Launches Dramatic Makeover of Size Standards SBA is proposing huge increases in size standards for many industries, changes that would make thousands of additional companies eligible for small business set-asides and government-backed loans. Many of the new standards, if adopted, would be three, four or five times as large as the current limits for small business status. SBA officials acknowledged in the past that they were debating whether sudden, dramatic increases would be too disruptive for industry; evidently they have decided the answer is “no.” The first round of changes affects retailers, hotels and restaurants, and many categories of services such as auto repair and dry cleaning shops. SBA estimates the new standards would make more than 11,000 companies in those sectors eligible for small business programs. Changes in NAICS sector 54, a major service sector in federal contracting, are coming “in the near future,” the agency said. Many companies in that sector, especially in the IT area, have been clamoring for a big increase in the standards. The current standard for IT services is $25 million in annual receipts. Most retailers in NAICS sectors 44 and 45 now operate under a $7 million size standard; SBA proposes to at least double that in all categories, and in some cases to raise it by a far greater amount. For example, the standard for office supply and stationery stores would jump from $7 million to $30 million. The full list of proposed retail changes is at http://edocket.access.gpo.gov/2009/E9-25193.htm.<. SBA proposes increases in 48 of 76 retail categories. Increases are proposed in 18 of 47 industries in NAICS sector 81, other services. The standard for NAICS 811213, communication equipment repair and maintenance, would increase from $7 million to $10 million. The full list of those revised standards is at http://edocket.access.gpo.gov/2009/E9-25199.htm. SBA’s economic analysis showed that standards should be reduced for some industries in sector 81, but the agency declined to do so because it believes reductions would hurt some companies and hinder economic recovery. In sector 72, accommodations and food services, the standard for NAICS 722310, food service contractors, would rise from $20.5 million to $35.5 million. The full list for sector 72 is at http://edocket.access.gpo.gov/2009/E9-25204.htm.. The proposed changes were published in the Oct. 21 Federal Register. Comments are due Dec. 21. SBA has said it would examine a few of the 19 industry sectors each quarter and roll out changes piecemeal. It is the first comprehensive review of size standards in more than 25 years. SBA said it based its review on an analysis of each industry’s structure. An explanation of the methodology is at www.sba.gov/size..