Change Aimed at Increasing Eligibility for Contracting and Loan Programs. Public Comments Due by Jan. 26, 2021
The U.S. Small Business Administration is seeking public comments on a proposed rule that would revise the small business size standards for businesses in five North American Industrial Classification System (NAICS) sectors to increase small business eligibility for SBA’s loan and contracting programs.
Comments can be submitted on this proposed rule on or before Jan. 26, 2021 at www.regulations.gov, using the following RIN number: RIN 3245-AG88. You may also comment by mail to Khem R. Sharma, Chief, Size Standards Division, 409 3rd Street SW, Mail Code 6530, Washington, D.C., 20416.
The NAICS sectors reviewed in the proposed rule are: Education Services; Health Care and Social Assistance; Arts, Entertainment and Recreation; Accommodation and Food Services; and Other Services. SBA proposes to increase size standards for 70 industries in those sectors. The following table includes the number of industries reviewed and the number of industries with proposed increases in size standards by NAICS sector.
| NAICS Sector | Sector Name | No. of Industries Reviewed | No. of Industries Reviewed with Increases |
|---|---|---|---|
| 61 | Education Services | 18 | 14 |
| 62 | Health Care and Social Assistance | 39 | 18 |
| 71 | Arts, Entertainment and Recreation | 25 | 11 |
| 72 | Accommodation and Food Services | 15 | 4 |
| 81 | Other Services | 48 | 23 |
| Total | 145 | 70 |
SBA estimates that about 4,700 additional firms in these three sectors will become eligible for SBA’s programs under the revised size standards, if adopted.
The proposed rule is part of a five-year comprehensive review of small business size standards, as required under the Small Business Jobs Act of 2010. The proposed revisions reflect changes in industry and federal marketplace conditions and SBA’s policy position under the current economic situation due to the COVID-19 pandemic. In response to the pandemic, SBA is retaining current size standards where data suggests that size standards should be lowered.
As part of the ongoing review of all size standards, SBA considers the structural characteristics of individual industries, including average firm size, the degree of competition, and federal government contracting trends. This ensures that small business size standards reflect current economic conditions in those industries. The proposed revisions to the size standards in these sectors will enable more small businesses to retain their small business status, and will provide federal agencies a larger pool of small businesses to choose from for small business procurement opportunities and help eligible small businesses benefit from SBA’s loan programs.
An SBA-issued White Paper entitled, “SBA’S Size Standards Methodology,” which explains how SBA establishes, reviews and modifies its receipts-based and employee-based small business size standards, can be viewed at https://www.sba.gov/size.
For more information about SBA’s revisions to its small business size standards, visit announcements about updating size standards at https://www.sba.gov/size.