SBA Increases Size Standards for 58 Industries in Three Sectors

The U.S. Small Business Administration issued three final rules in the Federal Register, effective Oct. 24, 2012, increasing size standards for firms in three North American Industry Classification System (NAICS) Sectors: Real Estate and Rental and Leasing; Educational Services; and Health Care and Social Assistance.

Size standards define the maximum size a firm can be and still be considered a small business.  The revised standards reflect changes in marketplace conditions and public comments that SBA received to the proposed rules.

New size standards will enable more businesses in these sectors to obtain or retain small business status; will give federal agencies a larger pool of small businesses from which to choose for their procurement programs; and will make more small businesses eligible for SBA’s loan programs.

SBA increased size standards for businesses in 21 industries in the Real Estate and Rental and Leasing Sector.  More than 13,000 additional firms will qualify as small under these new size standards and become eligible for SBA loan and federal procurement programs.

SBA also increased size standards for nine industries for firms in the Educational Services Sector.  More than 1,500 additional businesses will qualify as small under the new size standards and become eligible for SBA loan and federal procurement programs.

Size standards for 28 industries were also increased for firms in the Health Care and Social Assistance Sector.  More than 4,100 additional firms will qualify as small under these new size standards and become eligible for SBA loan and federal procurement programs.

To review the three rules and public comments, go to www.regulations.gov.  Each has a separate RIN number:

• Real Estate and Rental and Leasing – (RIN 3245-AG28).
• Educational Services – (RIN 3245-AG29).
• Health Care and Social Assistance – (RIN 3245‑AG30)

The SBA is reviewing all size standards, and takes into account 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 definitions reflect current economic conditions in those industries.  Under the Small Business Jobs Act of 2010, SBA will continue its comprehensive review of all size standards for the next several years.

The SBA issued a White Paper entitled “Size Standards Methodology,” which explains how SBA establishes, reviews and modifies its receipts-based and employee-based small business size standards.  It is available at http://www.sba.gov/size.  For the latest about SBA’s revisions to small business size standards, click on “What’s New with Size Standards.”