By Kim Slowey
Effective Aug. 19, the Small Business Administration (SBA) is raising its monetary-based small business size standards for inflation by an average of 8.4%, an adjustment that the administration expects will allow 90,000 additional companies to participate in its loan and contracting programs. The SBA said that this increase could result in $750 million more total contracts awarded to small businesses and as much as $65 million more in small business loans.
In order to be considered a small business under current SBA guidelines, most general, heavy and civil construction companies cannot have more than $36.5 million of average annual sales receipts. The SBA’s interim final rule raises that threshold about 8.2% to $39.5 million. The current threshold of $15 million for specialty contractors — i.e. electrical, concrete, plumbing, HVAC, painting — and those companies that provide engineering services will increase 10% to $16.5 million. The cap on average annual receipts for architects is increasing by about 6.7% to $7.5 million.
- The last adjustment for inflation made to the SBA’s monetary size standards was in 2014. The administration has also requested comments on the new limits, and those must be submitted by September 16.
In June, the SBA proposed a rule that will change how the administration calculates annual average receipts — from a look-back period of three years to five. The SBA expects that this will allow some businesses …