By Gloria Larkin
“Just what is the definition of small business?”
That classification can bring alight a burning question when one considers the various rules and parameters that come into play. To illustrate its understanding, the powers that be at the SBA recently updated its white paper, which explains how it establishes, reviews, and modifies size standards.
The lack of general understanding isn’t hard to fathom, as the SBA uses a whopping 102 different size standards; they cover 978 industries and 14 exceptions. Of these, 505 are based on average annual receipts, 483 on the number of employees (one of which also includes barrels per calendar day regarding total refining capacity), and four on average assets.
The revised white paper provides a detailed description of the SBA’s methodology, including the changes from SBA’s 2019 Revised Size Standards Methodology that guided its five-year review of size standards as required by the Small Business Jobs Act of 2010.
The SBA’s goal is simple: to determine whether its existing small business size standards reflect the current industry structure and Federal market conditions, and revise them if the latest available data suggests that revisions are warranted. Today, it is seeking comments and feedback on the 2023 Revised Methodology which it intends to apply to its forthcoming third five-year review of size standards.
To offer your perspective, the Revised Methodology is available at www.sba.gov/size and www.regulations.gov. Note that the comment period closes Friday, Feb. 9.
$2B biz booster
In another important recent development, the General Services Administration recently issued a memorandum to civilian agencies concerning the new eligibility requirements for Service-Disabled Veteran-Owned Small Business (SDVOSB) set-asides or sole source awards that will boost that market in a big way.
The new rules are as follows: businesses have to be certified by SBA as an SDVOSB concern or have to represent as an SDVOSB concern and submit a completed application for SDVOSB certification.
There are two key takeaways here. First, there is now a 5% goal for all 24 federal agencies working with the SBA-set-aside program, representing a $560 billion market. That’s up from 3%, which represents a growth objective in dollars to veteran-owned companies of more than $2 billion in new contracts.
Can you imagine the economic impact of that news? In addition, SDVOSBs must now be certified through the SBA instead of self-certified, which will greatly boost the prospects of those businesses that were already SBA-certified but will eliminate all those only self-certified.
With that news (and those numbers), you can imagine the elation at the National Veterans Small Business Coalition (NVSBC), an organization that works to bring equity and access to transitioning service members, notably while supporting their entrepreneurial endeavors. The NVSBC had advocated for years that Congress increase the Government-wide goal for awards to SDVOSB to 5%.
So, at the end of 2023, it finally happened. NVSBC reported the change in the signed version of the National Defense Authorization Act (NDAA) for fiscal 2024.
With the increase, the updated NDAA also prohibits the government from counting awards to self-certified SDVOSBs toward its prime and subcontracting goals, which closed a major loophole in certification requirements.
“Our coalition represents the 40,000 Veteran-owned firms across America seeking to do work with the federal government,” said NVSBC Executive Director Scott Jensen. “About 12,000 of these Veteran business owners currently have contracts to provide products or services to federal agencies. Federal agencies contract with SDVOSB firms to support every category of products and services including construction, information technology, home health services, supply chain logistics and janitorial services. SDVOSB firms support every agency in every state and [all 14] U.S. territories.”
The full memorandum is available at www.acquisition.gov/sites/default/files/page_file_uploads/CAAC_Letter_2024-02_Final.pdf.
Gloria Larkin is President and CEO of TargetGov, and a national expert in business development in the government markets. Email glorialarkinTG@targetgov.com, visit www.targetgov.com, or call toll-free 1-866-579-1346 x 325 for more information.