SBA size-standard hike draws pushback at town hall
The proposal would lift some NAICS ceilings over 1,100%, and small contractors say the jump would let firms with vastly deeper benches compete for set-aside dollars.
TL;DR
More than 200 commenters logged in for SBA's virtual town hall Thursday, most opposing proposed size-standard increases that push certain NAICS codes dramatically higher, one to $295 million from $24.5 million. Several small-business owners said the one-minute speaking window was tight but enough to flag the core problem: firms operating at the proposed ceilings carry staffing, financial, and business-development resources that would swamp smaller incumbents in the same set-aside pool. A few voiced qualified support, and comments close today.
The feedback SBA heard last Thursday ran heavily against the proposal, and the numbers back that up. One small-business owner after another told the agency that raising ceilings to $295 million or $400 million in certain NAICS codes pulls competitors with entirely different cost structures into the same set-aside fights they've been winning at the current $24.5 million or $34 million thresholds.
Alexandra Afari, CEO of woman-owned small business IQ Leverage, put the objection plainly: for NAICS 541611, the proposed jump from $24.5 million to $295 million represents an increase of roughly 1,100%. "Firms operating at that scale will generally have greater staffing capacity, financial resources and business development resources," she said, calling for the current standard to stay.
Several speakers didn't oppose raising the ceilings in principle but argued the pace is wrong. John Paul of New Directions Technologies, a service-disabled veteran-owned firm, urged phased increases, stepping NAICS 336411 to 2,000 employees in year one, then 2,400, then 2,800, rather than one large bound. "Roll a small change out, test a little, measure the industry," he said.
The proposal has its defenders. Stephen Pitchney, CEO of Ignite IT, backed raising several IT NAICS codes to $400 million, arguing that without the headroom, companies graduate the program and are still too small to compete unrestricted. Pitchney also floated subcontracting commitments as a guardrail for firms under $34 million.
SBA is sitting on a substantial comment pile. Formal comments were due today, and the docket is not quiet, the response volume makes this one of the more contested SBA rulemakings in recent memory. A final rule that walks back the most extreme NAICS-level jumps wouldn't be surprising; pressing ahead unchanged would be.
Published ·Deep Fathom