Happy New Year! SBA updates Size Standards and Net Worth Thresholds

Just before Christmas, the SBA gave small business government contractors a nice gift. An SBA final rule went into effect on December 19, 2022, adjusting upwards all receipts-based size standards and measures of economic disadvantage. For size standards, this means that for any small business set-aside procurements or any SBA program where a concern must qualify as a small business, the SBA has increased the five (5) year average receipts-measured size standards for all those applicable NAICS codes. (recall, since January 6, 2022, federal contractors are required to use a five (5) year average instead of three (3) years). Note that these increases only apply to receipts-based (i.e., typically construction and services) and not employee-based (i.e., typically manufacturing and supply) NAICS codes. For measuring economic disadvantage, the SBA has increased the thresholds for personal net worth, adjusted gross income, and total asset value. These thresholds apply to the 8(a) Business Development and Economically Disadvantaged Women-Owned Small Business (EDWOSB) Programs as well as firm’s self-certifying at www.SAM.gov as a Small Disadvantaged Business.​

SBA adjusted these values to provide some relief to small businesses dealing with historic rates of inflation. Bottom line, this change will allow small businesses to maintain eligibility for set-aside and sole-source work longer and provide a bit more flexibility to business owners seeking to qualify and maintain economic disadvantage qualification for the SBA’s programs.