SBA Raises Size Limit For Firms To Qualify As Small Businesses

07/25/2019 by Michael L. Sterling

The U.S. Small Business Administration (SBA) is raising the size limit for engineering, construction, and other companies to be classified as “small.” The interim final will increase thresholds by about 8% from the current levels. The new standards will take effect on August 19, 2019.

For construction firms in the various buildings construction and heavy and civil engineering construction categories, the new threshold will be average annual receipts of $39.5 million. That’s an increase of $3 million, or 8.2%, from the current level.

For engineering services, SBA’s new threshold will be $16.5 million, a 10% boost from the present amount. For architectural services firms, the new threshold will be $8 million, up 6.7% from $7.5 million. Also, the SBA is finally moving towards the implementation of the Small Business Runway Extension Act, which became law last year.

The Act required SBA to change from a three-year to a five-year averaging period to compute average revenue for size determination purposes. However, SBA has been slow to implement the law. The SBA recently issued proposed rules, but they are not yet in place.

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