Sen. Murkowski Welcomes Decision Of SBA To Revamp Proposed Regulations Defining The Size Of Small Business
Washington, D.C. - U.S. Sen. Lisa Murkowski thanked the U.S. Small Business Administration for stopping its efforts to implement a new definition of what constitutes a small business, giving the agency time to develop better definitions that won't harm Alaska small businesses.
The SBA this spring proposed wholesale changes in its regulations defining size standards for "small business." The goal was to simplify the definition of what constitutes a small business, cutting the number of standards to 10 from the dozens of different standards now in effect. The change is important because it would affect which businesses can receive government assistance in a variety of contract, business counseling and financial assistance areas.
In general, the SBA proposed to revise the current standards that classify small businesses as ones with 37 or fewer employees, shifting to different 10-employee-based standards with a cap on revenues. The new standards would have disqualified up to 34,100 businesses nationwide from SBA assistance, with the food and construction industries being most affected.
Murkowski in a June applauded the goal of simplifying the size standards, but said changing the rules to an employee and receipts based standard was very unwise for Alaska businesses because the receipts levels did not take into account the higher costs of doing business in high-cost areas like Alaska. She also noted that the rules could well harm the chances for Alaska Native Corporations to be classified as small businesses and thus stopping them from benefiting from SBA programs - as Congress intended when it created the 8(a) contracting mechanisms for Alaska Native firms.
"These changes are a worthy goal, but the proposed standards are not prudent," said Murkowski in June. Earlier this week the SBA informed Murkowski that it was withdrawing the proposed rules and would study the issue before attempting to draft new size rules.
"We are here to serve small business owners, (which) is why we are going to step back and study this rule further," said Allegra McCullough, SBA Associate Deputy Administrator for Government Contracting.