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SBA Increases Size Standards, Expands Eligibility as Senate Seeks to Fight Fraud

More small businesses than ever will soon be eligible for programs available through the Small Business Administration (SBA). A final rule published by the agency earlier this month increased the revenue-based size standards in 34 industries and three sub-industries in the "Professional, Scientific and Technical Services" sector.

The updates come as a result of the SBA's comprehensive review of all size standards for the next several years, mandated by the Small Business Jobs Act of 2010. Numerous public comments were submitted and several observers said that the revision was long overdue. These most recent changes to the SBA's size standards were the first made by the agency in 25 years.

Increasing the size standards "will enable more small businesses to retain their small business status and...give federal agencies a larger selection of small businesses to choose from for small business procurement opportunities," said the SBA, which also estimated that as many as 8,350 additional firms will become eligible for SBA programs as a result of these revisions.

While the SBA increases access to its financing programs, and simultaneously increases competition for small business contracting funds, high-ranking lawmakers are keeping an eye on fraud in the agency. Most recently, Senators Mary Landrieu (D-LA) and Olympia Snowe (R-ME), chair and ranking member of the Committee on Small Business and Entrepreneurship, respectively, reiterated their call for swift passage of the Small Business Contracting Fraud Prevention Act (S. 633), a bipartisan bill that would aim to prevent federal contracting fraud.

"It is imperative that the House of Representatives pass the critical contracting fraud prevention legislation that the Senate has already unanimously agreed to," said Snowe. "In testimony before our Committee, SBA Inspector General Peg Gustafson noted that our bill 'will greatly assist [her] office's efforts in deterring, detecting and prosecuting false statements made to obtain...contracts.'"

Specifically, the bill would provide a comprehensive oversight framework within the SBA to execute effective certification, surveillance and monitoring of small businesses, as well as increase criminal penalties for companies awarded contracts through fraudulent means. S. 633 passed the Senate unanimously in September of last year and has 13 bipartisan cosponsors, yet the House has yet to take up the legislation.

Jacob Barron, CICP, NACM staff writer