The interim alternative size standards for the 7(a) and 504 loan programs will remain in effect until the SBA establishes a permanent alternative size standard for these programs. 12/29/2020, 303 In a recent update regarding PPP loan eligibility, the Department explained that a business can qualify for a loan even if it has more than 500 employees whose principal place of residence is in the United States if it meets the SBA employee-based or revenue-based size standard corresponding to its primary industry. This repetition of headings to form internal navigation links Federal Register provide legal notice to the public and judicial notice The law also establishes a temporary alternative standard that is in effect until SBA issues the new size rule. Under the “alternative size standard”, if a business can show that its (i) maximum tangible net The Treasury Department continues to roll out new guidance on the CARES Act and the Paycheck Protection Program. The SBA is also not adjusting the tangible net worth and net income based alternative size standard for the Small Business Investment Company program. Under the PPP Loan, the SBA considers a business “small” if it meets the one of the criteria based on three different measurements for size standards: 1) employee-based measurement; 2) revenue-based measurement; or 3) alternative-based measurement. The most interesting guidance is the Department's reminder of the SBA's "alternative size standard" for determining whether an applicant is a "small business concern" for PPP loan eligibility. documents in the last year, by the International Trade Administration You may submit comments, identified by RIN 3245-AG16 by one of the following methods: (1) Federal eRulemaking Portal: www.regulations.gov, following the instructions for submitting comments; or (2) Mail/Hand Delivery/Courier: Khem R. Sharma, Ph.D., Chief, Office of Size Standards, 409 Third Street SW, Mail Code 6530, Washington, DC 20416. The SBA is also not adjusting the tangible net worth and net income based alternative size standard for the Small Business Investment Company program. The new standards come soon after SBA issued a proposal to allow small businesses to calculate their average receipts—for size-standard purposes—over five years, … In an effort to establish a permanent alternative size standard for its Business Loan Programs as mandated by the Jobs Act, SBA has taken steps to gather the information and data necessary to develop an analysis to support the creation of a new permanent alternative size standard based on tangible net worth and average net income. documents in the last year, 9 To embed, copy and paste the code into your website or blog: Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra: [HOT] Read Latest COVID-19 Guidance, All Aspects... [SCHEDULE] Upcoming COVID-19 Webinars & Online Programs, [GUIDANCE] COVID-19 and Force Majeure Considerations, [GUIDANCE] COVID-19 and Employer Liability Issues. However, a business must be a “small business concern” as defined below and must meet the alternative standards tests. On September 27, 2010, the Small Business Jobs Act of 2010 (“Jobs Act”) was enacted (Pub. Furthermore, while SBA has approximated the percentage of all loan approvals issued to small businesses that qualified only under the Interim Rule, it is not possible to determine the precise impact because the available electronic data lacks tangible net worth and average net income data for the impacted population of small businesses. This prototype edition of the Section 1116 of the Jobs Act added a new Section 3(a)(5) to the Small Business Act that directed SBA to establish an alternative size standard using maximum tangible net worth and average net income for applicants of the SBA's Business Loan Programs. documents in the last year, 67 This PDF is publication in the future. offers a preview of documents scheduled to appear in the next day's the Federal Register. Click here to read more about how we use cookies. Similarly, commenters who believe the level established in the Interim Rule is not appropriate as a permanent alternative size standard should suggest, along with supporting data and analysis, a different alternative size standard which they believe would be more appropriate. Commenters in support of the level in the Interim Rule should provide justification, along with supporting data and analysis to support their position. A business can also qualify for the PPP as a small business concern if it and its affiliates met both tests in SBA’s “alternative size standard” as of March 27, 2020: (1) maximum tangible net worth of the business is not more than $15 million; and (2) the average net income after Federal income taxes (excluding any carry-over losses) of the business for the two full fiscal years before the date of the application is not … Under the alternative size standard, a business can qualify for a PPP loan as a small business if as of March 27, 2020, it (1) had a maximum tangible net worth of not more than $15 million, and (2) had an average net income after Federal income taxes (excluding any carry-over losses) of not more than $5 million for the last two fiscal years before the date of the application. If you wish to submit confidential business information (CBI) as defined in the User Notice at www.regulations.gov, you must submit such information either by mail to the U.S. Small Business Administration, Khem R. Sharma, Ph.D., Chief, Office of Size Standards, 409 Third Street SW, Mail Code 6530, Washington, DC 20416, or by email to sizestandards@sba.gov. Small Business Jobs Act: New Alternative Size Standard for 7 (a) and 504 Loans. For this analysis, SBA converted industry based receipts-based size standards to the equivalent number of employees using the receipts-to-employees ratios from the special tabulations of the 2012 Economic Census (http://www.census.gov/​econ/​census/​). Although useful, the analyzed data is selective in that it includes only those firms that were approved for and received an SBA Business Loan, but not those that applied and were not approved nor those interested in applying in the future. These markup elements allow the user to see how the document follows the The CARES Act provides a 500 employee size standard, which a business may use regardless of whether the applicant qualifies as a small business under SBA’s two existing size standards. 12/29/2020, 199 This information is not part of the official Federal Register document. How to calculate average annual receipts and average employment of a firm can be found in 13 CFR § 121.104 and 13 CFR § 121.106, respectively. L. 111-240). of the issuing agency. Deletes references to Surety Bond Guarantee small business size standards for contracts awarded in the presidentially declared disaster areas following Hurricanes Katrina, Rita, and Wilma in 2005. The SBA currently uses two types of size standards to determine SBA program eligibility: (1) industry-specific size standards and (2) alternative size standards based on the applicant’s maximum tangible net worth and average net income after federal taxes. [FR Doc. EPA’s proposal included a small business size standard to qualify a user for a reduced fee amount. the official SGML-based PDF version on govinfo.gov, those relying on it for Be sure to leave feedback using the 'Feedback' button on the bottom right of each page! better and aid in comparing the online edition to the print edition. Against the above backdrop, in this ANPRM, SBA seeks comment on the following issues. CLICK TO DOWNLOAD Aug 2019 Version. documents in the last year, 765 Furthermore, while SBA collects and maintains limited relevant electronic data on applicants for its Business Loan Programs (such as the number of employees for each loan recipient, but not average annual receipts, tangible net worth, or average net income), SBA's electronic internal data does not show whether an applicant for its Business Loan Programs was determined to be eligible under its industry based size standard or under the alternative size standard. The President of the United States issues other types of documents, including but not limited to; memoranda, notices, determinations, letters, messages, and orders. In determining the concern's size, SBA counts the receipts, employees , or the alternate size standard (if applicable) of the concern whose size is at issue and all of its domestic and foreign affiliates, regardless of whether the affiliates are organized for … documents in the last year, 29 In an effort to estimate the percentage of loans that were approved under the temporary statutory alternative size standard, SBA examined its electronic internal data on its Business Loan Programs for the three most recent fiscal years (FY 2015 through FY 2017). 2. Although the guidance is a good reminder of the alternative size standard, the guidance leaves open questions on how other SBA concepts, such as business affiliation, apply to businesses when attempting to qualify under the alternative size standard. This was expected and comes straight from the text of the CARES Act and SBA regulations. are not part of the published document itself. 13 CFR 120.301(b)(2). Until the ACFR grants it official status, the XML Printed version: PDF Publication Date: 03/22/2018 Agency: Small Business Administration Dates: SBA must receive comments to this … edition of the Federal Register. See, 13 CFR part 121, Small Business Size Regulations. the most part, size standards are the average annual receipts or the average employment of a firm. The SBA's table of small business size standards helps small businesses assess their business size. Small Business Size Standards; Temporary Alternative Size Standards for 7(a) Business Loan Program, 20577-20580 [E9-10359] Download as PDF Federal Register / Vol. the current document as it appeared on Public Inspection on SBA uses financial assets and refining capacity to measure the size of a few specialized industries. It is not an official legal edition of the Federal DATA APPENDS. The SBA estimates that nearly 90,000 additional businesses will gain small business status under the adjusted size standards, becoming eligible for SBA loan and contracting programs. to the courts under 44 U.S.C. 12/29/2020, 392 This table of contents is a navigational tool, processed from the This option does not apply to … SBA invites suggestions on sources of relevant data and information, especially tangible net worth and average net income of applicants to SBA's Business Loan Programs, that SBA can evaluate to assess the impact of the Interim Rule on small businesses and use in developing a new permanent alternative size standard and in estimating the impact of the new permanent alternative size standard. These can be useful include documents scheduled for later issues, at the request SBA establishes small business size definitions, commonly known as “size standards,” for private sector industries in the United States to determine eligibility for Federal small business assistance programs, including the SBA's 7(a) and 504 Loan Programs (“Business Loan Programs”). Information about this document as published in the Federal Register. RIN 3245-AG16 Small Business Size Standards; Alternative Size Standard for 7(a), 504, and Disaster Loan Programs; Federal Register Vol. Counts are subject to sampling, reprocessing and revision (up or down) throughout the day. 83, Issue PRORULE 2018-05787 SMALL BUSINESS ADMINISTRATION 2018-05-21 8025-01-P 2018-05787 Advance notice of proposed rulemaking. Aiming to expand credit opportunities for small businesses under the distressed credit conditions in the aftermath of the 2007-2009 Great Recession, Congress, through the Jobs Act, temporarily increased by statute the level of the existing regulatory alternative size standard for the Business Loan Programs by raising the maximum thresholds of tangible net worth from $8.5 million to $15 million and of average net income from $3 million to $5 million, and it provided that the temporary statutory alternative size standard would remain in effect for the Business Loan Programs until such time as SBA established a new permanent alternative size standard. Because of the difficulty of obtaining relevant data, SBA has not yet established a new permanent tangible net worth and net income based alternative size standard for its Business Loan Programs, so the Agency continues to use the temporary statutory Start Printed Page 12507alternative size standard (referred to in the Jobs Act as the “Interim Rule”) to determine eligibility for a small business concern under SBA's Business Loan Programs, in addition to using the industry based size standards. On April 6, the Small Business Administration (“SBA”) provided an “alternative size standard” under which employers may qualify under the PPP program. A Proposed Rule by the Small Business Administration on 03/22/2018. Size standards vary by industry, and are generally based on the number of employees or the amount of annual receipts the business has. Dozens of … on FederalRegister.gov Only official editions of the 1. In this Issue, Documents documents in the last year, 652 informational resource until the Administrative Committee of the Federal DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations. 2018-05787 Filed 3-21-18; 8:45 am], updated on 4:15 PM on Monday, December 28, 2020, updated on 8:45 AM on Tuesday, December 29, 2020. establishing the XML-based Federal Register as an ACFR-sanctioned You can […] Law Firms: Be Strategic In Your COVID-19 Guidance... [GUIDANCE] On COVID-19 and Business Continuity Plans. The SBA is also not adjusting the tangible net worth and net income based alternative size standard for the Small Business Investment Company program. The documents posted on this site are XML renditions of published Federal SBA’s “alternative size standard” as of March 27, 2020: Maximum tangible net worth of the business is not more than $15 million; and The average net income after Federal income taxes (excluding any carry-over losses) of the business for the two full fiscal years before the date of … Additionally, SBA is statutorily authorized to make direct loans under the EIDL Program to small businesses that do not have credit available elsewhere and that have suffered a substantial economic injury as a result of a disaster. documents in the last year, by the Nuclear Regulatory Commission On April 6, the Small Business Administration (“SBA”) provided an “alternative size standard” under which employers may qualify under the PPP program. SBA is seeking public input to assist in establishing a permanent alternative size standard for its 7(a) and 504 … We invite you to try out our new beta eCFR site at https://ecfr.federalregister.gov. Federal Register issue. The Small Business Jobs Act directs SBA to establish a new alternative size standard based on tangible net worth and net income for determining size eligibility for its 7(a) and 504 loan programs. SBA seeks comment on whether or not the level of the temporary statutory alternative size standard under the Interim Rule (i.e., $15 million in tangible net worth and $5 million in average net income) is appropriate under the current credit environment and as a new permanent alternative size standard. 6. by the Treasury Department documents in the last year, 308 4. In this analysis, EPA discusses the impact on fee revenue under the proposed User Fees rule if the small business definition were changed from a receipts-based threshold (as proposed) to an employee-based definition. Register (ACFR) issues a regulation granting it official legal status. SBA is statutorily authorized to provide access to capital to small businesses that do not have credit available elsewhere from non-Federal sources on reasonable terms and conditions. Document Drafting Handbook The “alternative size standard” originally promulgated in 2010 pursuant to the Small Business Jobs Act may also be used to determine if a borrower can qualify for SBA loans. 632(a)(5). Information about this document as published in the Federal Register. Under the alternative size standard, a business can qualify for a PPP loan as a small business if as of March 27, Prior to that, SBA had a lower permanent regulatory alternative size standard that applied to the 504 Loan Program, and temporarily applied, for the period beginning on May 5, 2009 and ending on September 30, 2010, to the 7(a) Loan Program. on 12/29/2020, 146 Such a small percentage of loan approvals issued to firms that exceeded their industry size standard (1.3%) suggests that a vast majority of small businesses receiving loans through SBA's Business Loan Programs would have qualified under their industry based size standards and would not be impacted significantly by a modification, if any, to the Interim Rule. However, as explained elsewhere in this rule, SBA is not adjusting either (1) the tangible net worth and net income-based alternative size standard established under the Jobs Act for its 7(a) and 504 Loan Programs; or (2) the tangible net worth and net income-based alternative size standard established for the Small Business Investment Company (SBIC) Program. While every effort has been made to ensure that EPA is now publishing a supplemental analysis of alternative small business size standard definitions and their effect on the TSCA user fee collection. SBA also invites suggestions on sources of relevant data and information that SBA should evaluate in developing a permanent alternative size standard and assessing its impact. The new standards come soon after SBA issued a proposal to allow small businesses to calculate their average receipts—for size-standard purposes—over five years, … has no substantive legal effect. documents in the last year, 73 If you are using public inspection listings for legal research, you This document has been published in the Federal Register. We support America's small businesses. rendition of the daily Federal Register on FederalRegister.gov does not SBA invites comment on the effects of the Interim Rule on conventional small business lending. The Information Notice further stated that the new statutory alternative size standard would remain in effect until such time as SBA established a permanent alternative size standard for the Business Loan Programs through rulemaking. Specifically, SBA welcomes information on industries/sectors where small businesses benefit the most or do not benefit at all from the use of an alternative size standard. SBA invites comments from interested parties on the proposal to apply the same new permanent alternative size standard established for the Business Loan Programs to the EIDL Program as an alternative to industry based size standards. on The SBA is also not adjusting the tangible net worth and net income based alternative size standard for the Small Business Investment Company program. documents in the last year, 965 Accurately Update, Cleanse, and Append Mission-Critical Data to your existing Customer Database. Conversely, if the loan recipient's number of employees was equal to or less than the industry based size standard, it was deemed for the purposes of this analysis that the loan could have been approved under the industry based size standard. Qualify a user for a temporary alternative standard that is in effect until SBA issues the new size... ) and 504 Loan Programs the text of the CARES Act and SBA.! 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