The U.S. Small Business Administration (“SBA”) issued a proposed rule on March 16, 2011 that increases the small business size standards for 35 industries and one sub-industry in North American Industry Classification System (“NAICS”) Sector 54, Professional, Scientific and Technical Services and one industry in NAICS Sector 81, Other Services. The proposed rule is one of several rules to be proposed by the SBA that will examine and potentially change the small business size standards for industries grouped by NAICS Sector. The SBA undertook this effort following passage of the Small Business Jobs Act of 2010, implemented on September 27, 2010, and Executive Order 13563, signed by President Obama on January 18, 2011, which calls for agencies to undertake a review of possible ineffective or outdated rules and, if necessary, update and streamline their rules to better meet regulatory objectives.

The SBA’s proposed rule focuses on receipts-based size standards, as it covers all industries with receipts-based standards in NAICS Sector 54. In an effort to “simplify managing and using size standards” the SBA proposes to reduce the total number of receipts-based standards that are used from 31 to eight “fixed” size standards. These eight “fixed” receipts-based standards are $5 million, $7 million, $10 million, $14 million, $19 million, $25.5 million, $30.0 million, and $35.5 million. The SBA considered five primary factors in order to determine the appropriate receipts-based standard for the targeted industries...