Federal Register / Vol. 86, No. 8 / Wednesday, January 13, 2021 / Rules and Regulations 2529 

TABLE 1 TO PARAGRAPH (b)—Continued 

Statute Adjusted civil 

money penalty 

Third Tier ...................................................................................................................................................................................... 2,073,133 

12 U.S.C. 505: 

First Tier ....................................................................................................................................................................................... 10,366 

Second Tier .................................................................................................................................................................................. 51,827 

Third Tier ...................................................................................................................................................................................... 2,073,133 

12 U.S.C. 1464(v)(4) ........................................................................................................................................................................... 4,146 

12 U.S.C. 1464(v)(5) ........................................................................................................................................................................... 41,463 

12 U.S.C. 1464(v)(6) ........................................................................................................................................................................... 2,073,133 

12 U.S.C. 1467a(i)(2) .......................................................................................................................................................................... 51,827 

12 U.S.C. 1467a(i)(3) .......................................................................................................................................................................... 51,827 

12 U.S.C. 1467a(r): 

First Tier ....................................................................................................................................................................................... 4,146 

Second Tier .................................................................................................................................................................................. 41,463 

Third Tier ...................................................................................................................................................................................... 2,073,133 

12 U.S.C. 1817(j)(16): 

First Tier ....................................................................................................................................................................................... 10,366 

Second Tier .................................................................................................................................................................................. 51,827 

Third Tier ...................................................................................................................................................................................... 2,073,133 

12 U.S.C. 1818(i)(2): 

First Tier ....................................................................................................................................................................................... 10,366 

Second Tier .................................................................................................................................................................................. 51,827 

Third Tier ...................................................................................................................................................................................... 2,073,133 

12 U.S.C. 1820(k)(6)(A)(ii) ................................................................................................................................................................... 341,000 

12 U.S.C. 1832(c) ................................................................................................................................................................................ 3,011 

12 U.S.C. 1847(b) ................................................................................................................................................................................ 51,827 

12 U.S.C. 1847(d): 

First Tier ....................................................................................................................................................................................... 4,146 

Second Tier .................................................................................................................................................................................. 41,463 

Third Tier ...................................................................................................................................................................................... 2,073,133 

12 U.S.C. 1884 .................................................................................................................................................................................... 301 

12 U.S.C. 1972(2)(F): 

First Tier ....................................................................................................................................................................................... 10,366 

Second Tier .................................................................................................................................................................................. 51,827 

Third Tier ...................................................................................................................................................................................... 2,073,133 

12 U.S.C. 3110(a) ................................................................................................................................................................................ 47,378 

12 U.S.C. 3110(c): 

First Tier ....................................................................................................................................................................................... 3,791 

Second Tier .................................................................................................................................................................................. 37,901 

Third Tier ...................................................................................................................................................................................... 1,895,095 

12 U.S.C. 3909(d) ................................................................................................................................................................................ 2,579 

15 U.S.C. 78u–2(b)(1): 

For a natural person ..................................................................................................................................................................... 9,753 

For any other person .................................................................................................................................................................... 97,523 

15 U.S.C. 78u–2(b)(2): 

For a natural person ..................................................................................................................................................................... 97,523 

For any other person .................................................................................................................................................................... 487,616 

15 U.S.C. 78u–2(b)(3): 

For a natural person ..................................................................................................................................................................... 195,047 

For any other person .................................................................................................................................................................... 975,230 

15 U.S.C. 1639e(k)(1) ......................................................................................................................................................................... 11,906 

15 U.S.C. 1639e(k)(2) ......................................................................................................................................................................... 23,811 

42 U.S.C. 4012a(f)(5) .......................................................................................................................................................................... 2,252 

By order of the Board of Governors of the 

Federal Reserve System, under delegated 

authority. 

Ann Misback, 

Secretary of the Board. 

[FR Doc. 2021–00235 Filed 1–12–21; 8:45 am] 

BILLING CODE 6210–01–P 

SMALL BUSINESS ADMINISTRATION 

13 CFR Part 124 

RIN 3245–AH64 

Extension of Participation in 8(a) 

Business Development Program 

AGENCY: U.S. Small Business 

Administration. 

ACTION: Interim final rule. 

SUMMARY: This interim final rule 

contains amendments to the regulations 

governing the 8(a) Business 

Development (BD) program. The U.S. 

Small Business Administration (SBA) is 

revising its regulations to implement a 

provision in the Consolidated 

Appropriations Act, 2021 

(Appropriations Act), and the National 

Defense Authorization Act for Fiscal 

Year 2021 (NDAA 2021), which 

authorized certain 8(a) Participants to 

extend their 8(a) BD program term by a 

period of one year. This interim final 

rule amends the 8(a) BD program 

regulations to carry out the changes 

made by the Act. 

2530 Federal Register / Vol. 86, No. 8 / Wednesday, January 13, 2021 / Rules and Regulations 

DATES:

Effective date: This interim final rule 

is effective on January 13, 2021. 

Comment date: Comments must be 

received no later than March 15, 2021. 

ADDRESSES: You may submit comments, 

identified by RIN: 3245–AH64 by any of 

the following methods: 

• Federal eRulemaking Portal: http:// 

www.regulations.gov. Follow the 

instructions for submitting comments. 

• Email: Van Tran, Deputy Associate 

Administrator, Office of Business 

Development, Small Business 

Administration, at 8aQuestions@

sba.gov. 

SBA will post all comments on http:// 

www.regulations.gov. If you wish to 

submit confidential business 

information (CBI), as defined in the User 

Notice at http://www.regulations.gov, 

please submit the information to Van 

Tran, Deputy Associate Administrator, 

Office of Business Development, Small 

Business Administration at 

8aQuestions@sba.gov. Highlight the 

information that you consider to be CBI 

and explain why you believe SBA 

should hold this information as 

confidential. SBA will review the 

information and make the final 

determination on whether it will 

publish the information. 

FOR FURTHER INFORMATION CONTACT: Van 

Tran, Deputy Associate Administrator, 

Office of Business Development, Office 

of Government Contracting and 

Business Development, at 8aQuestions@

sba.gov, or SBA’s 8(a) BD information 

line at (415) 744–0328. 

SUPPLEMENTARY INFORMATION: 

I. Background Information 

On December 27, 2020, President 

Trump signed into law the 

Appropriations Act, Public Law 116– 

260, Div. N, title III, sec. 330 (Dec. 27, 

2020), to, among other things, make 

appropriations for the 2021 fiscal year 

and to provide coronavirus emergency 

response and relief. Section 330 of the 

Appropriations Act mandates that SBA 

must ensure that any small business 

concern participating in the 8(a) BD 

program on or before September 9, 2020 

has the option to extend such 

participation for a period of one year 

from the end of its program term, 

regardless of whether the concern 

previously elected to voluntarily 

suspend its program participation in 

connection with the President’s 

nationwide coronavirus emergency 

disaster declaration on March 13, 2020. 

(Presidential Disaster Declaration on 

Declaring a National Emergency 

Concerning the Novel Coronavirus 

Disease (COVID–19) Outbreak (March 

13, 2020) (https://www.whitehouse.gov/ 

presidential-actions/proclamationdeclaring-national-emergencyconcerning-novel-coronavirus-diseasecovid-19-outbreak). 

Section 869 of the National Defense 

Authorization Act for Fiscal Year 2021, 

Public Law 116–283, title VIII, sec. 869 

(January 1, 2021) (NDAA 2021) also 

contained the same language 

authorizing business concerns 

participating in the 8(a) BD program on 

or before September 9, 2020 to extend 

their participation in the program for a 

period of one year from the end of their 

program terms. The statutory language 

of both the Appropriations Act and 

NDAA 2021 authorizes an extension for 

firms participating in the program ‘‘on 

or before September 9, 2020.’’ There is 

no further clarifying language as to what 

‘‘before’’ September 9, 2020 is intended 

to encompass. It is SBA’s understanding 

that Congress extended the term of 

participation in the 8(a) BD program 

because it believed that the pandemic 

has adversely affected 8(a) concerns and 

their ability to participate in and receive 

the full benefits of the program. Thus, 

SBA believes it is reasonable to 

conclude that any firms participating in 

the program as of the date the national 

disaster was declared due to the 

pandemic (i.e., March 13, 2020) should 

receive the program term extension 

authorized by Congress. 

This extension authority does not 

extend to business concerns that 

graduated from or otherwise left the 8(a) 

BD program prior to March 13, 2020, or 

to business concerns that were admitted 

to the 8(a) BD program after September 

9, 2020. In addition, this rule clarifies 

that the extension will not apply to 

business concerns that were Participants 

in the 8(a) BD program at any point 

between March 13, 2020, and September 

9, 2020, but were terminated, early 

graduated or voluntarily withdrew from 

the program in lieu of being terminated 

or early graduated. SBA has already 

determined that such business concerns 

are no longer eligible to participate in 

the 8(a) BD program. 

In addition, both the Appropriations 

Act and the NDAA 2021 provide that 

SBA shall issue regulations 

implementing the provision not later 

than 15 days after the date of enactment, 

and that the regulations shall be issued 

without regard to the notice 

requirements under section 553(b) of 

title 5, United States Code. As such, this 

rule is being implemented as an interim 

final rule with an immediate effective 

date. 

In order to implement the statutory 

language of section 330 of the 

Appropriations Act and section 869 of 

the NDAA 2021, SBA is amending 

§ 124.2 of its regulations to incorporate 

the optional program term extension for 

small business concerns participating in 

the 8(a) BD program on March 13, 2020. 

Specifically, revised § 124.2 provides 

that for a firm participating in the 8(a) 

BD program as of March 13, 2020 and 

through January 13, 2021, SBA will 

extend its program term by one year 

unless the concern declines such 

extension. A firm that was participating 

in the 8(a) BD program as of March 13, 

2020, but has since graduated or 

otherwise left the program before 

January 13, 2021 must notify SBA of its 

intent to be readmitted for a period of 

one year from the date it completed its 

program term. Any such notification 

must be received by SBA no later than 

March 15, 2021. In addition, a firm 

seeking to be readmitted must certify 

that it continues to meet the applicable 

eligibility requirements as set forth in 

§§ 124.101 through 124.111. 

SBA is also revising § 124.2 to clarify 

that any period of extension under the 

Act will be added to a Participant’s 

transitional stage of participation in the 

8(a) BD program. SBA has selected this 

approach for two reasons. First, in 

authorizing an extension of 8(a) BD 

program participation, Congress clearly 

intended to give certain 8(a) Participants 

the opportunity to recover and take full 

advantage of the program’s business 

development assistance, including the 

additional assistance available to firms 

in the transitional stage as set forth in 

§ 124.404(c). Second, it would be 

administratively burdensome and 

illogical to place a Participant that has 

already entered the transitional stage (or 

completed its program term) back in the 

development stage during its period of 

extension. 

As part of this revision, SBA is also 

making conforming amendments to 

§ 124.404 to clarify the respective terms 

of the developmental and transitional 

stages of program participation. 

Lastly, SBA is revising § 124.509 of its 

regulations to clarify how an extension 

of participation under the Act will 

impact an 8(a) Participant’s requirement 

to attain the targeted dollar levels of 

non-8(a) revenue in its extended 

program term. Currently, under SBA’s 

regulations, a Participant in the 

transitional stage of the 8(a) BD program 

(i.e., years five through nine) must 

generally achieve certain targets of 

revenue derived from sources other than 

sole source or competitive 8(a) 

contracts. The purpose of these targets 

is to ensure that Participants do not 

develop an unreasonable reliance on 

8(a) awards, and to ease their transition 

into the competitive marketplace after 

Federal Register / Vol. 86, No. 8 / Wednesday, January 13, 2021 / Rules and Regulations 2531 

leaving the 8(a) BD program. As such, 

the targets increase incrementally 

during the transitional stage of the 

program. Where a Participant fails to 

meet its applicable competitive business 

activity target for the just completed 

program year and SBA determines that 

the Participant did not make good faith 

efforts to obtain the requisite non-8(a) 

revenue, that Participant will be 

ineligible for sole source 8(a) contracts 

in the current program year unless a 

waiver is granted by SBA. 

Currently, a Participant in the ninth 

year of its program term must derive at 

least 50 percent of its revenues from 

sources other than sole source or 

competitive 8(a) contracts. As noted 

above, the statutory language contained 

in section 330 of the Appropriations Act 

and section 869 of the NDAA 2021 was 

added because Congress believed that 

firms participating in the 8(a) BD 

program may not have been able to 

experience the full benefits of the 

program due to complications caused by 

the pandemic. Thus, it is our view that 

firms that were in program year nine as 

of March 13, 2020 should not be subject 

to a higher business activity target for 

the time added on to the end of their 

program terms by section 330 and 

section 869. As such, the same 50 

percent business activity target that 

applies to program year nine will also 

apply to the extended program term. In 

order to receive sole source 8(a) 

contracts during the extended program 

term a Participant must meet (or have 

met) the applicable 50 percent non-8(a) 

business activity target or have made 

good faith efforts to obtain the requisite 

non-8(a) revenue in the ninth program 

year (or fifth year of the transitional 

stage). Because the period of extension 

for firms that were participating as of 

March 13, 2020 but have since 

graduated or otherwise left the program 

may be less than a full year, SBA 

understands that it may be more 

difficult to meet the 50 percent non-8(a) 

business activity target for the extended 

program term. However, SBA 

encourages Participants to make good 

faith efforts to obtain at least 50 percent 

of their revenue from non-8(a) sources 

during the extension period in order to 

ease the transition to the competitive 

marketplace after graduating from the 

8(a) BD program. As a point of 

clarification, SBA notes that this interim 

final rule does not revise the schedule 

of the transitional stage or the 

corresponding business activity target 

requirements for current 8(a) 

Participants in years one through five of 

the transitional stage of the program. In 

other words, for purposes of the 

business activity target requirements 

any such Participant that elects to 

extend its participation in the program 

under the Act will not repeat a year in 

the transitional stage or revert back to a 

prior year in the transitional stage as a 

result of the program extension. 

II. Comments and Immediate Effective 

Date 

This interim final rule is effective 

without advance notice and public 

comment because section 330(b) of the 

Appropriations Act and section 869(b) 

of the NDAA 2021 authorize SBA to 

issue implementing regulations without 

regard to notice requirements under 5 

U.S.C. 553(b). However, SBA is 

providing a 60-day comment period for 

the public to comment on this Interim 

Final Rule. SBA’s justification for the 

use of an interim final rule and 

immediate effective date follow. 

III. Justification for Interim Final Rule 

In general, SBA publishes a rule for 

public comment before issuing a final 

rule, in accordance with the 

Administrative Procedure Act, 5 U.S.C. 

553. The Administrative Procedure Act 

provides an exception to this standard 

rulemaking process, however, where an 

agency finds good cause to adopt a rule 

without prior public participation. 5 

U.S.C. 553(b)(3)(B). The good cause 

requirement is satisfied when prior 

public participation is impracticable, 

unnecessary, or contrary to the public 

interest. Under such circumstances, an 

agency may publish an interim final 

rule without soliciting public comment. 

SBA has determined that there is good 

cause for dispensing with advance 

public notice and comment on the 

grounds that that it would be contrary 

to the public interest. Specifically, 

advance public notice and comment 

would delay the delivery of critical 

business development assistance 

Congress sought to extend to firms that 

are presently not eligible for the 

program’s assistance because they have 

already graduated or otherwise left the 

8(a) BD program. As explained above, 

such firms will need to notify SBA that 

they would like to be readmitted to the 

program as soon as possible in order to 

take full advantage of the extension 

period. 

In addition, both the Appropriations 

Act and the NDAA provisions cited 

provide specific authority for SBA to 

proceed with this rule. Section 330(b) of 

the Appropriation Act provides: ‘‘(b). 

Emergency Rulemaking Authority—Not 

later than 15 days after the date of 

enactment of this Act, the Administrator 

shall issue regulations to carry out this 

section without regard to the notice 

requirements under section 553(b) of 

title 5, United States Code.’’ Similarly, 

section 869(b) of the NDAA 21 provides: 

‘‘(b) Emergency Rulemaking 

Authority.—Not later than 15 days after 

the date of enactment of this section, the 

Administrator shall issue regulations to 

carry out this section without regard to 

the notice requirements under section 

553(b) of title 5, United States Code.’’ 

Although this interim final rule is 

effective immediately, comments are 

solicited from interested members of the 

public on all aspects of the interim final 

rule. These comments must be received 

on or before the close of the comment 

period noted in the DATES section of this 

interim final rule. SBA will then 

consider these comments in making any 

necessary revisions to these regulations. 

IV. Justification for Immediate Effective 

Date 

The APA requires that ‘‘publication or 

service of a substantive rule shall be 

made not less than 30 days before its 

effective date, except as—otherwise 

provided by the agency for good cause 

found and published with the rule.’’ 5 

U.S.C. 553(d)(3). The purpose of this 

provision is to provide interested and 

affected member of the public sufficient 

time to adjust their behavior before the 

rule takes effect. 

In light of the urgent need to assist 

8(a) small business concerns during the 

pandemic, SBA finds that there is good 

cause for making this rule effective 

immediately instead of observing the 

30-day period between publication and 

effective date. While this interim final 

rule is effective immediately upon 

publication, SBA is inviting public 

comment on the rule during a 60-day 

period and will consider the comments 

in developing a final rule. SBA has 

included an applicability date to make 

clear that the rule is applicable for 

eligible 8(a) companies to either retain 

or regain their 8(a) status as quickly as 

possible. 

V. Compliance With Executive Orders 

12866, 13771, 12988, 13132, and 13175, 

the Paperwork Reduction Act (44 

U.S.C., Ch. 35), and the Regulatory 

Flexibility Act (5 U.S.C. 601–612) 

Executive Order 12866 

The Office of Information and 

Regulatory Affairs has determined that 

this interim final rule is not significant 

for the purposes of Executive Order 

12866 and is not considered a major 

rule under the Congressional Review 

Act. 

This interim final rule is necessary to 

implement section 330 of the 

Appropriations act and section 869 of 

2532 Federal Register / Vol. 86, No. 8 / Wednesday, January 13, 2021 / Rules and Regulations 

1Congressional Research Service, SBA’s ‘‘8(a) 

Program’’: Overview, History, and Current Issues, 

Page 36–37, https://crsreports.congress.gov/ 

product/pdf/R/R44844. 

2SBA’s FY 2021 Congressional Justification and 

Annual Performance Report, Table 10, Page 16, 

https://www.sba.gov/cj. 

the NDAA 2021 in order to provide 

relief to 8(a) firms adversely impacted 

by the March 13, 2020, emergency 

declaration. SBA anticipates that this 

rule will substantially benefit such 8(a) 

firms, their employees, and the 

communities they serve. The rule will 

allow 8(a) firms to continue to be 

eligible to be awarded both competitive 

and sole source 8(a) contracts for an 

extended period in the program. In FY 

2019, 8(a) firms were awarded 5.15% of 

federal contract dollars amounting to 

$30.39 billion with $8.62 billion 

awarded through set asides, $9.90 

billion awarded as sole-source, and 

$11.87 billion awarded though open 

competition or with another preference 

(e.g., HUBZone) applied.1 In the past 

five years (FY 2016–FY 2020) the 

average total contract awards per 8(a) 

firm ranged from $3.15 million in FY 

2018 to $4.45 million in FY 2016. 

An addition of one year to the term 

of 8(a) firms will increase the pool of 

firms participating in the program by up 

to 400 to 600 8(a) firms each year for the 

next ten years, which reflects the 

amount of firms that have graduated 

from the 8(a) program annually in the 

past five years, on average. 

Approximately 4,150 8(a) firms would 

be eligible to receive benefits for an 

additional year in the 8(a) program 

during the course of the next ten years 

based on the number of firms within the 

current 8(a) portfolio and including 

those firms that graduated since March 

13, 2020. While more firms will be 

eligible to participate in the 8(a) 

program each year, the impact on 8(a) 

contract dollars awarded is anticipated 

to be non-substantive. 

SBA will also need to account for 

costs associated with the management of 

an additional year of eligibility for 8(a) 

firms, which includes business 

development assistance and compliance 

oversight. In FY 2019, with nearly 5,200 

8(a) firms in the program, SBA 

expended approximately $12,150 per 

8(a) Program Participant based on a total 

program cost of $63.17 million; this 

figure includes overhead costs 2. An 

additional year of eligibility would 

likely increase total program costs 

stemming from program services. 

However, some of these costs (e.g., 

overhead) would be redistributed across 

the 8(a) program and other SBA 

programs or reduced due to economies 

of scale. SBA is unable to estimate the 

marginal costs associated with an 

additional year at the end of a firm’s 

term in the 8(a) program, but anticipates 

that it would not exceed SBA’s annual 

costs for an 8(a) Participant. 

Executive Order 13771 

This rule is not an E.O. 13771 

regulatory action because this rule is not 

significant under E.O. 12866. 

Executive Order 12988 

This action meets applicable 

standards set forth in sections 3(a) and 

3(b)(2) of Executive Order 12988, Civil 

Justice Reform, to minimize litigation, 

eliminate ambiguity, and reduce 

burden. The action does not have 

retroactive or preemptive effect. 

Executive Order 13132 

This rule does not have federalism 

implications as defined in Executive 

Order 13132. It will not have substantial 

direct effects on the States, on the 

relationship between the National 

Government and the States, or on the 

distribution of power and 

responsibilities among the various 

levels of government, as specified in the 

Executive Order. As such it does not 

warrant the preparation of a Federalism 

Assessment. 

Executive Order 13175 

This rule does not have tribal 

implications under Executive Order 

13175, Consultation and Coordination 

with Indian Tribal Governments, 

because it would not have a substantial 

direct effect on one or more Indian 

tribes, on the relationship between the 

Federal Government and Indian tribes, 

or on the distribution of power and 

responsibilities between the Federal 

Government and Indian tribes. 

Paperwork Reduction Act 

The SBA has determined that this rule 

does not affect any existing collection of 

information. The rule does require a 

concern seeking to be readmitted to the 

8(a) BD program to notify SBA of its 

intent to be readmitted and make a 

certification that it continues to meet 

the applicable 8(a) BD program 

eligibility requirements as set forth in 

§§ 124.101 through 124.111 of title 13 of 

the Code of Federal Regulations. SBA is 

not seeking to collect information 

through any required form, but rather is 

anticipating a simple email from the 

business concern to SBA notifying SBA 

of its intent to be readmitted to the 8(a) 

BD program. There are 346 business 

concerns whose program terms have 

expired since March 13, 2020. Those are 

the only business concerns who would 

be subject to the notification 

requirement. 

Regulatory Flexibility Act 

The Regulatory Flexibility Act (RFA), 

5 U.S.C. 601, requires administrative 

agencies to consider the effect of their 

actions on small entities, small 

nonprofit enterprises, and small local 

governments. Pursuant to the RFA, 

when an agency issues a rulemaking, 

the agency must prepare a regulatory 

flexibility analysis which describes the 

impact of the rule on small entities. 

However, rules that are exempt from 

notice and comment are exempt from 

the RFA requirements when the agency 

for good cause finds that notice and 

public procedure are impracticable, 

unnecessary, or contrary to the public 

interest. Small Business 

Administration’s Office of Advocacy 

guide: How to Comply with the 

Regulatory Flexibility Ac. Ch.1. p.9. 

Accordingly, SBA is not required to 

conduct a regulatory flexibility analysis. 

List of Subjects in 13 CFR Part 124 

Administrative practice and 

procedure, Government procurement, 

Government property, Small businesses. 

Accordingly, for the reasons stated in 

the preamble, SBA is amending 13 CFR 

part 124 as follows: 

PART 124—8(a) BUSINESS 

DEVELOPMENT/SMALL 

DISADVANTAGED BUSINESS STATUS 

DETERMINATIONS 

■ 1. The authority citation for part 124 

is revised to read as follows: 

Authority: 15 U.S.C. 634(b)(6), 636(j), 

637(a), 637(d), 644 and Pub. L. 99–661, Pub. 

L. 100–656, sec. 1207, Pub. L. 101–37, Pub. 

L. 101–574, section 8021, Pub. L. 108–87, 

Pub. L. 116–260, sec. 330, and 42 U.S.C. 

9815. 

■ 2. Revise § 124.2 to read as follows: 

§ 124.2 What length of time may a 

business participate in the 8(a) BD 

program? 

(a) Except as set forth in paragraph (b) 

of this section, a Participant receives a 

program term of nine years from the 

date of SBA’s approval letter certifying 

the concern’s admission to the program. 

The Participant must maintain its 

program eligibility during its tenure in 

the program and must inform SBA of 

any changes that would adversely affect 

its program eligibility. The nine-year 

program term may be shortened only by 

termination, early graduation (including 

voluntary early graduation) or voluntary 

withdrawal as provided for in this 

subpart. 

(b) Pursuant to section 330 of the 

Consolidated Appropriations Act, 2021, 

Federal Register / Vol. 86, No. 8 / Wednesday, January 13, 2021 / Rules and Regulations 2533 

and section 869 of the National Defense 

Authorization Act for Fiscal Year 2021, 

a small business concern participating 

the 8(a) BD program on March 13, 2020, 

may elect to extend such participation 

by a period of one year from the end of 

its program term, regardless of whether 

it previously elected to suspend 

participation in the program under the 

procedures set forth in 

§ 124.305(h)(1)(iii). 

(1) Unless expressly declined in 

writing, SBA will extend a Participant’s 

program term by one year if the concern 

was a Participant in the 8(a) BD program 

on March 13, 2020, and continued its 

participation through January 13, 2021. 

Declines of such extension must be 

submitted to: Deputy Associate 

Administrator, Office of Business 

Development, Small Business 

Administration, 409 Third Street SW, 

Washington, DC 20416, or email to 

8aQuestions@sba.gov. 

(2) Except as set forth in paragraph 

(b)(2)(iii) of this section any concern 

that was a Participant in the 8(a) BD 

program on March 13, 2020, but 

graduated or otherwise left the program 

before January 13, 2021 may elect to be 

readmitted to the 8(a) BD program for 

the period of time equal to one year 

from the date of the original expiration 

of the concern’s program term. A 

concern seeking to be readmitted to the 

8(a) BD program must notify SBA of its 

intent to be readmitted no later than 

March 15, 2021. 

Example 1 to paragraph (b)(2) 

introductory text. Business Concern A 

was a Participant in the 8(a) BD program 

on September 9, 2020, and its program 

term expired on November 25, 2020. On 

January 28, 2021, Business Concern A 

notified SBA of its election to be 

readmitted to the 8(a) BD program under 

the process outlined in this paragraph 

(b)(2). Business Concern A would be 

eligible to participate in the 8(a) BD 

program until November 25, 2021. 

(i) All requests for readmittance must 

be submitted to: Associate 

Administrator, Office of Business 

Development, Small Business 

Administration, 409 Third Street SW, 

Washington, DC 20416, or email to 

8aQuestions@sba.gov. 

(ii) As part of a concern’s notification 

to SBA of its intent to be readmitted to 

the 8(a) BD program, the concern must 

certify that it continues to meet the 

applicable 8(a) BD program eligibility 

requirements as set forth in §§ 124.101 

through 124.111. SBA may, in its 

discretion, request information or 

documentation to assess whether the 

concern meets the eligibility criteria for 

readmittance. 

(iii) Business concerns that were 

Participants in the 8(a) BD program on 

March 13, 2020, but were terminated or 

early graduated by SBA or elected to 

voluntarily withdraw or early graduate 

in lieu of termination are not eligible to 

extend their program terms. 

(iv) The readmittance of a business 

concern owned and controlled by a 

tribe, ANC, NHO, or CDC to the 8(a) BD 

program under this paragraph (b)(2) will 

be disregarded for purposes of the 

ownership restrictions applicable to 

Participants owned by a tribe, ANC, 

NHO, or CDC as set forth in 

§§ 124.109(c)(3)(ii), 124.110(e), and 

124.111(d). The date to commence the 

two-year waiting period for the tribe, 

ANC, NHO, or CDC to own another 

business concern in the 8(a) BD program 

with the same primary NAICS code as 

the readmitted concern will not be 

readjusted with the firm’s readmittance. 

■ 3. Amend § 124.404 by revising the 

second sentence of paragraph (a) to read 

as follows: 

§ 124.404 What business development 

assistance is available to Participants 

during the two stages of participation in the 

8(a) BD program? 

(a) * * * The developmental stage 

will last four years, and the transitional 

stage will last five years, unless the 

concern has exited the program by one 

of the means set forth in § 124.301 prior 

to the expiration of its program term or 

has elected to extend its participation 

pursuant to § 124.2(b). 

* * * * * 

■ 4. Amend § 124.509 by revising 

paragraph (b)(2) and adding an example 

to paragraph (d)(4) to read as follows: 

§ 124.509 What are non-8(a) business 

activity targets? 

* * * * * 

(b) * * * 

(2) Non-8(a) business activity 

targets.—(i) During their transitional 

stage of program participation, 

Participants must meet the following 

non-8(a) business activity targets each 

year: 

TABLE 1 TO PARAGRAPH (b)(2)(i) 

Participant’s year in 

the transitional stage 

Non-8(a) business 

activity targets 

(required minimum 

non-8(a) revenue 

as a percentage of 

total revenue) 

1 .................................. 15 

2 .................................. 25 

3 .................................. 30 

4 .................................. 40 

5 .................................. 50 

(ii) Any Participant that extended its 

program term pursuant to § 124.2(b) of 

this chapter must meet the business 

activity target for year 5 or meet the 

applicable requirements of paragraph 

(d) or (e) of this section in order to 

preserve its eligibility for sole source 

8(a) contracts during the extended 

program period. The applicable 

business activity target for the extended 

program period will be the same as that 

for year 5 of the transitional stage (i.e., 

50% non-8(a) revenue). 

* * * * * 

(d) * * * 

(4) * * * 

Example 3 to paragraph (d)(4): Firm 

C elected to extend its participation in 

the 8(a) BD program as set forth in 

§ 124.2 of this chapter. Firm C had $10 

million in total revenue during year 5 in 

the transitional stage (year 9 in the 

program), of which $8.5 million were 

8(a) revenues and $1.5 million were 

non-8(a) revenues, and SBA determined 

that Firm C did not make good faith 

efforts to meet its non-8(a) business 

activity target. In order to be eligible for 

sole source 8(a) contracts during year 6 

of the transitional stage (year 10 in the 

program), Firm C must demonstrate at 

its first or second quarterly review that 

it had received at least $3.5 million in 

non-8(a) revenue and new non-8(a) 

awards (the amount by which it failed 

to meet the 50% non-8(a) business 

activity target for year 5 in the 

transitional stage). If, at its first two 

quarterly reviews during year 6 of the 

transitional stage (year 10 in the 

program), Firm C could not demonstrate 

that it had received at least $3.5 million 

in non-8(a) revenue and new non-8(a) 

awards, Firm C would not be eligible for 

sole source 8(a) contracts for the 

remainder of its program term. 

* * * * * 

Jovita Carranza, 

Administrator. 

[FR Doc. 2021–00602 Filed 1–12–21; 8:45 am] 

BILLING CODE 8026–03–P