[Federal Register Volume 87, Number 127 (Tuesday, July 5, 2022)]
[Proposed Rules]
[Pages 40034-40087]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-13250]



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Vol. 87

Tuesday,

No. 127

July 5, 2022

Part III





Small Business Administration





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13 CFR Part 121





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Small Business Size Standards: Adoption of 2022 North American Industry 
Classification System for Size Standards; Proposed Rule

Federal Register / Vol. 87, No. 127 / Tuesday, July 5, 2022 / 
Proposed Rules

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SMALL BUSINESS ADMINISTRATION

13 CFR Part 121

RIN 3245-AH89


Small Business Size Standards: Adoption of 2022 North American 
Industry Classification System for Size Standards

AGENCY: U.S. Small Business Administration.

ACTION: Proposed rule.

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SUMMARY: The U.S. Small Business Administration (``SBA'' or ``Agency'') 
proposes to amend its small business size regulations to incorporate 
the U.S. Office of Management and Budget's (OMB) North American 
Industry Classification System (NAICS) revision for 2022, identified as 
NAICS 2022, into its table of small business size standards. The NAICS 
2022 revision created 111 new industries by reclassifying, combining, 
or splitting 156 NAICS 2017 industries or their parts. SBA's proposed 
size standards for these 111 new industries under NAICS 2022 have 
resulted in an increase to the size standards for 21 industries and 27 
parts of three industries under NAICS 2017, a decrease to size 
standards for seven industries and 41 parts of one industry, a change 
in the size standard measure from average annual receipts to number of 
employees for one industry, a change in the size standard measure from 
number of employees to average annual receipts for a part of one 
industry, and no change in size standards for 118 industries and 33 
parts of eight industries. SBA proposes to adopt the updated table of 
size standards, effective October 1, 2022.

DATES: SBA must receive comments to this proposed rule on or before 
August 4, 2022.

ADDRESSES: Identify your comments by RIN 3245-AH89 and submit them 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. SBA will post all comments to this proposed rule 
on www.regulations.gov.
    If you wish to submit confidential business information (CBI), as 
defined in the User Notice at www.regulations.gov, you must submit such 
information to U.S. Small Business Administration, Khem R. Sharma, 
Ph.D., Chief, the Office of Size Standards, 409 Third Street SW, Mail 
Code 6530, Washington, DC 20416, or send an email to 
<a href="/cdn-cgi/l/email-protection#a4d7cddec1d7d0c5cac0c5d6c0d7e4d7c6c58ac3cbd2"><span class="__cf_email__" data-cfemail="89fae0f3ecfafde8e7ede8fbedfac9faebe8a7eee6ff">[email protected]</span></a>. Highlight the information that you consider to 
be CBI and explain why you believe SBA should hold such information as 
confidential. SBA will review your information and determine whether it 
will make the information public.
    Requests to redact or remove posted comments cannot be honored and 
a request to redact or remove posted comments will be posted as a 
comment. See the www.regulations.gov Help section for information on 
how to make changes to your comments.

FOR FURTHER INFORMATION CONTACT: Dr. Khem R. Sharma, Chief, Office of 
Size Standards, (202) 205-6618 or <a href="/cdn-cgi/l/email-protection#deadb7a4bbadaabfb0babfacbaad9eadbcbff0b9b1a8"><span class="__cf_email__" data-cfemail="37445e4d524443565953564553447744555619505841">[email protected]</span></a>.

SUPPLEMENTARY INFORMATION: Effective October 1, 2000, the U.S. Small 
Business Administration (SBA) adopted North American Industry 
Classification System (NAICS) 1997 industry definitions as a basis for 
defining industries for its table of small business size standards, 
replacing the 1987 Standard Industrial Classification (SIC) (65 FR 
30836 (May 15, 2000)). Since then, the Office of Management and Budget 
(OMB) has issued five revisions to NAICS. SBA's table of size standards 
adopted the OMB's first revision, NAICS 2002, effective October 1, 2002 
(67 FR 52597 (August 13, 2002)); the second revision, NAICS 2007, 
effective October 1, 2007 (72 FR 49639 (August 29, 2007)); the third 
revision, NAICS 2012, effective October 1, 2012 (77 FR 49991 (August 
20, 2012)); and fourth revision, NAICS 2017, effective October 1, 2017 
(82 FR 44886 (September 27, 2017)).
    On December 21, 2021, OMB published its fifth and the latest 
revision to NAICS ``Notice of NAICS 2022 Final Decisions; Update of 
Statistical Policy Directive No. 8, North American Industry 
Classification System: Classification of Establishments; and 
Elimination of Statistical Policy Directive No. 9, Standard Industrial 
Classification of Enterprises'' (86 FR 72277). In the December 21, 
2021, Federal Register notice, OMB accepted the Economic Classification 
Policy Committee's (ECPC) recommendations, as outlined in the July 2, 
2021, Federal Register notice (86 FR 35350), for the 2022 revisions to 
the North American Industry Classification System (NAICS), as well as 
the recommendations to update OMB Statistical Policy Directive No. 8, 
North American Industry Classification System: Classification of 
Establishments and to eliminate OMB Statistical Policy Directive No. 9, 
Standard Industrial Classification of Enterprises.
    The OMB's notice stated that Federal statistical establishment data 
published for reference years beginning on or after January 1, 2022, 
should be published using NAICS 2022. Though SBA is not a statistical 
agency, it proposes to adopt NAICS 2022 for its table of size 
standards, effective October 1, 2022.
    As with the previous NAICS revisions, SBA proposes to adopt the 
latest NAICS revision, identified as NAICS 2022, effective October 1, 
2022 (i.e., the beginning of the new fiscal year following the 
effective date of the OMB's release of the NAICS 2022 revision), for 
several reasons: (1) Federal Government contracting data and related 
statistics will be more consistent and comparable with past data for 
analyzing future small business activity if implementation of the 
revised table of size standards occurs at the beginning of a new fiscal 
year; (2) Users of size standards, for instance, Federal prime 
contractors, who may use the size standards for developing their 
subcontracting plans, can have more consistent data to examine the past 
and future Federal contracting trends; and (3) Small business size 
standards apply to most Federal agencies and their programs involving 
small businesses; with a time lag between the OMB's effective date and 
SBA's update of its size standards, agencies will have sufficient time 
to implement the changes and develop training tools, if necessary.

Changes in NAICS 2022

    The NAICS 2022 revision created 111 new NAICS industries by 
splitting, merging, or modifying 6-digit codes or industry titles/
definitions of 156 exiting industries under NAICS 2017 structure, of 
which nine industries were split to two or more NAICS 2022 industries. 
These changes are broken down by NAICS sector in Table 1, ``Modified 
Industries under NAICS 2017 and New Industries under NAICS 2022 by 
NAICS Sector.'' As can be seen in Table 1, Sector 44-45 (Retail Trade) 
accounts for the largest proportions of NAICS 2017 industries that have 
changed or been amended and of the new industries that have been 
created under NAICS 2022, followed by Sector 31-33 (Manufacturing), and 
Sector 51 (Information).

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        Table 1--Modified Industries Under NAICS 2017 and New Industries Under NAICS 2022 by NAICS Sector
----------------------------------------------------------------------------------------------------------------
                                                  Existing NAICS 2017 industries     New NAICS 2022 industries
                                                              changed                         created
                  NAICS sector                   ---------------------------------------------------------------
                                                       Count             %             Count             %
----------------------------------------------------------------------------------------------------------------
Sector 21.......................................              13             8.3               6             5.4
Sector 31-33....................................              33            21.2              19            17.1
Sector 42.......................................               5             3.2               3             2.7
Sector 44-45....................................              61            39.1              52            46.8
Sector 51.......................................              20            12.8              18            16.2
Sector 52.......................................              12             7.7               6             5.4
Sector 81.......................................               7             4.5               2             1.8
Sectors 48-49, 54, 56 & 62......................               5             3.2               5             4.5
All Sectors.....................................             156           100.0             111           100.0
----------------------------------------------------------------------------------------------------------------

    Of the 111 new industries under NAICS 2022, 79 (71% of the new 
industries) were created by merging two or more NAICS 2017 industries 
in their entirety, one or more of NAICS 2017 industries and part(s) of 
one or more NAICS 2017 industries, or parts of two or more NAICS 2017 
industries. Altogether, 124 NAICS 2017 industries or their parts were 
involved in the creation of the 79 new industries. Of the remaining 32 
new industries, OMB changed the 6-digit codes for 11 (10%) NAICS 2017 
industries without changing their titles, amended the industry titles 
of 15 (14%) NAICS 2017 industries without changing their 6-digit codes, 
and created six (5%) new industries by modifying the title, 6-digit 
code, or definition (or any combination thereof) of a single NAICS 2017 
industry or part. These results are summarized in Table 2, ``Summary of 
NAICS 2022 Changes.''

                 Table 2--Summary of NAICS 2022 Changes
------------------------------------------------------------------------
     Types of new industries formed            Count             %
------------------------------------------------------------------------
New industries formed by merging two or               79            71.2
 more NAICS 2017 industries or their
 parts \1\..............................
NAICS 2017 industries for which 6-digit               11             9.9
 codes have changed without changing
 their titles...........................
NAICS 2017 industries for which titles                15            13.5
 have changed without changing their 6-
 digit codes............................
NAICS 2017 industries for which titles,                6             5.4
 6-digit codes, or definitions have
 changed, mostly by splitting a single
 NAICS 2017 industry....................
                                         -------------------------------
    Total...............................             111           100.0
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\1\ Of the 79 NAICS 2022 new industries, 15 industries formed by merging
  two or more NAICS 2017 industries or their parts used the NAICS 2017
  industry titles, of which 14 used different 6-digit codes and one used
  the same NAICS 2017 industry code.

    Complete information on the relationship between NAICS 2017 and 
NAICS 2022 is available on the U.S. Bureau of the Census (Census 
Bureau) website at https://www.census.gov/naics/. The Census Bureau's 
website also provides detailed documentation on Federal notices 
involving the replacement of SIC with NAICS, and all subsequent NAICS 
updates and revisions, including both the July 2, 2021, and December 
21, 2021, Federal notices regarding the NAICS 2022 revision.
    Of the 79 new NAICS 2022 industries formed by merging existing 
NAICS 2017 industries or their parts, 33 or 42% were formed by merging 
one NAICS 2017 industry with parts of two other NAICS 2017 
industries.\1\ Likewise, 21 or 27% of new industries were formed by 
merging two NAICS 2017 industries, and 11 or 14% were formed by merging 
one NAICS 2017 industry with part of another industry. These results 
and the formation of the remining 14 or 18% of new industries are 
summarized in Table 3, ``Formation of New Industries in NAICS 2022.''
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    \1\ These 33 industries were in Sector 44-45 (Retail Trade). 
Specifically, NAICS 2017 industry 454110 (Electronic Shopping and 
Mail-Order Houses) was split to and distributed across 42 different 
retail trade industries, and similarly NAICS 454390 (Other Direct 
Selling Establishments) was split to and distributed across 39 
different retail trade industries, which were in turn merged with 33 
different Retail Trade industries.

           Table 3--Formation of New Industries in NAICS 2022
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                                             NAICS 2022 new industries
                                           formed by merging NAICS 2017
  NAICS 2017 industries or their parts       industries or their parts
                                         -------------------------------
                                               Count             %
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One industry and parts of two industries              33            41.8
Two industries..........................              21            26.6
One industry and part of one industry...              11            13.9
Three industries........................               4             5.1
Two industries and parts of two                        2             2.5
 industries.............................
Parts of three industries...............               2             2.5
Four industries.........................               2             2.5
One industry and parts of three                        1             1.3
 industries.............................

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Parts of two industries.................               1             1.3
Three industries and part of one                       1             1.3
 industry...............................
Six industries and parts of two                        1             1.3
 industries.............................
                                         -------------------------------
    Total...............................              79           100.0
------------------------------------------------------------------------

    Table 4, ``NAICS 2017 Industries or Their Parts Matched to NAICS 
2022 Industries,'' below, shows the detailed changes from NAICS 2017 to 
NAICS 2022.
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Proposed Size Standards for New Industries in NAICS 2022

    On October 22, 1999, SBA proposed to replace SIC with NAICS 1997 as 
the basis of industry definitions for its table of small business size 
standards (64 FR 57188). The proposed rule included a set of guidelines 
or rules that SBA applied to convert the size standards for industries 
under SIC to industries under NAICS. The guidelines primarily aimed to 
minimize the impact of applying a new industry classification system on 
SBA's size standards and on small businesses that qualified as small 
under the SIC-based size standards. SBA received no negative comments 
against the proposed guidelines. Thus, SBA published its final rule on 
May 15, 2000 (65 FR 30386), corrected on September 5, 2000 (65 FR 
53533), adopting the resulting table of size standards based on NAICS 
1997 structure, as proposed. To be consistent, SBA generally applied 
the same guidelines when it updated its table of size standards to 
adopt NAICS 2002, NAICS 2007, NAICS 2012, and NAICS 2017 revisions. In 
those updates as well, SBA received no adverse comments against using 
those guidelines, or against the resulting changes to the size 
standards. These guidelines to adopt NAICS revisions for size standards 
were also included in the SBA's ``Size Standards Methodology'' white 
paper and SBA received no adverse comments when the revised methodology 
was open for public comments. Accordingly, in this proposed rule to 
adopt NAICS 2022 structure for its size standards table as well, SBA 
has generally followed the same guidelines. The guidelines that are 
applicable to this update are shown below in Table 5, ``General 
Guidelines to Establish Size Standards for New Industries under NAICS 
2022.''

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    SBA generally applied the guidelines in Table 5 to convert the size 
standards from NAICS 2017 industries to NAICS 2022 industries. In 
addition to following the above general guidelines in Table 5, in cases 
where a new industry is formed by merging multiple industries or parts 
of multiple industries with substantially different levels or measures 
of size

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standards, in this proposed rule, SBA has also examined the relevant 
latest industry and Federal procurement data to determine an 
appropriate size standard for the new industry. Developed based on the 
above guidelines and analyses of the relevant data, where necessary, 
SBA's proposed size standards for the new industries under NAICS 2022 
are shown in Table 6, ``Proposed Size Standards for New Industries in 
NAICS 2022.'' Also shown in Table 6 are the current size standards for 
the affected NAICS 2017 industries and their parts.

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Derivation of Proposed Size Standards for Select NAICS 2022 Industries

NAICS 212114--Surface Coal Mining

    SBA proposes a 1,250-employee size standard for NAICS 2022 industry 
212114 (Surface Coal Mining). This new industry was formed by combining 
NAICS 2017 industry 212111 (Bituminous Coal and Lignite Surface Mining) 
with the Anthracite Surface Mining part of NAICS 2017 industry 212113 
(Anthracite Mining). Their current size standards are 1,250 employees 
for NAICS 2017 industry 212111 and 250 employees for NAICS 2017 
industry 212113. Based on the 2017 Economic Census data, 91.5% of firms 
in NAICS 212111 qualify as small under the 1,250-employee size 
standard. Similarly, 98% of all firms in entire NAICS 212113 are small 
under the 250-employee size standard. However, SBA cannot compute the 
percentage of firms that qualify as small for the Anthracite Surface 
Mining part of NAICS 2017 industry 212113 because such information is 
not available in the 2017 Economic Census data. Thus, SBA analyzed the 
data for NAICS 212111 and entire NAICS 212113. SBA follows this 
approach when a new NAICS 2022 industry includes part or parts of one 
or more NAICS 2017 industries.
    Based on the 2017 Economic Census data, accounting for 98% of 
combined receipts, 80% of firms, and 96% of employees of the new 2022 
NAICS industry 212114, NAICS 212111 dominates the new industry. When a 
new NAICS 2022 industry is composed of one or more NAICS 2017 
industries and part(s) of one or more NAICS 2017 industries and they 
all have different size standards (which is true in the case of NAICS 
2022 industry 212114), the guidelines in Table 5 directs to select the 
same size standard as for the NAICS 2017 industry or part that most 
closely matches the economic activity described by the NAICS 2022 
industry. Additionally, the guidelines also provide that the size 
standard for a new NAICS 2022 industry, comprising one or more of NAICS 
2017 industries in their entirety and one or more part(s) of NAICS 2017 
industries with different size standards, will be the highest size 
standard among the NAICS 2017 industries or their part(s) making up the 
new industry, provided that the highest size standard does not include 
dominant or potentially dominant firms. These criteria support the 
higher 1,250-employee size standard for NAICS 2022 industry 212114. 
Nevertheless, SBA also considered adopting 250 employees as a size 
standard for the new industry, but it would cause 15 firms in NAICS 
2017 industry 212111 to lose their small business status under the 250-
employee size standard and access to Federal assistance. Based on the 
2017 Economic Census data, 92.5% of firms will qualify as small under 
the proposed 1,250-employee size standard for in the new industry.

NAICS 212115--Underground Coal Mining

    SBA proposes to adopt a 1,500-employee size standard for NAICS 2022 
industry 212115 (Underground Coal Mining). This new industry was 
generated by merging NAICS 2017 industry 212112 (Bituminous Underground 
Mining) and the Anthracite Underground Mining part of NAICS 2017 
industry 212113 (Anthracite Mining). The current size standards are 
1,500 employees for NAICS 212112 and 250 employees for NAICS 212113. 
Based on the 2017 Economic Census data, 92.6% of firms in NAICS 212112 
are below the 1,500-employee size standard. While SBA does not have the 
data to estimate the percentage of firms that would be small in the 
Anthracite Underground Mining part of NAICS 212113, 98% of firms 
qualify as small under the 250-employee size standard for the overall 
NAICS 212113 industry.
    Based on the 2017 Economic Census data, accounting for 98% of total 
receipts, 68% of total firms, and 97% of total employees, NAICS 2017 
industry 212112 dominates the new NAICS 2022 industry 212115. These 
percentages would be even higher if only the part of NAICS 212113 was 
considered instead of the entire industry. Thus, based on these 
results, the guidelines in Table 5 support the 1,500-employee size 
standard for NAICS 212115. SBA also considered adopting the 250-
employee size standard applicable to NAICS 212113 as the size standard 
for NAICS 212115. However, doing so would cause about 20 firms in NAICS 
212112 to lose their small business status. Adopting any size standard 
lower than 1,500 employees would cause some businesses that are 
currently small in NAICS 212112 to lose their small status. The data 
shows that one additional firm would qualify as small in NAICS 212113 
under the 1,500-employee size standard. According to the 2012 Economic 
Census data, 94% of firms would qualify as small under the proposed 
1,500-employee size standard for NAICS 2022 industry 212115.

NAICS 212220--Gold Ore and Silver Ore Mining

    SBA proposes to adopt a 1,500-employee size standard for NAICS 2022 
industry 212220 (Goal Ore and Silver Ore Mining). This new industry was 
generated by merging NAICS 2017 industry 212221 (Gold Ore Mining) and 
NAICS 2017 industry 212222 (Silver Ore Mining). The current size 
standards are 1,500 employees for NAICS 212221 and 250 employees for 
NAICS 212222. Based on the 2017 Economic Census data, about 96.2% of 
firms in NAICS 212112 are below the 1,500-employee size standard and 
almost all firms in NAICS 212222 are small under the 250-employee size 
standard. Accounting for 95% of total receipts, 94% of total firms, and 
91% of total employees, NAICS 2017 industry 212221 dominates the new 
NAICS industry 212220. Thus, according to the guidelines in Table 5, 
SBA is proposing to adopt, as the size standard for the new NAICS 
industry 212220, a 1,500-employee size standard, which applies to NAICS 
2017 industry 212221. If SBA were to adopt the lower 250-employee size 
standard, five firms will lose their small business status in NAICS 
212221. Based on the 2017 Economic Census data, 96.5% of firms in NAICS 
2022 industry 212220 would qualify as small under the proposed 1,500-
employee size standard.

NAICS 212290--Other Metal Ore Mining

    SBA proposes to adopt a 750-employee size standard for NAICS 2022 
industry 212290 (Other Metal Ore Mining). This new industry was 
generated by merging NAICS 2017 industry 212291 (Uranium-Radium-
Vanadium Ore Mining) and NAICS 2017 industry 212299 (Other Metal Ore 
Mining). The current size standards are 250 employees for NAICS 212291 
and 750 employees for NAICS 212299. Accounting for 83% of total 
employees of the new industry (information on receipts and firms not 
available in the 2017 Economic Census tabulations), NAICS 212299 
dominates the new industry. Thus, SBA is proposing to adopt 750 
employees as the size standard for NAICS 212290. SBA also considered 
proposing a 250-employee size standard for the new industry but doing 
so would cause two firms in NAICS 212299 to lose their small business 
status and access to Federal small business assistance.

NAICS 212323--Kaolin, Clay, and Ceramic and Refractory Minerals Mining

    SBA proposes to adopt a 500-employee size standard for NAICS 2022 
industry NAICS 212323 (Kaolin, Clay, and Ceramic and Refractory 
Minerals Mining). This new industry was formed by combining NAICS 2017 
industry

[[Page 40066]]

212324 (Kaolin and Ball Clay Mining) and NAICS 2017 industry 212325 
(Clay and Ceramic and Refractory Minerals Mining). The current size 
standards are 750 employees for NAICS 212324 and 500 employees for 
NAICS 212325. Based on the 2017 Economic Census data, almost all firms 
in NAICS 212324 are below the 750-employee size standard and 91.7% of 
firms are small under the 500-employee size standard in NAICS 212222. 
Accounting for half of total receipts and employees and 78% of total 
firms, NAICS 212325 tends to dominate the new industry. Following the 
guidelines in Table 5, SBA is adopting 500 employees as the size 
standard for NAICS 212323. Adopting the higher 750-employee standard 
would enable the largest, and possibly a dominant, firm in NAICS 212324 
to qualify as small. Adopting 500 employee would cause only one largest 
firm in NAICS 212324 to lose its small business status. Thus, SBA is 
proposing to adopt 500 employees as the size standard for NAICS 2022 
industry 212323. Under the proposed 500-employee size standard, 92.2% 
of firms would qualify as small in the new industry.

NAICS 212390--Other Nonmetallic Mineral Mining and Quarrying

    SBA proposes to adopt a 500-employee size standard for NAICS 2022 
industry 212390 (Other Nonmetallic Mineral Mining and Quarrying). This 
new industry was formed by combining four NAICS 2017 industries: NAICS 
212391 (Potash, Soda, and Borate Mineral Mining), NAICS 312392 
(Phosphate Rock Mining), NAICS 212393 (Other Chemical and Fertilizer 
Mineral Mining), and NAICS 212399 (All Other Nonmetallic Mineral 
Mining). Their current size standards are 750 employees, 1,000 
employees, 500 employees, and 500 employees, respectively. Based on the 
2017 Economic Census data, almost all firms in NAICS 212391 and in 
NAICS 212392 are below their 750-employee and 1,000-employee size 
standards, respectively. Similarly, 90% of firms in NAICS 212393 and 
91.9% firms in NAICS 212300 qualify as small under their 500-employee 
size standard. Except for NAICS 212399 accounting for 69% of total 
firms, no individual industry was found to dominate the new industry. 
SBA proposes to assign a 500-employee standard for NAICS 212390, which 
applies to two of the four industries comprising the new industry. No 
firms in NAICS 212391 and NAICS 212392 would lose their small business 
status by adopting a lower 500-employee size standard for the new 
industry. Based on the 2017 Economic Census data, 92.5% of firms would 
qualify as small under the proposed 500-employee size standard for the 
new industry.

NAICS 316990--Other Leather and Allied Product Manufacturing

    SBA proposes to adopt a 500-employee size standard for NAICS 2022 
industry NAICS 316990 (Other Leather and Allied Product Manufacturing). 
This new industry was formed by combining NAICS 2017 industry 316992 
(Women's Handbag and Purse Manufacturing) and NAICS 2017 industry 
316998 (All Other Leather Good and Allied Product Manufacturing). The 
current size standards are 750 employees for NAICS 316992 and 500 
employees for NAICS 316998. Based on the 2017 Economic Census data, 
98.9% of firms in NAICS 316992 are below the 750-employee size standard 
and 98.8% of firms are small under the 500-employee size standard in 
NAICS 316998. Accounting for nearly 80% of combined receipts and 87-88% 
of combined firms and employees, NAICS 316998 with a 500-employee size 
standard dominates the new industry. Thus, SBA is proposing to adopt 
the 500 employees as the size standard for new NAICS 2022 industry 
316990. No firms in NAICS 316992 would lose their small business status 
under the proposed 500-employee size standard. Based on the 2017 
industry data, 98.8% of firms will qualify as small under the proposed 
500-employee size standard for NAICS 2022 industry 316990.

NAICS 321215--Engineered Wood Member Manufacturing

    SBA proposes to adopt a 500-employee size standard for NAICS 2022 
industry NAICS 321215 (Engineered Wood Member Manufacturing). This new 
industry was formed by combining NAICS 2017 industry 321213 (Engineered 
Wood Member (except Truss) Manufacturing) and NAICS 2017 industry 
321214 (Truss Manufacturing). The current size standards are 750 
employees for NAICS 321213 and 500 employees for NAICS 321214. Based on 
the 2017 Economic Census data, 90.3% of firms in NAICS 321213 qualify 
as small under its 750-employee size standard and 96.3% of firms are 
small under the 500-employee size standard in NAICS 321214. Accounting 
for 76% of combined receipts and 86-87% of combined firms and 
employees, NAICS 321214 dominates the new industry. Following the 
guidelines in Table 5, SBA proposes to adopt the 500-employee size 
standard for NAICS 2022 industry 321315. Only one firm in NAICS 321213 
would lose small business status under the proposed 500-employee size 
standard. Based on the 2017 industry data, 95.4% of firms will qualify 
as small under the proposed 500-employee size standard for NAICS 2022 
industry 321215.

NAICS 322120--Paper Mills

    SBA proposes to adopt a 1,250-employee size standard for NAICS 2022 
industry NAICS 322120 (Paper Mills). This new industry was created by 
combining NAICS 2017 industry 322121 (Paper (except Newsprint) Mills) 
and NAICS 2017 industry 322122 (Newsprint Mills). The current size 
standards are 1,250 employees for NAICS 322121 and 750 employees for 
NAICS 322122. Based on the 2017 Economic Census data, 77% of firms in 
NAICS 322121 qualify as small under its 1,250-employee size standard 
and 66.7% of firms are small under the 750-employee size standard in 
NAICS 322122. Accounting for 98% of combined receipts, 85% of total 
firms, and 91% of aggregate employees, NAICS 322122 dominates the new 
industry. Thus, in accordance with the guidelines in Table 5, SBA 
proposes to adopt, as the size standard for NAICS 322120, 1,250-
employee standard that applies to NAICS 322122. Adopting 750-employee 
size standard would have caused five firms to lose their small business 
status in NAICS 322121. Based on the 2017 industry data, 77.1% of firms 
will qualify as small under the proposed 1,250-employee size standard 
for NAICS 2022 industry 322120.

NAICS 333248--All Other Industrial Machinery Manufacturing

    SBA proposes to adopt a 750-employee size standard for NAICS 2022 
industry 333248 (All Other Industrial Machinery Manufacturing). This 
new industry was formed by combining NAICS 2017 industry 333244 
(Printing Machinery and Equipment Manufacturing) and NAICS 2017 
industry 333249 (Other Industrial Machinery Manufacturing). The current 
size standards are 750 employees for NAICS 333244 and 500 employees for 
NAICS 333249. Based on the 2017 Economic Census data, 98.1% of firms in 
NAICS 333244 qualify as small under its 750-employee size standard and 
95.4% of firms are small under the 500-employee size standard in NAICS 
333249. Accounting for 87-89% of combined receipts, firms, and 
employees, NAICS 333249 dominates the new industry. Thus, SBA 
considered adopting, as the size standard for NAICS 333248, the 500-
employee size standard

[[Page 40067]]

that applies to NAICS 333249. However, under the lower 500-employee 
size standard would cause three firms participating in Federal 
contracting in NAICS 333244 to lose their small business status. Thus, 
SBA is proposing to adopt the higher 750-employee size standard that 
applies to NAICS 333244. Based on the 2017 industry data, 96.7% of 
firms would qualify as small under the proposed 750-employee size 
standard for NAICS 2022 industry 333248.

NAICS 333310--Commercial and Service Industry Machinery Manufacturing

    SBA proposes to adopt a 1,000-employee size standard for NAICS 2022 
industry 333310 (Commercial and Service Industry Machinery 
Manufacturing). This new industry was generated by aggregating three 
NAICS 2017 industries. These include NAICS 333314 (Optical Instrument 
and Lens Manufacturing) with a 500-employee size standard, NAICS 333316 
(Photographic and Photocopying Equipment Manufacturing) with a 1,000-
employee size standard, and NAICS 333318 (Other Commercial and Service 
Industry Machinery Manufacturing) with a 1,000-employee size standard. 
Based on the 2017 Economic Census data, 91.3% of firms in NAICS 333314, 
96.7% of firms in NAICS 333316, and 96.1% of firms in NAICS 333318 
qualify as small under their respective size standards. Accounting for 
75-76% of combined receipts and employees, and 68% of combined firms, 
NAICS 333318 dominates the new industry. Thus, SBA is proposing, as the 
size standard for new NAICS 333310, to adopt the 1,000-employee 
standard that applies to NAICS 333318. SBA also considered adopting the 
500-employee size standard but doing so would, based on the 2017 
Economic Census data, cause about 25 firms in NAICS 333316 and 333318 
to lose their small business status. This would also, based on the 
Federal Procurement Data System-Next Generation (FPDS-NG) data for 
fiscal years 2018-2020, cause more than 25 firms participating in 
Federal contracting to lose their small business eligibility. Based on 
the 2017 Economic Census data, 95.5% of firms will qualify as small 
under the proposed 1,000 employee size standard for NAICS 2022 industry 
333310.

NAICS 334610--Manufacturing and Reproducing Magnetic and Optical Media

    SBA proposes to adopt a 1,250-employee size standard for NAICS 2022 
industry 334610 (Manufacturing and Reproducing Magnetic and Optical 
Media). This new industry was created by combining NAICS 2017 industry 
334613 (Blank Magnetic and Optical Recording Media Manufacturing) and 
NAICS 2017 industry 334614 (Software and Other Prerecorded Compact 
Disc, Tape, and Record Reproducing). Their current size standards are 
1,000 employees for NAICS 334613 and 1,250 employees for NAICS 334614. 
Based on the 2017 Economic Census data, 98.2% of firms in NAICS 334613 
and 99.2% of firms in NAICS 334614 qualify as small under their 
respective size standards. Accounting for 80% of combined receipts, 87% 
of firms, and 94% of employees, NAICS 334614 dominates the new 
industry. Thus, SBA is proposing to adopt, as the size standard for the 
new industry, 1,250-employee size standard that applies to NAICS 
334614. SBA also considered proposing to adopt a lower 1,000-employee 
size standard; however, doing so would cause seven firms participating 
in Federal contracting in that industry to lose their small business 
status. Based on the 2017 industry data, 99.1% of firms would qualify 
as small under the proposed 1,250-employee size standard for NAICS 2022 
industry 334610.

NAICS 335139--Electric Lamp Bulb and Other Lighting Equipment 
Manufacturing

    SBA proposes to adopt a 1,250-employee size standard for NAICS 2022 
industry 335139 (Electric Lamp Bulb and Other Lighting Equipment 
Manufacturing). This new industry was generated by merging NAICS 2017 
industry 335110 (Electric Lamp Bulb and Part Manufacturing) and NAICS 
2017 industry 335129 (Other Lighting Equipment Manufacturing). Their 
current size standards are 1,250 employees and 500 employees, 
respectively. Based on the 2017 Economic Census data, 93.5% of firms in 
NAICS 335110 and 94.9% of firms in NAICS 335129 qualify as small under 
their respective size standards. Contributing to 74-75% of combined 
receipts and employees and 82% of all firms, NAICS 335129 dominates the 
new industry. Thus, SBA considered assigning 500 employees as a size 
standard for the new industry. However, adopting the 500-employee size 
standard would cause three firms based on the 2017 Economic Census data 
and eight firms based on the FPDS-NG data for fiscal years 2018-2020 to 
lose their small business eligibility in NAICS 335110. Accordingly, SBA 
is proposing to adopt 1,250 employees as a size standard for the new 
industry. Based on the 2017 Economic Census data, 95.8% of firms would 
qualify as small under the proposed 1,250-employee size standard for 
NAICS 2022 industry 335139.

NAICS 335910--Battery Manufacturing

    SBA proposes to adopt a 1,250-employee size standard for NAICS 2022 
industry 335910 (Battery Manufacturing). This new industry was 
generated by merging NAICS 2017 industry 335911 (Storage Battery 
Manufacturing) and NAICS 2017 industry 335912 (Primary Battery 
Manufacturing). Their current size standards are 1,250 employees and 
1,000 employees, respectively. Based on the 2017 Economic Census data, 
92.5% of firms in NAICS 335911 and 87.7% of firms in NAICS 335129 
qualify as small under their respective size standards. Accounting for 
78-79% of combined receipts and employees and 68% of combined firms, 
NAICS 335911 dominates the new industry. Thus, SBA is proposing to 
adopt, as the size standard for the new industry, 1,250 employees which 
is the current size standard for NAICS 359111. Had SBA adopted 1,000 
employees as the size standard for the new industry, three firms 
participating in Federal contracts in NAICS 359111 would lose their 
small business status. Based on the 2017 industry data, 91.5% of firms 
would qualify as small under the proposed 1,250-employee size standard 
for NAICS 2022 industry 335910.

NAICS 424350--Clothing and Clothing Accessories Merchant Wholesalers

    SBA proposes to adopt a 150-employee size standard for NAICS 2022 
industry 424350 (Clothing and Clothing Accessories Merchant 
Wholesalers). This new industry was formed by combining NAICS 2017 
industry 424320 (Men's and Boys' Clothing and Furnishings Merchant 
Wholesalers) and NAICS 2017 industry 424330 (Women's, Children's, and 
Infants' Clothing and Accessories Merchant Wholesalers). Their current 
size standards are 150 employees and 100 employees, respectively. Based 
on the 2017 Economic Census data, 96.2% of firms in NAICS 424320 and 
96.7% of firms in NAICS 424330 qualify as small under their respective 
size standards. Accounting for 55% of combined receipts, 69% of firms, 
and 61% of employees, NAICS 424330 tends to dominate the new industry. 
Thus, SBA considered adopting 100 employees as size standard for the 
new industry. However, that would cause more than 30 firms in NAICS 
424320 to lose their small business status. Thus, SBA is

[[Page 40068]]

proposing to adopt the 150 employees as the size standard for the new 
industry. Based on the 2017 Economic Census data, 97.1% of firms in 
NAICS 2022 industry 424350 would qualify as small under the proposed 
150-employee size standard.

Size Standards for New Retail Trade Industries in NAICS 2022

    For the Retail Trade sector, given the increasing prevalence of 
omni-channel distribution and variations in reporting patterns, the OMB 
eliminated the store/nonstore distinction (89 FR 35350 (July 2, 2021)). 
Under the NAICS 2017 structure, Subsector 454, Nonstore Retailers, 
included industries for NAICS 454110 (Electronic Shopping and Mail-
Order Houses), NAICS 454210 (Vending Machine Operators), NAICS 454310 
(Fuel Dealers), and 454390 (Other Direct Selling Establishments). OMB 
eliminated Subsector 454 from the NAICS 2017 structure. Under the NAICS 
2022 structure for the sector, NAICS 454110 and NAICS 454390 are 
distributed throughout the new structure in the same way as retail 
stores, delineated by specialized broad product lines, such as 
groceries, apparel, hardware, etc. Vending Machine Operators is moved 
to Subsector 445 (Food and Beverage Retailers) with a new 6-digit code 
of 445132 and Fuel Dealers is moved to Subsector 457 (Gasoline Stations 
and Fuel Dealers) with a new 6-digit code of 457210.
    As stated previously, NAICS 2017 industry 454110 was distributed to 
42 different retail trade industries, and NAICS 454390 was distributed 
to 39 different retail trade industries. Almost all the new NAICS 2022 
retail trade industries thus formed saw their 6-digit codes and NAICS 
industry titles changed but largely retained their contents and 
descriptions. Almost all new retail trade industries under NAICS 2022 
contained a NAICS 2017 retail trade industry and parts of NAICS 454110 
and NAICS 454390 and carried the description of the NAICS 2017 retail 
trade industry. Accordingly, following the guidelines in Table 5 (2b), 
SBA assigned the same size standard as for the NAICS 2017 retail trade 
industry that most closely matched the economic activity described by 
the NAICS 2022 retail trade industry.
    For example, as shown in Table 7, Formation of NAICS 449110 
(Furniture Retailers) under NAICS 2022, NAICS 2022 industry 449110 was 
formed by combining NAICS 442110 (Furniture Stores) with parts of NAICS 
454110 and 454390 under NAICS 2017 and by changing the industry title 
to Furniture Retailers. The description of NAICS 2022 industry 449110 
is almost the same as that for the corresponding NAICS 2017 industry. 
Thus, based on the same industry description, the size standard for new 
NAICS 2022 industry 449110 is $22 million, the same size standard as 
that for NAICS 442110 under NAICS 2017. The current size standards are 
$41.5 million for NAICS 454110 and $8.0 million for NAICS 454390. In 
this example, the adoption of the $22 million size standard for NAICS 
2022 industry 449110 will, thus, result in a decrease to size standard 
for part of NAICS 454110 and an increase to the size standard for part 
of NAICS 454390 that merged with NAICS 442110. SBA applies this 
approach in determining the size standard for all other new NAICS 2022 
retail trade industries that contained part of NAICS 2017 industry 
454110, part of NAICS 454390, or both.
[GRAPHIC] [TIFF OMITTED] TP05JY22.055

    Since the current size standards for almost all impacted retail 
trade industries are less than $41.5 million which is the size standard 
for NAICS 454110, parts of NAICS 454110 that have merged with other 
retail trade industries will, in almost all cases, experience a 
decrease to the size standard. Specifically, of the 42 different split 
parts of NAICS 454110 that have merged with other retail trade 
industries, 41 will experience a decrease to the size standard and one 
will experience no change. Similarly, of the 39 different split parts 
of NAICS 454390 that have merged with other retail trade industries, 25 
will see an increase to the size standard and 14 will see no changes to 
the size standard. The size standards for the affected NAICS 2017 
retail trade industries are not impacted and, therefore, remain the 
same.

NAICS 458110--Clothing and Clothing Accessories Retailers

    SBA is proposing to adopt the $41.5 million receipts-based size 
standard for NAICS 2022 industry 458110 (Clothing and Clothing 
Accessories Retailers). This new industry was formed by combining six 
clothing and clothing accessories related retail trade industries with 
parts of NAICS 2017 industries 454110 and 454390. Table 8, Formation of 
NAICS 2022 Industry 458110 (Clothing and Clothing Accessories 
Retailers), lists all of these industries along with their respective 
size standards. Excluding parts of NAICS 454110 and 454390, the size 
standards for those six industries vary from $12 million for NAICS 
448110 (Men's Clothing Stores) to $41.5 million for NAICS 448140 
(Family Clothing Stores), and the percentages of firms that are small 
under their respective size standards vary from 96.7% for 448110

[[Page 40069]]

to 98.9% for NAICS 448120 (Women's Clothing Stores).
[GRAPHIC] [TIFF OMITTED] TP05JY22.056

    Excluding parts of NAICS 454110 and 454390, no single industry 
seems to dominate among those six clothing and clothing accessories 
related retail trade industries making up the new industry. 
Accordingly, following the guidelines laid out in Table 5, SBA is 
proposing to adopt the highest $41.5 million size standard among the 
six industries as the size standard for new NAICS 2022 industry 458110. 
Based on the 2017 industry data, 98.7% of firms in NAICS 458110 would 
qualify as small under the proposed $41.5 million size standard. SBA 
confirmed that no individual firm at the proposed $41.5 million size 
standard would dominate the market in any of those industries. For 
example, based on the 2017 Economic Census data, the market share of a 
firm at the proposed size standard averaged just 0.3%, varying from 
0.04% to 0.6%. SBA determines that these levels of market shares 
effectively preclude a firm at or below the proposed size standard from 
exerting control on any of the industries.

NAICS 513140--Directory and Mailing List Publishers

    SBA proposes to adopt a 1,000-employee size standard for NAICS 2022 
industry 513140 (Directory and Mailing List Publishers). This new 
industry was formed by combining NAICS 2017 industry 511140 (Directory 
and Mailing List Publishers) and the internet Directory and Mailing 
List Publishers part of NAICS 2017 industry 519130 (Internet Publishing 
and Broadcasting and Web Search Portals). Their current size standards 
are 1,250 employees and 1,000 employees, respectively. Based on the 
2017 Economic Census data, 98.3% of firms in both industries qualify as 
small under their respective size standards. Accounting for 97% of 
combined receipts, 92% of combined firms, and 95% of combined 
employees, NAICS 519130 dominates the new industry. Thus, SBA is 
proposing to adopt 1,000 employees as the size standard for the new 
industry. Moreover, under the 1,000-employee size standard, no firm in 
NAICS 511140 would lose small status, based on both the 2017 Economic 
Census and FPDS-NG data for fiscal years 2018-2020.

NAICS 513191--Greeting Card Publishers

    SBA proposes to adopt a 1,000-employee size standard for NAICS 2022 
industry 513191 (Greeting Card Publishers). This new industry was 
formed by combining NAICS 2017 industry 511191 (Greeting Card 
Publishers) with the Internet Greeting Card Publishers part of NAICS 
2017 industry 519130 (Internet Publishing and Broadcasting and Web 
Search Portals). Their current size standards are 1,500 employees and 
1,000 employees, respectively. Based on the 2017 Economic Census data, 
99% of firms in NAICS 511191 and 98.3% in 519130 qualify as small under 
their respective size standards. Accounting for 98% of combined 
receipts and firms and 95% of combined employees, NAICS 519130 
dominates the new industry. Thus, SBA is proposing to adopt 1,000 
employees as the size standard for the new industry. Moreover, at the 
1,000-

[[Page 40070]]

employee size standard, no firm in NAICS 511191 would lose small 
status, based on both the 2017 Economic Census and FPDS-NG data for 
fiscal years 2018-2020. Based on the 2017 industry data, 98.4% of firms 
in NAICS 2022 industry 513191 would qualify as small under the proposed 
1,000-employee size standard.

NAICS 513199--All Other Publishers

    SBA proposes to adopt a 1,000-employee size standard for NAICS 2022 
industry 513199 (All Other Publishers). This new industry was formed by 
combining NAICS 2017 industry 511199 (All Other Publishers) with the 
All Other Internet Publishers part of NAICS 2017 industry 519130 
(Internet Publishing and Broadcasting and Web Search Portals). Their 
current size standards are 500 employees and 1,000 employees, 
respectively. Based on the 2017 Economic Census data, 98.9% of firms in 
NAICS 511199 and 98.3% in 519130 qualify as small under their 
respective size standards. Accounting for 98-99% of combined receipts 
and employees, and 93% of combined firms, NAICS 519130 dominates the 
new industry. Thus, SBA is proposing to adopt 1,000 employees as the 
size standard for the new industry. SBA also considered adopting, as 
the size standard for the new industry, the 500-employee size standard 
that applies to NAICS 511199. However, doing so would cause about 40 
firms based on the 2017 Economic Census data and 35 firms based on the 
FPDS-NG data for fiscal years 2018-2020 to lose small business status 
in NAICS 519130. Based on the 2017 Economic Census data, 98.7% of firms 
in NAICS 2022 industry 513199 would qualify as small under the proposed 
1,000-employee size standard.

NAICS 516210--Media Streaming Distribution Services, Social Networks, 
and Other Media Networks and Content Providers

    SBA proposes to adopt a $41.5 million receipts-based size standard 
for NAICS 2022 industry 516210 (Media Streaming Distribution Services, 
Social Networks, and Other Media Networks and Content Providers). This 
new industry was formed by combining three industries in their entirety 
with parts of two other industries under NAICS 2017. As shown in Table 
9, Formation of NAICS 2022 Industry 516210, NAICS 515111 (Radio 
Networks), NAICS 515210 (Cable and other Subscription Programming), 
NAICS 519110 (News Syndicates), and the Television Networks part of 
NAICS 515120 (Television Broadcasting) have receipts-based size 
standards, and the Internet Broadcasting part of NAICS 519130 (Internet 
Publishing and Broadcasting and Web Search Portals) has an employee 
size standard. Since four of the five components of the new industry 
have a receipts-based size standard, SBA determines that a receipts-
based size standard would be more appropriate for the new industry 
instead of an employee-based size standard. Moreover, industries with 
receipts-based size standards account for more than two-thirds (68%) of 
total firms in the new industry. When converted to receipts, the 1,000-
employee size standard for the Internet Broadcasting part of NAICS 
519130 will translate to a $41.5 million receipts-based size 
standard.\2\
---------------------------------------------------------------------------

    \2\ Using the 2012 Economic Census data, the 1,000-employee size 
standard for NAICS 519130 is equivalent to $286 million in receipts, 
capping of which translates to the maximum receipts-based size 
standard of $41.5 million. In accordance with the SBA's ``Size 
Standards Methodology,'' SBA's receipts-based size standards are 
capped at the maximum of $41.5 million and employee-based size 
standards are capped at the maximum of 1,500 employees.
[GRAPHIC] [TIFF OMITTED] TP05JY22.057

    Considering the $41.5 million receipts-based equivalent of the 
1,000-employee size standard for NAICS 519130, four of the five 
industries or parts contained in NAICS 2022 industry 516210 now have a 
$41.5 million receipts-based size standard. Thus, consistent with the 
guidelines as set forth in Table 5, SBA is proposing to

[[Page 40071]]

adopt, as the size standard for the new industry, a $41.5 million 
receipts-based size standard which happens to be the highest and most 
frequently occurring size standard among the industries or parts 
comprising the new industry. SBA has determined that no individual firm 
at or below the proposed $41.5 million size standard will be large 
enough to dominate the operation in NAICS 2017 industry 519110, which 
currently has a lower size $32 million receipts-based size standard. 
Specifically, an individual firm at or below the proposed $41.5 million 
size standard would account for less than 3% of total industry receipts 
in NAICS 519110. This level of market share precludes the possibility 
of a firm at the proposed size standard to dominate the industry. 
Nearly 96% of firms in NAICS 511930 will qualify as small under the 
proposed $41.5 million size standard, as compared to 98% under the 
current 1,000-employee size standard. At the $41.5 million size 
standard, based on the 2017 Economic Census data, about 15-20 firms in 
NAICS 511930 (0.25% of firms in the industry) would lose their status 
as small businesses. Based on the 2017 Economic Census data, 92.3% of 
total firms in the new industry would qualify as small under the 
proposed $41.5 million receipts-based size standard.

NAICS 519290--Web Search Portals and All Other Information Services

    SBA proposes to adopt a 1,000-employee size standard for NAICS 2022 
industry 519290 (Web Search Portals and All Other Information 
Services). This new industry was formed by combining NAICS 2017 
industry 519190 (All Other Information Services) with the Web Search 
Portals part of NAICS 2017 industry 519130 (Internet Publishing and 
Broadcasting and Web Search Portals). Their current size standards are 
$30 million in average annual receipts and 1,000 employees, 
respectively. Based on the 2017 Economic Census data, 97.7% of firms in 
NAICS 519190 and 98.3% in NAICS 519130 qualify as small under their 
respective size standards. Accounting for 97-98% of combined receipts 
and employees, and 87% of combined firms, NAICS 519130 dominates the 
new industry. Thus, SBA is proposing to adopt 1,000 employees as the 
size standard for the new industry. Based on the 2017 Economic Census 
data, SBA confirmed that the proposed 1,000-employee size standard 
excludes the largest and potentially dominant firms in NAICS 519190, 
even with 99% of firms qualifying as small under the 1,000-emploee size 
standard compared to 97.7% at the $30 million receipts-based size 
standard. Based on the 2017 industry data, 98.8% of firms would qualify 
as small under the 1,000-employee based size standard for NAICS 2022 
industry 519290.

NAICS 811210--Electronic and Precision Equipment Repair and Maintenance

    SBA proposes to adopt a $30 million receipts-based size standard 
for NAICS 2022 industry 811210 (Electronic and Precision Equipment 
Repair and Maintenance). This new industry was formed by merging four 
electronic, machinery and equipment repair and maintenance related 
industries. These industries, along with their respective size 
standards, are listed in Table 10, Formation of NAICS 811210 
(Electronic and Precision Equipment Repair and Maintenance). Their 
current size standards for these industries vary from $19.5 million for 
NAICS 811213 to $30 million for NAICS 811212. The percentages of firms 
that are below the current size standards vary from 96.6% for NAICS 
811219 to 99% for NAICS 811212. Based on the shares of combined 
receipts, firms, or employees, no industry seems to dominate the new 
industry. Accordingly, following the guidelines set forth in Table 5, 
SBA proposes to adopt, as the size standard for the new industry, the 
highest size standard (i.e., $30 million) among the four industries 
making up the new industry. Based on the 2017 industry data, 98.4% of 
firms in NAICS 2022 industry 811210 would qualify as small under the 
proposed $30 million size standard.
    In none of the three industries for which the current size standard 
is lower than the proposed $30 million, no largest or potentially 
dominant firms will be included under the proposed $30 million size 
standard. For example, based on the 2017 Economic Census data, the 
market share of a firm at the proposed $30 million size standard 
averages 1%, ranging from 0.4% for NAICS 812219 to 2.1% for NAICS 
811211. SBA determines that these levels of market shares effectively 
preclude a firm at or below the proposed size standard from exerting 
control on any of the four impacted industries.

[[Page 40072]]

[GRAPHIC] [TIFF OMITTED] TP05JY22.058

Summary of Proposed Size Standards for NAICS 2022 Industries

    The NAICS 2022 revision created 111 new industries by 
reclassifying, combining, or splitting 156 NAICS 2017 industries or 
their parts. SBA's proposed size standards for these 111 new industries 
under NAICS 2022, as shown in Table 6 (above) have resulted in an 
increase to the size standards for 21 industries and 27 parts of three 
industries under NAICS 2017, a decrease to size standards for seven 
industries and 41 parts of one industry, a change in the size standard 
measure from average annual receipts to number of employees for one 
industry, a change in the size standard measure from number of 
employees to average annual receipts for part of one industry, and no 
change in size standards for 118 industries and 33 parts of eight 
industries.

Evaluation of Dominance in Field of Operation

    Section 3(a) of the Small Business Act (15 U.S.C. 632(a)) defines a 
small business concern as one that: (1) Is independently owned and 
operated; (2) Is not dominant in its field of operation; and (3) Meets 
a specific small business definition or size standard established by 
SBA's Administrator. SBA considers, as part of its evaluation, whether 
a business concern at a proposed or revised size standard would be 
dominant in its field of operation. For this, SBA generally examines 
the industry's market share of firms at the proposed or revised 
standard. SBA also examines distribution of firms by size to ensure 
that a contemplated size standard excludes the largest and potentially 
dominant firms within an industry. The results of the market share 
analysis and size distribution of firms may indicate whether a firm, at 
the proposed or revised size standard, can exercise a control on a 
national basis. SBA has determined that for the industries for which 
size standards have been changed in this proposed rule, no individual 
firm at or below the proposed size standard will be large enough to 
dominate its field of operation. The share of a firm in total industry 
receipts at the proposed size standard, among those industries for 
which size standards have been changed is, on average, 1.4%, ranging 
from 0.005% to 31.2%. SBA determines that these levels of market shares 
effectively preclude a firm at or below the proposed size standards 
from exerting control on any of the industries.

Alternatives to Adopting NAICS 2022 for Size Standards

    As an alternative to proposing new size standards for NAICS 2022 
industries, SBA considered retaining NAICS 2017 as the basis of 
industry definitions for its small business size standards. That would, 
however, lead to inconsistency between SBA's size standards and 
establishment data published by Federal agencies that will adopt NAICS 
2022 for their statistical and other data collection programs. OMB 
stated in its December 21, 2021, notice that ``Federal statistical 
establishment data published for reference years beginning on or after 
January 1, 2022, should be published using the 2022 NAICS United States 
codes.'' SBA is not a statistical agency, but the Agency uses for its 
size standards analyses establishment data collected by other Federal 
agencies, such as the Economic Census data and County Business Patterns 
from the U.S. Census Bureau. If SBA continues using NAICS 2017 for its 
size standards, it will not be able to analyze and evaluate industry 
structure adequately and accurately and adjust small business size 
standards appropriately because the forthcoming Economic Census and 
County Business Patterns data based on NAICS 2022 will not be 
compatible with NAICS 2017. That would run counter to the mandate of 
the Small Business Jobs Act (Jobs Act) (Pub. L. 111-240 (September 27, 
2010)), which requires SBA to review all size standards and adjust them 
appropriately to reflect the current industry and market data every 
five years.
    To establish, review, or revise, where necessary, small business 
size standards, SBA uses special tabulations of industry data that it 
obtains from the U.S. Census Bureau based on its

[[Page 40073]]

Economic Census of U.S. industries and businesses, and establishment 
data from its County Business Patterns. Because the 2022 Economic 
Census will be based on NAICS 2022 industry definitions, it is 
imperative that SBA use NAICS 2022 as the basis of industry definitions 
for its table of small business size standards.

Request for Comments

    SBA welcomes public comment on this proposed rule. Specifically, 
SBA invites comments on whether its proposed size standards for new 
industries are appropriate and suggestions on alternative size 
standards, along with supporting data and analysis, if proposed size 
standards are not appropriate. SBA also seeks comments on its 
methodology for converting size standards from NAICS 2017 to NAICS 2022 
and data sources and analyses it used in developing proposed size 
standards for new industries. SBA will thoroughly evaluate and address 
all comments in preparing the final rule to adopt NAICS 2022 for its 
table of size standards.

Justification for the October 1, 2022, Effective Date

    SBA's small business size standards, matched to NAICS 2022 to be 
adopted in a forthcoming final rule, will be effective on October 1, 
2022, for the following reasons:
    1. OMB stated in its December 21, 2021, notice that Federal 
statistical establishment data published for reference years beginning 
on or after January 1, 2022, should be published using NAICS 2022. SBA 
is not a statistical agency, but it uses the establishment data 
collected from other Federal agencies, such as the Economic Census and 
County Business Patterns data from the Census Bureau for its size 
standards analysis. Similarly, Federal procurement databases and 
systems, such as FPDS-NG and the System for Award Management (SAM), use 
NAICS codes from SBA's table of size standards. If SBA does not adopt 
NAICS 2022 for its table of size standards in a timely manner, it will 
result in inconsistency between SBA's size standards and other Federal 
procurement databases.
    2. October 1, 2022, is the start of the new Federal Government 
fiscal year following OMB's adoption of NAICS 2022 effective January 1, 
2022, and is consistent with SBA's adoption of previous NAICS revisions 
for its size standards effective at the beginning of the new fiscal 
year after the OMB's effective date.
    3. With the adoption of the updated size standards at the start of 
the new fiscal year, Federal agencies that use NAICS industry 
definitions and SBA's size standards can collect comparable and 
consistent data on Federal statistics for program and industry 
analyses.
    4. With the October 1, 2022, effective date, Federal agencies that 
use SBA's small business size standards for their programs will have 
sufficient time to plan and implement the updated size standards and 
assess the impact of size standards changes on their programs.

Compliance With Executive Orders 12866, the Congressional Review Act (5 
U.S.C. 801-808), the Regulatory Flexibility Act (5 U.S.C. 601-612), 
Executive Orders 13563, 12988, and 13132, and the Paperwork Reduction 
Act (44 U.S.C. Ch. 35)

Executive Order 12866

    OMB has determined that this proposed rule is not a ``significant 
regulatory action'' for purposes of Executive Order 12866. This rule 
proposes to incorporate the OMB's 2022 revisions of NAICS, which SBA 
uses as a basis of industry definitions for purposes of establishing 
small business size standards. As discussed above in this SUPPLEMENTARY 
INFORMATION section, the size standards of some industries or their 
parts would change because of the adoption of the NAICS 2022 revisions 
for SBA's Table of Size Standards. However, SBA has determined that a 
vast majority of businesses defined as small under the current NAICS 
2017 based size standards will continue to remain small under the NAICS 
2022 based size standards. The proposed rule, if adopted in its present 
form, will also affect other Federal Government programs that use SBA's 
size standards and provide various benefits for small businesses. SBA 
welcomes comments describing the impact on small businesses of the size 
standard changes resulting from the adoption of the NAICS revision for 
SBA Table of Size Standards. In order to help explain the need and 
objective of this proposed rule and its potential benefits and costs, 
SBA is providing, below, a Cost Benefit Analysis of this rule, 
including (1) A statement of the need for the regulatory action, (2) An 
examination of alternative approaches, and (3) An evaluation of the 
benefits and costs--both quantitative and qualitative--of the 
regulatory action and the alternatives considered.

Cost Benefit Analysis

1. What is the need for the regulatory action?
    SBA believes that revising its small business size standards based 
on NAICS 2022 is in the best interests of small businesses. SBA's 
mission is to aid and assist small businesses through a variety of 
financial, procurement, business development and counselling, and 
advocacy programs. To ensure that these programs are best directed to 
their intended beneficiaries, SBA establishes numerical small business 
definitions (usually referred to as ``size standards'') to determine 
which businesses are deemed eligible for Federal small business 
assistance. NAICS 2022 provides the latest industry definitions 
reflecting the latest changes in industry structure in the United 
States.
    Under the Small Business Act (Act) (15 U.S.C. 632(a)), SBA 
Administrator is responsible for establishing small business size 
definitions and for ensuring that such definitions vary from industry 
to industry to reflect differences among various industries. By 
analyzing and reviewing size standards based on the NAICS 2022 industry 
definitions, SBA can more accurately and appropriately fulfill its 
mandate. If SBA does not use the latest industry definitions under 
NAICS 2022, size standards would not accurately reflect differences 
among industries. In addition, the Jobs Act requires SBA to review, at 
least every five years, all size standards and make necessary 
adjustments to reflect current industry and market conditions. To 
better serve this mandate, SBA needs to evaluate the industry data 
based on the latest NAICS industry definitions available.
    In this proposed rule, SBA is generally following the same 
guidelines that it followed for adopting prior NAICS revisions for size 
standards, as spelled out under the Supplemental Information section. 
SBA also analyzed the relevant industry and program data to determine 
the size standards for certain NAICS 2022 industries involving NAICS 
2017 industries or their parts with substantially different size 
standards. Size standards based on NAICS 2022 industry definitions and 
corresponding data will serve SBA's mission more effectively.
2. What are the potential benefits and costs of this regulatory action?
    As stated previously, the NAICS 2022 revision created 111 new 
industries by reclassifying, combining, or splitting 156 NAICS 2017 
industries or their parts. Changes from NAICS 2017 to NAICS 2022 
consist of mergers of 124

[[Page 40074]]

NAICS 2017 industries or their parts to form the 79 new industries in 
NAICS 2022 with impacts on size standards on a number of NAICS 2017 
industries. The NAICS 2022 revision also comprises of 32 changes in 6-
digit codes, industry titles, or descriptions without changing the size 
standards. SBA's proposed size standards for these 111 new industries 
under NAICS 2022 have resulted in an increase to the size standards for 
21 industries and 27 parts of three industries, a decrease to size 
standards for seven industries and 41 parts of one industry, a change 
in the size standard measure from average annual receipts to number of 
employees for one industry, a change in the size standard measure from 
number of employees to average annual receipts for part of one 
industry, and no change in size standards for 118 industries and 33 
parts of eight industries. The benefits, costs, and transfer impacts of 
these changes are discussed below.
    OMB directs agencies to establish an appropriate baseline to 
evaluate any benefits, costs, or transfer impacts of new regulatory 
actions and alternative approaches considered. The baseline should 
represent the agency's best assessment of what the world would look 
like absent the regulatory action. For a regulatory action promulgating 
modifications to an existing regulation (such as modifying the existing 
size standards), a baseline assuming no change to the regulation (i.e., 
making no changes to current size standards) would generally provide an 
appropriate benchmark for evaluating benefits, costs, or transfer 
impacts of proposed or final regulatory changes and their alternatives.
The Baseline
    For purposes of this regulatory action, the baseline represents 
maintaining the ``status quo,'' i.e., making no changes to the current 
size standards. Using the number of small businesses and levels of 
small business benefits (such as set-aside contracts, SBA's loans, 
disaster assistance, etc.) they receive under the current size 
standards as a baseline, one can examine the potential benefits, costs, 
and transfer impacts of changes to size standards on small businesses 
and on the overall economy.
    Based on the 2017 Economic Census data, of a total of about 880,245 
firms in the 156 impacted industries under NAICS 2017, 97.7% are 
considered small under the current size standards under NAICS 2017.
    Similarly, based on the data from FPDS-NG for fiscal years 2018-
2020, about 15,400 unique firms in those 156 NAICS 2017 industries 
received at least one Federal contract during that period, of which 
76.2% were found to be small under the current size standards.\3\ Of 
about $18.6 billion in total average annual contract dollars awarded to 
businesses in the impacted industries during that period, 25.6% went to 
small businesses. Of about $4.8 billion in total small business 
contract dollars awarded in those industries during that period, 87.1% 
were awarded through various set-aside programs and 12.9% were awarded 
through non-set aside contracts. Table 11, Baseline of Impacted 
Industries Under NAICS 2017, provides these baseline results.
---------------------------------------------------------------------------

    \3\ Of the 156 NAICS 2017 industries impacted in the NAICS 2022 
revision, 66 industries were part of Sector 42 (Wholesale Trade) or 
Sector 44-45 (Retail Trade) that does not apply for Federal 
contracting. In the remaining 90 industries that belong to other 
sectors, about 15,400 unique firms got at least one Federal contract 
during fiscal years 2018-2022.

       Table 11--Baseline of Impacted Industries Under NAICS 2017
------------------------------------------------------------------------
                     Impact variable                           Value
------------------------------------------------------------------------
Number of industries impacted...........................             156
Total firms in impacted industries (2017 Economic                880,245
 Census)................................................
Total small firms in impacted industries under current           859,573
 size standards (2017 Economic Census)..................
Small firms as % of total firms (2017 Economic Census)..           97.7%
Total contract dollars ($ million) (FPDS-NG--fiscal              $18,644
 years 2018-2020).......................................
Total small business contract dollars under current               $4,776
 standards ($ million) (FPDS-NG--fiscal years 2018-2020)
Small business dollars as % of total dollars (FPDS-NG              25.6%
 fiscal years 2018-2020)................................
Total number of unique firms getting contracts (FPDS-NG           15,391
 fiscal years 2018-2020)................................
Total number of unique small firms getting small                  11,727
 business contracts (FPDS-NG fiscal years 2018-2020)....
Small business firms as % of total firms (FPDS-NG fiscal           76.2%
 years 2018-2020).......................................
Number of 7(a) and Certified Development Company (CDC)/            8,316
 504 loans (fiscal years 2018-2020).....................
Amount of 7(a) and 504 loans ($ million) (fiscal years            $4,789
 2018-2020).............................................
Number of Economic Injury Disaster Loan (EIDL) program               589
 loans (fiscal years 2018-2020) \1\.....................
Amount of EIDL loans ($ million) (fiscal years 2018-               $52.6
 2020) \1\..............................................
------------------------------------------------------------------------
\1\ Excludes COVID-19 related EIDL loans due to their temporary nature.
  Effective January 1, 2022, SBA stopped accepting applications for new
  COVID EIDL loans or advances.

    Based on the SBA's internal data on its loan programs for fiscal 
years 2018-2020, small businesses in those 156 industries received, on 
an annual basis, a total of 8,316 7(a) loans and CDC/504 loans in that 
period, totaling about $4.8 billion, of which 85.8% was issued through 
the 7(a) loan guarantee program and 14.2% was issued through the CDC/
504 program. During fiscal years 2018-2020, small businesses in those 
industries also received 589 loans through the SBA's EIDL program, 
totaling about $52.6 million on an annual basis.\4\
---------------------------------------------------------------------------

    \4\ The analysis of the disaster loan data excludes physical 
disaster loans that are available to anyone regardless of size, 
disaster loans issued to nonprofit entities, and EIDLs issued under 
the COVID-19 relief program. Effective January 1, 2022, SBA stopped 
accepting applications for new COVID EIDL loans or advances. Thus, 
the disaster loan analysis presented here pertains to the regular 
EIDL loans only. SBA estimates impacts of size standards changes on 
EIDL loans by calculating the ratio of businesses getting EIDL loans 
to total small businesses (based on the 2017 Economic Census data) 
and multiplying it by the number of impacted small firms. Due to 
data limitations, for FY 2019-20, some loans with both physical and 
EIDL loan components could not be broken into the physical and EIDL 
loan amounts. In such cases, SBA applied the ratio of EIDL amount to 
total (physical loan + EIDL) amount using FY 2016-18 data to the FY 
2019-20 data to obtain the amount attributable to the EIDL loans.
---------------------------------------------------------------------------

Proposed Increases to Size Standards
    As stated above, SBA's proposed size standards for the 111 new 
industries under NAICS 2022 have resulted in an increase to the size 
standards for 21 industries and 27 parts of three industries under 
NAICS 2017. Below are descriptions of the benefits, costs, and

[[Page 40075]]

transfer impacts of the proposed size standards.
Benefits of Proposed Increases to Size Standards
    The benefits of adopting NAICS 2022 and the resulting proposed 
increases to size standards, if adopted, will accrue to three groups in 
the following ways: (1) Some businesses that are currently above their 
current size standards may gain small business status, thereby becoming 
eligible to participate in Federal small business assistance programs, 
including SBA's 7(a) loan program, CDC/504 loan program, EIDL program, 
Surety Bond Guarantee Program, and Federal procurement and business 
development programs intended for small businesses; (2) Growing small 
businesses that are close to exceeding the current size standards for 
their NAICS 2017 industries may retain their small business status for 
a longer period under proposed size standards under NAICS 2022, and can 
continue participating in the above programs; and (3) Federal 
Government agencies will have a larger pool of small businesses from 
which to draw to fulfill their small business procurement requirements 
because they will be able to define more accurately the principal 
purposes of their procurements under NAICS 2022 industry definitions.
    The most significant benefit to businesses from increases to size 
standards is gaining or extending eligibility for Federal small 
business assistance programs. These include SBA's 7(a) loan program, 
CDC/504 loan program, EIDL program, Surety Bond Guarantee Program, and 
Federal procurement programs intended for small businesses. Federal 
procurement programs provide targeted, set-aside opportunities for 
small businesses. These include the 8(a) Business Development (BD) 
program, the Small Disadvantaged Businesses (SDB) program, the 
Historically Underutilized Business Zones (HUBZone) program, the Women-
Owned Small Businesses (WOSB) program, the Economically Disadvantaged 
Women-Owned Small Businesses (EDWOSB) program, and the Service-Disabled 
Veteran-Owned Small Businesses (SDVOSB) program.
    For the affected NAICS 2017 industries or their parts for which 
size standards have increased, based on the 2017 Economic Census data, 
SBA estimates that approximately 700 additional businesses would gain 
small business status under the proposed size standards for 2022 NAICS 
industries. That represents about 1.0% of the total number of small 
businesses in the affected industries. SBA's proposed size standards 
would result in an increase to the small business share of total 
receipts in those 24 industries (i.e., those with increases in size 
standards) from 38.3% to 44.6%. Table 12, Impacts of Proposed Size 
Standards for NAICS 2022 Industries, provides impacts of increasing 
size standards for 21 industries and 27 parts of three industries under 
NAICS 2017.

 Table 12--Impacts of Proposed Size Standards for NAICS 2022 Industries
------------------------------------------------------------------------
                     Impact variable                           Value
------------------------------------------------------------------------
Number of industries with increases to size standards...              24
Total current small businesses in industries with                 70,979
 increases to size standards (2017 Economic Census).....
Additional firms qualifying as small under standards                 691
 (2017 Economic Census).................................
% of additional firms qualifying as small relative to               1.0%
 current small businesses in industries with increases
 to size standards (2017 Economic Census)...............
Number of current unique small firms getting small                 1,479
 business contracts in industries with increases to size
 standards (FPDS-NG fiscal years 2018-2020) \1\.........
Additional small business firms getting small business                42
 status (FPDS-NG fiscal years 2018-2020) \1\............
% increase to small businesses relative to current                  2.8%
 unique small firms getting small business contracts in
 industries with increases to size standards (FPDS-NG
 fiscal years 2018-2020)................................
Total small business contract dollars under current               $492.3
 standards in industries with increases to size
 standards ($ million) (FPDS-NG fiscal years 2018-2020).
Estimated additional small business dollars available to           $60.4
 newly- qualified small firms (using avg. dollars
 obligated to small businesses) ($ million) (FPDS-NG
 fiscal years 2018-2020) \2\............................
% increase to small business dollars relative to total             12.3%
 small business contract dollars under current standards
 in industries with increases to size standards.........
Total number of 7(a) and 504 loans to small business in              822
 industries with increases to size standards (fiscal
 years 2018-2020).......................................
Total 7(a) and 504 loan amounts to small businesses in            $300.0
 industries with increases to size standards ($ million)
 (fiscal years 2018-2020)...............................
Estimated number of 7(a) and 504 loans to newly                        1
 qualified small firms..................................
Estimated 7(a) and 504 loan amounts to newly qualified            $0.001
 small firms ($ million)................................
% increase to 7(a) and 504 loan amount relative to the              0.0%
 total amount of 7(a) and 504 loans in industries with
 increases to size standards............................
Total number of EIDL loans to small businesses in                     87
 industries with increases to size standards (fiscal
 years 2018-2020) \3\...................................
Total amount of EIDL loans to small businesses in                   $5.4
 industries with increases to size standards ($ million)
 (fiscal years 2018-2020) \3\...........................
Estimated number of EIDL loans to newly qualified small                0
 firms \3\..............................................
Estimated EIDL loan amount to newly qualified small                 $0.0
 firms ($ million) \3\..................................
% increase to EIDL loan amount relative to the total                0.0%
 amount of disaster loans in industries with increases
 to size standards \3\..................................
------------------------------------------------------------------------
\1\ Total impact represents total unique number of firms impacted to
  avoid double counting as some firms are participating in more than one
  industry.
\2\ Additional dollars are calculated multiplying average small business
  dollars obligated per Data Universal Numbering System (DUNS) times
  change in number of firms. Numbers of firms are calculated using the
  SBA current size standard, not the contracting officer's size
  designation.
\3\ Excludes COVID-19 related EIDL loans due to their temporary nature.
  Effective January 1, 2022, SBA stopped accepting applications for new
  COVID EIDL loans or advances.

    As shown in Table 12, based on the FPDS-NG data for fiscal years 
2018-2020, SBA estimates that about 42 firms that are currently active 
in Federal contracting in those industries would gain small business 
status under the proposed size standards. Based on the same data, SBA 
estimates that those newly qualified small businesses under

[[Page 40076]]

the proposed size standards under NAICS 2022 could receive Federal 
small business contracts totaling about $60.4 million annually. That 
represents a 12.3% increase to Federal small business dollars from the 
baseline.
    The added competition from more businesses qualifying as small can 
result in lower prices to certain Federal Government procurements set 
aside or reserved for small businesses, but SBA cannot quantify this 
impact precisely. Costs could also be higher when full and open 
contracts are awarded to HUBZone businesses that receive price 
evaluation preferences. However, with agencies likely setting aside 
more contracts for small businesses in response to the availability of 
a larger pool of small businesses under the proposed size standards, 
HUBZone firms might receive more set-aside contracts and fewer full and 
open contracts, thereby resulting in some cost savings to agencies. SBA 
cannot estimate such costs savings as it is impossible to determine the 
number and value of unrestricted contracts to be otherwise awarded to 
HUBZone firms will be awarded as set-asides. However, such cost savings 
are likely to be relatively small as only a small fraction of full and 
open contracts are awarded to HUBZone businesses.
    Under SBA's 7(a) and CDC/504 loan programs, with more businesses 
qualifying as small under the proposed size standards, SBA will be able 
to guarantee more loans to small businesses. However, SBA expects the 
impact on loans to be minimal since applicants to SBA's financial 
assistance programs are typically much smaller than the industry size 
standard and most businesses that currently participate in the program 
would remain eligible for assistance even after this rule is adopted. 
Moreover, SBA does not anticipate that the proposed increases to size 
standards will have a significant impact on the distribution of firms 
receiving loans by size of firm. Since SBA's proposed size standards 
changes primarily impact firms at the higher margin of size standards, 
SBA estimates the impact to its financial assistance programs by 
estimating the number of loans and the amount of loans to firms greater 
than 10% below their size thresholds. SBA believes that expanding 
access to SBA's financial assistance programs will help all small 
businesses to adapt to changes in business environment, recover from 
disasters more quickly, and grow successfully, while having no impact 
on the ability of smaller small firms to access financial services from 
SBA.
    Based on its internal data for fiscal years 2018-2020, SBA 
estimates that about one additional 7(a) and CDC/504 loans, totaling 
approximately $.001 million, could be made to the newly-defined small 
businesses under the proposed size standards under NAICS 2022. That 
represents a 0.0% increase to the loan amount compared to the baseline 
(see Table 12). The actual impact might be smaller as the newly 
qualified firms under the proposed size standards could have qualified 
anyway under the tangible net worth and net income based alternative 
size standard.
    Newly-defined small businesses will also benefit from SBA's EIDL 
program, which, like SBA's 7(a) and CDC/504 loan program, typically 
provides loans to businesses that are much smaller than the industry 
size standard. Since this program is contingent on the occurrence and 
severity of a disaster, SBA cannot make a precise estimate of the 
future EIDL benefit. However, based on its internal disaster loan 
program data for fiscal years 2018-2020 and the amount of loans to 
firms greater than 10% below their size thresholds, SBA estimates that, 
on an annual basis, the newly defined small businesses under the 
proposed size standards for NAICS 2022 would not be impacted.
    Additionally, the newly-defined small businesses under proposed 
size standards under NAICS 2022 would also benefit through reduced 
fees, less paperwork, and fewer compliance requirements that are 
available to small businesses through the Federal Government programs, 
but SBA has no data to quantify this impact.
Costs of Proposed Increases to Size Standards
    Aside from taking time to register in the System for Award 
Management (SAM) to be eligible to participate in Federal contracting 
and update the SAM profile annually, small businesses incur no direct 
costs to gain or retain their small business status under proposed size 
standards for NAICS 2022. All businesses willing to do business with 
the Federal Government must register in SAM and update their SAM 
profiles annually, regardless of their size status. SBA believes that a 
vast majority of businesses that are willing to participate in Federal 
contracting are already registered in SAM and update their SAM profiles 
annually. It is important to point out that most business entities that 
are already registered in SAM will not be required to update their SAM 
profiles. However, it will be incumbent on registrants to review, and 
update as necessary, their profiles to ensure that they have the 
correct NAICS codes. SAM requires that registered companies review and 
update their profiles annually, and therefore, businesses will need to 
pay particular attention to the changes to determine if they might 
affect them. They will also have to verify, and update, if necessary, 
their Representations and Certifications in SAM. More importantly, this 
proposed rule does not establish the new size standards for the very 
first time; rather it intends to modify the existing size standards to 
conform to new industry definitions under NAICS 2022.
    To the extent that the newly-defined small firms under NAICS 2022 
could become active in Federal procurement programs, this may entail 
some additional administrative costs to the Federal Government because 
of more businesses qualifying for Federal small business programs. For 
example, there will be more firms seeking SBA's loans, more firms 
eligible for enrollment in the SBA's Dynamic Small Business Search 
(DSBS) database or in certify.sba.gov, more firms seeking 
certifications as 8(a) BD or HUBZone firms, or qualifying for SDB, 
WOSB, EDWOSB, and SDVOSB status, and more firms applying for SBA's 8(a) 
BD mentor-prot[eacute]g[eacute] program.
    Among those newly-defined small businesses seeking SBA's loans, 
there could be some additional costs associated with verification of 
their small business status. However, small business lenders have an 
option of using the tangible net worth and net income-based alternative 
size standard instead of using the industry-based size standards to 
establish eligibility for SBA's loans. For these reasons, SBA believes 
that these added administrative costs will be minor because necessary 
mechanisms are already in place to handle these added requirements.
    Additionally, some Federal contracts may possibly have higher 
costs. With a greater number of businesses defined as small due to 
proposed size standards under NAICS 2022, Federal agencies may choose 
to set aside more contracts for competition among small businesses only 
instead of using a full and open competition. The movement of contracts 
from unrestricted competition to small business set-aside contracts 
might result in competition among fewer total bidders, although there 
will be more small businesses eligible to submit offers under the 
proposed size standards. However, any additional costs associated with 
fewer bidders are expected to be minor since, by law, procurements may 
be set aside for small businesses under the 8(a)/BD, SDB, HUBZone, 
WOSB, EDWOSB, or SDVOSB programs only if awards are

[[Page 40077]]

expected to be made at fair and reasonable prices.
    Costs may also be higher when full and open contracts are awarded 
to HUBZone businesses that receive price evaluation preferences. 
However, with agencies likely setting aside more contracts for small 
businesses in response to the availability of a larger pool of small 
businesses under the adopted increases to size standards, HUBZone firms 
might receive fewer full and open contracts, thereby resulting in some 
cost savings to agencies. However, such cost savings are likely to be 
minimal as only a small fraction of unrestricted contracts are awarded 
to HUBZone businesses.
Transfer Impacts of Proposed Increases to Size Standards
    The proposed size standards for the NAICS 2022 industries may 
result in some redistribution of Federal contracts between the newly-
qualified small businesses and large businesses and between the newly-
qualified small businesses and small businesses under the current size 
standards. However, it would have no impact on the overall economic 
activity since total Federal contract dollars available for businesses 
to compete for will not change with changes to size standards. While 
SBA cannot quantify with certainty the actual outcome of the gains and 
losses from the redistribution of contracts among different groups of 
businesses, it can identify several probable impacts in qualitative 
terms. With the availability of a larger pool of small businesses under 
the proposed increases to size standards for 21 NAICS 2017 industries 
and 27 parts of three industries, some unrestricted Federal contracts 
that would otherwise be awarded to large businesses may be set aside 
for small businesses. As a result, large businesses may lose some 
Federal contracting opportunities. Similarly, some small businesses 
under the current size standards may obtain fewer set-aside contracts 
due to the increased competition from larger businesses qualifying as 
small under the proposed size standards for NAICS 2022 industries. This 
impact may be offset by a greater number of procurements being set 
aside for small businesses because of more businesses qualifying as 
small under the proposed size standards. With larger businesses 
qualifying as small under the higher proposed size standards, smaller 
small businesses could face some disadvantage in competing for set-
aside contracts against their larger counterparts. However, SBA cannot 
quantify these impacts.
Proposed Decreases to Size Standards
    As stated above, SBA's proposed size standards for the 111 new 
industries under NAICS 2022 have resulted in a decrease to the size 
standards for 7 industries and 41 parts of one industry under NAICS 
2017. Below are descriptions of the benefits, costs, and transfer 
impacts of these proposed decreases to size standards.
Benefits of Proposed Decreases to Size Standards
    The most significant benefit from proposed decreases to size 
standards based on analytical results is to ensure that size standards 
are more reflective of latest industry structure and Federal market 
trends and that Federal small business assistance is more effectively 
targeted to its intended beneficiaries. These include SBA's 7(a) loan 
program, CDC/504 loan program, EIDL program, Surety Bond Guarantee 
Program, and Federal procurement programs. As stated previously, 
Federal procurement programs provide targeted, set-aside opportunities 
for small businesses under SBA's contracting and business development 
programs, such as small business, SDB, 8(a) BD, HUBZone, WOSB, EDWOSB, 
and SDVOSB programs. The adoption of size standards based on relevant 
data diminishes the risk of awarding Federal Government contracts or 
granting financial assistance to firms that are not small anymore. 
Lowering size standards would also reduce the risk of allowing the 
largest and potentially dominant firms to qualify as small and become 
eligible for Federal assistance intended for small businesses. This may 
provide a better chance for smaller small firms to grow and benefit 
from the opportunities available on the Federal marketplace and 
strengthen the small business industrial base for the Federal 
Government.
Costs of Proposed Decreases to Size Standards
    Table 13, Impacts of Proposed Decreases to Size Standards, shows 
the various impacts of proposing to lower size standards in seven 
industries and 41 parts of one industry under NAICS 2017. Based on the 
2017 Economic Census, about 1,055 (2.7%) firms would lose their small 
business status under proposed decreases to size standards.\5\ However, 
many of these businesses were not found to have participated in Federal 
small businesses programs, including SBA's financial assistance and 
procurement programs, which suggests that impacts of proposed decreases 
to size standards would be fairly minimal. Similarly, based on the 
FPDS-NG data for fiscal years 2018-2020, SBA estimates that no small 
businesses participating in Federal contracting would lose their small 
status and become ineligible to compete for set-aside contracts. Thus, 
SBA believes these impacts are minimal.
---------------------------------------------------------------------------

    \5\ Of the 1,055 firms losing small business status under the 
proposed size standards for new industries under NAICS 2022 
structure, 1053 (or 99.8%) belong to NAICS 2017 industry 454110 
(Electronic Shopping and Mail-Order Houses). NAICS 454110, with a 
$41.5 million size standard, was split and distributed among 42 
other Retail Trade industries, resulting in a decrease to the size 
standard for 41 parts and no change to the size standard for one 
part. This would have very minimal impact on firms seeking SBA's 
financial assistance as firms receiving such assistance are 
typically much smaller than the size standard. Moreover, businesses 
not qualifying as small for financial assistance under the industry 
size standard, could still qualify under the tangible net worth and 
net income based alternative size standard. The reduction in size 
standard for NAICS 454110 would have no impact on small businesses 
seeking Federal contracts as that NAICS code does not apply to 
Federal contracting.

        Table 13--Impacts of Proposed Decreases to Size Standards
------------------------------------------------------------------------
                     Impact variable                           Value
------------------------------------------------------------------------
Number of industries for which SBA proposes to decrease                8
 size standards.........................................
Total current small businesses in industries for which            39,011
 SBA proposes to decrease size standards (2017 Economic
 Census)................................................
Estimated number of firms losing small status in                   1,055
 industries for which SBA proposes to decrease size
 standards (2017 Economic Census).......................
% of firms losing small status relative to current small            2.7%
 businesses in industries for which SBA proposes to
 decrease size standards (2017 Economic Census).........
Number of current unique small firms getting small                    30
 business contracts in industries for which SBA proposes
 to decrease size standards (FPDS-NG FY 2018-2020) \1\..

[[Page 40078]]

 
Estimated number of small business firms that would have               0
 lost small business status in industries for which SBA
 proposes to decrease size standards (FPDS-NG FY 2018-
 2020) \1\..............................................
% decrease to small business firms relative to current                0%
 unique small firms getting small business contracts in
 industries for which SBA proposes to decrease size
 standards (FPDS-NG FY 2018-2020) \1\...................
Total small business contract dollars under current size            $3.3
 standards in industries for which SBA proposes to
 decrease size standards ($ million) (FPDS-NG FY 2018-
 2020)..................................................
Estimated small business dollars not available to firms                0
 losing small business status in industries for which
 SBA proposes to decrease size standards ($ million)
 (FPDS-NG FY 2018-2020) \2\.............................
% decrease to small business dollars relative to total                0%
 small business contract dollars under current size
 standards in industries for which SBA proposes to
 decrease size standards................................
Total number of 7(a) and 504 loans to small businesses               402
 in industries for which SBA proposes to decrease size
 standards (FY 2018-2020)...............................
Total amount of 7(a) and 504 loans to small businesses            $140.3
 in industries for which SBA proposes to decrease size
 standards ($ million) (FY 2018-2020)...................
Estimated number of 7(a) and 504 loans not available to                1
 firms that would have lost small business status in
 industries for which SBA proposes to decrease size
 standards..............................................
Estimated 7(a) and 504 loan amount not available to               $0.001
 firms that would have lost small status ($ million)....
% decrease to 7(a) and 504 loan amount relative to the              0.0%
 total amount of 7(a) and 504 loans in industries for
 which SBA proposes to decrease size standards..........
Total number of EIDL loans to small businesses in                      4
 industries for which SBA proposes to decrease size
 standards (FY 2018-2020) \3\...........................
Total amount of EIDL loans to small businesses in                   $0.2
 industries for which SBA proposes to decrease size
 standards ($ million) (FY 2018-2020) \3\...............
Estimated number of EIDL loans not available to firms                  0
 that would have lost small business status in
 industries for which SBA proposes to decrease size
 standards \3\..........................................
Estimated EIDL loan amount not available to firms that              $0.0
 would have lost small business status ($ million) \3\..
% decrease to EIDL loan amount relative to the baseline             0.0%
 \3\....................................................
------------------------------------------------------------------------
\1\ Total impact represents total unique number of firms impacted to
  avoid double counting as some firms participate in more than one
  industry.
\2\ Additional dollars are calculated multiplying average small business
  dollars obligated per unique small firm times change in number of
  firms. Numbers of firms are calculated using the SBA's current size
  standards, not the contracting officer's size designation.
\3\ Excludes COVID-19 related EIDL loans due to their temporary nature.
  Effective January 1, 2022, SBA stopped accepting applications for new
  COVID EIDL loans or advances.

Transfer Impacts of Proposed Decreases to Size Standards
    If the size standards are decreased, it may result in a 
redistribution of Federal contracts between small businesses losing 
their small business status and large businesses and between small 
businesses losing their small business status and small businesses 
remaining small under the reduced size standards. However, as under the 
proposed increases to size standards, this would have no impact on the 
overall economic activity since the total Federal contract dollars 
available for businesses to compete for will stay the same. While SBA 
cannot estimate with certainty the actual outcome of the gains and 
losses among different groups of businesses from contract 
redistribution resulting from decreases to size standards, it can 
identify several probable impacts. With a smaller pool of small 
businesses under the proposed decreases to size standards, some set-
aside Federal contracts to be otherwise awarded to small businesses may 
be competed on an unrestricted basis. As a result, large businesses may 
have more Federal contracting opportunities. However, because agencies 
are still required by law to award 23% of Federal dollars to small 
businesses, SBA expects the movement of set-aside contracts to 
unrestricted competition to be limited. For the same reason, small 
businesses under the reduced size standards are likely to obtain more 
set-aside contracts due to the reduced competition from fewer 
businesses qualifying as small under the decreases to size standards. 
With some larger small businesses losing small business status under 
the proposed decreases to size standards, smaller small businesses 
would likely become more competitive in obtaining set-aside contracts. 
However, SBA cannot quantify these impacts.
Net Impacts of Proposed Size Standards Changes
    The impacts of the proposed increases of size standards for 21 
industries and 27 parts of three industries were shown in Table 12 
(above). Similarly, the impacts of proposed decreases of size standards 
for seven industries and 41 parts of one industry were presented in 
Table 13 (above). Table 14, Net Impacts of Proposed Size Standards 
Changes, below, presents the net impacts of proposed changes to size 
standards for 28 industries and 68 parts of four industries.
    Based on the 2017 Economic Census, SBA estimates that in 28 NAICS 
2017 industries and 68 parts of four industries for which proposed size 
standards for NAICS 2022 have resulted changes in size standards, about 
364 firms (almost all in NAICS 2017 industry 454110) would not qualify 
as small under the proposed size standards for NAICS 2022 industries. 
That represents about 0.3% of all firms classified as small in those 
industries and industry parts under the current size standards.

        Table 14--Net Impacts of Proposed Size Standards Changes
------------------------------------------------------------------------
                     Impact variable                           Value
------------------------------------------------------------------------
Number of industries or industry parts with changes to                32
 size standards.........................................

[[Page 40079]]

 
Total number of small firms under the current size               109,990
 standards in industries with changes to size standards
 (2017 Economic Census).................................
Additional number of firms qualifying as small under                -364
 size standards changes (2017 Economic Census)..........
% of additional firms qualifying as small relative to              -0.3%
 total current small firms (2017 Economic Census).......
Number of current unique small firms getting small                 1,509
 business contracts in industries with changes to size
 standards (FPDS-NG FY 2018-2020) \1\...................
Additional number of unique small firms gaining small                 42
 business status in industries with changes to size
 standards (FPDS-NG FY 2018-2020) \1\...................
% increase to small firms relative to current unique                2.8%
 small firms gaining small business status (FPDS-NG FY
 2018-2020).............................................
Total small business contract dollars under current size          $495.6
 standards in industries with changes to size standards
 ($ million) (FPDS-NG FY 2018-2020).....................
Estimated small business dollars available to newly                $60.4
 qualified small firms ($ million) (FPDS-NG FY 2018-
 2020) \2\..............................................
% increase to dollars relative to total small business             12.2%
 contract dollars under current size standards..........
Total number of 7(a) and 504 loans to small businesses             1,224
 in industries with changes to size standards (FY 2018-
 2020)..................................................
Additional number of 7(a) and 504 loans to small                       0
 businesses in industries with changes to size standards
 (FY 2018-2020).........................................
% of additional 7(a) and 504 loans go small businesses              0.0%
 in industries with changes to size standards...........
Total amount of 7(a) and 504 loans to small businesses            $440.3
 in industries with changes to size standards ($
 million) (FY 2018-2020)................................
Estimated additional 7(a) and 504 loan amount to newly-             $0.0
 qualified small firms ($ million)......................
% increase to 7(a) and 504 loan amount relative to the              0.0%
 total amount of 7(a) and 504 loans to small businesses.
Total number of EIDL loans to small businesses in                     91
 industries with changes to size standards (FY 2018-
 2020) \3\..............................................
Estimated number of additional EIDL loans to newly-                    0
 qualified small firms (FY 2018-2020) \3\...............
% of additional EIDL loans to small businesses in                   0.0%
 industries with changes to size standards..............
Total amount of EIDL loans to small businesses in                   $0.2
 industries with changes to size standards ($ million)
 (FY 2018-2020) \3\.....................................
Estimated additional EIDL loan amount to newly-qualified            $0.0
 small firms ($ million) \3\ (FY2018-2020)..............
% increase to EIDL loan amount relative to the total                0.0%
 amount of disaster loans to small businesses \3\.......
------------------------------------------------------------------------
\1\ Total impact represents total unique number of firms impacted to
  avoid double counting as some firms participate in more than one
  industry.
\2\ Additional dollars are calculated multiplying average small business
  dollars obligated per unique firm times change in number of firms.
  Numbers of firms are calculated using the SBA's current size
  standards, not the contracting officer's size designation.
\3\ Excludes COVID-19 related EIDL loans due to their temporary nature.
  Effective January 1, 2022, SBA stopped accepting applications for new
  COVID EIDL loans or advances.

    Based on the FPDS-NG data for fiscal years 2018-2020, SBA estimates 
that about 42 unique active firms in Federal contracting in those 
industries would gain their small business status under proposed 
changes to size standards, most of them in Sector 31-33 
(Manufacturing). This represents an increase of about 2.8% of the total 
number of small businesses participating in Federal contracting under 
the current size standards. Based on the same data, SBA estimates that 
about $60.4 million of Federal procurement dollars would become 
available to all small firms, including those gaining small status. 
This represents an increase of 12.2% from the baseline. SBA estimates 
that the dollars obligated to small businesses will increase despite a 
reduction in the total number of small firms because the contract 
dollars to newly-qualified small businesses in sectors with increases 
to size standards is higher than the contract dollars to small 
businesses losing small business status in sectors with decreases to 
size standards.
    Based on the SBA's loan data for fiscal years 2018-2020, the total 
number of 7(a) and CDC/504 loans will not be impacted, and the loan 
amount may increase slightly since the average loan value to firms with 
increases to size standards is higher than the average loan value to 
firms with decreases to size standards.
    Firms' participation under the SBA's EIDL program will be affected 
as well. Since the benefit provided through this program is contingent 
on the occurrence and severity of a disaster in the future, SBA cannot 
make a meaningful estimate of this impact. However, based on the 
disaster loan program data for fiscal years 2018-2020, SBA estimates 
that the total number of EIDL loans and the loan amount will not be 
impacted.
3. What alternatives have been considered?
    As stated previously, as an alternative to proposing new size 
standards for NAICS 2022 industries, SBA considered retaining NAICS 
2017 as the basis of industry definitions for its small business size 
standards. That would, however, lead to inconsistencies between SBA's 
size standards and establishment data published by Federal agencies 
that will adopt NAICS 2022 for their statistical and other data 
collection programs. OMB stated in its December 21, 2021, notice that 
``Federal statistical establishment data published for reference years 
beginning on or after January 1, 2022, should be published using the 
2022 NAICS United States codes.'' SBA is not a statistical agency, but 
it uses for its size standards analyses establishment data collected by 
other Federal agencies, such as the Economic Census data and County 
Business Patterns from the U.S. Census Bureau. If SBA continues using 
NAICS 2017 for its size standards, it will not be able to analyze and 
evaluate industry structure adequately and accurately and adjust small 
business size standards appropriately because the forthcoming Economic 
Census and County Business Patterns data based on NAICS 2022 will not 
be compatible with NAICS 2017 industry definitions. That would run 
counter to the Jobs Act mandate that requires SBA to review all size 
standards and adjust them appropriately to reflect the current industry 
structure and market conditions every five years.
    To establish, review, or revise, where necessary, small business 
size standards, SBA uses special tabulations of industry data that it 
obtains from the U.S. Census Bureau based on its Economic Census of 
U.S. industries and businesses, and establishment data from its County 
Business Patterns (CBP). Because the 2022 Economic Census and CBP data 
will be based on NAICS 2022 industry definitions, it is imperative that 
SBA also use NAICS 2022 as the basis of industry definitions for its 
table of small business size standards.

Congressional Review Act

    Subtitle E of the Small Business Regulatory Enforcement Fairness 
Act of

[[Page 40080]]

1996 (codified at 5 U.S.C. 801-808), also known as the Congressional 
Review Act or CRA, generally provides that before a rule may take 
effect, the agency promulgating the rule must submit a rule report, 
which includes a copy of the rule, to each House of the Congress and to 
the Comptroller General of the United States. SBA will submit a report 
containing this rule and other required information to the U.S. Senate, 
the U.S. House of Representatives, and the Comptroller General of the 
United States. A major rule under the CRA cannot take effect until 60 
days after it is published in the Federal Register. OMB's Office of 
Information and Regulatory Affairs has determined that this rule is not 
a ``major rule'' as defined by 5 U.S.C. 804(2).

Initial Regulatory Flexibility Analysis

    Under the Regulatory Flexibility Act (RFA), this proposed rule, if 
adopted, may have a significant impact on a substantial number of small 
businesses in some industries whose size standards have been revised. 
As described above, this rule may affect small businesses applying for 
Federal Government contracts, loans under SBA's 7(a), 504, and Economic 
Injury Disaster Loan Programs, and assistance under other Federal small 
business programs.
    Immediately below, SBA sets forth an initial regulatory flexibility 
analysis (IRFA) of this proposed rule addressing the following 
questions: (1) What are the need for and objectives of the rule?; (2) 
What are SBA's description and estimate of the number of small 
businesses to which the rule will apply?; (3) What are the projected 
reporting, record keeping, and other compliance requirements of the 
rule?; (4) What are the relevant Federal rules that may duplicate, 
overlap, or conflict with the rule?; and (5) What alternatives will 
allow the Agency to accomplish its regulatory objectives while 
minimizing the impact on small businesses?
1. What are the need for and objective of the rule?
    The Small Business Act requires that small business size standards 
vary from industry to industry reflecting the differing characteristics 
of the various industries. SBA uses the latest NAICS as a basis of 
industries definitions for its table of size standards. As part of its 
five-year review of and revisions to NAICS industry definitions, OMB 
published its latest NAICS revision, NAICS 2022, on December 21, 2021. 
According to the OMB's notice, Federal establishment and industry data 
for reference years beginning on or after January 1, 2022, should be 
published using NAICS 2022. This rule proposes to amend SBA's small 
business size regulations to incorporate NAICS 2022 into its table of 
size standards. This not only makes SBA's size standards more 
reflective of the latest industry differences but also makes them more 
consistent with latest industry data the Agency uses to establish, 
review or adjust size standards. Updating size standards to the latest 
industry definitions also serves the SBA's mandate to review all size 
standards and make appropriate adjustments to reflect market conditions 
under the Jobs Act.
2. What are SBA's description and estimate of the number of small 
businesses to which the rule will apply?
    With the update of size standards to the latest industry 
definitions under NAICS 2022, Federal small business assistance is more 
effectively targeted to its intended beneficiaries. The NAICS 2022 
revision created 111 new industries by reclassifying, combining, or 
splitting 156 NAICS 2017 industries or their parts. If adopted as 
proposed, SBA's proposed size standards for these 111 new industries 
under NAICS 2022 will result in an increase to the size standards for 
21 industries and 27 parts of three industries under NAICS 2017, a 
decrease to size standards for seven industries and 41 parts of one 
industry, a change in the size standard measure from average annual 
receipts to number of employees for one industry, a change in the size 
standard measure from number of employees to average annual receipts 
for a part of one industry, and no change in size standards for 118 
industries and 33 parts of eight industries. In 21 industries and 27 
parts of three industries whose size standards would increase due to 
the adoption of NAICS 2022, nearly 700 firms above the current size 
standards would qualify as small under the updated size standards, 
thereby making them eligible for Federal small business assistance 
programs. Based on the data for fiscal years 2018-2020, SBA estimates 
that approximately $60.0 million in Federal contracts and about 
$100,000 in SBA 7(a) and 504 loans could be awarded to the newly 
defined small businesses under the updated size standards. The updated 
size standards would enable advanced small businesses to maintain their 
small business size status for a longer period and some mid-size 
businesses (i.e., businesses that have just exceeded the size 
thresholds) regain their small business status. In the seven NAICS 2017 
industries and 41 parts of one industry for which size standards will 
decrease as a result of adoption of NAICS 2022, 1,055 firms below the 
current size standards would lose their small business size status 
under the proposed size standards. However, the program data suggests 
that this would cause no impact on them in terms of access to Federal 
contracting and SBA's loans programs. Currently, they are not 
participating in any small business programs.
3. What are the projected reporting, record keeping and other 
compliance requirements of the rule?
    The proposed size standard changes due to the adoption of NAICS 
2022 impose no additional reporting or record keeping requirements on 
small businesses. However, qualifying for Federal small business 
contracting and other programs may require businesses to register in 
SAM and recertify in SAM that they are small at least once annually. 
Therefore, the newly qualified small businesses opting to participate 
in those programs must comply with SAM requirements. There are minimal 
costs associated with SAM registration and annual recertification, but 
the proposed rule does not impose any new costs in this area. Changing 
size standards alters the access to SBA's financial and other Federal 
programs that assist small businesses but does not impose a regulatory 
burden because they neither regulate nor control business behavior.
4. What are the relevant Federal rules, which may duplicate, overlap, 
or conflict with the rule?
    Under section 3(a)(2)(C) of the Small Business Act, 15 U.S.C. 
632(a)(2)(c), Federal agencies must generally use SBA's size standards 
to define a small business, unless specifically authorized by statute 
to do otherwise. In 1995, SBA published in the Federal Register a list 
of statutory and regulatory size standards that identified the 
application of SBA's size standards as well as other size standards 
used by Federal agencies (60 FR 57988 (November 24, 1995)). An agency 
may establish for its programs a size standard that is different from 
those established by SBA if approved by SBA's Administrator in 
accordance with 13 CFR 121.903. SBA is not aware of any Federal rule 
that would duplicate or conflict with establishing or updating size 
standards.
    However, the Small Business Act and SBA's regulations allow Federal 
agencies to develop different size standards if they believe that SBA's 
size standards are not appropriate for their programs, with the 
approval of SBA's Administrator (13 CFR 121.903). The RFA authorizes a 
Federal agency to establish an alternative small business

[[Page 40081]]

definition, after consultation with the Office of Advocacy of the U.S. 
Small Business Administration (5 U.S.C. 601(3)).
5. What alternatives will allow the Agency to accomplish its regulatory 
objectives while minimizing the impact on small entities?
    By law, SBA is required to develop numerical size standards for 
establishing eligibility for Federal small business assistance 
programs. Other than varying levels of size standards by industry and 
changing the size measures, no practical alternative exists to the 
systems of numerical size standards. As stated previously, SBA 
considered continuing to use NAICS 2017 as a basis of industry 
definitions for its table of size standards. However, that would render 
SBA's table of size standards incompatible with Federal industry and 
establishment statistics and other databases when evaluating industry 
characteristics to ensure size standards are reflective of current 
industry structure and market conditions.

Executive Order 13563

    A description of the need for this proposed regulatory action and 
benefits and costs associated with this action including possible 
distribution impacts that relate to Executive Order 13563 are included 
above in the Cost Benefit Analysis.
    To engage interested parties in this action, SBA reached out to all 
Federal agencies advising them that the Agency plans to update its 
table of size standards to NAICS 2022, effective October 1, 2022, and 
that agencies must continue using the current size standards until that 
date. Adopting the updated size standards on October 1, 2022, is 
consistent with SBA's adoptions of previous NAICS revisions at the 
beginning of the new fiscal year following the OMB's January 1 
effective date of NAICS revisions for Federal statistical agencies.
    Unlike the previous NAICS revisions which SBA adopted for its size 
standards either through a direct final rule or through an interim 
final rule, for the adoption of NAICS 2022 revision, SBA is issuing 
this proposed rule and seeking comments to better engage the public in 
the process. SBA will also issue a press release on the publication of 
the proposed rule and update the size standards web page at 
www.sba.gov/size, asking interested parties to comment on the rule. SBA 
will thoroughly consider all public comments when developing the final 
rule.

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

    For purposes of Executive Order 13132, SBA has determined that this 
proposed rule, if adopted as proposed, will not have substantial, 
direct effects on the States, on the relationship between the Federal 
Government and the States, or on the distribution of power and 
responsibilities among the various levels of government. Therefore, SBA 
has determined that this proposed rule has no federalism implications 
warranting preparation of a federalism assessment.

Paperwork Reduction Act

    For the purpose of the Paperwork Reduction Act, 44 U.S.C. Ch. 35, 
SBA has determined that this proposed rule would not impose any new 
reporting or record keeping requirements.

List of Subjects in 13 CFR Part 121

    Administrative practice and procedure, Federal Government 
procurement, Federal Government property, Grant programs--Business, 
Individuals with disabilities, Loan programs--Business, Reporting and 
recordkeeping requirements, Small businesses.

    For the reasons set forth in the preamble, SBA proposes to amend 13 
CFR part 121 as follows:

PART 121--SMALL BUSINESS SIZE REGULATIONS

0
1. The authority citation for part 121 is revised to read as follows:

    Authority:  15 U.S.C. 632, 634(b)(6), 636(a)(36), 662, 694a(9), 
and 9012.

0
2. In Sec.  121.201, amend the table, ``Small Business Size Standards 
by NAICS Industry'' as follows:
0
a. Remove the entries for 212111, 212112, and 212113.
0
b. Add entries for 212114, 212115, and 212220 in numerical order.
0
c. Remove the entries for 212221 and 212222.
0
d. Add an entry for 212290 in numerical order.
0
e. Remove the entries for 212291 and 212299.
0
f. Add an entry for 212323 in numerical order.
0
g. Remove the entries for 212324 and 212325.
0
h. Add an entry for 212390 in numerical order.
0
i. Remove the entries for 212391, 212392, 212393, and 212399.
0
j. Revise entry 311221.
0
k. Remove the entry for 315110.
0
l. Add an entry for 315120 in numerical order.
0
m. Remove the entries for 315190, 315220, and 315240.
0
n. Add an entry for 315250 in numerical order.
0
o. Remove the entry for 315280.
0
p. Add an entry for 316990 in numerical order.
0
q. Remove the entries for 316992, 316998, 321213, and 321214.
0
r. Add entries for 321215 and 322120 in numerical order.
0
s. Remove the entries for 322121 and 322122.
0
t. Add an entry for 325315 in numerical order.
0
u. Revise entry 325992.
0
v. Remove the entry for 333244.
0
w. Add an entry for 333248 in numerical order.
0
x. Remove the entry for 333249.
0
y. Add an entry for 333310 in numerical order.
0
z. Remove the entries for 333314, 333316, 333318, and 333997.
0
aa. Add an entry for 333998 in numerical order.
0
bb. Remove the entry for 333999.
0
cc. Add an entry for 334610 in numerical order.
0
dd. Remove the entries for 334613, 334614, 335110, 335121, 335122, and 
335129.
0
ee. Add entries for 335131, 335132, 335139, and 335910 in numerical 
order.
0
ff. Remove the entries for 335911 and 335912.
0
gg. Add an entry for 336110 in numerical order.
0
hh. Remove the entries for 336111, 336112, 337124, and 337125.
0
ii. Add an entry for 337126 in numerical order.
0
jj. Remove the entries for 424320 and 424330.
0
kk. Add an entry for 424350 in numerical order.
0
ll. Revise entry 424940 and the heading for Subsector 425.
0
mm. Remove the entry for 425110.
0
nn. Add an entry for 441227 in numerical order.
0
oo. Remove the entries for 441228, 441310, and 441320.
0
pp. Add entries for 441330 and 441340 in numerical order.
0
qq. Remove the heading for Subsector 442 and entries 442110, 442210, 
442291, and 442299 and the heading for Subsector 443 and entries 443141 
and 443142.
0
rr. Revise entry 444120.

[[Page 40082]]

0
ss. Remove the entry for 444130.
0
tt. Add entries for 444140 and 444180 in numerical order.
0
uu. Remove the entries for 444190, 444210, and 444220.
0
vv. Add entries for 444230 and 444240 in numerical order.
0
ww. Revise the heading for Subsector 445 and all the entries under 
Subsector 445.
0
xx. Remove the heading for Subsector 446 and all the entries under 
Subsector 446, the heading for Subsector 447 and all the entries under 
Subsector 447, and the heading for Subsector 448 and all the entries 
under Subsector 448.
0
yy. Add a heading for Subsector 449 and entries 449110, 449121, 449122, 
449129, and 449210 in numerical order.
0
zz. Remove the heading for Subsector 451 and all the entries under 
Subsector 451, the heading for Subsector 452 and all the entries under 
Subsector 452, the heading for Subsector 453 and all the entries under 
Subsector 453, and the heading for Subsector 454 and all the entries 
under Subsector 454.
0
aaa. Add a heading for Subsector 455 and entries 455110, 455211, and 
455219, a heading for Subsector 456 and entries 456110, 456120, 456130, 
456191, and 456199, a heading for Subsector 457 and entries 457110, 
457120, and 457210, a heading for Subsector 458 and entries 458110, 
458210, 458310, and 458320, and a heading for Subsector 459 and entries 
459110, 459120, 459130, 459140, 459210, 459310, 459410, 459420, 459510, 
459910, 459920, 459930, 459991, and 459999 in numerical order.
0
bbb. Revise entry 485310.
0
ccc. Remove the heading for Subsector 511 and all the entries under 
Subsector 511.
0
ddd. Add a heading for Subsector 513 and entries 513110, 513120, 
513130, 513140, 513191, 513199, and 513210 in numerical order.
0
eee. Remove the heading for Subsector 515 and all the entries under 
Subsector 515.
0
fff. Add a heading for Subsector 516 and entries 516110, 516120, and 
516210 in numerical order.
0
ggg. Remove all the entries under Subsector 517.
0
hhh. Add entries 517111, 517112, 517121, 517122, and 517810 in 
numerical order.
0
iii. Revise the heading for Subsector 518, entry 518210, and the 
heading for Subsector 519.
0
jjj. Remove the entries for 519110, 519120, 519130, and 519190.
0
kkk. Add entries for 519210 and 519290 in numerical order.
0
lll. Remove the entry for 522120.
0
mmm. Add an entry for 522180 in numerical order.
0
nnn. Remove the entries for 522190, 522293, 522294, and 522298.
0
ooo. Add an entry for 522299 in numerical order.
0
ppp. Remove the entries for 523110, 523120, 523130, and 523140.
0
qqq. Add entries for 523150 and 523160 in numerical order.
0
rrr. Remove the entries for 523920 and 523930.
0
sss. Add an entry for 523940 in numerical order.
0
ttt. Revise entries for 524292, 541380, 541850, 561611, and 624410.
0
uuu. Remove the entries for 811112 and 811113.
0
vvv. Add an entry for 811114 in numerical order.
0
www. Remove the entry for 811118.
0
xxx. Add an entry for 811210 in numerical order.
0
yyy. Remove the entries for 811211, 811212, 811213, and 811219.
0
zzz. Revise footnotes 8 and 15 at the end of the table.
    The additions and revisions read as follows:


Sec.  121.201  What size standards has SBA identified by North American 
U.S. Industry Classification System codes?

* * * * *

                                 Small Business Size Standards by NAICS Industry
----------------------------------------------------------------------------------------------------------------
                                                                               Size standards    Size standards
             NAICS codes                     NAICS U.S. industry title         in millions of     in number of
                                                                                   dollars          employees
----------------------------------------------------------------------------------------------------------------
 
                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------
                            Sector 21--Mining, Quarrying, and Oil and Gas Extraction
----------------------------------------------------------------------------------------------------------------
 
                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------
                                   Subsector 212--Mining (except Oil and Gas)
----------------------------------------------------------------------------------------------------------------
212114..............................  Surface Coal Mining...................  ................             1,250
212115..............................  Underground Coal Mining...............  ................             1,500
 
                                                  * * * * * * *
212220..............................  Gold Ore and Silver Ore Mining........  ................             1,500
 
                                                  * * * * * * *
212290..............................  Other Metal Ore Mining................  ................               750
 
                                                  * * * * * * *
212323..............................  Kaolin, Clay, and Ceramic and           ................               500
                                       Refractory Minerals Mining.
212390..............................  Other Nonmetallic Mineral Mining and    ................               500
                                       Quarrying.
 
                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------
                                          Sectors 31-33--Manufacturing
----------------------------------------------------------------------------------------------------------------
                                        Subsector 311--Food Manufacturing
----------------------------------------------------------------------------------------------------------------
 
                                                  * * * * * * *
311221..............................  Wet Corn Milling and Starch             ................             1,250
                                       Manufacturing.

[[Page 40083]]

 
 
                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------
                                      Subsector 315--Apparel Manufacturing
----------------------------------------------------------------------------------------------------------------
315120..............................  Apparel Knitting Mills................  ................               750
 
                                                  * * * * * * *
315250..............................  Cut and Sew Apparel Manufacturing       ................               750
                                       (except Contractors).
 
                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------
                             Subsector 316--Leather and Allied Product Manufacturing
----------------------------------------------------------------------------------------------------------------
 
                                                  * * * * * * *
316990..............................  Other Leather and Allied Product        ................               500
                                       Manufacturing.
----------------------------------------------------------------------------------------------------------------
                                    Subsector 321--Wood Product Manufacturing
----------------------------------------------------------------------------------------------------------------
321215..............................  Engineered Wood Member Manufacturing..  ................               500
 
                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------
                                       Subsector 322--Paper Manufacturing
----------------------------------------------------------------------------------------------------------------
 
                                                  * * * * * * *
322120..............................  Paper Mills...........................  ................             1,250
 
                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------
                                      Subsector 325--Chemical Manufacturing
----------------------------------------------------------------------------------------------------------------
 
                                                  * * * * * * *
325315..............................  Compost Manufacturing.................  ................               500
 
                                                  * * * * * * *
325992..............................  Photographic Film, Paper, Plate,        ................             1,500
                                       Chemical, and Copy Toner
                                       Manufacturing.
 
                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------
                                   Subsector 333--Machinery Manufacturing \6\
----------------------------------------------------------------------------------------------------------------
 
                                                  * * * * * * *
333248..............................  All Other Industrial Machinery          ................               750
                                       Manufacturing.
333310..............................  Commercial and Service Industry         ................             1,000
                                       Machinery Manufacturing.
 
                                                  * * * * * * *
333998..............................  All Other Miscellaneous General         ................               500
                                       Purpose Machinery Manufacturing.
----------------------------------------------------------------------------------------------------------------
                        Subsector 334--Computer and Electronic Product Manufacturing \6\
----------------------------------------------------------------------------------------------------------------
 
                                                  * * * * * * *
334610..............................  Manufacturing and Reproducing Magnetic  ................             1,250
                                       and Optical Media.
----------------------------------------------------------------------------------------------------------------
                 Subsector 335--Electrical Equipment, Appliance and Component Manufacturing \6\
----------------------------------------------------------------------------------------------------------------
335131..............................  Residential Electric Lighting Fixture   ................               750
                                       Manufacturing.
335132..............................  Commercial, Industrial, and             ................               500
                                       Institutional Electric Lighting
                                       Fixture Manufacturing.
335139..............................  Electric Lamp Bulb and Other Lighting   ................             1,250
                                       Equipment Manufacturing.
 
                                                  * * * * * * *
335910..............................  Battery Manufacturing.................  ................             1,250
 

[[Page 40084]]

 
                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------
                            Subsector 336--Transportation Equipment Manufacturing \6\
----------------------------------------------------------------------------------------------------------------
336110..............................  Automobile and Light Duty Motor         ................             1,500
                                       Vehicle Manufacturing.
 
                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------
                           Subsector 337--Furniture and Related Product Manufacturing
----------------------------------------------------------------------------------------------------------------
 
                                                  * * * * * * *
337126..............................  Household Furniture (except Wood and    ................               750
                                       Upholstered) Manufacturing.
 
                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------
                                           Sector 42--Wholesale Trade
----------------------------------------------------------------------------------------------------------------
 
                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------
                              Subsector 424--Merchant Wholesalers, Nondurable Goods
----------------------------------------------------------------------------------------------------------------
 
                                                  * * * * * * *
424350..............................  Clothing and Clothing Accessories       ................               150
                                       Merchant Wholesalers.
 
                                                  * * * * * * *
424940..............................  Tobacco Product and Electronic          ................               250
                                       Cigarette Merchant Wholesalers.
 
                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------
                                Subsector 425--Wholesale Trade Agents and Brokers
----------------------------------------------------------------------------------------------------------------
 
                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------
                                           Sector 44-45--Retail Trade
----------------------------------------------------------------------------------------------------------------
 
                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------
                                 Subsector 441--Motor Vehicles and Parts Dealers
----------------------------------------------------------------------------------------------------------------
 
                                                  * * * * * * *
441227..............................  Motorcycle, ATV, and All Other Motor               35.00  ................
                                       Vehicle Dealers.
441330..............................  Automotive Parts and Accessories                   16.50  ................
                                       Retailers.
441340..............................  Tire Dealers..........................             16.50  ................
----------------------------------------------------------------------------------------------------------------
                   Subsector 444--Building Material and Garden Equipment and Supplies Dealers
----------------------------------------------------------------------------------------------------------------
 
                                                  * * * * * * *
444120..............................  Paint and Wallpaper Retailers.........             30.00  ................
444140..............................  Hardware Retailers....................              8.00  ................
444180..............................  Other Building Material Dealers.......             22.00  ................
444230..............................  Outdoor Power Equipment Retailers.....              8.00  ................
444240..............................  Nursery, Garden Center, and Farm                   12.00  ................
                                       Supply Retailers.
----------------------------------------------------------------------------------------------------------------
                                   Subsector 445--Food and Beverage Retailers
----------------------------------------------------------------------------------------------------------------
445110..............................  Supermarkets and Other Grocery                     35.00  ................
                                       Retailers (except Convenience
                                       Retailers).
445131..............................  Convenience Retailers.................             32.00  ................
445132..............................  Vending Machine Operators.............             12.00  ................
445230..............................  Fruit and Vegetable Retailers.........              8.00  ................
445240..............................  Meat Retailers........................              8.00  ................
445250..............................  Fish and Seafood Retailers............              8.00  ................
445291..............................  Baked Goods Retailers.................              8.00  ................
445292..............................  Confectionery and Nut Retailers.......              8.00  ................
445298..............................  All Other Specialty Food Retailers....              8.00  ................

[[Page 40085]]

 
445320..............................  Beer, Wine, and Liquor Retailers......              8.00  ................
----------------------------------------------------------------------------------------------------------------
                Subsector 449--Furniture, Home Furnishings, Electronics, and Appliance Retailers
----------------------------------------------------------------------------------------------------------------
449110..............................  Furniture Retailers...................             22.00  ................
449121..............................  Floor Covering Retailers..............              8.00  ................
449122..............................  Window Treatment Retailers............              8.00  ................
449129..............................  All Other Home Furnishings Retailers..             22.00  ................
449210..............................  Electronics and Appliance Retailers...             35.00  ................
 
                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------
                                  Subsector 455--General Merchandise Retailers
----------------------------------------------------------------------------------------------------------------
455110..............................  Department Stores.....................             35.00  ................
455211..............................  Warehouse Clubs and Supercenters......             32.00  ................
455219..............................  All Other General Merchandise                      35.00  ................
                                       Retailers.
----------------------------------------------------------------------------------------------------------------
                                Subsector 456--Health and Personal Care Retailers
----------------------------------------------------------------------------------------------------------------
456110..............................  Pharmacies and Drug Retailers.........             30.00  ................
456120..............................  Cosmetics, Beauty Supplies, and                    30.00  ................
                                       Perfume Retailers.
456130..............................  Optical Goods Retailers...............             22.00  ................
456191..............................  Food (Health) Supplement Retailers....             16.50  ................
456199..............................  All Other Health and Personal Care                  8.00  ................
                                       Retailers.
----------------------------------------------------------------------------------------------------------------
                                Subsector 457--Gasoline Stations and Fuel Dealers
----------------------------------------------------------------------------------------------------------------
457110..............................  Gasoline Stations with Convenience                 32.00  ................
                                       Stores.
457120..............................  Other Gasoline Stations...............             16.50  ................
457210..............................  Fuel Dealers..........................  ................               100
----------------------------------------------------------------------------------------------------------------
                   Subsector 458--Clothing, Clothing Accessories, Shoe, and Jewelry Retailers
----------------------------------------------------------------------------------------------------------------
458110..............................  Clothing and Clothing Accessories                  41.50  ................
                                       Retailers.
458210..............................  Shoe Retailers........................             30.00  ................
458310..............................  Jewelry Retailers.....................             16.50  ................
458320..............................  Luggage and Leather Goods Retailers...             30.00  ................
----------------------------------------------------------------------------------------------------------------
           Subsector 459--Sporting Goods, Hobby, Musical Instrument, Book, and Miscellaneous Retailers
----------------------------------------------------------------------------------------------------------------
459110..............................  Sporting Goods Retailers..............             16.50  ................
459120..............................  Hobby, Toy, and Game Retailers........             30.00  ................
459130..............................  Sewing, Needlework, and Piece Goods                30.00  ................
                                       Retailers.
459140..............................  Musical Instrument and Supplies                    12.00  ................
                                       Retailers.
459210..............................  Book Retailers and News Dealers.......             30.00  ................
459310..............................  Florists..............................              8.00  ................
459410..............................  Office Supplies and Stationery                     35.00  ................
                                       Retailers.
459420..............................  Gift, Novelty, and Souvenir Retailers.              8.00  ................
459510..............................  Used Merchandise Retailers............              8.00  ................
459910..............................  Pet and Pet Supplies Retailers........             22.00  ................
459920..............................  Art Dealers...........................              8.00  ................
459930..............................  Manufactured (Mobile) Home Dealers....             16.50  ................
459991..............................  Tobacco, Electronic Cigarette, and                  8.00  ................
                                       Other Smoking Supplies Retailers.
459999..............................  All Other Miscellaneous Retailers.....              8.00  ................
----------------------------------------------------------------------------------------------------------------
                                  Sectors 48-49--Transportation and Warehousing
----------------------------------------------------------------------------------------------------------------
 
                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------
                           Subsector 485--Transit and Ground Passenger Transportation
----------------------------------------------------------------------------------------------------------------
 
                                                  * * * * * * *
485310..............................  Taxi and Ridesharing Services.........             16.50  ................
 
                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------
                                             Sector 51--Information
----------------------------------------------------------------------------------------------------------------
 

[[Page 40086]]

 
                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------
                                      Subsector 513--Publishing Industries
----------------------------------------------------------------------------------------------------------------
513110..............................  Newspaper Publishers..................  ................             1,000
513120..............................  Periodical Publishers.................  ................             1,000
513130..............................  Book Publishers.......................  ................             1,000
513140..............................  Directory and Mailing List Publishers.  ................             1,000
513191..............................  Greeting Card Publishers..............  ................             1,000
513199..............................  All Other Publishers..................  ................             1,000
513210..............................  Software Publishers \15\..............        \15\ 41.50  ................
----------------------------------------------------------------------------------------------------------------
                                Subsector 516--Broadcasting and Content Providers
----------------------------------------------------------------------------------------------------------------
516110..............................  Radio Broadcasting Stations...........             41.50  ................
516120..............................  Television Broadcasting Stations......             41.50  ................
516210..............................  Media Streaming Distribution Services,             41.50  ................
                                       Social Networks, and Other Media
                                       Networks and Content Providers.
----------------------------------------------------------------------------------------------------------------
                                        Subsector 517--Telecommunications
----------------------------------------------------------------------------------------------------------------
517111..............................  Wired Telecommunications Carriers.....  ................             1,500
517112..............................  Wireless Telecommunications Carriers    ................             1,500
                                       (except Satellite).
517121..............................  Telecommunications Resellers..........  ................             1,500
517122..............................  Agents for Wireless Telecommunications  ................             1,500
                                       Services.
517810..............................  All Other Telecommunications..........             35.00  ................
----------------------------------------------------------------------------------------------------------------
      Subsector 518--Computing Infrastructure Providers, Data Processing, Web Hosting, and Related Services
----------------------------------------------------------------------------------------------------------------
518210..............................  Computing Infrastructure Providers,                35.00  ................
                                       Data Processing, Web Hosting, and
                                       Related Services.
----------------------------------------------------------------------------------------------------------------
             Subsector 519--Web Search Portals, Libraries, Archives, and Other Information Services
----------------------------------------------------------------------------------------------------------------
519210..............................  Libraries and Archives................             18.50  ................
519290..............................  Web Search Portals and All Other        ................             1,000
                                       Information Services.
----------------------------------------------------------------------------------------------------------------
                                        Sector 52--Finance and Insurance
----------------------------------------------------------------------------------------------------------------
                           Subsector 522--Credit Intermediation and Related Activities
----------------------------------------------------------------------------------------------------------------
 
                                                  * * * * * * *
522180..............................  Savings Institutions and Other            750.00 million  ................
                                       Depository Credit Intermediation\8\.         in average
                                                                                    assets \8\
 
                                                  * * * * * * *
522299..............................  International, Secondary Market, and               41.50  ................
                                       All Other Nondepository Credit
                                       Intermediation.
 
                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------
     Subsector 523--Securities, Commodity Contracts, and Other Financial Investments and Related Activities
----------------------------------------------------------------------------------------------------------------
523150..............................  Investment Banking and Securities                  41.50  ................
                                       Intermediation.
523160..............................  Commodity Contracts Intermediation....             41.50  ................
 
                                                  * * * * * * *
523940..............................  Portfolio Management and Investment                41.50  ................
                                       Advice.
 
                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------
                            Subsector 524--Insurance Carriers and Related Activities
----------------------------------------------------------------------------------------------------------------
 
                                                  * * * * * * *
524292..............................  Pharmacy Benefit Management and Other              40.00  ................
                                       Third-Party Administration of
                                       Insurance and Pension Funds.
 

[[Page 40087]]

 
                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------
                           Sector 54--Professional, Scientific and Technical Services
----------------------------------------------------------------------------------------------------------------
                         Subsector 541--Professional, Scientific and Technical Services
----------------------------------------------------------------------------------------------------------------
 
                                                  * * * * * * *
541380..............................  Testing Laboratories and Services.....             16.50  ................
 
                                                  * * * * * * *
541850..............................  Indoor and Outdoor Display Advertising             30.50  ................
 
                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------
               Sector 56--Administrative and Support and Waste Management and Remediation Services
----------------------------------------------------------------------------------------------------------------
                               Subsector 561--Administrative and Support Services
----------------------------------------------------------------------------------------------------------------
 
                                                  * * * * * * *
561611..............................  Investigation and Personal Background              22.00  ................
                                       Check Services.
 
                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------
                                  Sector 62--Health Care and Social Assistance
----------------------------------------------------------------------------------------------------------------
                                 Subsector 621--Ambulatory Health Care Services
----------------------------------------------------------------------------------------------------------------
 
                                                  * * * * * * *
624410..............................  Child Care Services...................              8.50  ................
 
                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------
                            Sector 81--Other Services (Except Public Administration)
----------------------------------------------------------------------------------------------------------------
                                      Subsector 811--Repair and Maintenance
----------------------------------------------------------------------------------------------------------------
 
                                                  * * * * * * *
811114..............................  Specialized Automotive Repair.........              8.00  ................
 
                                                  * * * * * * *
811210..............................  Electronic and Precision Equipment                 30.00  ................
                                       Repair and Maintenance.
 
                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------
Footnotes:
 * * * * * * *
6. NAICS Subsectors 333, 334, 335 and 336--For rebuilding machinery or equipment on a factory basis, or
  equivalent, use the NAICS code for a newly manufactured product. Concerns performing major rebuilding or
  overhaul activities do not necessarily have to meet the criteria for being a ``manufacturer'' although the
  activities may be classified under a manufacturing NAICS code. Ordinary repair services or preservation are
  not considered rebuilding.
 * * * * * * *
8. NAICS Codes 522110, 522130, 522180, and 522210--A financial institution's assets are determined by averaging
  the assets reported on its four quarterly financial statements for the preceding year. ``Assets'' for the
  purposes of this size standard means the assets defined according to the Federal Financial Institutions
  Examination Council 041 call report form for NAICS codes 522110, 522180, and 522210 and the National Credit
  Union Administration 5300 call report form for NAICS code 522130.
 * * * * * * *
15. NAICS code 513210--For purposes of Government procurement, the purchase of software subject to potential
  waiver of the nonmanufacturer rule pursuant to Sec.   121.1203(d) should be classified under this NAICS code.
 * * * * * * *


Isabella Casillas Guzman,
Administrator.
[FR Doc. 2022-13250 Filed 7-1-22; 8:45 am]
BILLING CODE 8026-09-P


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