Small Business Size Standards: Agriculture, Forestry, Fishing, and Hunting, 55755-55768 [2012-22259]

Agencies

• SMALL BUSINESS ADMINISTRATION

[Federal Register Volume 77, Number 176 (Tuesday, September 11, 2012)]
[Proposed Rules]
[Pages 55755-55768]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-22259]


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SMALL BUSINESS ADMINISTRATION

13 CFR Part 121

RIN 3245-AG43


Small Business Size Standards: Agriculture, Forestry, Fishing, 
and Hunting

AGENCY: U.S. Small Business Administration.

ACTION: Proposed rule.

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SUMMARY: The U.S. Small Business Administration (SBA) proposes to 
increase small business size standards for 11 industries in North 
American Industry Classification System (NAICS) Sector 11, Agriculture, 
Forestry, Fishing and Hunting. As part of its ongoing comprehensive 
size standards review, SBA evaluated receipts based size standards for 
16 industries and two sub-industries in NAICS Sector 11 to determine 
whether they should be retained or revised. SBA did not review size 
standards for 46 industries in NAICS Sector 11 that are currently set 
by statute at $750,000 in average annual receipts. SBA also did not 
review the 500-employee based size standard for NAICS 113310, Logging, 
but will review it in the near future with other employee based size 
standards. This proposed rule is one of a series of proposed rules that 
will review size standards of industries grouped by NAICS Sector. SBA 
issued a White Paper entitled ``Size Standards Methodology'' and 
published a notice in the October 21, 2009 issue of the Federal 
Register to advise the public that the document is available on its Web 
site at www.sba.gov/size for public review and comments. The ``Size 
Standards Methodology'' White Paper explains how SBA establishes, 
reviews, and modifies its receipts based and employee based small 
business size standards. In this proposed rule, SBA has applied its 
methodology that pertains to establishing, reviewing, and modifying a 
receipts based size standard.

DATES: SBA must receive comments to this proposed rule on or before 
November 13, 2012.

ADDRESSES: Identify your comments by RIN 3245-AG43 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, Size Standards Division, 409 Third Street SW., Mail Code 6530, 
Washington, DC 20416. SBA will not accept comments to this proposed 
rule submitted by email.
    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, Size Standards Division, 409 Third Street 
SW., Mail Code 6530, Washington, DC 20416, or send an email to 
sizestandards@sba.gov. Highlight the information that you consider to 
be CBI and explain why you believe SBA should hold this information as 
confidential. SBA will review your information and determine whether it 
will make the information public.

FOR FURTHER INFORMATION CONTACT: Jorge Laboy-Bruno, Ph.D., Economist, 
Size Standards Division, (202) 205-6618 or sizestandards@sba.gov.

SUPPLEMENTARY INFORMATION: To determine eligibility for Federal small 
business assistance, SBA establishes small business size definitions 
(referred to as size standards) for private sector industries in the 
United States. SBA uses two primary measures of business size--average 
annual receipts and average number of employees. SBA uses financial 
assets, electric output, and refining capacity to measure the size of a 
few specialized industries. In addition, SBA's Small Business 
Investment Company (SBIC), Certified Development Company (504), and 
7(a) Loan Programs use either the industry based size standards, or net 
worth and net income based alternative size standards to determine 
eligibility for those programs. At the beginning of the current 
comprehensive size standards review, there were 41 different size 
standards covering 1,141 NAICS industries and 18 sub-industry 
activities (``exceptions'' in SBA's table of size standards). Thirty-
one of these size levels were based on average annual receipts, seven 
were based on average number of employees, and three were based on 
other measures.
    Over the years, SBA has received comments that its size standards 
have not kept up with changes in the economy, in particular the changes 
in the Federal contracting marketplace and industry structure. The last 
time SBA conducted a comprehensive review of all size standards was 
during the late 1970s and early 1980s. Since then, most reviews of size 
standards were limited to a few specific industries in response to 
requests from the public and Federal agencies. SBA also adjusts all 
monetary based size standards (except for statutorily set size 
standards in NAICS Sector 11) for inflation at least once every five 
years. SBA's latest inflation adjustment to size standards was 
published in the Federal Register on July 18, 2008 (73 FR 41237).
    NAICS 11, Agriculture, Forestry, Fishing and Hunting, includes 46 
industries within NAICS Subsector 111 (Agricultural Crop Production) 
and NAICS Subsector 112 (Animal

[[Page 55756]]

Production) for which size standards are set by statute, currently at 
$750,000 in average annual receipts. Within NAICS Subsector 112, SBA 
may revise the size standards for only two industries: NAICS 112112 
(Cattle Feedlots) and NAICS 112310 (Chicken Egg Production).
    Because of changes in the Federal marketplace and industry 
structure since the last comprehensive size standards review, SBA 
recognizes that current data may no longer support some of its existing 
size standards. Accordingly, in 2007, SBA began a comprehensive review 
of all size standards to determine if they are consistent with current 
data, and to adjust them when necessary. In addition, on September 27, 
2010, the President of the United States signed the Small Business Jobs 
Act of 2010 (Jobs Act). The Jobs Act directs SBA to conduct a detailed 
review of all size standards and to make appropriate adjustments to 
reflect market conditions. Specifically, the Jobs Act requires SBA to 
conduct a detailed review of at least one-third of all size standards 
during every 18-month period from the date of its enactment. In 
addition, the Jobs Act requires that SBA review all size standards not 
less frequently than once every five years thereafter. Reviewing 
existing small business size standards and making appropriate 
adjustments based on current data are also consistent with Executive 
Order 13563 on improving regulation and regulatory review.
    Rather than review all size standards at one time, SBA is reviewing 
size standards on a Sector by Sector basis. A NAICS Sector generally 
includes 25 to 75 industries, except for NAICS Sector 31-33, 
Manufacturing, which has considerably more industries. Once SBA 
completes its review of size standards for industries in a NAICS 
Sector, it issues a proposed rule to revise size standards for those 
industries for which it believes currently available data and other 
relevant factors support doing so.
    Below is a discussion of SBA's size standards methodology for 
establishing receipts based size standards that SBA applied to this 
proposed rule, including analyses of industry structure, Federal 
procurement trends, the impact of the proposed revisions to size 
standards on Federal small business assistance, and the evaluation of 
whether a revised size standard would exclude dominant firms from being 
considered small.

Size Standards Methodology

    SBA has recently developed a ``Size Standards Methodology'' for 
developing, reviewing, and modifying size standards when necessary. SBA 
published the document on its Web site at www.sba.gov/size for public 
review and comments, and has included it as a supporting document in 
the electronic docket of this proposed rule at www.regulations.gov. SBA 
does not apply all features of its ``Size Standards Methodology'' to 
all industries because not all features are appropriate for every 
industry. For example, since all industries in NAICS Sector 11 that are 
being reviewed in this proposed rule have receipts based size 
standards, the methodology described in this proposed rule applies only 
to establishing receipts based size standards. However, the methodology 
is available in its entirety for parties who have an interest in SBA's 
overall approach to establishing, evaluating, and modifying small 
business size standards. SBA always explains its analysis in individual 
proposed and final rules relating to size standards for specific 
industries.
    SBA welcomes comments from the public on a number of issues 
concerning its ``Size Standards Methodology,'' such as whether there 
are other approaches to establishing and modifying size standards; 
whether there are alternative or additional factors that SBA should 
consider; whether SBA's approach to small business size standards makes 
sense in the current economic environment; whether SBA's use of anchor 
size standards is appropriate; whether there are gaps in SBA's 
methodology because the data it uses are not current or sufficiently 
comprehensive; and whether there are other data, facts, and/or issues 
that SBA should consider. Comments on SBA's size standards methodology 
should be submitted via: (1) The Federal eRulemaking Portal: 
www.regulations.gov, following the instructions for submitting 
comments; the docket number is SBA-2009-0008, or (2) Mail/Hand 
Delivery/Courier: Khem R. Sharma, Ph.D., Chief, Size Standards 
Division, 409 Third Street SW., Mail Code 6530, Washington, DC 20416. 
As it will do with comments to this and other proposed rules, SBA will 
post all comments on its methodology on www.regulations.gov. As of May 
31, 2012, SBA has received 14 comments to its ``Size Standards 
Methodology.'' The comments are available to the public at 
www.regulations.gov. SBA continues to welcome comments on its 
methodology from interested parties. SBA will not accept comments to 
its ``Size Standards Methodology'' submitted by email.
    Congress granted the SBA's Administrator discretion to establish 
detailed small business size standards. 15 U.S.C. 632(a)(2). 
Specifically, Section 3(a)(3) of the Small Business Act (15 U.S.C. 
632(a)(3)) requires that ``* * * the [SBA] Administrator shall ensure 
that the size standard varies from industry to industry to the extent 
necessary to reflect the differing characteristics of the various 
industries and consider other factors deemed to be relevant by the 
Administrator.'' Accordingly, the economic structure of an industry is 
the basis for developing and modifying small business size standards. 
SBA identifies the small business segment of an industry by examining 
data on the economic characteristics defining the industry structure 
(as described below). In addition, SBA considers current economic 
conditions, its mission and program objectives, the Administration's 
current policies, suggestions from industry groups and Federal 
agencies, and public comments on the proposed rule. SBA also examines 
whether a size standard based on industry and other relevant data 
successfully excludes businesses that are dominant in the industry.
    This proposed rule includes information regarding the factors SBA 
evaluated and the criteria it used to propose adjustments to receipts 
based size standards for 16 industries and two sub-industries 
(``exceptions'') in NAICS Sector 11. This proposed rule affords the 
public an opportunity to review and to comment on SBA's proposal to 
revise size standards in NAICS Sector 11, as well as on the data and 
methodology it used to evaluate and revise the size standards.

Industry Analysis

    For the current comprehensive size standards review, SBA has 
established three ``base'' or ``anchor'' size standards--$7.0 million 
in average annual receipts for industries that have receipts based size 
standards, 500 employees for manufacturing and other industries that 
have employee based size standards (except for Wholesale Trade), and 
100 employees for industries in the Wholesale Trade Sector. SBA 
established 500 employees as the anchor size standard for manufacturing 
industries at its inception in 1953. Shortly thereafter, SBA 
established $1 million in average annual receipts as the anchor size 
standard for nonmanufacturing industries. SBA has periodically 
increased the receipts based anchor size standard for inflation, and 
today it is $7 million. Since 1986, the size standard for all 
industries in the Wholesale Trade Sector for SBA's financial assistance 
and for most Federal programs has been 100 employees. However, NAICS 
codes

[[Page 55757]]

for the Wholesale Trade Sector and their 100 employee size standards do 
not apply to Federal procurement programs. Rather, for Federal 
procurement the size standard for all industries in Wholesale Trade 
(NAICS Sector 42) and for all industries in Retail Trade (NAICS Sector 
44-45) is 500 employees under SBA's nonmanufacturer rule (13 CFR 
121.406(b)).
    These long-standing anchor size standards have stood the test of 
time and gained legitimacy through practice and general public 
acceptance. An anchor is neither a minimum nor a maximum size standard. 
It is a common size standard for a large number of industries that have 
similar economic characteristics and serves as a reference point in 
evaluating size standards for individual industries. SBA uses the 
anchor in lieu of trying to establish precise small business size 
standards for each industry. Otherwise, theoretically, the number of 
size standards might be as high as the number of industries for which 
SBA establishes size standards (1,141). Furthermore, the data SBA 
analyzes are static, while the U.S. economy is not. Hence, absolute 
precision is impossible. SBA presumes an anchor size standard is 
appropriate for a particular industry unless that industry displays 
economic characteristics that are considerably different from other 
industries with the same anchor size standard.
    When evaluating a size standard, SBA compares the economic 
characteristics of the industry under review to the average 
characteristics of industries with one of the three anchor size 
standards (referred to as the ``anchor comparison group''). This allows 
SBA to assess the industry structure and to determine whether the 
industry is appreciably different from the other industries in the 
anchor comparison group. If the characteristics of a specific industry 
under review are similar to the average characteristics of the anchor 
comparison group, the anchor size standard is generally appropriate for 
that industry. SBA may consider adopting a size standard below the 
anchor when: (1) all or most of the industry characteristics are 
significantly smaller than the average characteristics of the anchor 
comparison group; or (2) other industry considerations strongly suggest 
that the anchor size standard would be an unreasonably high size 
standard for the industry.
    If the specific industry's characteristics are significantly higher 
than those of the anchor comparison group, then a size standard higher 
than the anchor size standard may be appropriate. The larger the 
differences are between the characteristics of the industry under 
review and those in the anchor comparison group, the larger will be the 
difference between the appropriate industry size standard and the 
anchor size standard. To determine a size standard above the anchor 
size standard, SBA analyzes the characteristics of a second comparison 
group. For industries with receipts based size standards, including 
those in NAICS Sector 11 reviewed in this proposed rule, SBA has 
developed a second comparison group consisting of industries that have 
the highest of receipts based size standards. To determine a size 
standard above the anchor size standard, SBA analyzes the 
characteristics of this second comparison group. The size standards for 
this group of industries range from $23 million to $35.5 million in 
average annual receipts; the weighted average size standard for the 
group is $29 million. SBA refers to this comparison group as the 
``higher level receipts based size standard group.''
    The primary factors that SBA evaluates to examine industry 
structure include average firm size, startup costs and entry barriers, 
industry competition, and distribution of firms by size. SBA evaluates, 
as an additional primary factor, the impact that revised size standards 
might have on Federal contracting assistance to small businesses. These 
are, generally, the five most important factors SBA examines when 
establishing or revising a size standard for an industry. However, SBA 
will also consider and evaluate other information that it believes is 
relevant to a particular industry (such as technological changes, 
growth trends, SBA financial assistance, other program factors, etc.). 
SBA also considers possible impacts of size standard revisions on 
eligibility for Federal small business assistance, current economic 
conditions, the Administration's policies, and suggestions from 
industry groups and Federal agencies. Public comments on a proposed 
rule also provide important additional information. SBA thoroughly 
reviews all public comments before making a final decision on its 
proposed size standards. Below are brief descriptions of each of the 
five primary factors that SBA has evaluated for each industry in NAICS 
Sector 11. A more detailed description of this analysis is provided in 
SBA's ``Size Standards Methodology,'' available at https://www.sba.gov/size.
    1. Average firm size. SBA computes two measures of average firm 
size: simple average and weighted average. For industries with receipts 
based size standards, the simple average is the total receipts of the 
industry divided by the total number of firms in the industry. The 
weighted average firm size is the sum of weighted simple averages in 
different receipts size classes, where weights are the shares of total 
industry receipts for respective size classes. The simple average 
weighs all firms within an industry equally regardless of their size. 
The weighted average overcomes that limitation by giving more weight to 
larger firms.
    If the average firm size of an industry is significantly higher 
than the average firm size of industries in the anchor comparison 
industry group, this will generally support a size standard higher than 
the anchor size standard. Conversely, if the industry's average firm 
size is similar to or significantly lower than that of the anchor 
comparison industry group, it will be a basis to adopt the anchor size 
standard, or, in rare cases, a standard lower than the anchor.
    2. Startup costs and entry barriers. Startup costs reflect a firm's 
initial size in an industry. New entrants to an industry must have 
sufficient capital and other assets to start and maintain a viable 
business. If new firms entering a particular industry have greater 
capital requirements than firms in industries in the anchor comparison 
group, this can be a basis for establishing a size standard higher than 
the anchor size standard. In lieu of actual startup cost data, SBA uses 
average assets as a proxy to measure the capital requirements for new 
entrants to an industry.
    To calculate average assets, SBA begins with the sales to total 
assets ratio for an industry from the Risk Management Association's 
Annual eStatement Studies. SBA then applies these ratios to the average 
receipts of firms in that industry. An industry with average assets 
that are significantly higher than those of the anchor comparison group 
is likely to have higher startup costs; this in turn will support a 
size standard higher than the anchor. Conversely, an industry with 
average assets that are similar to or lower than those of the anchor 
comparison group is likely to have lower startup costs; this will 
support the anchor standard or one lower than the anchor.
    3. Industry competition. Industry competition is generally measured 
by the share of total industry receipts generated by the largest firms 
in an industry. SBA generally evaluates the share of industry receipts 
generated by the four largest firms in each industry. This is referred 
to as the ``four-firm concentration ratio,'' a commonly used economic 
measure of market

[[Page 55758]]

competition. SBA compares the four-firm concentration ratio for an 
industry to the average four-firm concentration ratio for industries in 
the anchor comparison group. If a significant share of economic 
activity within the industry is concentrated among a few relatively 
large companies, all else being equal, SBA will establish a size 
standard higher than the anchor size standard. SBA does not consider 
the four-firm concentration ratio as an important factor in assessing a 
size standard if its share of economic activity of the largest four 
firms within the industry is less than 40 percent. For an industry with 
a four-firm concentration ratio of 40 percent or more, SBA examines the 
average size of the four largest firms to determine a size standard.
    4. Distribution of firms by size. SBA examines the shares of 
industry total receipts accounted for by firms of different receipts 
and employment size classes in an industry. This is an additional 
factor in assessing industry competition. If most of an industry's 
economic activity is attributable to smaller firms, this generally 
indicates that small businesses are competitive in that industry. This 
can support adopting the anchor size standard. If most of an industry's 
economic activity is attributable to larger firms, this indicates that 
small businesses are not competitive in that industry. This can support 
adopting a size standard above the anchor.
    Concentration is a measure of inequality of distribution. To 
determine the degree of inequality of distribution in an industry, SBA 
computes the Gini coefficient, using the Lorenz curve. The Lorenz curve 
presents the cumulative percentages of units (firms) along the 
horizontal axis and the cumulative percentages of receipts (or other 
measures of size) along the vertical axis. (For further detail, please 
refer to SBA's ``Size Standards Methodology'' on its Web site at 
www.sba.gov/size.) Gini coefficient values vary from zero to one. If 
receipts are distributed equally among all the firms in an industry, 
the value of the Gini coefficient will equal zero. If an industry's 
total receipts are attributed to a single firm, the Gini coefficient 
will equal one.
    SBA compares the Gini coefficient value for an industry with that 
for industries in the anchor comparison group. If the Gini coefficient 
value for an industry is higher than it is for industries in the anchor 
comparison industry group this may, all else being equal, warrant a 
size standard higher than the anchor. Conversely, if an industry's Gini 
coefficient is similar to or lower than that for the anchor group, the 
anchor standard, or in some cases a standard lower than the anchor, may 
be adopted.
    5. Impact on Federal contracting and SBA loan programs. SBA 
examines the possible impact a size standard change may have on Federal 
small business assistance. This most often focuses on the share of 
Federal contracting dollars awarded to small businesses in the industry 
in question. In general, if the small business share of Federal 
contracting in an industry with significant Federal contracting is 
appreciably less than the small business share of the industry's total 
receipts, this could justify considering a size standard higher than 
the existing size standard. The disparity between the small business 
Federal market share and industry-wide small business share may be due 
to various factors, such as extensive administrative and compliance 
requirements associated with Federal contracts, the different skill set 
required for Federal contracts as compared to typical commercial 
contracting work, and the size of Federal contracts. These, as well as 
other factors, are likely to influence the type of firms within an 
industry that compete for Federal contracts. By comparing the small 
business Federal contracting share with the industry-wide small 
business share, SBA includes in its size standards analysis the latest 
Federal contracting trends. This analysis may support a size standard 
larger than the current size standard.
    SBA considers Federal contracting trends in the size standards 
analysis only if: (1) the small business share of Federal contracting 
dollars is at least 10 percent lower than the small business share of 
total industry receipts; and (2) the amount of total Federal 
contracting averages $100 million or more during the latest three 
fiscal years. These thresholds reflect significant levels of 
contracting where a revision to a size standard may have an impact on 
contracting opportunities to small businesses.
    Besides the impact on small business Federal contracting, SBA also 
evaluates the impact of a proposed size standard revision on SBA's loan 
programs. For this, SBA examines the data on volume and number of its 
guaranteed loans within an industry and the size of firms obtaining 
those loans. This allows SBA to assess whether the existing or the 
proposed size standard for a particular industry may restrict the level 
of financial assistance to small firms. If current size standards have 
impeded financial assistance to small businesses, higher size standards 
may be supportable. However, if small businesses under current size 
standards have been receiving significant amounts of financial 
assistance through SBA's loan programs, or if the financial assistance 
has been provided mainly to businesses that are much smaller than the 
existing size standards, SBA does not consider this factor when 
determining the size standard.

Sources of Industry and Program Data

    SBA's primary source of industry data used in this proposed rule 
are special tabulations of the 2007 County Business Patterns (see 
www.census.gov/econ/cbp/) from the U.S. Bureau of Census (Census 
Bureau) and the 2007 Census of Agriculture (https://www.nass.usda.gov) 
from the National Agricultural Statistics Service (NASS). NAICS Sector 
11 is not covered by the Census Bureau's Economic Census. The special 
tabulations provides SBA with data on the number of firms, number of 
establishments, number of employees, annual payroll, and annual 
receipts of companies by Industry (6-digit level), Industry Group (4-
digit level), Subsector (3-digit level), and Sector (2-digit level). 
These data are arrayed by various classes of firms' size based on the 
overall number of employees and receipts of the entire enterprise (all 
establishments and affiliated firms) from all industries. The special 
tabulation enables SBA to evaluate average firm size, the four-firm 
concentration ratio, and distribution of firms by various receipts, and 
employment size classes.
    In some cases, where data were not available due to disclosure 
prohibitions in the Census Bureau's and NASS' tabulations, SBA either 
estimated missing values using available relevant data or examined data 
at a higher level of industry aggregation, such as at the NAICS 2-digit 
(Sector), 3-digit (Subsector), or 4-digit (Industry Group) level. In 
some instances, SBA's analysis was based only on those factors for 
which data were available or estimates of missing values were possible.
    To calculate average assets, SBA used sales to total assets ratios 
from the Risk Management Association's Annual eStatement Studies, 2008-
2010.
    To evaluate Federal contracting trends, SBA examined data on 
Federal contract awards for fiscal years 2008-2010. The data are 
available from the U.S. General Service Administration's Federal 
Procurement Data System--Next Generation (FPDS-NG).
    To assess the impact on financial assistance to small businesses, 
SBA examined data on its own guaranteed

[[Page 55759]]

loan programs for fiscal years 2008-2010.
    Data sources and estimation procedures SBA uses in its size 
standards analysis are documented in detail in SBA's ``Size Standards 
Methodology'' White Paper, which is available at www.sba.gov/size.

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 is: (1) Independently owned and 
operated; (2) not dominant in its field of operation; and (3) within a 
specific small business definition or size standard established by SBA 
Administrator. SBA considers as part of its evaluation whether a 
business concern at a proposed 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 standard. Market share and other 
factors may indicate whether a firm can exercise a major controlling 
influence on a national basis in an industry where a significant number 
of business concerns are engaged. If a contemplated size standard 
includes a dominant firm, SBA will consider a lower size standard to 
exclude the dominant firm from being defined as small.

Selection of Size Standards

    To simplify receipts based size standards, SBA has proposed to 
select size standards from a limited number of levels. For many years, 
SBA has been concerned about the complexity of determining small 
business status caused by a large number of varying receipts based size 
standards (see 69 FR 13130 (March 4, 2004) and 57 FR 62515 (December 
31, 1992)). At the beginning of the current comprehensive size 
standards review, there were 31 different levels of receipts based size 
standards. They ranged from $0.75 million to $35.5 million, and many of 
them applied to one or only a few industries. SBA believes that such a 
large number of different small business size standards are unnecessary 
and difficult to justify analytically. To simplify managing and using 
size standards, SBA proposes that there be fewer size standard levels. 
This will produce more common size standards for businesses operating 
in related industries. This will also result in greater consistency 
among the size standards for industries that have similar economic 
characteristics.
    SBA proposes, therefore, to apply one of eight receipts based size 
standards to the analysis of receipts based size standards for 16 
industries and two sub-industries within NAICS Sector 11 that are 
reviewed in this proposed rule. The eight ``fixed'' receipts based size 
standard levels are $5 million, $7 million, $10 million, $14 million, 
$19 million, $25.5 million, $30 million, and $35.5 million. SBA 
established these eight receipts based size standard based on the 
current minimum, the current maximum, and the most commonly used 
current receipts based size standards. At the start of the current 
comprehensive review, the most commonly used receipts based size 
standards clustered around the following--$2.5 million to $4.5 million, 
$7 million, $9 million to $10 million, $12.5 million to $14 million, 
$25 million to $25.5 million, and $33.5 million to $35.5 million. SBA 
selected $7 million as one of eight fixed levels of receipts based size 
standards because it is an anchor standard. The lowest or minimum 
receipts based size level will be $5 million. Other than the size 
standards for NAICS Sector 11 that are set by statute and those based 
on commissions (such as real estate brokers and travel agents), $5 
million includes those industries with the lowest receipts based 
standards, which ranged from $2 million to $4.5 million. Among the 
higher level size clusters, SBA has set four fixed levels: $10 million, 
$14 million, $25.5 million, and $35.5 million. Because of the large 
intervals between some of the fixed levels, SBA established two 
intermediate levels, namely $19 million between $14 million and $25.5 
million, and $30 million between $25.5 million and $35.5 million. These 
two intermediate levels reflect roughly the same proportional 
differences as between the other two successive levels.
    To simplify size standards further, SBA may propose a common size 
standard for closely related industries. Although the size standard 
analysis may support a separate size standard for each industry, SBA 
believes that establishing different size standards for closely related 
industries may not always be appropriate. For example, in cases where 
many of the same businesses operate in the same multiple industries, a 
common size standard for those industries might better reflect the 
Federal marketplace. This might also make size standards among related 
industries more consistent than separate size standards for each of 
those industries. This led SBA to establish a common size standard for 
the information technology (IT) services (NAICS 541511, NAICS 541112, 
NAICS 541513, NAICS 541519, and NAICS 811212), even though the industry 
data might support a distinct size standard for each industry (57 FR 
27906 (June 23, 1992)). More recently SBA adopted common size standards 
for some of the industries in NAICS Sector 54, Professional, Scientific 
and Technical services (77 FR 7490 (February 10, 2012)) and NAICS 
Sector 48-49, Transportation and Warehousing (77 FR 10943 (February 24, 
2012)).
    In NAICS Sector 11, currently all industries in NAICS Subsector 114 
(Fishing, Hunting, and Trapping) and all industries (except for two 
sub-industries under NAICS 115310) within NAICS Industry Subsector 115 
(Support Activities for Agriculture and Forestry) have common size 
standards. However, in this proposed rule, based on characteristics of 
individual industries, SBA proposes different size standards for some 
of the industries in those Subsectors. Whenever SBA proposes a common 
size standard for closely related industries it will provide its 
justification.

Evaluation of Industry Structure

    SBA evaluated all industries and two sub-industries in NAICS Sector 
11, Agriculture, Forestry, Fishing and Hunting, with the exceptions of 
NAICS 113310 (Logging) and those industries for which their size 
standards were determined by statute, to assess the appropriateness of 
the current receipts based size standards. As described above, SBA 
compared data on the economic characteristics of each industry to the 
average characteristics of industries in two comparison groups. The 
first comparison group consists of all industries with $7 million size 
standards and is referred to as the ``receipts based anchor comparison 
group.'' Because the goal of SBA's review is to assess whether a 
specific industry's size standard should be the same as or different 
from the anchor size standard, this is the most logical group of 
industries to analyze. In addition, this group includes a sufficient 
number of firms to provide a meaningful assessment and comparison of 
industry characteristics.
    If the characteristics of an industry are similar to the average 
characteristics of industries in the anchor comparison group, the 
anchor size standard is generally appropriate for that industry. If an 
industry's structure is significantly different from industries in the 
anchor group, a size standard lower or higher than the anchor size 
standard might be appropriate. The proposed new size standard is based 
on the difference between the characteristics of the anchor comparison 
group and a second industry comparison group. As

[[Page 55760]]

described above, the second comparison group for receipts based 
standards consists of industries with the highest receipts based size 
standards, ranging from $23 million to $35.5 million. The average size 
standard for this group is $29 million. SBA refers to this group of 
industries as the ``higher level receipts based size standard 
comparison group.'' SBA determines differences in industry structure 
between an industry under review and the industries in the two 
comparison groups by comparing data on each of the industry factors, 
including average firm size, average assets size, the four-firm 
concentration ratio, and the Gini coefficient of distribution of firms 
by size. Table 1, Average Characteristics of Receipts Based Comparison 
Groups, shows the average firm size (both simple and weighted), average 
assets size, four-firm concentration ratio, average receipts of the 
four largest firms, and the Gini coefficient for both anchor level and 
higher level comparison groups for receipts based size standards.

                                          Table 1--Average Characteristics of Receipts Based Comparison Groups
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                          Average firm size  ($ million)                                      Average
                                                         --------------------------------     Average     Four[dash]firm    receipts of
             Receipts based comparison group                                                assets size    concentration   four largest        Gini
                                                              Simple         Weighted       ($ million)     ratio  (%)       firms  ($      coefficient
                                                              average         average                                      million) \*\
--------------------------------------------------------------------------------------------------------------------------------------------------------
Anchor Level............................................            1.32           19.63            0.84            16.6           196.4           0.693
Higher Level............................................            5.07          116.84            3.20            32.1         1,376.0           0.830
--------------------------------------------------------------------------------------------------------------------------------------------------------
* To be used for industries with a four-firm concentration ratio of 40% or greater.

Derivation of Size Standards Based on Industry Factors

    For each industry factor in Table 1, Average Characteristics of 
Receipts Based Comparison Groups, SBA derives a separate size standard 
based on the differences between the values for an industry under 
review and the values for the two comparison groups. If the industry 
value for a particular factor is near the corresponding factor for the 
anchor comparison group, the $7 million anchor size standard is 
appropriate for that factor.
    An industry factor significantly above or below the anchor 
comparison group will generally imply a size standard for that industry 
above or below the $7 million anchor. The new size standard in these 
cases is based on the proportional difference between the industry 
value and the values for the two comparison groups.
    For example, if an industry's simple average receipts are $3.3 
million, that can support a $19 million size standard. The $3.3 million 
level is 52.8 percent between $1.32 million for the anchor comparison 
group and $5.07 million for the higher level comparison group (($3.30 
million - $1.32 million) / ($5.07 million - $1.32 million) = 0.528 or 
52.8%). This proportional difference is applied to the difference 
between the $7 million anchor size standard and average size standard 
of $29 million for the higher level size standard group and then added 
to $7.0 million to estimate a size standard of $18.61 million ([{$29.0 
million - $7.0 million{time}  * 0.528] + $7.0 million = $18.61 
million). The final step is to round the estimated $18.61 million size 
standard to the nearest fixed size standard, which in this example is 
$19 million.
    SBA applies the above calculation to derive a size standard for 
each industry factor. Detailed formulas involved in these calculations 
are presented in SBA's ``Size Standards Methodology'' which is 
available on its Web site at www.sba.gov/size. (However, it should be 
noted that figures in the ``Size Standards Methodology'' White Paper 
are based on 2002 Economic Census data and are different from those 
presented in this proposed rule. That is because when SBA prepared its 
``Size Standards Methodology,'' the 2007 Economic Census data were not 
yet available). Table 2, Values of Industry Factors and Supported Size 
Standards below, shows ranges of values for each industry factor and 
the levels of size standards supported by those values.

                        Table 2--Values of Industry Factors and Supported Size Standards
----------------------------------------------------------------------------------------------------------------
                                                                 Or if average
                               Or if weighted   Or if average     receipts of                      Then implied
 If simple average  receipts      average      assets size  ($    largest four      Or if Gini     size standard
      size  ($ million)        receipts size       million)        firms  ($       coefficient        is  ($
                                ($ million)                         million)                         million)
----------------------------------------------------------------------------------------------------------------
<1.15.......................  <15.22.........  <0.73..........  <142.8.........  <0.686.........             5.0
1.15 to 1.57................  15.22 to 26.26.  0.73 to 1.00...  142.8 to 276.9.  0.686 to 0.702.             7.0
1.58 to 2.17................  26.27 to 41.73.  1.01 to 1.37...  277.0 to 464.5.  0.703 to 0.724.            10.0
2.18 to 2.94................  41.74 to 61.61.  1.38 to 1.86...  464.6 to 705.8.  0.725 to 0.752.            14.0
2.95 to 3.92................  61.62 to 87.02.  1.87 to 2.48...  705.9 to         0.753 to 0.788.            19.0
                                                                 1,014.1.
3.93 to 4.86................  87.03 to 111.32  2.49 to 3.07...  1,014.2 to       0.789 to 0.822.            25.5
                                                                 1,309.0.
4.87 to 5.71................  111.33 to        3.08 to 3.61...  1,309.1 to       0.823 to 0.853.            30.0
                               133.41.                           1,577.1.
>5.71.......................  >133.41........  >3.61..........  >1,577.1.......  >0.853.........            35.5
----------------------------------------------------------------------------------------------------------------

Derivation of Size Standard Based on Federal Contracting Factor

    Besides industry structure, SBA also evaluates Federal contracting 
data to assess the success of small businesses in getting Federal 
contracts under the existing size standards. For industries where the 
small business share of total Federal contracting dollars is 10 to 30 
percent lower than the small business share of total industry receipts, 
SBA has designated a size standard one level higher than their current 
size standard. For industries where the small business share of total 
Federal contracting dollars is more than 30 percent lower than the 
small business share of total industry receipts, SBA has designated a 
size standard two levels higher than the current size standard.
    Because of the complex relationships among several variables 
affecting small business participation in the Federal

[[Page 55761]]

marketplace, SBA has chosen not to designate a size standard for the 
Federal contracting factor alone that is more than two levels above the 
current size standard. SBA believes that a larger adjustment to size 
standards based on Federal contracting activity should be based on a 
more detailed analysis of the impact of any subsequent revision to the 
current size standard. In limited situations, however, SBA may conduct 
a more extensive examination of Federal contracting experience. This 
may support a different size standard than indicated by this general 
rule and take into consideration significant and unique aspects of 
small business competitiveness in the Federal contract market. SBA 
welcomes comments on its methodology for incorporating the Federal 
contracting factor in its size standard analysis and suggestions for 
alternative methods and other relevant information on small business 
experience in the Federal contract market that SBA should consider.
    Only one industry in NAICS Sector 11, NAICS 115310 (Support 
Activities for Agriculture and Forestry), averaged $100 million or more 
annually in Federal contracting during the period of fiscal years 2008-
2010. However, since the Federal contracting factor was not significant 
(i.e., the difference between the small business share of total 
industry receipts and small business share of Federal contracting 
dollars was 10 percentage points or more), no size standard was 
computed for that industry (including two sub-industries under it) 
based on Federal contracting factor.

New Size Standards Based on Industry and Federal Contracting Factors

    Table 3, Size Standards Supported by Each Factor for Each Industry 
(millions of dollars), below, shows the results of analyses of industry 
and Federal contracting factors for each industry covered by this 
proposed rule. Many NAICS industries in columns 2, 3, 4, 6, and 7 show 
two numbers. The upper number is the value for the industry factor 
shown on the top of the column and the lower number is the size 
standard supported by that factor. For the four-firm concentration 
ratio, SBA estimates a size standard only if its value is 40 percent or 
more. If the four-firm concentration ratio for an industry is less than 
40 percent, SBA does not estimate a size standard for that factor. If 
the four-firm concentration ratio is more than 40 percent, SBA 
indicates in column 6 the average size of the industry's four largest 
firms together with a size standard based on that average. As stated 
earlier, since Federal contracting factor was not significant for any 
of industries and sub-industries in NAICS Sector 11 that are reviewed 
in this proposed rule, no size standard was estimated for that factor 
in column 8. Column 9 shows a calculated new size standard for each 
industry. This is the average of the size standards supported by each 
factor, rounded to the nearest fixed size level. Analytical details 
involved in the averaging procedure are described in SBA's ``Size 
Standard Methodology.'' For comparison with the new standards, the 
current size standards are in column 10 of Table 3.

                                           Table 3--Size Standards Supported by Each Factor for Each Industry
                                                                  [Millions of dollars]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                       Simple      Weighted     Average                  Four-firm                               Calculated    Current
                                      average      average    assets size   Four-firm     average        Gini        Federal        size         size
  NAICS code/NAICS industry title    firm size    firm size        ($       ratio  (%)      size      coefficient    contract   standard ($  standard ($
                                    ($ million)  ($ million)    million)                 ($million)                factor  (%)    million)     million)
(1)                                         (2)          (3)          (4)          (5)          (6)       (7)              (8)          (9)         (10)
--------------------------------------------------------------------------------------------------------------------------------------------------------
112112............................         $1.0         $3.6         $0.6          3.7       $276.4        $0.732  ...........  ...........  ...........
Cattle Feedlots...................          5.0          5.0          5.0  ...........  ...........        14.0    ...........          7.0          2.0
112310............................          0.2          1.4          0.1          4.0         74.8         0.848  ...........  ...........  ...........
Chicken Egg Production............          5.0          5.0          5.0  ...........  ...........        30.0    ...........         14.0         12.5
113110............................          1.8          9.1          1.7         24.0         45.6         0.726  ...........  ...........  ...........
Timber Tract Operations...........         10.0          5.0         14.0  ...........  ...........        14.0    ...........         10.0          7.0
113210............................          2.0         21.7  ...........         54.0         47.4         0.755  ...........  ...........  ...........
Forest Nurseries and Gathering of          10.0          7.0  ...........  ...........          5.0        19.0    ...........         10.0          7.0
 Forest Products..................
114111............................          1.6         44.8          1.4         29.0        130.7         0.802  ...........  ...........  ...........
Finfish Fishing...................         10.0         14.0         14.0  ...........  ...........        25.5    ...........         19.0          4.0
114112............................          0.6         13.2          0.4         24.0         32.6         0.618  ...........  ...........  ...........
Shellfish Fishing.................          5.0          5.0          5.0  ...........  ...........         5.0    ...........          5.0          4.0
114119............................          2.9          9.3  ...........         88.0          9.0         0.573  ...........  ...........  ...........
Other Marine Fishing..............         19.0          5.0  ...........  ...........          5.0         5.0    ...........          7.0          4.0
114210............................          0.7         17.2  ...........         48.0         27.1         0.661  ...........  ...........  ...........
Hunting and Trapping..............          5.0          7.0  ...........  ...........          5.0         5.0    ...........          5.0          4.0
115111............................          2.2          5.1          1.9         12.0         17.1         0.498  ...........  ...........  ...........
Cotton Ginning....................         14.0          5.0         19.0  ...........  ...........         5.0    ...........         10.0          7.0
115112............................          1.2          8.6          0.7         14.0         84.9         0.641  ...........  ...........  ...........
Soil Preparation, Planting, and             7.0          5.0          5.0  ...........  ...........         5.0    ...........          5.0          7.0
 Cultivating......................
115113............................          1.5          8.4          0.7         19.0         21.2         0.689  ...........  ...........  ...........
Crop Harvesting, Primarily by               7.0          5.0          7.0  ...........  ...........         7.0    ...........          7.0          7.0
 Machine..........................
115114............................          6.5         29.6          3.9         21.0        286.1         0.745  ...........  ...........  ...........
Postharvest Crop Activities                35.5         10.0         35.5  ...........  ...........        14.0    ...........         25.5          7.0
 (Except Cotton Ginning)..........
115115............................          2.0         35.9  ...........         29.0         60.8         0.735  ...........  ...........  ...........
Farm Labor Contractors and Crew            10.0         10.0  ...........  ...........  ...........        14.0    ...........         14.0          7.0
 Leaders..........................
115116............................          1.0          7.7  ...........  ...........  ...........         0.682  ...........  ...........  ...........
Farm Management Services..........          5.0          5.0  ...........  ...........  ...........         5.0    ...........          5.0          7.0
115210............................          0.6         11.3          0.3         15.0         90.2         0.611  ...........  ...........  ...........
Support Activities for Animal               5.0          5.0          5.0  ...........  ...........         5.0    ...........          5.0          7.0
 Production.......................
115310............................          0.9          8.4  ...........         18.0         66.2         0.672  ...........  ...........  ...........
Support Activities for Forestry...          5.0          5.0  ...........  ...........  ...........         5.0    ...........          5.0          7.0
Except,...........................          0.6          4.7          0.3         16.0         13.5         0.657  ...........  ...........  ...........

[[Page 55762]]

 
Forest Fire Suppression and Fuels           5.0          5.0          5.0  ...........  ...........         5.0    ...........          5.0         17.5
 Management Services..............
--------------------------------------------------------------------------------------------------------------------------------------------------------

Special Considerations: Forest Fire Suppression and Fuels Management 
Services

    The Forest Fire Suppression and Fuels Management Services are sub-
industry categories (or ``exceptions'') under NAICS 115310 (Support 
Activities for Forestry) with a size standard of $17.5 million in 
average annual receipts. In 2003, SBA established a different size 
standard for these activities (see 68 FR 33348 (June 4, 2003)). Data 
from the Census Bureau's and NASS' special tabulation are limited to 
the 6-digit NAICS industry level, and hence, do not provide separate 
data at the sub-industry level. As such, SBA relied upon data from 
other sources to evaluate the current $17.5 million size standard for 
both sub-industries.
    Firms engaged in the Forest Fire Suppression and Fuels Management 
Services sub-industries were identified from contracting activity 
reported in FPDS-NG during fiscal years 2008-2010. The contracts for 
Forest Fire Suppression and Fuels Management Services can be identified 
as those classified within NAICS 115310 and by the Product Service Code 
(PSCs) F003 (Natural Resources/Conservation- Forest-Range Fire 
Suppression/Presuppression). SBA also looked at contract data from the 
USDA Forest Service National Interagency Fire Center (https://www.fs.fed.us/fire/contracting/and https://www.fs.fed.us/business/incident/vipr.php). Finally, SBA evaluated the description of the 
requirements of the contracts for the Forest Fire Suppression and Fuels 
Management Services in FPDS-NG, which allowed the Agency to identify 
principal activities related to forest fire suppression and fuel 
management services and to differentiate them from other supporting 
activities. SBA identified activities associated with specialized 
crews, equipment and engines with trained personnel that are critical 
to perform the tasks of suppressing or managing fires as principal 
activities and other activities, such as leases of equipment, machinery 
and transportation vehicles, or provision of services that do not 
require specialize personnel or special training as supporting 
activities. Since most firms involved in Fire Suppression Services were 
also found to be involved in Fuel Management Services and vice versa, 
SBA analyzed them together as one group.
    Finally, SBA obtained receipts and employment data for the fiscal 
years 2008-2010 from the Central Contractor Registration (CCR) for the 
firms that it identified from the FPDS-NG to develop the size standards 
evaluation factors. Table 3, Size Standards Supported by Each Factor 
for Each Industry (millions of dollars), above, shows the results from 
the analysis of these sub-industries, which supported a $5.0 million 
size standard as compared to the current $17.5 million. SBA believes 
that the results reflect decreases in numbers of forest fires and 
consequent reductions in payments (revenues) to contractors during 
fiscal years 2008-2010 as compared to prior years. Given the inherent 
uncertainty of occurrences of forest fires, SBA believes that 
contracting officers need flexibility to hire small businesses, 
especially in the worst case scenario. In a very active fire season, 
size of payments can easily support the $17.5 million size standard for 
Fire Suppression Services. With this reality in mind, SBA proposes to 
retain the current $17.5 size standard and seeks comments on this 
proposal.

Evaluation of SBA's Loan Data

    Before deciding on an industry's size standard, SBA also considers 
the impact of new or revised size standards on its loan programs. 
Accordingly, SBA examined its 7(a) and 504 Loan Programs data for 
fiscal years 2008-2010 to assess whether the proposed size standards 
need further adjustments to ensure credit opportunities for small 
businesses through those programs. For the industries reviewed in this 
rule, the data showed that it is mostly businesses much smaller than 
the current size standards that use SBA's 7(a) and 504 loans.
    Furthermore, the Jobs Act established an alternative size standard 
for SBA's 7(a) and 504 Loan Programs. Specifically, an applicant 
exceeding an NAICS industry size standard may still be eligible if its 
maximum tangible net worth does not exceed $15 million and its average 
net income after Federal income taxes (excluding any carry-over losses) 
for the 2 full fiscal years before the date of the application is not 
more than $5 million.
    Therefore, no size standard in NAICS Sector 11, Agriculture, 
Forestry, Fishing and Hunting reviewed in this proposed rule, needs an 
adjustment based on this factor.

Proposed Changes to Size Standards

    Table 4, Summary of Size Standards Analysis, below, summarizes the 
results of SBA's analyses from Table 3, Size Standards Supported by 
Each Factor for Each Industry (millions of dollars). The results might 
support increases in size standards for 11 industries, decreases for 
four industries and two sub-industries and no change for one industry.

                                   Table 4--Summary of Size Standards Analysis
----------------------------------------------------------------------------------------------------------------
                                                                                Current size     Calculated size
               NAICS Code                        NAICS Industry title           standard  ($      standard  ($
                                                                                  million)          million)
----------------------------------------------------------------------------------------------------------------
112112..................................  Cattle Feedlots...................              $2.0              $7.0
1123106.................................  Chicken Egg Production............              12.5              14.0
113110s.................................  Timber Tract Operations...........               7.0              10.0

[[Page 55763]]

 
113210..................................  Forest Nurseries and Gathering of                7.0              10.0
                                           Forest Products.
114111..................................  Finfish Fishing...................               4.0              19.0
114112..................................  Shellfish Fishing.................               4.0               5.0
114119..................................  Other Marine Fishing..............               4.0               7.0
114210..................................  Hunting and Trapping..............               4.0               5.0
115111..................................  Cotton Ginning....................               7.0              10.0
115112..................................  Soil Preparation, Planting, and                  7.0               5.0
                                           Cultivating.
115113..................................  Crop Harvesting, Primarily by                    7.0               7.0
                                           Machine.
115114..................................  Postharvest Crop Activities                      7.0              25.5
                                           (Except Cotton Ginning).
115115..................................  Farm Labor Contractors and Crew                  7.0              14.0
                                           Leaders.
115116..................................  Farm Management Services..........               7.0               5.0
115210..................................  Support Activities for Animal                    7.0               5.0
                                           Production.
115310..................................  Support Activities for Forestry...               7.0               5.0
Except,.................................  Forest Fire Suppression...........              17.5               5.0
Except,.................................  Fuels Management Services.........              17.5               5.0
----------------------------------------------------------------------------------------------------------------

    However, SBA believes that lowering small business size standards 
is not in the best interest of small businesses in the current economic 
environment. The U.S. economy was in recession from December 2007 to 
June 2009, the longest and deepest of any recessions since before World 
War II. The economy lost more than eight million non-farm jobs during 
2008-2009. In response, Congress passed and the President signed into 
law the American Recovery and Reinvestment Act of 2009 (Recovery Act) 
to promote economic recovery and to preserve and create jobs. Although 
the recession officially ended in June 2009, the unemployment rate is 
still high at 8.2 percent in June 2012 and is forecast to remain around 
this level at least through the end of 2012. In addition, the 
unemployment rate by industry and class of worker in June 2012 showed 
the agricultural workers facing one of the worst unemployment rates 
(8.4%) in the Nation.
    Recently, Congress passed and the President signed the Jobs Act to 
promote small business job creation. The Jobs Act puts more capital 
into the hands of entrepreneurs and small business owners; strengthens 
small businesses' ability to compete for contracts; includes 
recommendations from the President's Task Force on Federal Contracting 
Opportunities for Small Business; creates a better playing field for 
small businesses; promotes small business exporting, building on the 
President's National Export Initiative; expands training and 
counseling; and provides $12 billion in tax relief to help small 
businesses invest in their firms and create jobs. A proposal to reduce 
size standards will have an immediate impact on jobs, and it would be 
contrary to the expressed will of the President and the Congress.
    Lowering size standards would decrease the number of firms that 
participate in Federal financial and procurement assistance programs 
for small businesses. It would also affect small businesses that are 
now exempt or receive some form of relief from other Federal 
regulations that use SBA's size standards. That impact could take the 
form of increased fees, paperwork, or other compliance requirements for 
small businesses. Furthermore, size standards based solely on 
analytical results without any other considerations can cut off 
currently eligible small firms from those programs and benefits. In 
industries and sub-industries reviewed in this proposed rule, about 70 
businesses would lose their small business eligibility if size 
standards were lowered based solely on analytical results. That would 
run counter to what SBA and the Federal government are doing to help 
small businesses and create jobs. Reducing size eligibility for Federal 
procurement opportunities, especially under current economic 
conditions, would not preserve or create more jobs; rather, it would 
have the opposite effect. Therefore, in this proposed rule, SBA does 
not intend to reduce size standards for any industries. Accordingly, 
for industries where analyses might seem to support lowering size 
standards, SBA proposes to retain the current size standards.
    Furthermore, as stated previously, the Small Business Act requires 
the SBA's Administrator to ``* * * consider other factors deemed to be 
relevant * * *'' to establishing small business size standards. The 
current economic conditions and the impact on job creation are quite 
relevant factors when establishing small business size standards. SBA 
nevertheless invites comments and suggestions on whether it should 
lower size standards as suggested by analyses of industry and program 
data or retain the current standards for those industries in view of 
current economic conditions.
    As discussed above, lowering small business size standards is 
inconsistent with what the Federal government is doing to stimulate the 
economy and would discourage job growth for which Congress established 
the Recovery Act and Jobs Act. In addition, it would be inconsistent 
with the Small Business Act requiring the Administrator to establish 
size standards based on industry analysis and other relevant factors 
such as current economic conditions. Thus, SBA proposes to increase 
size standards for 10 industries and retain the current size standards 
for six industries and two sub-industries in NAICS Sector 11 that are 
reviewed in this rule. The SBA's proposed increases are in Table 5, 
Summary of Proposed Size Standards Revisions, below.
    In addition, retaining current standards when the analytical 
results suggested lowering them is consistent with SBA's prior actions 
for NAICS Sector 44-45 (Retail Trade), NAICS Sector 72 (Accommodation 
and Food Services), and NAICS Sector 81 (Other Services) that the 
Agency proposed (74 FR 53924, 74 FR 53913, and 74 FR 53941, October 21, 
2009) and adopted in its final rules (75 FR 61597, 75 FR 61604, and 75 
FR 61591, October 6, 2010). It is also consistent with the Agency' 
recently published proposed rule (76 FR 14323 (March 16, 2011)) and 
final rule (77 FR 7490 (February 10, 2012)) for NAICS Sector 54, 
Professional, Technical, and Scientific Services, propose rule (76 FR 
27935 (May 13, 2011)) and final rule (77 FR 10943 (February 24, 2012)) 
for NAICS Sector 48-49, Transportation and

[[Page 55764]]

Warehousing, and proposed rules for NAICS Sector 51, Information (76 FR 
63216 (October 12, 2011)), NAICS Sector 56, Administrative and Support, 
Waste Management and Remediation Services (76 FR 63510 (October 12, 
2011)), NAICS Sector 61, Educational Services (76 FR 70667 (November 
15, 2011)), NAICS Sector 53, Real Estate and Rental and Leasing (76 FR 
70680 (November 15, 2011)), NAICS Sector 62, Health Care and Social 
Assistance (77 FR 11001 (February 24, 2012)), NAICS Sector 71, Arts, 
Entertainment and Recreation (forthcoming), and NAICS Sector 23, 
Construction (forthcoming). In each of those final and proposed rules, 
SBA opted not to reduce small business size standards, for the same 
reasons it has provided above in this proposed rule.

                              Table 5--Summary of Proposed Size Standards Revisions
----------------------------------------------------------------------------------------------------------------
                                                                                Current size      Proposed size
               NAICS Code                        NAICS Industry title           standard  ($      standard  ($
                                                                                  million)          million)
----------------------------------------------------------------------------------------------------------------
112112..................................  Cattle Feedlots...................              $2.0              $7.0
112310..................................  Chicken Egg Production............              12.5              14.0
113110..................................  Timber tract Operations...........               7.0              10.0
113210..................................  Forest Nurseries and Gathering of                7.0              10.0
                                           Forest products.
114111..................................  Finfish Fishing...................               4.0              19.0
114112..................................  Shellfish Fishing.................               4.0               5.0
114119..................................  Other Marine Fishing..............               4.0               7.0
114210..................................  Hunting and trapping..............               4.0               5.0
115111..................................  Cotton Ginning....................               7.0              10.0
115114..................................  Postharvest Crop Activities                      7.0              25.5
                                           (Except Cotton Ginning).
115115..................................  Farm Labor Contractors and Crew                  7.0              14.0
                                           Leaders.
----------------------------------------------------------------------------------------------------------------

Evaluation of Dominance in Field of Operation

    SBA has determined that for the industries in NAICS Sector 11, 
Agriculture, Forestry, Fishing and Hunting, for which it has proposed 
to increase size standards in this proposed rule, no individual firm at 
or below the proposed size standard will be large enough to dominate 
its field of operation. At the proposed size standards, if adopted, the 
small business share of total industry receipts among those industries 
is, in average, 2.9 percent, with an interval showing a minimum of 0.02 
percent to a maximum of 17.0 percent. These market shares effectively 
preclude a firm at or below the proposed size standards from exerting 
control on any of the industries.

Request for Comments

    SBA invites public comments on this proposed rule, especially on 
the following issues:
    1. To simplify size standards, SBA proposes eight fixed levels for 
receipts based size standards: $5 million, $7 million, $10 million, $14 
million, $19 million, $25.5 million, $30 million, and $35.5 million. 
SBA invites comments on whether this is necessary and whether the 
proposed fixed size levels are appropriate. SBA welcomes suggestions on 
alternative approaches to simplifying small business size standards.
    2. SBA seeks feedback on whether SBA's proposal to increase size 
standards for 11 industries and retain current size standards for five 
industries and two sub-industries (within NAICS 115310, Support 
Activities for Forestry) within NAICS Sector 11 is appropriate, given 
the economic characteristics of each industry reviewed in this proposed 
rule. SBA also seeks feedback and suggestions on alternative standards, 
if they would be more appropriate, including whether the number of 
employees is a more suitable measure of size for certain industries and 
what that employee level should be.
    3. SBA has proposed to retain the current size standards for four 
industries and two sub-industries for which its analysis would support 
lowering them. SBA seeks comments on whether SBA should lower them 
solely based on its analysis or retain them at their current levels in 
view of current economic conditions.
    4. SBA's proposed size standards are based on five primary 
factors--average firm size, average assets size (as a proxy of startup 
costs and entry barriers), four-firm concentration ratio, distribution 
of firms by size and, the level and small business share of Federal 
contracting dollars of the evaluated industries. SBA welcomes comments 
on these factors and/or suggestions on other factors that it should 
consider when evaluating or revising size standards. SBA also seeks 
information on relevant data sources, other than what it uses, if 
available.
    5. SBA gives equal weight to each of the five primary factors in 
all industries. SBA seeks feedback on whether it should continue giving 
equal weight to each factor or whether it should give more weight to 
one or more factors for certain industries. Recommendations to weigh 
some factors more than others should include suggested weights for each 
factor along with supporting information.
    6. For analyzing the Forest Fire Suppression and Fuel Management 
Services size standard, two sub-industries (``exception'') within NAICS 
115310, SBA used PSC F003 within NAICS 115310 to identify contracting 
activity reported in FPDS-NG, and firms in the Forest Fire Suppression 
and Fuel Management Services sub-industry during fiscal years 2008-
2010. Using the receipts and employment data for those identified firms 
from CCR, SBA analyzed the industry factors for these sub-industries. 
SBA seeks suggestions or comments on the use of the data sources and 
its proposal to retain the current $17.5 million size standard for them 
even if the analysis supported lowering it to $5 million. SBA is also 
interested in comments on the elimination of the Forest Fire 
Suppression and Fuel Management Services as ``exceptions'' to NAICS 
115310, and the application of the same size standard for them as for 
the rest of NAICS 115310. Comments on applying the same NAICS 115310 
size standard for Forest Fire Suppression and Fuel Management Services 
should address why the same size standard is more suitable than 
separate size standards for Forest Fire Suppression and Fuel management 
Services sub-industry size standard or why Forest Fire Suppression and 
Fuel management Services firms should continue to be treated as 
separate activities from the rest of NAICS 115310 for SBA's size 
standards purposes.
    7. For analytical simplicity and efficiency, in this proposed rule, 
SBA has refined its size standard

[[Page 55765]]

methodology to obtain a single value as a proposed size standard 
instead of a range of values, as in its past size regulations. SBA 
welcomes any comments on this procedure and suggestions on alternative 
methods.
    Public comments on the above issues are very valuable to SBA for 
validating its size standard methodology and its proposed size 
standards revisions in this proposed rule. This will help SBA to move 
forward with its review of size standards for other NAICS Sectors. 
Commenters addressing size standards for a specific industry or a group 
of industries should include relevant data and/or other information 
supporting their comments. If comments relate to using size standards 
for Federal procurement programs, SBA suggests that commenters provide 
information on the size of contracts in their industries, the size of 
businesses that can undertake the contracts, start-up costs, equipment 
and other asset requirements, the amount of subcontracting, other 
direct and indirect costs associated with the contracts, the use of 
mandatory sources of supply for products and services, and the degree 
to which contractors can mark up those costs.

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

Executive Order 12866

    The Office of Management and Budget (OMB) has determined that this 
proposed rule is not a ``significant regulatory action'' for purposes 
of Executive Order 12866. In order to help explain the need of this 
rule and the rule's potential benefits and costs, SBA is providing a 
Cost Benefit Analysis in this section of the rule. This is also not a 
``major rule'' under the Congressional Review Act, 5 U.S.C. 800.

Cost Benefit Analysis

1. Is there a need for the regulatory action?
    SBA believes that proposed size standards revisions in NAICS Sector 
11, Agriculture, Forestry, Fishing and Hunting, will better reflect the 
economic characteristics of small businesses in this Sector and the 
Federal government marketplace. SBA's mission is to aid and assist 
small businesses through a variety of financial, procurement, business 
development, and advocacy programs. To determine the intended 
beneficiaries of these programs, SBA establishes distinct definitions 
of which businesses are deemed small businesses. The Small Business Act 
(15 U.S.C. 632(a)) delegates to SBA's Administrator the responsibility 
for establishing small business definitions. The Act also requires that 
small business definitions vary to reflect industry differences. The 
recently enacted Jobs Act also requires SBA to review all size 
standards and make necessary adjustments to reflect market conditions. 
The supplementary information section of this proposed rule explains 
SBA's methodology for analyzing a size standard for a particular 
industry.
2. What are the potential benefits and costs of this regulatory action?
    The most significant benefit to businesses obtaining small business 
status because of this proposed rule is gaining or retaining 
eligibility for Federal small business assistance programs. These 
include SBA's financial assistance programs, economic injury disaster 
loans, and Federal procurement programs intended for small businesses. 
Federal procurement programs provide targeted opportunities for small 
businesses under SBA's business development programs, such as 8(a), 
Small Disadvantaged Businesses (SDB), small businesses located in 
Historically Underutilized Business Zones (HUBZone), women-owned small 
businesses (WOSB), and service-disabled veteran-owned small businesses 
(SDVOSB). Federal agencies may also use SBA's size standards for a 
variety of other regulatory and program purposes. These programs assist 
small businesses to become more knowledgeable, stable, and competitive. 
SBA estimates that in 11 industries in NAICS Sector 11 for which it has 
proposed to increase size standards more than 7,500 firms, not small 
under the existing size standards, will become small under the proposed 
size standards and therefore become eligible for these programs. That 
is about 17 percent of all firms classified as small under the current 
size standards in all industries reviewed in this proposed rule. If 
adopted as proposed, this will increase the small business share of 
total receipts in those industries from 78.4 percent to 79.1 percent.
    Three groups will benefit from the proposed size standards 
revisions in this rule, if they are adopted as proposed: (1) Some 
businesses that are above the current size standards may gain small 
business status under the higher size standards, thereby enabling them 
to participate in Federal small business assistance programs; (2) 
growing small businesses that are close to exceeding the current size 
standards will be able to retain their small business status under the 
higher size standards, thereby enabling them to continue their 
participation in the programs; and (3) Federal agencies will have a 
larger pool of small businesses from which to draw for their small 
business procurement programs.
    SBA estimates that firms gaining small business status under the 
proposed size standards could receive Federal contracts totaling $7 
million to $12 million annually under SBA's small business, 8(a), SDB, 
HUBZone, WOSB, and SDVOSB Programs, and other unrestricted 
procurements. The added competition for many of these procurements can 
also result in lower prices to the Government for procurements reserved 
for small businesses, but SBA cannot quantify this benefit.
    Under SBA's 7(a) and 504 Loan Programs, based on the fiscal years 
2008-2010 data, SBA estimates up to about 32 SBA's 7(a) and 504 loans 
totaling about $7.0 million could be made to these newly defined small 
businesses under the proposed size standards. Increasing the size 
standards will likely result in more small business guaranteed loans to 
businesses in these industries, but it is be impractical to try to 
estimate exactly the number and total amount of loans. There are two 
reasons for this: (1) under the Jobs Act, SBA can now guarantee 
substantially larger loans than in the past; and (2) as described 
above, the Jobs Act established a higher alternative size standard ($15 
million in tangible net worth and $5 million in net income after income 
taxes) for business concerns that do not meet the size standards for 
their industry. Therefore, SBA finds it difficult to quantify the 
actual impact of these proposed size standards on its 7(a) and 504 Loan 
Programs.
    Newly defined small businesses will also benefit from SBA's 
Economic Injury Disaster Loan (EIDL) Program. Since this program is 
contingent on the occurrence and severity of a disaster in the future, 
SBA cannot make a meaningful estimate of this impact.
    In addition, newly defined small businesses will also benefit 
through reduced fees, less paperwork, and fewer compliance requirements 
that are available to small businesses through Federal government.
    To the extent that those 7,500 newly defined additional small firms 
could become active in Federal procurement programs, the proposed 
changes to size standards, if adopted, may entail some additional 
administrative costs to the government as a result of more businesses 
being eligible for Federal small business programs. For example, there 
will be more firms seeking SBA's

[[Page 55766]]

guaranteed loans, more firms eligible for enrollment in the Central 
Contractor Registration (CCR)'s Dynamic Small Business Search database, 
and more firms seeking certification as 8(a) or HUBZone firms or 
qualifying for small business, WOSB, SDVOSB, and SDB status. Among 
those newly defined small businesses seeking SBA's assistance, there 
could be some additional costs associated with compliance and 
verification of small business status and protests of small business 
status. However, SBA believes that these added administrative costs 
will be minimal because mechanisms are already in place to handle these 
requirements.
    Additionally, Federal government contracts may have higher costs. 
With a greater number of businesses defined as small, Federal agencies 
may choose to set aside more contracts for competition among small 
businesses only rather than using full and open competition. The 
movement from unrestricted to small business set-aside contracting 
might result in competition among fewer total bidders, although there 
will be more small businesses eligible to submit offers. However, the 
additional costs associated with fewer bidders are expected to be minor 
since, by law, procurements may be set aside for small businesses or 
reserved for the 8(a), HUBZone, WOSB, or SDVOSB Programs only if awards 
are expected to be made at fair and reasonable prices. In addition, 
there may be higher costs when more full and open contracts are awarded 
to HUBZone businesses that receive price evaluation preferences.
    The proposed size standards revisions, if adopted, may have some 
distributional effects among large and small businesses. Although SBA 
cannot estimate with certainty the actual outcome of the gains and 
losses among small and large businesses, it can identify several 
probable impacts. There may be a transfer of some Federal contracts to 
small businesses from large businesses. Large businesses may have fewer 
Federal contract opportunities as Federal agencies decide to set aside 
more contracts for small businesses. In addition, some Federal 
contracts may be awarded to HUBZone concerns instead of large 
businesses since these firms may be eligible for a price evaluation 
preference for contracts when they compete on a full and open basis.
    Similarly, some businesses defined small under the current size 
standards may obtain fewer Federal contracts due to the increased 
competition from more businesses defined as small under the proposed 
size standards. This transfer may be offset by a greater number of 
Federal procurements set aside for all small businesses. The number of 
newly defined and expanding small businesses that are willing and able 
to sell to the Federal Government will limit the potential transfer of 
contracts from large and currently defined small businesses. SBA cannot 
estimate the potential distributional impacts of these transfers with 
any degree of precision.
    The proposed revisions to the existing size standards for 11 
industries in NAICS Sector 11, Agriculture, Forestry, Fishing and 
Hunting, are consistent with SBA's statutory mandate to assist small 
business. This regulatory action promotes the Administration's 
objectives. One of SBA's goals in support of the Administration's 
objectives is to help individual small businesses succeed through fair 
and equitable access to capital and credit, Government contracts, and 
management and technical assistance. Reviewing and modifying size 
standards, when appropriate, ensures that intended beneficiaries have 
access to small business programs designed to assist them.

Executive Order 13563

    Descriptions of the need for this regulatory action and benefits 
and costs associated with this action including possible distributional 
impacts that relate to Executive Order 13563 are included above in the 
Cost Benefit Analysis under Executive Order 12866.
    In an effort to engage interested parties in this action, SBA has 
presented its size standards methodology (discussed above under 
SUPPLEMENTARY INFORMATION) to various industry associations and trade 
groups. SBA also met with a number of industry groups and individual 
businesses to get their feedback on its methodology and other size 
standards issues. In addition, SBA presented its size standards 
methodology to businesses in 13 cities in the U.S. and sought their 
input as part of Jobs Act tours. The presentation also included 
information on the latest status of the comprehensive size standards 
review and on how interested parties can provide SBA with input and 
feedback on size standards review.
    Additionally, SBA sent letters to the Directors of the Offices of 
Small and Disadvantaged Business Utilization (OSDBU) at several Federal 
agencies with considerable procurement responsibilities requesting 
their feedback on how the agencies use SBA's size standards and whether 
current size standards meet their programmatic needs (both procurement 
and non-procurement). SBA gave appropriate consideration to all input, 
suggestions, recommendations, and relevant information obtained from 
industry groups, individual businesses, and Federal agencies in 
preparing this proposed rule.
    The review of size standards in NAICS Sector 11, Agriculture, 
Forestry, Fishing and Hunting, is consistent with Executive Order 
13563, Section 6, calling for retrospective analyses of existing rules. 
The last comprehensive review of size standards occurred during the 
late 1970s and early 1980s. Since then, except for periodic adjustments 
for monetary based size standards, most reviews of size standards were 
limited to a few specific industries in response to requests from the 
public and Federal agencies. SBA recognizes that changes in industry 
structure and the Federal marketplace over time have rendered existing 
size standards for some industries no longer supportable by current 
data. Accordingly, in 2007, SBA began a comprehensive review of its 
size standards to ensure that existing size standards have supportable 
bases and to revise them when necessary. In addition, the Jobs Act 
requires SBA to conduct a detailed review of all size standards and to 
make appropriate adjustments to reflect market conditions. 
Specifically, the Jobs Act requires SBA to conduct a detailed review of 
at least one-third of all size standards during every 18-month period 
from the date of its enactment and do a complete review of all size 
standards not less frequently than once every 5 years thereafter.

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 will not have substantial, direct effects on the States, 
on the relationship between the national government and the States, or 
on the distribution of power and responsibilities among the various 
levels of government. 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

[[Page 55767]]

has determined that this proposed rule will not impose any new 
reporting or record keeping requirements.

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 NAICS Sector 11, Agriculture, Forestry, Fishing and 
Hunting. As described above, this rule may affect small businesses 
seeking Federal 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 objective 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?
    Changes in industry structure, technological changes, productivity 
growth, mergers and acquisitions, and updated industry definitions have 
changed the structure of many industries in NAICS Sector 11. Such 
changes can be sufficient to support revisions to current size 
standards for some industries. Based on the analysis of the latest data 
available, SBA believes that the revised standards in this proposed 
rule more appropriately reflect the size of businesses that need 
Federal assistance. The recently enacted Jobs Act also requires SBA to 
review all size standards and make necessary adjustments to reflect 
market conditions.
2. What are SBA's description and estimate of the number of small 
businesses to which the rule will apply?
    If the proposed rule is adopted in its present form, SBA estimates 
that more than 7,500 additional firms will become small because of 
increased size standards seven industries in NAICS Sector 11. That 
represents 17 percent of total firms that are small under current size 
standards in all industries reviewed by SBA within that Sector. This 
will result in an increase in the small business share of total 
industry receipts for the Sector from 78.4 percent under the current 
size standards to 79.1 percent under the proposed size standards. The 
proposed size standards, if adopted, will enable more small businesses 
to retain their small business status for a longer period. Many firms 
may have lost their eligibility and find it difficult to compete at 
current size standards with companies that are significantly larger 
than they are. SBA believes the competitive impact will be positive for 
existing small businesses and for those that exceed the size standards 
but are on the very low end of those that are not small. They might 
otherwise be called or referred to as mid-sized businesses, although 
SBA only defines what is small; other entities are other than small.
3. What are the projected reporting, record keeping and other 
compliance requirements of the rule?
    The proposed size standard changes impose no additional reporting 
or record keeping requirements on small businesses. However, qualifying 
for Federal procurement and a number of other programs requires that 
businesses register in the CCR database and certify in the Online 
Representations and Certifications Application (ORCA) that they are 
small at least once annually. Therefore, businesses opting to 
participate in those programs must comply with CCR and ORCA 
requirements. However, there are no costs associated with either CCR 
registration or ORCA certification. Changing size standards alters the 
access to SBA's 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 Sec.  3(a)(2)(C) of the Small Business Act, 15 U.S.C. 
632(a)(2)(c), Federal agencies must 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)). SBA is not aware of any 
Federal rule that would duplicate or conflict with establishing 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 Regulatory 
Flexibility Act authorizes an Agency to establish an alternative small 
business 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 size standards by industry and changing 
the size measures, no practical alternative exists to the systems of 
numerical size standards.

List of Subjects in 13 CFR Part 121

    Administrative practice and procedure, Government procurement, 
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 
part 13 CFR part 121 as follows:

PART 121--SMALL BUSINESS SIZE REGULATIONS

    1. The authority citation for Part 121 continues to read as 
follows:

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

    2. In Sec.  121.201, in the table, revise the entries for 
``112112'', ``112310'', ``113110'', ``113210'', ``114111'', ``114112'', 
``114119'', ``114210'', ``115111'', ``115114'', and ``115115'' to read 
as follows:


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

* * * * *

[[Page 55768]]



                                 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
----------------------------------------------------------------------------------------------------------------
 
                                                  * * * * * * *
112112..................................  Cattle Feedlots...................              $7.0  ................
 
                                                  * * * * * * *
112310..................................  Chicken Egg Production............              14.0  ................
 
                                                  * * * * * * *
113110..................................  Timber Tract Operations...........              10.0  ................
113210..................................  Forest Nurseries and Gathering of               10.0
                                           Forest Products.
 
                                                  * * * * * * *
114111..................................  Finfish Fishing...................              19.0  ................
114112..................................  Shellfish Fishing.................               5.0  ................
114119..................................  Other Marine Fishing..............               7.0  ................
114210..................................  Hunting and Trapping..............               5.0  ................
115111..................................  Cotton Ginning....................              10.0  ................
 
                                                  * * * * * * *
115114..................................  Postharvest Crop Activities                     25.5  ................
                                           (except Cotton Ginning).
115115..................................  Farm Labor Contractors and Crew                 14.0  ................
                                           Leaders.
 
                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------

* * * * *

    Dated: June 22, 2012.
Karen G. Mills,
Administrator.
[FR Doc. 2012-22259 Filed 9-10-12; 8:45 am]
BILLING CODE 8025-01-P