Late last year, President Trump signed into law H.R. 6330, the Small Business Runway Extension Act of 2018 (the “Runway Extension Act”). As detailed in our client alert on the Runway Extension Act, this law extends the measurement period for determining whether a contractor qualifies as a small business concern under revenue-based size standards from an average of the most recently completed five fiscal years, rather than the long-standing three-year measurement period. It is anticipated that many growing firms, which had or would soon come to exceed the revenue threshold applicable to their principal NAICS code(s), will gain additional years of “small business” status by including (often much lower) revenue totals from 4 and 5 years ago to determine their average annual revenue.
We noted that the Runway Extension Act amends the Small Business Act without expressly requiring implementation by the Small Business Administration (SBA), thereby allowing contractors reasonably to take the position that the Runway Extension Act is immediately effective, absent contrary guidance from the SBA.
In a move sure to disappoint the many small but growing services firms that Congress intended to help by passing the Runway Extension Act, SBA has now issued such contrary guidance.
Keep reading this article at: http://www.mondaq.com/article.asp?articleid=771894
See our earlier article on this subject at: https://gtpac.org/2018/12/20/bill-changes-small-business-size-measurement-term-from-3-to-5-years/
