[Federal Register Volume 70, Number 188 (Thursday, September 29, 2005)]
[Rules and Regulations]
[Pages 56813-56814]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-19512]



13 CFR Parts 121 and 125

RIN 3245-AF38

The Very Small Business Program

AGENCY: U.S. Small Business Administration.

ACTION: Final rule.


SUMMARY: The U.S. Small Business Administration (SBA or Agency) is 
amending its regulations to remove provisions relating to the Very 
Small Business Program (VSB). The Agency no longer has statutory 
authority to provide assistance under this program; therefore, the 
regulations are unnecessary. Without any authority to carry out the 
program, removal of the applicable regulations is a ministerial act 
that does not require a comment period.

DATES: The rule is effective September 29, 2005.

FOR FURTHER INFORMATION CONTACT: Dean Koppel, Assistant Administrator, 
Office of Procurement Policy and Liaison, (202) 205-7322 or 
[email protected].

SUPPLEMENTARY INFORMATION: The VSB program was authorized as a pilot 
program by the Small Business Administration Reauthorization and 
Amendments Act of 1994 (Act). (See Pub. L. 103-403, Section 304). The 
purpose of the VSB program was to improve access to Federal contract 
opportunities for concerns that are substantially below SBA's size 
standards by reserving certain procurements for competition among very 
small business concerns. Specifically, under the VSB program, federal 
agencies with procurement needs valued at $2,500 to $50,000 were 
required to give small businesses with 15 or fewer employees, average 
annual revenues of less than $1 million, and that were located in 
certain designated areas, the first opportunity to meet those

[[Page 56814]]

needs. The pilot was originally scheduled to expire in 1998 but was 
extended until December 8, 2004, through a series of legislative 
actions. On December 8, 2004, President Bush signed Public Law 108-447, 
Division K, which included the Small Business Administration 
Reauthorization and Manufacturing Assistance Act of 2004. This Act gave 
SBA authorization to continue several programs but did not re-authorize 
the VSB program. Because SBA no longer has statutory authority to 
conduct the VSB program, the regulations applicable to the program are 
no longer necessary and will be removed from the Code of Federal 
Regulations. Removal of these regulations is an entirely administrative 
action that will minimize confusion about the status of the VSB program 
and how agencies are to conduct procurements.
    The expiration of the authority to give preference to very small 
businesses under the VSB program also impacts the Federal Acquisition 
Regulation (FAR). SBA has notified the Civilian Agency Acquisition 
Council (Council) as well as the Federal procurement agencies of the 
expiration of the VSB program and intends to work with the Council to 
implement the necessary amendments to the FAR.

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

    OMB has determined that this final rule does not constitute a 
''significant regulatory action'' under Executive Order 12866.
    For purposes of the Paperwork Reduction Act, 44 U.S.C. Ch. 35, the 
SBA determines that this rule does not impose new reporting or 
recordkeeping requirements.
    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.
    This regulation will not have substantial direct effect 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, for the purposes of Executive 
Order 13132, SBA determines that this final rule has no federalism 
implications warranting preparation of a federalism assessment.
    The Regulatory Flexibility Act (RFA), 5 U.S.C. 601-612, requires 
administrative agencies to consider the effect of their actions on 
small entities, small non-profit enterprises, and small local 
governments. Pursuant to the RFA, when an agency issues a rulemaking, 
the agency must prepare a regulatory flexibility analysis which 
describes the impact of the rule on small entities. However, section 
605 of the RFA allows an agency to certify a rule, in lieu of preparing 
an analysis, if the rulemaking is not expected to have a significant 
economic impact on a substantial number of small entities. Within the 
meaning of RFA, SBA certifies that this rule will not have a 
significant economic impact on a substantial number of small entities.

List of Subjects

13 CFR Part 121

    Administrative practice and procedures, Government procurement, 
Government property, Reporting and recordkeeping requirements, Small 

13 CFR Part 125

    Government contracts, Government procurement, Small businesses, 
Reporting and recordkeeping requirements, Small businesses, Technical 

For the reasons stated in the preamble, the Small Business 
Administration amends 13 CFR parts 121 and 125 as follows:


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

    Authority: 15 U.S.C. 632(a), (p), (q), 634(b)(6), 637(a), 644, 
and 662(5); Pub. L. 105-135 sec. 401 et seq.

2. Revise Sec.  121.401 to read as follows:

Sec.  121.401  What procurement programs are subject to size 

    The rules set forth in Sec. Sec.  121.401 through 121.413 apply to 
all Federal procurement programs for which status as a small business 
is required or advantageous, including the small business set-aside 
program, SBA's Certificate of Competency program, SBA's 8(a) Business 
Development program, SBA's HUBZone program, SBA's Service-Disabled 
Veteran-Owned Small Business program, the Small Business Subcontracting 
program, and the Federal Small Disadvantaged Business (SDB) program.

Sec.  121.413  [Removed and Reserved]

3. Remove and reserve Sec.  121.413.


4. The authority citation for Part 125 is revised to read as follows:

    Authority: 15 U.S.C. 632(p), (q); 634(b)(6); 637; 644 and 

Sec.  125.7  [Removed and Reserved]

5. Amend Part 125 by removing and reserving Sec.  125.7.

6. Revise Sec.  125.13 to read as follows:

Sec.  125.13  May 8(a) Program participants, HUBZone SBCs, Small and 
Disadvantaged Businesses, or Women-Owned Small Businesses qualify as 

    Yes, 8(a) Program participants, HUBZone SBCs, Small and 
Disadvantaged Businesses, and Women-Owned SBCs, may also qualify as 
SDVO SBCs if they meet the requirements in this subject.

    Dated: September 23, 2005.
Hector V. Barretto,
[FR Doc. 05-19512 Filed 9-28-05; 8:45 am]