[Federal Register Volume 78, Number 119 (Thursday, June 20, 2013)]
[Rules and Regulations]
[Pages 37417-37422]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2013-14708]


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SMALL BUSINESS ADMINISTRATION

13 CFR Part 121

RIN 3245-AG36


Small Business Size Standards: Arts, Entertainment, and 
Recreation

AGENCY: U.S. Small Business Administration.

ACTION: Final rule.

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SUMMARY: The United States Small Business Administration (SBA) is 
increasing the small business size standards for 17 industries in North 
American Industry Classification System (NAICS) Sector 71, Arts, 
Entertainment, and Recreation, and retaining the current size standards 
for the remaining eight industries in that Sector. As part of its 
ongoing comprehensive size standards review, SBA evaluated all size 
standards for industries in NAICS Sector 71 to determine whether they 
should be retained or revised.

DATES: This rule is effective July 22, 2013.

FOR FURTHER INFORMATION CONTACT: Jon Haitsuka, Program Analyst, Size 
Standards Division, (202) 205-6618 or [email protected].

SUPPLEMENTARY INFORMATION: To determine eligibility for Federal small 
business assistance programs, SBA establishes small business size 
definitions (referred to as size standards) for private sector 
industries in the United States. The SBA's existing size standards use 
two primary measures of business size--average annual receipts and 
number of employees. Financial assets, electric output and refining 
capacity are used as size measures for a few specialized industries. In 
addition, SBA's Small Business Investment Company (SBIC), 7(a), and 
Certified Development Company (CDC or 504) Loan Programs determine 
small business eligibility using either the industry based size 
standards or alternative net worth and net income size based standards. 
At the start of the current comprehensive review of SBA's small 
business size standards, there were 41 different size standards levels, 
covering 1,141 NAICS industries and 18 sub-industry activities (i.e., 
``exceptions'' in SBA's table of size standards). Of these, 31 were 
based on average annual receipts, seven based on number of employees, 
and three based on other measures. Presently, there are a total of 
1,031size standards, 516 of which are based on average annual receipts, 
499 on number of employees, 10 on megawatt hours, and six on average 
assets.
    Over the years, SBA has received comments that its size standards 
have not kept up with changes in the economy, and in particular, that 
they do not reflect changes in the Federal contracting marketplace and 
industry structure. The last comprehensive review of 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 makes periodic 
inflation adjustments to its monetary based size standards. The latest 
inflation adjustment to size standards was published in the Federal 
Register on July 18, 2008 (73 FR 41237).
    SBA recognizes that changes in industry structure and the Federal 
marketplace since the last overall review 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 determine whether existing size standards have supportable 
bases relative to the current data, and to revise them, where 
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 and to review all size standards not 
less frequently than once every 5 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.
    SBA has chosen not to review all size standards at one time. 
Rather, it is reviewing groups of related industries on a Sector by 
Sector basis.
    As part of SBA's comprehensive review of size standards, the Agency 
reviewed all size standards in NAICS Sector 71, Arts, Entertainment, 
and Recreation, to determine whether the existing size standards should 
be retained or revised. After its review, SBA published a proposed rule 
for public comment in the July 18, 2012 issue of the Federal Register 
(77 FR 42211) on its proposal to increase the size standards for 17 
industries in NAICS Sector 71. The rule was one of a series of proposed 
rules that examines industries grouped by NAICS Sector.
    In conjunction with current comprehensive size standards review, 
SBA 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 also included it as a supporting document in the 
electronic docket of the proposed rule on NAICS Sector 71 at 
www.regulations.gov.
    In evaluating an industry's size standard, SBA examines its 
characteristics (such as average firm size, startup costs, industry 
competition and distribution of firms by size) and the level and small 
business share of Federal contract dollars in that industry. SBA also 
examines the potential impact a size standard revision might have on 
its financial assistance programs, and whether a business concern under 
a revised size standard would be dominant in its industry. For the 
proposed rule, SBA analyzed the characteristics of each industry in 
NAICS Sector 71, mostly using a special tabulation obtained from the 
U.S. Bureau of the Census from its 2007 Economic Census (the latest 
available). SBA also evaluated the level and small business share of 
Federal contracts in each of those industries using the data from the 
Federal Procurement Data System--Next Generation (FPDS-NG) for fiscal 
years 2008-2010. To evaluate the impact of changes to size standards on 
its loan programs, SBA evaluated internal data on its guaranteed loan 
programs for fiscal years 2008-2010.
    SBA's ``Size Standards Methodology'' provides a detailed 
description of its analyses of various industry and program factors and 
data sources, and how the Agency uses the results to establish and 
revise size standards. In the proposed rule itself, SBA detailed how it 
applied its ``Size Standards Methodology'' to review and modify, where 
necessary, the existing size standards for industries in NAICS Sector 
71. SBA sought comments from the public on a number of issues about its 
``Size Standards Methodology,'' such as whether there are alternative 
methodologies that SBA should consider; whether there are alternative 
or additional factors or data sources that

[[Page 37418]]

SBA should evaluate; whether SBA's approach to establishing small 
business size standards makes sense in the current economic 
environment; whether SBA's application of anchor size standards is 
appropriate in the current economy; whether there are gaps in SBA's 
methodology because of the lack of comprehensive data; and whether 
there are other facts or issues that SBA should consider.
    SBA sought comments on its proposal to increase size standards for 
17 industries and retain the existing size standards for the remaining 
eight industries in NAICS Sector 71. Specifically, SBA requested 
comments on whether the size standards should be revised as proposed 
and whether the proposed revisions are appropriate. SBA also invited 
comments on whether its proposed eight fixed levels for receipts based 
size standard are appropriate and whether it should adopt common size 
standards for some industries in NAICS Sector 71.
    The SBA's analyses supported keeping the current size standards for 
three industries and lowering them for five industries in NAICS Sector 
71. However, as SBA pointed out in the proposed rule, lowering size 
standards will reduce the number of firms eligible to participate in 
Federal small business assistance programs and this is counter to what 
the Federal government and SBA are doing to help small businesses. 
Therefore, SBA proposed to retain the current size standards for those 
five industries and requested comments on whether the Agency should 
lower size standards for which its analyses might support lowering 
them.

Summary of Comments

    SBA received only one comment to the proposed rule. However, the 
commenter did not offer any comments or suggestions regarding the 
proposed revisions to size standards in NAICS Sector 71. Thus, SBA is 
not making any adjustment to proposed size standards based on this 
comment.
    The comment to the proposed rule is available for public review at 
http://www.regulations.gov, using RIN-3245-AG36.

Conclusion

    Based on the analyses of relevant industry and program data and 
evaluation of public comments it received on the proposed rule, SBA has 
decided to increase the small business size standards for 17 industries 
in NAICS Sector 71 to the levels it proposed. Those industries and 
their revised size standards are shown in Table 1, Summary of Revised 
Size Standards in NAICS Sector 71, below.

                          Table 1--Summary of Revised Size Standards in NAICS Sector 71
----------------------------------------------------------------------------------------------------------------
                                                                                Current size      Revised size
    NAICS Industry code                    NAICS Industry title                  standard ($       standard ($
                                                                                  million)          million)
----------------------------------------------------------------------------------------------------------------
711110.....................  Theater Companies and Dinner Theaters..........              $7.0             $19.0
711120.....................  Dance Companies................................              $7.0             $10.0
711130.....................  Musical Groups and Artists.....................              $7.0             $10.0
711190.....................  Other Performing Arts Companies................              $7.0             $25.5
711211.....................  Sports Teams and Clubs.........................              $7.0             $35.5
711212.....................  Race Tracks....................................              $7.0             $35.5
711219.....................  Other Spectator Sports.........................              $7.0             $10.0
711310.....................  Promoters of Performing Arts, Sports and                     $7.0             $30.0
                              Similar Events with Facilities.
711320.....................  Promoters of Performing Arts, Sports and                     $7.0             $14.0
                              Similar Events without Facilities.
711410.....................  Agents and Managers for Artists, Athletes,                   $7.0             $10.0
                              Entertainers and Other Public Figures.
712110.....................  Museums........................................              $7.0             $25.5
712130.....................  Zoos and Botanical Gardens.....................              $7.0             $25.5
713110.....................  Amusement and Theme Parks......................              $7.0             $35.5
713210.....................  Casinos (except Casino Hotels).................              $7.0             $25.5
713290.....................  Other Gambling Industries......................              $7.0             $30.0
713910.....................  Golf Courses and Country Clubs.................              $7.0             $14.0
713920.....................  Skiing Facilities..............................              $7.0             $25.5
----------------------------------------------------------------------------------------------------------------

    For the reasons as stated above in this final rule and in the 
proposed rule, SBA has decided to retain the current receipts based 
size standards for the five industries for which analytical results 
suggested lowering them. The five industries are the following: NAICS 
711510, Independent Artists, Writers, and Performers; NAICS 712120, 
Historical Sites; NAICS 712190, Nature Parks and Other Similar 
Institutions; NAICS 713120, Amusement Arcades; and NAICS 713990, All 
Other Amusement and Recreation Industries. Not lowering size standards 
for these industries in NAICS Sector 71 is consistent with SBA's recent 
final rules on NAICS Sector 44-45, Retail Trade (75 FR 61597 (October 
6, 2010)), NAICS Sector 72, Accommodation and Food Services (75 FR 
61604 (October 6, 2010)), NAICS Sector 81, Other Services (75 FR 61591 
(October 6, 2010)), NAICS Sector 54, Professional, Scientific and 
Technical Services (77 FR 7490 (February 10, 2012)), NAICS Sector 48-
49, Transportation and Warehousing (77 FR 10943 (February 24, 2012)), 
NAICS Sector 53, Real Estate and Rental and Leasing (77 FR 58747 
(September 24, 2012)), NAICS Sector 61, Educational Services (77 FR 
58739 (September 24, 2012)), NAICS Sector 62, Health Care and Social 
Assistance (77 FR 58755 (September 24, 2012)), NAICS Sector 51, 
Information (77 FR 72702 (December 6, 2012)), and NAICS Sector 56, 
Administrative and Support, Waste Management and Remediation Services 
(77 FR 72691 (December 6, 2012)). In each of those final rules, SBA 
adopted its proposal not to reduce small business size standards for 
the same reasons. SBA is also retaining the existing size standards for 
three industries for which the results supported them at their current 
levels. The three industries are the following: NAICS 713930, Marinas; 
NAICS 713940, Fitness and Recreational Sports Centers; and NAICS 
713950, Bowling Centers.

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 
final rule is not a ``significant regulatory action'' for purposes of 
Executive Order

[[Page 37419]]

12866. In order to help explain the need of this rule and the rule's 
potential benefits and costs, SBA is providing below a Cost Benefit 
Analysis in of this 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 the revised changes to small business size 
standards for 17 industries in NAICS Sector 71, Arts, Entertainment, 
and Recreation, reflect changes in economic characteristics of small 
businesses and the Federal procurement market conditions in those 
industries. SBA's mission is to aid and assist small businesses through 
a variety of financial, procurement, business development, and advocacy 
programs. To assist the intended beneficiaries of these programs 
effectively, SBA establishes distinct definitions to determine which 
businesses are deemed small businesses. The Small Business Act (15 
U.S.C. 632(a)) delegated to the SBA's Administrator the responsibility 
for establishing definitions for small business. The Act also requires 
that small business definitions vary to reflect industry differences. 
The Jobs Act requires the Administrator to review at least one-third of 
all size standards within each 18-month period from the date of its 
enactment, and review all size standards at least every five years 
thereafter. The supplementary information section of the July 18, 2012 
proposed rule and this final rule explained the 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 as a result of this final rule is gaining eligibility for 
Federal small business assistance programs, including SBA's financial 
assistance programs, economic injury disaster loans, and Federal 
procurement opportunities intended for small businesses. Federal small 
business programs provide targeted opportunities for small businesses 
under SBA's various business development and contracting programs. 
These include the 8(a), small disadvantaged businesses (SDB), small 
businesses located in Historically Underutilized Business Zones 
(HUBZone), women owned small businesses (WOSB), economically 
disadvantaged women-owned small businesses (EDWOSB), and the service 
disabled veteran owned small business (SDVOSB) Programs. Other Federal 
agencies also may use SBA's size standards for a variety of regulatory 
and program purposes. These programs help small businesses become more 
knowledgeable, stable, and competitive. In the 17 industries in NAICS 
Sector 71 for which SBA has decided to increase size standards, SBA 
estimates that about 1,450 additional firms will gain small business 
status and become eligible for these programs. That number is 1.3 
percent of total firms that are classified as small under the current 
size standards in all 25 industries in NAICS Sector 71. SBA estimates 
that this will increase the small business share of total industry 
receipts in that Sector from 35 percent under the current size 
standards to 43 percent under the revised size standards.
    The benefits of increasing size standards to a more appropriate 
level will accrue to three groups: (1) Some businesses that are above 
the current size standards will 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.
    Based on the data for fiscal years 2008-2010, more than 45 percent 
of total Federal contracting dollars spent in all industries in NAICS 
Sector 71 were accounted for by the 17 industries for which SBA is 
increasing size standards. SBA estimates that additional firms gaining 
small business status in those industries under the revised size 
standards could potentially obtain Federal contracts totaling up to $5 
million per year under the small business, 8(a), SDB, HUBZone, WOSB, 
EDWOSB and SDVOSB Programs and other unrestricted procurements. The 
added competition for many of these procurements may also result in 
lower prices to the Government for procurements reserved for small 
businesses, although SBA cannot quantify this benefit.
    Under SBA's 7(a) and 504 Loan Programs, based on the data for 
fiscal years 2008-2010, SBA estimates that approximately 15 to 20 
additional loans totaling $4 million to $6 million in new Federal loan 
guarantees could be made to the newly defined small businesses under 
the revised size standards. Under the Jobs Act, SBA can now guarantee 
substantially larger loans than in the past. In addition, the Jobs Act 
established an alternative size standard for SBA's 7(a) and 504 Loan 
Programs for those applicants that do not meet the size standards for 
their industries. That is, under the Jobs Act, if a firm applies for a 
7(a) or 504 loan but does not meet the size standard for its industry, 
it might still qualify if, including its affiliates, it has tangible 
net worth that does not exceed $15 million and also has average net 
income after Federal income taxes (excluding any carry-over losses) for 
its preceding two completed fiscal years that do not exceed $5 million. 
Thus, SBA finds it difficult to quantify the actual impact of the 
revised size standards on its 7(a) and 504 Loan Programs.
    Newly defined small businesses will also benefit from SBA's 
Economic Injury Disaster Loan Program. Since this program is contingent 
on the occurrence and severity of a disaster, SBA cannot make a 
meaningful estimate of this impact.
    To the extent that all 1,450 newly defined small firms under the 
revised size standards in NAICS Sector 71 could become active in 
Federal procurement programs, the revisions to size standards may 
entail some additional administrative costs to the Federal Government 
associated with there being more bidders for Federal small business 
procurement opportunities. In addition, there will be more firms 
seeking SBA guaranteed loans, more firms eligible for enrollment in the 
System for Award Management (SAM) and Dynamic Small Business Search 
database, and more firms seeking certification as 8(a) or HUBZone firms 
or more firms qualifying for small business, WOSB, EDWOSB, SDVOSB and 
SDB status. Among these 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. SBA believes that these added administrative 
costs will be minimal because mechanisms are already in place to handle 
these requirements.
    Additionally, costs to the Federal Government may be higher on some 
Federal contracts under the higher revised size standards. With a 
greater number of businesses defined as small, Federal agencies may 
choose to set aside more contracts for competition among small 
businesses rather than using full and open competition. The movement 
from unrestricted to set-aside contracting might result in competition 
among fewer total bidders, although

[[Page 37420]]

there will be more small businesses eligible to submit offers. In 
addition, higher costs may result when additional full and open 
contracts are awarded to HUBZone businesses because of price evaluation 
preference. However, these 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 small business, 8(a), 
HUBZone, WOSB, EDWOSB or SDVOSB Programs only if awards are expected to 
be made at fair and reasonable prices.
    The revised size standards may have some distributional effects 
among large and small businesses. Although SBA cannot estimate with 
certainty the actual outcome of gains and losses among small and large 
businesses, it can identify several probable impacts. There may be a 
transfer of some Federal contracts from large businesses to small 
businesses. Large businesses may have fewer Federal contract 
opportunities as Federal agencies decide to set aside more Federal 
contracts for small businesses. In addition, some agencies may award 
more Federal contracts to HUBZone concerns instead of large businesses 
since HUBZone concerns may be eligible for price evaluation adjustments 
when they compete on full and open bidding opportunities. Similarly, 
currently defined small businesses may obtain fewer Federal contracts 
due to the increased competition from more businesses defined as small 
under the revised size standards. This transfer may be offset by more 
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 away from large and small businesses under the existing size 
standards. The SBA cannot estimate with precision the potential 
distributional impacts of these transfers.
    The revisions to the existing size standards in NAICS Sector 71, 
Arts, Entertainment, and Recreation, 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

    A description of the need for this regulatory action and benefits 
and costs associated with this action, including possible distributions 
impacts that relate to Executive Order 13563 is included above in the 
Cost Benefit Analysis under Executive Order 12866.
    In an effort to engage interested parties in this regulatory 
action, SBA presented its methodology (discussed under Supplementary 
Information in the proposed rule and this rule) to various industry 
associations and trade groups. SBA also met with various industry 
groups to obtain their feedback on its methodology and other size 
standards issues. In addition, SBA also presented its size standards 
methodology to businesses in 13 cities in the U.S. and sought their 
input as part of the Jobs Act tours. The presentations also included 
information on the latest status of the comprehensive size standards 
review and how interested parties can provide SBA with input and 
feedback on the size standards review. Moreover, SBA presented the same 
information to Department of Defense (DoD) contracting personnel at 
their annual training session. It included updates on what size 
standards rules SBA was currently reviewing and plans to review in the 
future. This is important because DoD contracting provides the greatest 
opportunities for and awards to small businesses.
    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 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 the July 18, 2012 proposed rule (77 FR 42211) for NAICS 
Sector 71.
    Furthermore, when SBA issued the proposed rule, it notified 
individuals, government procurement, and companies that had in recent 
years exhibited an interest by letter, email, or phone, in size 
standards for NAICS Sector 71 so they could comment.
    The review of size standards in NAICS Sector 71, Arts, 
Entertainment, and Recreation, is consistent with Section 6 of 
Executive Order 13563 calling for retrospective analyses of existing 
rules. The last overall 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 all 
size standards to ensure that existing size standards have supportable 
bases and to revise them when necessary. In addition, 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 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 
final 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 final rule has 
no Federalism implications warranting preparation of a Federalism 
assessment.

Paperwork Reduction Act

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

Final Regulatory Flexibility Analysis

    Under the Regulatory Flexibility Act (RFA), this final rule may 
have a significant impact on a substantial number of small entities in 
NAICS Sector 71, Arts, Entertainment, and Recreation. As described 
above, this rule may affect small entities seeking

[[Page 37421]]

Federal contracts, SBA's 7(a) and 504 Guaranteed Loans, SBA's Economic 
Injury Disaster Loans, and various small business benefits under other 
Federal programs.
    Immediately below, SBA sets forth a final regulatory flexibility 
analysis of this final 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 entities 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 which 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 
entities?

1. What are the need for and objective of the rule?

    Most of SBA's size standards for the Arts, Entertainment, and 
Recreation industries had not been reviewed since the 1980s. 
Technological changes, productivity growth, international competition, 
mergers and acquisitions and updated industry definitions may have 
changed the structure of many industries in that Sector. Such changes 
can be sufficient to support revisions to size standards for some 
industries. Based on the analysis of the latest industry and program 
data available, SBA believes that the revised standards in this rule 
more appropriately reflect the size of businesses in those industries 
that need Federal assistance. Additionally, the Jobs Act requires SBA 
to review all size standards and make appropriate adjustments to 
reflect current data and market conditions.

2. What are SBA's description and estimate of the number of small 
entities to which the rule will apply?

    SBA estimates that approximately 1,450 additional firms will become 
small because of increases in size standards in 17 industries in NAICS 
Sector 71. That represents 1.3 percent of total firms that are 
classified as small under the current size standards in all 25 
industries in that Sector. This will result in an increase in the small 
business share of total industry receipts in those industries from 
about 35 percent under the current size standards to nearly 43 percent 
under the revised size standards. SBA does not anticipate a significant 
competitive impact on smaller businesses in these industries because of 
this rule. The revised size standards will enable more small businesses 
to retain their small business status for a longer period. Under 
current size standards, many small businesses may have lost their 
eligibility or found it difficult to compete with companies that are 
significantly larger than they are and this final rule attempts to 
correct that impact. SBA believes these changes will have a positive 
impact for existing small businesses and for those that have either 
exceeded or are about to exceed current size standards.

3. What are the projected reporting, record keeping, and other 
compliance requirements of the rule and an estimate of the classes of 
small entities which will be subject to the requirements?

    Revising size standards does not impose any additional reporting or 
record keeping requirements on small entities. However, qualifying for 
Federal procurement and a number of other Federal programs requires 
that entities register in the System for Award Management (SAM). 
Therefore, businesses opting to participate in those programs must 
comply with SAM requirements. There are no costs associated with SAM 
registration. Revising size standards alters access to SBA's and other 
Federal programs that are designed to assist small businesses, but does 
not impose a regulatory burden because they neither regulate nor 
control business behavior.

4. What are the relevant Federal rules which may duplicate, overlap, or 
conflict with the rule?

    Under section 3(a)(2)(C) of the Small Business Act, 15 U.S.C. 
632(a)(2)(c), Federal agencies must 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 or 
revising size standards.
    However, the Small Business Act and SBA's regulations allow Federal 
agencies to establish different size standards if they believe that 
SBA's size standards are not appropriate for their programs, with the 
approval of SBA's Administrator (see 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 existing 
system 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 reasons set forth in the preamble, SBA amends 13 CFR part 121 
as follows:

PART 121--SMALL BUSINESS SIZE REGULATIONS

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

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



0
2. In Sec.  121.201, in the table ``Small Business Size Standards by 
NAICS Industry,'' revise entries for ``711110'', ``711120'', 
``711130'', ``711190'', ``711211'', ``711212'', ``711219'', ``711310'', 
``711320'', ``711410'', ``712110'', ``712130'', ``713110'', ``713210'', 
``713290'', ``713910'', and ``713920'' to read as follows:


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

* * * * *

[[Page 37422]]



                                 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
----------------------------------------------------------------------------------------------------------------
 
                                                  * * * * * * *
711110...................  Theater Companies and Dinner Theaters............             $19.0  ................
711120...................  Dance Companies..................................             $10.0  ................
711130...................  Musical Groups and Artists.......................             $10.0  ................
711190...................  Other Performing Arts Companies..................             $25.5  ................
711211...................  Sports Teams and Clubs...........................             $35.5  ................
711212...................  Race Tracks......................................             $35.5  ................
711219...................  Other Spectator Sports...........................             $10.0  ................
711310...................  Promoters of Performing Arts, Sports and Similar              $30.0  ................
                            Events with Facilities.
711320...................  Promoters of Performing Arts, Sports and Similar              $14.0  ................
                            Events without Facilities.
711410...................  Agents and Managers for Artists, Athletes,                    $10.0  ................
                            Entertainers and Other Public Figures.
 
                                                  * * * * * * *
712110...................  Museums..........................................             $25.5  ................
 
                                                  * * * * * * *
712130...................  Zoos and Botanical Gardens.......................             $25.5  ................
 
                                                  * * * * * * *
713110...................  Amusement and Theme Parks........................             $35.5  ................
 
                                                  * * * * * * *
713210...................  Casinos (except Casino Hotels)...................             $25.5  ................
713290...................  Other Gambling Industries........................             $30.0  ................
713910...................  Golf Courses and Country Clubs...................             $14.0  ................
713920...................  Skiing Facilities................................             $25.5  ................
 
                                                  * * * * * * *
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    Dated: June 13, 2013.
Karen G. Mills,
Administrator.
[FR Doc. 2013-14708 Filed 6-19-13; 8:45 am]
BILLING CODE 8025-01-P