[Federal Register Volume 79, Number 96 (Monday, May 19, 2014)]
[Proposed Rules]
[Pages 28631-28647]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-11269]


 ========================================================================
 Proposed Rules
                                                 Federal Register
 ________________________________________________________________________
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 This section of the FEDERAL REGISTER contains notices to the public of 
 the proposed issuance of rules and regulations. The purpose of these 
 notices is to give interested persons an opportunity to participate in 
 the rule making prior to the adoption of the final rules.
 
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 

  Federal Register / Vol. 79, No. 96 / Monday, May 19, 2014 / Proposed 
Rules  

[[Page 28631]]



SMALL BUSINESS ADMINISTRATION

13 CFR Part 121

RIN 3245-AG49


Small Business Size Standards: Employee Based Size Standards in 
Wholesale Trade and Retail Trade

AGENCY: U.S. Small Business Administration.

ACTION: Proposed rule.

-----------------------------------------------------------------------

SUMMARY: The U.S. Small Business Administration (SBA or Agency) 
proposes to increase employee based size standards for 46 industries in 
North American Industry Classification System (NAICS) Sector 42, 
Wholesale Trade, and one industry in NAICS Sector 44-45, Retail Trade 
and retain the current size standards in the remaining industries in 
those sectors. SBA also proposes to retain the current 500-employee 
size standard for Federal procurement of supplies under the 
nonmanufacturer rule. As part of its ongoing comprehensive size 
standards review, SBA reviewed all 71 industries in NAICS Sector 42 as 
well as the two industries in NAICS Sector 44-45 that have employee 
based size standards. The proposed revisions, if adopted, will 
primarily affect eligibility for SBA's financial assistance programs. 
This proposed rule is one of a series of proposed rules that will 
review size standards of industries grouped by NAICS Sector.

DATES: SBA must receive comments to this proposed rule on or before 
July 18, 2014.

ADDRESSES: You may submit comments identified by RIN 3245-AG49 by one 
of the following methods: (1) Federal eRulemaking Portal: 
www.regulations.gov, following the instructions for submitting 
comments; or (2) Mail/Hand Delivery/Courier: Khem R. Sharma, Ph.D., 
Chief, Office of Size Standards, 409 Third Street SW., Mail Code 6530, 
Washington, DC 20416. SBA will not accept comments to this proposed 
rule submitted by email except for confidential information.
    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 this information to U.S. Small Business Administration, 
Khem R. Sharma, Ph.D., Chief, Office of Size Standards, 409 Third 
Street SW., Mail Code 6530, Washington, DC 20416, or send an email to 
[email protected]. Highlight the information that you consider to 
be CBI and explain why you believe SBA should hold this information as 
confidential. SBA will review this information and determine whether it 
will make the information public.

FOR FURTHER INFORMATION CONTACT: Khem R. Sharma, Ph.D., Chief, Office 
of Size Standards by phone at (202) 205-6618 or by email at 
[email protected].

SUPPLEMENTARY INFORMATION:

Background

    In an effort to remove possible public confusion, SBA would like to 
explain the changes made to the title of this rule. When SBA initially 
announced in the Fall 2012 Unified Agenda of Federal Regulatory and 
Deregulatory Actions, 78 FR 1636 at 1639 (January 8, 2013) (Item 
391) that it intended to propose this rule, it was titled 
``Small Business Size Standards for Wholesale Trade'' under Regulatory 
Information Number (RIN) 3245-AG49. SBA later realized that this rule 
also addresses two industries with employee based size standards in 
Retail Trade. As a result, the title of this proposed rule is changed 
to read ``Small Business Size Standards: Employee Based Size Standards 
in Wholesale Trade and Retail Trade.'' SBA believes that this title 
change of the rule will make it easier for affected parties to 
understand the scope of its coverage and will engender more public 
comment and involvement.
    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. 
SBA's existing size standards use two primary measures of business 
size--average annual receipts and number of employees. SBA also has 
used financial assets, electric output, and refining capacity to 
measure the size in a few specialized industries. In addition, SBA's 
Small Business Investment Company, Certified Development Company (CDC/
504), and 7(a) Loan Programs use either the industry based size 
standards or tangible net worth and net income based alternative size 
standard to determine eligibility for these programs. The new 
alternative size standard, which was established under the Small 
Business Jobs Act of 2010 (Jobs Act), is tangible net worth of not more 
than $15 million and average net income after Federal income taxes 
(excluding any carry-over losses) for the two latest fiscal years of 
not more than $5 million.
    At the start of the current comprehensive size standards review 
when the size standards were based on NAICS 2007, there were 41 
different size levels, covering 1,141 NAICS industries and 18 
subindustry 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, under NAICS 2012, there are 28 different size standards 
covering 1,031 industries and 16 ``exceptions''. Of these, 533 are 
based on average annual receipts, 509 on number of employees (one of 
which also contains barrels per day total capacity), and five on 
average assets.
    SBA has received comments periodically that its size standards have 
not kept up with changes in the economy and in the Federal contracting 
marketplace. The last time SBA conducted a comprehensive review of its 
size standards involving actual public involvement in the rulemaking 
process was from 1980 to 1984. After a series of Federal Register 
notices from 1980 to 1983, SBA adopted a detailed list of size 
standards based on individual industry codes. Since then, SBA's 
revisions to size standards have focused on inflationary adjustments to 
its monetary based size standards. SBA's latest inflationary adjustment 
to size standards was published in the Federal Register on July 18, 
2008 (73 FR 41237). Besides inflation adjustment, SBA's reviews of size 
standards since the last comprehensive review have been limited to a 
few specific industries in response to public request.
    When SBA established its size standard framework in 1984, it 
focused

[[Page 28632]]

on having a common size standard for both its financial and Federal 
procurement programs. However, SBA made an exception for the Wholesale 
Trade industries and established the 100-employee size standard for 
SBA's financial programs and the 500-employee size standard for Federal 
procurement programs under the nonmanufacturer rule. The 
nonmanufacturer rule has been periodically updated and is presently 
codified in SBA's small business size regulations at 13 CFR 121.406. 
The nonmanufacturer rule also applies to Federal procurement for the 
industries within Retail Trade (NAICS Sector 44-45). On a Federal 
procurement opportunity reserved for small business concerns to provide 
supplies or goods, the 500-employee size standard under the 
nonmanufacturer rule permits a firm that did not manufacture or produce 
those goods to qualify as small if it is at or below 500 employees and 
supplies the end item of a small domestic manufacturer. In effect, the 
nonmanufacturer rule has resulted in two sets of size standards for 
financial and Federal procurement programs for firms in industries in 
NAICS Sectors 42 and 44-45. In this proposed rule, SBA provides 
separate analyses of size standards for financial programs and the 500-
employee nonmanufacturer size standard for Federal procurement 
programs.
    Because of changes in the Federal marketplace and industry 
structure since the last comprehensive size standards review, SBA 
recognized that the latest available data might no longer support some 
of its existing size standards. Thus, in 2007, SBA began a 
comprehensive size standards review to determine if they were 
consistent with the latest data and to adjust them where necessary. 
Subsequently, 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 its size standards and to make 
appropriate adjustments to reflect market conditions (Sec.1344, Pub. L. 
111-240, 124 Stat 2545). 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 (September 
27, 2010). In addition, the Jobs Act requires that SBA review all size 
standards not less than once every five years thereafter. Reviewing 
existing size standards periodically and making appropriate adjustments 
based on the latest available data are also consistent with Executive 
Order 13563, which calls for periodic retrospective analyses of 
existing rules.
    Rather than review all size standards at one time, SBA is reviewing 
them on a sector by sector basis. Most NAICS sectors consist of 25 to 
75 industries, except for Manufacturing (NAICS Sector 31-33) which has 
more than 350 industries. Once SBA completes its review of size 
standards for industries in an NAICS sector, it issues for comments a 
proposed rule to revise some or all of the size standards it reviewed 
in the rule. The proposed rule provides the public with opportunity to 
comment on SBA's proposed size standards revisions. SBA also invites 
comments on size standards that the Agency had proposed to keep them at 
their current levels, if the public believes they should be revised as 
well.
    Below is a discussion of the size standard methodology for 
establishing employee based size standards that SBA applied to this 
proposed rule. It focuses primarily on industry structure but also 
includes federal procurement considerations, the impact on SBA's loan 
programs, and whether the revised small business size standards (if 
adopted as proposed) would exclude dominant firms from being considered 
small.

Size Standards Methodology

    SBA has developed and refined over time its ``Size Standard 
Methodology'' (methodology) for establishing, reviewing and revising, 
when necessary, its small business size standards. In conjunction with 
the current comprehensive size standards review, SBA has published a 
document explaining this methodology in detail on its Web site at 
www.sba.gov/size for public review and comment 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 methodology 
to all industries, however, because not all features are appropriate. 
For example, since all industries in NAICS Sector 42 and two industries 
in NAICS Sector 44-45 covered by this rule have employee based size 
standards, the methodology relating to receipts based size standards 
does not apply to this rule.
    SBA welcomes comments from the public on various issues concerning 
its methodology. These include, but are not limited to, whether there 
are better approaches to establishing a size standard; whether there 
are additional factors that SBA should consider; whether SBA's approach 
to its size standards makes sense in the current economic climate; 
whether there are gaps in SBA's methodology because the data it uses 
are not sufficiently current or comprehensive, and whether there are 
other data, facts, and/or issues that SBA should consider. Comments on 
SBA's methodology should be submitted either via (1) the Federal 
Rulemaking Portal: www.regulations.gov, using docket number SBA-2009-
0008, and following the instructions for submitting comments; or (2) 
Mail/Hand Delivery/Courier to Khem R. Sharma, Ph.D., Chief, Office of 
Size Standards, 409 Third Street SW., Mail Code 6530, Washington, DC 
20416. As with comments received to proposed rules, SBA will post all 
proposed rules on its methodology on www.regulations.gov. As of April 
30, 2014, SBA had received 17 comments to its methodology. The comments 
are available to the public at www.regulations.gov. SBA continues to 
welcome comments on its methodology from interested parties. SBA, 
however, will not accept comments submitted by email.
    Congress granted SBA's Administrator the discretion to establish 
detailed small business size standards in 15 U.S.C. 632(a)(2). 
Specifically 3(a)(3) of the Small Business Act states that ``. . . the 
[SBA] Administrator shall ensure that the size standard varies from 
industry to industry to reflect the differing characteristics of the 
various industries and consider other factors deemed to be relevant by 
the Administrator.'' 15 U.S.C. 632(a)(3). 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 relating to its industry structure, as described below. 
In addition, SBA considers other factors, including current economic 
conditions, its mission and program objectives, the Administration's 
current policies and priorities, suggestions from industry groups and 
Federal agencies, and public comments to proposed rules.
    This proposed rule includes information regarding the factors SBA 
evaluated and the criteria it used to propose revisions to a number of 
size standards in NAICS Sectors 42 and 44-45. The rule also explains 
why SBA has proposed to revise some size standards, but not others. 
This proposed rule affords the public an opportunity to review and 
comment on SBA's proposal to revise certain size standards in NAICS 
Sectors 42 and 44-45, as well as the data and methodology the Agency 
used to evaluate and propose revisions to size standards in those 
sectors. SBA also invites comments on those

[[Page 28633]]

industries for which it proposes to retain their size standards at the 
current levels.

Industry Analysis

    For the current comprehensive size standards review, SBA has 
established three base or anchor size standards as follows: $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 Retail Trade), and 100 employees for industries in 
the Wholesale Trade sector for SBA's financial and all programs other 
than federal procurement. SBA generally compares the characteristics of 
industries with the base or anchor size standard to other industries to 
determine whether they should have a higher or in some cases a lower 
size standard than the anchor.
    Since currently all industries in Wholesale Trade share the 100-
employee size standard for SBA's financial programs and the 500-
employee size standard for Federal procurement programs under the 
nonmanufacturer rule, the `anchor' size standard approach is difficult 
to apply. In its ``Size Standards Methodology'' White Paper, SBA 
created an implicit anchor group for the Wholesale Trade sector by 
grouping the middle half of the Wholesale Trade industries arranged in 
increasing order of average firm size. Based on its own review, SBA now 
believes that a quintile approach is more appropriate than the anchor 
approach in reviewing size standards in Wholesale Trade. In the 
quintile approach, to be detailed below, SBA measures and ranks every 
industry using the four industry factors, giving equal weight to each 
of them. The four industry factors are average firm size, average 
assets size as proxy for startup costs and entry barriers, industry 
concentration, and distribution of firms by size. Since NAICS codes in 
the Wholesale Trade sector do not apply to Federal contracting, the 
Federal contracting factor is not considered in reviewing industry 
based size standards.
    As stated above, since 1986, the size standard for all industries 
in the Wholesale Trade sector has been 100 employees for SBA's 
financial assistance and for most Federal programs. However, the 100-
employee size standard does 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 the SBA's 
nonmanufacturer rule. SBA's regulations also specify that NAICS codes 
for the Wholesale and Retail Trade industries shall not be used to 
classify Government acquisition for supplies. See 13 CFR 121.402(b). 
Instead, the applicable manufacturing code shall be used to classify 
acquisitions for supplies. A Wholesale Trade or Retail Trade business 
concern submitting an offer on a supply acquisition is categorized as a 
nonmanufacturer and deemed small if it has 500 or fewer employees and 
meets the requirements of 13 CFR 121.406(b).
    The long-standing anchor size standards have stood the test of time 
and gained legitimacy through practice and general public 
acceptability. The anchors have been the basis for analyzing the 
industrial structure of industries, and for proposing and justifying 
revisions to size standards under the current comprehensive size 
standards review. However, as stated earlier, the anchor approach is 
difficult to implement in reviewing the size standards of industries in 
Wholesale Trade (NAICS Sector 42) because all industries in the sector 
share the same 100-emplpoyee size standard for SBA's financial programs 
and 500-employe size standard for the Federal procurement programs. In 
other words, there is no subset of industries within the sector with a 
distinct common size standard that in some sense could be considered 
the base or the anchor and be used as the basis for evaluating 
structure of other industries and revising their size standards. Thus, 
in this rule, SBA is using a quintile approach in which industries are 
ranked and compared using each industry factor based on where the 
factor of that industry falls within the five ranked quintiles (i.e., 
less than the 20th percentile, the 20th to less than the 40th 
percentile, the 40th to less than the 60th percentile, the 60th to less 
than the 80th percentile, and the 80th or higher percentile) to produce 
an implied size standard for each factor for each industry. The implied 
size standards for each factor are then averaged to produce a 
calculated industry specific size standard. The five implied size 
standard levels are 50 employees, 100 employees, 150 employees, 200 
employees, and 250 employees. If the value of an industry factor falls 
in the first quintile (i.e., less than the 20th percentile), that 
factor would support a size standard of 50 employees. If the value 
falls in the second quintile (i.e., the 20th to less than the 40th 
percentile), it would support 100 employees. Similarly, if the value 
falls in the fifth quintile (i.e., the 80th or higher percentile), the 
factor would support 250 employees.
    SBA evaluates the four industry factors (viz., average firm size, 
average assets as proxy for startup costs and entry barriers, industry 
competition, and the distribution of firms by size). In addition, SBA 
evaluates a fifth factor, namely small business participation in 
Federal procurement programs under the current size standards. These 
are generally the five most important factors SBA examines when 
establishing or revising a size standard for an industry. In addition, 
SBA also considers and evaluates small business participation in SBA's 
financial programs, as well as other information that it believes is 
relevant to a particular industry, such as technological changes, 
growth trends, current economic conditions, and other program factors 
including present Administration policies and priorities. Below are 
brief descriptions of each of the five primary factors that SBA 
analyzed for evaluating, and revising where necessary, size standards 
for all industries in NAICS Sector 42 and two industries in NAICS 
Sector 44-45 that are reviewed in this proposed rule.
    1. Average firm size. SBA computes two measures of average firm 
size: Simple average and weighted average. For industries with employee 
based size standards, the simple average is the total number of 
employees in 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 employee size classes, where weights are the 
shares of total industry employees in their respective size classes. 
The simple average weighs all firms equally within an industry 
regardless of size. The weighted average overcomes that limitation by 
giving more weight to larger firms. The size standards obtained from 
simple average and weighted average firm size are averaged to obtain a 
single size standard supported by the average firm size.
    If an industry's average firm size is significantly higher than 
most other industries in the sector, this will support a higher size 
standard. Conversely, if the industry's firm size is appreciably lower 
than most other industries, a lower size standard will be justified.
    2. Startup costs and entry barriers. Startup costs affect a firm's 
initial size in an industry and its capacity to grow to a competitive 
size. New entrants to an industry must have sufficient capital and 
other assets to start and maintain a viable business. If new firms 
entering an industry under review have greater or lesser capital 
requirements than new

[[Page 28634]]

firms in other industries in the same sector, this can suggest a higher 
or lower size standard for the industry. Since startup costs and data 
on entry barriers are difficult to obtain, SBA uses average assets as a 
proxy to measure the capital requirements for new entrants into an 
industry. To calculate average assets, SBA uses a ratio of sales/
receipts to total assets for an industry from the Risk Management 
Association's Annual eStatement Studies. SBA then applies this ratio to 
the average receipts per firm in the industry to calculate the average 
assets per firm in the industry. Calculated average assets per firm 
provide an estimate of entry barriers, with the larger the asset level 
per firm the greater the difficulty to enter into and be successful in 
an industry, warranting a higher size standard.
    3. Industry competition. Industry competition is generally measured 
by the share of total industry receipts associated with the largest 
firms in an industry. While different measures can be used (and 
generally produce similar rankings), SBA evaluates the share of 
industry receipts of the four largest firms in the industry. This is 
referred to as the ``four-firm concentration ratio,'' a commonly used 
economic measure of industry concentration. If a higher share is 
concentrated among the largest four firms in the reviewed industry, 
this can suggest a higher size standard based on this factor. However, 
SBA does not consider this factor important to its assessment if the 
four-firm concentration ratio for the industry under review is less 
than 40 percent. If an industry's four-firm concentration ratio is 40 
percent or more, SBA then examines the average size (i.e., average 
number of employees for employee based size standards and average 
receipts for receipts based size standards) of the four largest firms 
for that industry and compares this figure with other industries.
    4. Distribution of firms by size. SBA examines the share of 
industry receipts generated by firms of different employment size 
categories in an industry with an employee based size standard and 
receipts size categories for a receipts based size standard. This is 
another component of industry competition within an industry, and it 
complements the four-firm concentration ratio, which also measures 
industry competition. If most of an industry's economic activity is 
attributable to smaller firms, this generally indicates that small 
businesses are competitive in the industry. This is generally 
interpreted as supporting a relatively low size standard. Conversely, 
if most of an industry's economic activity is generated by larger 
firms, this indicates that small businesses are not particularly 
competitive in that industry and can support a relatively high size 
standard.
    Concentration is a measure of inequality of distribution of 
economic activity. To determine the degree of inequality of 
distribution in an industry, SBA computes the Gini coefficient. For 
this, SBA first constructs the Lorenz curve for each industry using 
available data. The Lorenz curve portrays the cumulative percentages of 
firms along the horizontal axis, and the cumulative percentage of 
receipts along the vertical axis. (For further detail, see SBA's ``Size 
Standards Methodology'' on its Web site at www.sba.gov/size.) The Gini 
coefficient values vary from zero to one. If an industry's total 
receipts are attributed to a single firm, the Gini coefficient would 
equal one. Conversely, if every firm received the exact same amount of 
revenues the Gini coefficient would approach zero.
    In this rule, SBA compares the Gini coefficient value for an 
industry with that for other industries in NAICS Sector 42, Wholesale 
Trade. If the Gini coefficient value for an industry is higher than 
most industries in the sector, this suggests a relatively high size 
standard. Conversely, if an industry's Gini coefficient is lower than 
most industries, a relatively low size standard would be justified.
    5. Impact on Federal contracting and SBA loan programs. SBA 
examines the impact a size standard change may have on Federal small 
business assistance. This examination most often focuses on the share 
of Federal contracting dollars awarded to small businesses in the 
industry under the current size standard. Differences between small 
business shares of Federal contracting dollars and small business 
shares of industry total receipts can support a size standard different 
from the current size standard. In general, if the small business share 
of Federal contracting dollars is appreciably less than the small 
business share of the industry's total receipts, there is justification 
for considering a size standard higher than the current size standard. 
However, SBA cannot measure differences between small business share of 
Federal contracts and corresponding share of industry receipts by 
industry for the Wholesale and Retail Trade industries. As described 
previously, SBA's small business size regulations state that federal 
agencies shall not use Wholesale or Retail Trade NAICS codes to 
classify Federal Government's acquisitions for supplies. Instead, 
procuring agencies must use the applicable manufacturing NAICS code 
that is most closely associated with the purchase. See 13 CFR 
121.402(b). A Wholesale Trade or Retail Trade business concern 
submitting an offer on a supply acquisition is categorized as a 
nonmanufacturer and deemed small if it has 500 or fewer employees, and 
meets the other requirements of the nonmanufacturer rule (13 CFR 
121.406(b), q.v). This effectively precludes the gathering of Federal 
procurement statistics by industry in Wholesale and Retail Trade 
sectors. As a result, Federal procurement patterns cannot be used to 
evaluate the effect of the size standard on Federal procurements by 
NAICS code in these sectors, because the data on Wholesale and Retail 
trade nonmanufacturers are not gathered.
    Besides the impact of a proposed or revised size standard on small 
business Federal contracting, SBA evaluates the impact on SBA's loan 
programs. For this, SBA examines the data on volume and number of 7(a) 
and 504 loans within an industry and the size of firms obtaining those 
loans. This allows SBA to assess whether the existing, proposed, or 
revised size standard for a particular industry would restrict the 
level of financial assistance to small firms. If existing size 
standards are found to have impeded financial assistance to small 
businesses, higher size standards may be justified. However, if small 
businesses under existing 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 is 
a special tabulation of the 2007 Economic Census (see www.census.gov/econ/census07/) as prepared by the U.S. Bureau of the Census (Census 
Bureau) for SBA. The 2007 Economic Census data are the latest 
available. This special tabulation provides SBA with data on the number 
of firms, number of establishments, number of employees, total annual 
payroll, and annual receipts of companies by sector (2-digit level), 
subsector (3-digit level), industry group (4-digit level), and industry 
(6-digit level). These data are arrayed by various classes of firm size 
based on the overall numbers of employees (receipts in a separate 
tabulation) of the entire enterprise including all establishments

[[Page 28635]]

and affiliated firms regardless of industry. This special tabulation 
enables SBA to evaluate industries by average firm size, the four-firm 
concentration ratio, and the size distribution of firms by various 
receipts and employment size classes. Since wholesale industries use 
employee size standards (500 employees for the nonmanufacturer 
procurement based size standards, and 100 employees for the loan based 
size standards), the data that are arrayed by employee size of firms 
are reviewed in this rule to estimate industry structure and the impact 
of size standard revisions on the eligibility of firms for SBA's 
financial assistance programs.
    In some cases, where data were not available at the 6-digit 
industry level due to disclosure prohibitions in the Census Bureau's 
tabulation, SBA either estimates missing values using available 
relevant data or examines 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, 
where the data could not be obtained or estimated, SBA's analysis is 
based only on those factors for which data are available or estimates 
of missing values are possible.
    To calculate average assets (i.e., proxy of startup costs and entry 
barriers), SBA used sales to total assets ratios from the Risk 
Management Association's Annual eStatement studies 
(www.statementstudies.org) from 2009 to 2011 and applied these ratios 
to sales data from the 2007 Economic Census.
    To assess the impact on financial assistance to small businesses, 
SBA examined its internal data on the 7(a) and 504 loan programs for 
fiscal years 2010-2012.
    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 which is independently owned and 
operated and which is not dominant in its field of operation.'' SBA 
considers as part of its evaluation whether a business concern at or 
below a proposed or revised size standard would be considered dominant 
within the industry description covered by the proposed size standard. 
A key component of this analysis is the market share of firms at the 
proposed or revised size standard. SBA also examines distribution of 
firms by size to ensure that a contemplated size standard derived from 
its size standards analysis excludes the largest firms within an 
industry. Market share, size distribution and other factors may 
indicate whether a firm can exercise a major controlling influence on a 
national basis in which a significant number of business concerns are 
engaged. If a contemplated size standard includes dominant or largest 
firms in an industry, SBA will consider a lower size standard than the 
one suggested by the analytical results to exclude the dominant and 
largest firms from being defined as small.

Selection of Size Standards

    Presently all industries in the Wholesale Trade sector have a 
common 100-employee size standard for SBA's loan programs. However, in 
this proposed rule, SBA proposes to vary size standards in that sector 
based on industry structure as required by the Small Business Act. For 
this, individual industries were ranked and placed within one of the 
five quintile groups for each industry factor, and one of the five size 
standard levels were assigned to correspond to each of the five 
quintile groups. These five levels are: 50 employees, 100 employees, 
150 employees, 200 employees, and 250 employees. Besides being bases to 
vary size standards to reflect differences among the industries in the 
Wholesale Trade sector, these levels also include the current size 
standards for NAICS 441110, New Car Dealers (200 employees) and NAICS 
454310, Fuel Dealers (50 employees), which are also reviewed in this 
proposed rule. The evaluation of the data on SBA's 7(a) and 504 loan 
programs, since the adoption of the new alternative size standard, 
explained above, shows some wholesalers with 100 to 250 employees 
receiving these loans. The proposed levels would enable those firms to 
maintain their eligibility for SBA's 7(a) and 504 loan programs should 
the Agency decide to lower or discontinue the alternative size 
standard.
    SBA assigns one of the above five size standard levels for each 
industry according to its ranking based on each industry factor. For 
example, if an industry's ranking for an industry factor falls within 
the first or lowest quintile, SBA will apply 50 employees as the size 
standard for that industry for that factor. Likewise, if an industry's 
ranking for a factor falls within the fifth or highest quintile, the 
250-employee level will be assigned. SBA repeats this procedure for 
each industry factor.

Evaluation of Industry Structure

    SBA determines differences in industry structure by comparing data 
on each of the four industry factors: Average firm size, average assets 
size (as proxy of startup costs and entry barriers), industry 
competition, and distribution of firms by size.
    SBA uses two measures of average firm size: The simple average and 
weighted average. Average firm size (whether simple average or weighted 
average) is likely to be positively related to minimum efficient firm 
size. This refers to the level of output at which firms in an industry 
are able to minimize their costs of production and remain competitive. 
In general, industries with high minimum efficient size tend to be 
dominated by larger firms and thus their average firm size tends to be 
large, thereby warranting a relatively higher size standard for those 
industries. The size standards derived from the two average firm size 
measures are then averaged to obtain a single size standard for average 
firm size.
    Startup costs reflect the amount of capital requirements new firms 
must have to enter an industry and become competitive with existing 
firms. Relatively high average assets per firm in an industry would 
suggest high startup costs and a relatively high size standard; while 
relatively low assets per firm would suggest lower startup costs and a 
relatively low size standard. Given the lack of data on actual startup 
costs and other measures of entry barriers (such as degree of product 
differentiation, advertising expenses, economies of scale, etc.), as 
explained elsewhere in the rule, SBA uses average assets size as proxy 
for the levels of capital needs for a new firm entering an industry.
    The third factor SBA evaluates is industry competition. A common 
method of analyzing industry competition is the measurement of the 
concentration of market power of the largest firms within the industry. 
While numerous measures have been proposed in the literature to measure 
industry competition, as explained previously, SBA uses the cumulative 
share of total industry receipts of the four largest firms ranked by 
order of market share, which is commonly referred to as the four-firm 
concentration ratio. However, SBA does not apply this factor to all 
industries. SBA only considers this factor to be important when the 
four largest firms account for 40 percent or more of an industry's 
total receipts. SBA further refines the process by using the average 
size of the four largest firms in the industry. SBA uses employees to 
calculate the average size of the four largest firms for employee based 
size standards and receipts for receipts based size standards. This 
produces a measure

[[Page 28636]]

that is influenced both by the relative degree of concentration (the 
four-firm concentration ratio) and the absolute size of the four 
largest or most dominant firms in the industry. These latter criteria 
can result in a lower suggested size standard in an industry with a 
higher four-firm concentration ratio than in an industry with a lower 
four-firm concentration ratio, simply because the latter industry's 
four largest firms are larger in absolute terms than the former 
industry's four largest firms.
    Finally, as discussed above, SBA computes the Gini coefficient to 
measure distribution of firms by size by constructing the Lorenz curve. 
The Lorenz curve focuses on the arrangement of firms in order of 
increasing size (using receipts size for receipts based size standards 
and employee size for employee based size standards) and expresses 
inequality in terms of cumulative shares of industry's total receipts 
accounted for by various size categories. Cumulative percentages of 
units (firms) are on the horizontal axis and cumulative shares of 
industry's receipts are on the vertical axis. A diagonal line would 
represent perfect equality, which would mean that every firm in the 
industry has exactly the same share of industry receipts. The ratio of 
deviation from the diagonal serves is a measure of inequality. If an 
industry's receipts are perfectly equally distributed among all firms 
in the industry, then the Lorenz curve and the line of perfect equality 
become one and the Gini coefficient value approaches zero. Conversely, 
if an industry's total receipts are attributed to one firm, the Gini 
coefficient would equal one. Accordingly, the Gini coefficient values 
vary from zero to one, with zero implying perfect equality, and one 
perfect inequality. A high Gini coefficient value (closer to one) would 
thus suggest a relatively high size standard and a low value (closer to 
zero) would justify a relatively low size standard.
    Table 1, Values of Industry Factors by Quintile and Supported Size 
Standards, portrays the various quintile ranges for each industry 
factor and supported size standards that will be applied to the 
industries in Wholesale Trade (NAICS Sector 42).

                                      Table 1--Values of Industry Factors by Quintile and Supported Size Standards
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                              Supported
                                                   Simple average    Weighted average   Average assets      Avg. number                          size
          Quintile             Percentile  (%)       firm size          firm size          size  ($        employees of    Gini coefficient    standard
                                                     (number of         (number of         million)        largest four                       (number of
                                                     employees)         employees)                            firms *                         employees)
--------------------------------------------------------------------------------------------------------------------------------------------------------
1st quintile................  <20%.............  <13.5............  <78.0............  <2.8............  <700.0..........  <0.680..........           50
2nd quintile................  20% to <40%......  13.5 to <17.0....  78.0 to <141.0...  2.8 to <4.5.....  700.0 to          0.680 to <0.731.          100
                                                                                                          <1,096.3.
3rd quintile................  40% to <60%......  17.0 to <20.8....  141.0 to <202.8..  4.5 to <.5......  1,096.3 to        0.731 to <0.786.          150
                                                                                                          <1,648.8.
4th quintile................  60% to <80%......  20.8 to <26.0....  202.8 to <448.9..  6.5 to <8.8.....  1,648.8 to        0.786 to <0.844.          200
                                                                                                          <4,034.3.
5th quintile................  >=80%............  >=26.0...........  >=448.9..........  >=8.8...........  >=4,034.3.......  >=0.844.........          250
--------------------------------------------------------------------------------------------------------------------------------------------------------
* Used only if four-firm concentration ratio is 40 percent or more.

New Size Standards for SBA's Financial Programs

    For each industry factor shown in Table 1, Values of Industry 
Factors by Quintile and Supported Size Standards, SBA derives a size 
standard for each industry based on where the industry falls in the 
quintile rankings based on that factor. For example, if an industry's 
simple average firm size is 15 employees, the industry would fall 
within the second quintile and support a size standard of 100 
employees. Similarly, if an industry's four-firm ratio is above 40 
percent and average size of the largest four firms in that industry is 
1,250 employees, the industry would fall in the third quintile group 
with a supported size standard of 150 employees. This procedure is 
applied to each industry for each industry factor.
    The results of size standards analysis for the industries in 
Wholesale Trade (NAICS Sector 42) are shown in Table 2, Size Standards 
Supported by Each Factor for Each Industry (Number of Employees), 
below. Columns 2, 3, 4, 6, and 7 show two numbers for each industry. 
The upper number is the value of the industry factor shown on the top 
of the column, and the lower number is the size standard supported by 
that factor, as specified in Table 1, Values of Industry Factors by 
Quintile and Supported Size Standards. For the four-firm concentration 
ratio, SBA estimates a size standard only for those industries for 
which its value is 40 percent or more. If the four-firm concentration 
ratio for an industry is less than 40 percent, no size standard is 
derived for this factor. If the four-firm concentration ratio is 40 
percent or higher, SBA indicates in column 6 the average firm size of 
the industry's largest four firms together with the size standard 
supported by that factor. Only 11 industries in NAICS Sector 42 had the 
four-firm concentration ratio of 40 percent or more and a size standard 
was derived for each of them based on the average firm size of the 
industry's largest firms. Column 8 shows a calculated new size standard 
for each industry. This is the average of the size standards for each 
factor, rounded to the nearest level. However, size standards supported 
by the simple average and the weighted average firm size were averaged 
together to obtain one size standard for average firm size, and 
therefore received a single weight. Analytical details involved in the 
averaging procedures are further described in SBA's ``Size Standards 
Methodology.''

[[Page 28637]]



  Table 2--Size Standards Supported by Each Factor for Each Industry (Number of Employees) Upper Value = Calculated Factor, Lower Value = Size Standard
                                                                        Supported
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                     Simple      Weighted                              Four-firm                 Calculated    Current
                                                    average      average      Average                   average                     size         size
      NAICS Code NAICS U.S. industry title         firm size    firm size   assets size   Four-firm       size         Gini       standard     standard
                                                   (number of   (number of  ($ million)    ratio %     (number of  coefficient   (number of   (number of
                                                   employees)   employees)                             employees)                employees)   employees)
(1)                                                       (2)          (3)          (4)          (5)          (6)          (7)          (8)          (9)
--------------------------------------------------------------------------------------------------------------------------------------------------------
423110 Automobile and Other Motor Vehicle                  21          160        $27.1         53.5        2,115        0.931  ...........  ...........
 Merchant Wholesalers...........................          200          150          250                       200          250          250          100
423120 Motor Vehicle Supplies and New Parts                21          197         $6.5         31.3  ...........        0.860  ...........  ...........
 Merchant Wholesalers...........................          150          150          200               ...........          250          200          100
423130 Tire and Tube Merchant Wholesalers.......           24          207         $6.6  ...........  ...........        0.780  ...........  ...........
                                                          200          200          200  ...........  ...........          150          200          100
423140 Motor Vehicle Parts (Used) Merchant                  8          168         $0.6  ...........  ...........        0.476  ...........  ...........
 Wholesalers....................................           50          150           50  ...........  ...........           50           50          100
423210 Furniture Merchant Wholesalers...........           12           67         $2.0         14.3  ...........        0.681  ...........  ...........
                                                           50           50           50  ...........  ...........          100           50          100
423220 Home Furnishing Merchant Wholesalers.....           15           97         $3.4         22.1  ...........        0.710  ...........  ...........
                                                          100          100          100  ...........  ...........          100          100          100
423310 Lumber, Plywood, Millwork, and Wood Panel           24          261         $5.2         15.5  ...........        0.730  ...........  ...........
 Merchant Wholesalers...........................          200          200          150  ...........  ...........          100          150          100
423320 Brick, Stone, and Related Construction              15           78         $5.1         24.4  ...........        0.775  ...........  ...........
 Material Merchant Wholesalers..................          100          100          150  ...........  ...........          150          150          100
423330 Roofing, Siding, and Insulation Material            32          212         $7.9         30.0  ...........        0.781  ...........  ...........
 Merchant Wholesalers...........................          250          200          200  ...........  ...........          150          200          100
423390 Other Construction Material Merchant                18          132         $3.2         28.3  ...........        0.728  ...........  ...........
 Wholesalers....................................          150          100          100  ...........  ...........          100          100          100
423410 Photographic Equipment and Supplies                 21          251         $7.4         53.2        1,374        0.844  ...........  ...........
 Merchant Wholesalers...........................          200          200          200  ...........          150          250          200          100
423420 Office Equipment Merchant Wholesalers....           49        2,705         $4.4         45.4       15,798        0.870  ...........  ...........
                                                          250          250          100  ...........          250          250          200          100
423430 Computer and Computer Peripheral                    36        1,249         $8.8         31.5  ...........        0.891  ...........  ...........
 Equipment and Software Merchant Wholesalers....          250          250          250  ...........  ...........          250          250          100
423440 Other Commercial Equipment Merchant                 13           89         $1.8         10.6  ...........        0.638  ...........  ...........
 Wholesalers....................................           50          100           50  ...........  ...........           50           50          100
423450 Medical, Dental, and Hospital Equipment             25          645         $6.5         24.3  ...........        0.889  ...........  ...........
 and Supplies Merchant Wholesalers..............          200          250          150  ...........  ...........          250          200          100
423460 Ophthalmic Goods Merchant Wholesalers....           24          449         $3.4         23.6  ...........        0.739  ...........  ...........
                                                          200          250          100  ...........  ...........          150          150          100
423490 Other Professional Equipment and Supplies           16          203         $3.4         43.6        1,553        0.787  ...........  ...........
 Merchant Wholesalers...........................          100          200          100  ...........          150          200          150          100
423510 Metal Service Centers and Other Metal               20          128        $10.1         14.3  ...........        0.749  ...........  ...........
 Merchant Wholesalers...........................          150          100          250  ...........  ...........          150          200          100
423520 Coal and Other Mineral and Ore Merchant             11           38        $14.5         30.8  ...........        0.582  ...........  ...........
 Wholesalers....................................           50           50          250  ...........  ...........           50          100          100
423610 Electrical Apparatus and Equipment,                 22          455         $5.1         17.6  ...........        0.811  ...........  ...........
 Wiring Supplies, and Related Equipment Merchant          200          250          150  ...........  ...........          200          200          100
 Wholesalers....................................
423620 Household Appliances, Electric                      22          333         $7.8         36.8  ...........        0.813  ...........  ...........
 Housewares, and Consumer Electronics Merchant            200          200          200  ...........  ...........          200          200          100
 Wholesalers....................................
423690 Other Electronic Parts and Equipment                26          469         $8.0         20.5  ...........        0.860  ...........  ...........
 Merchant Wholesalers...........................          250          250          200  ...........  ...........          250          250          100
423710 Hardware Merchant Wholesalers............           17          160         $3.4         20.1  ...........        0.747  ...........  ...........
                                                          150          150          100  ...........  ...........          150          150          100
423720 Plumbing and Heating Equipment and                  22          333         $7.8         36.8  ...........        0.813  ...........  ...........
 Supplies (Hydronics) Merchant Wholesalers......          200          200          200  ...........  ...........          200          200          100
423730 Warm Air Heating and Air-Conditioning               25          201         $5.0         29.7  ...........        0.776  ...........  ...........
 Equipment and Supplies Merchant Wholesalers....          200          150          150  ...........  ...........          150          150          100
423740 Refrigeration Equipment and Supplies                17          184         $2.8         27.1  ...........        0.657  ...........  ...........
 Merchant Wholesalers...........................          150          150          100  ...........  ...........           50          100          100
423810 Construction and Mining (except Oil Well)           34          250        $15.2         24.1  ...........        0.817  ...........  ...........
 Machinery and Equipment Merchant Wholesalers...          250          200          250  ...........  ...........          200          250          100
423820 Farm and Garden Machinery and Equipment             16           53         $4.1         25.8  ...........        0.680  ...........  ...........
 Merchant Wholesalers...........................          100           50          100  ...........  ...........          100          100          100
423830 Industrial Machinery and Equipment                  15           94         $2.8          6.3  ...........        0.682  ...........  ...........
 Merchant Wholesalers...........................          100          100          100  ...........  ...........          100          100          100
423840 Industrial Supplies Merchant Wholesalers.           16           78         $3.8         22.9  ...........        0.732  ...........  ...........
                                                          100          100          100  ...........  ...........          150          100          100
423850 Service Establishment Equipment and                 14          128         $1.6         19.9  ...........        0.686  ...........  ...........
 Supplies Merchant Wholesalers..................          100          100           50  ...........  ...........          100          100          100
423860 Transportation Equipment and Supplies               17          112         $8.4         33.1  ...........        0.786  ...........  ...........
 (except Motor Vehicle) Merchant Wholesalers....          100          100          200  ...........  ...........          200          150          100
423910 Sporting and Recreational Goods and                 10           66         $2.7         11.2  ...........        0.690  ...........  ...........
 Supplies Merchant Wholesalers..................           50           50           50  ...........  ...........          100           50          100
423920 Toy and Hobby Goods and Supplies Merchant           15          148         $4.9         43.9        1,099        0.817  ...........  ...........
 Wholesalers....................................          100          150          150  ...........          150          200          150          100

[[Page 28638]]

 
423930 Recyclable Material Merchant Wholesalers.           17          104         $3.8         16.1  ...........        0.694  ...........  ...........
                                                          100          100          100  ...........  ...........          100          100          100
423940 Jewelry, Watch, Precious Stone, and                  7           75         $2.7         14.9  ...........        0.472  ...........  ...........
 Precious Metal Merchant Wholesalers............           50           50           50  ...........  ...........           50           50          100
423990 Other Miscellaneous Durable Goods                   10          108         $2.0         22.1  ...........        0.729  ...........  ...........
 Merchant Wholesalers...........................           50          100           50  ...........  ...........          100          100          100
424110 Printing and Writing Paper Merchant                 25          254        $11.1         41.9        1,567        0.866  ...........  ...........
 Wholesalers....................................          200          200          250  ...........          150          250          200          100
424120 Stationery and Office Supplies Merchant             19          593         $2.6         30.4  ...........        0.838  ...........  ...........
 Wholesalers....................................          150          250           50  ...........  ...........          200          150          100
424130 Industrial and Personal Service Paper               17          103         $4.5         32.7  ...........        0.811  ...........  ...........
 Merchant Wholesalers...........................          150          100          150  ...........  ...........          200          150          100
424210 Drugs and Druggists' Sundries Merchant              41          899        $31.0         43.9        4,655        0.950  ...........  ...........
 Wholesalers....................................          250          250          250  ...........          250          250          250          100
424310 Piece Goods, Notions, and Other Dry Goods           10           51         $2.3         11.5  ...........        0.621  ...........  ...........
 Merchant Wholesalers...........................           50           50           50  ...........  ...........           50           50          100
424320 Men's and Boys' Clothing and Furnishings            17          177         $4.6         20.0  ...........        0.762  ...........  ...........
 Merchant Wholesalers...........................          150          150          150  ...........  ...........          150          150          100
424330 Women's, Children's, and Infants'                   14          161         $3.1         13.4  ...........        0.711  ...........  ...........
 Clothing and Accessories Merchant Wholesalers..          100          150          100  ...........  ...........          100          100          100
424340 Footwear Merchant Wholesalers............           20          293         $8.0         34.5  ...........        0.833  ...........  ...........
                                                          150          200          200  ...........  ...........          200          200          100
424410 General Line Grocery Merchant Wholesalers           58        1,678        $11.4         39.5  ...........        0.919  ...........  ...........
                                                          250          250          250  ...........  ...........          250          250          100
424420 Packaged Frozen Food Merchant Wholesalers           28          301         $6.8         22.3  ...........        0.723  ...........  ...........
                                                          250          200          200  ...........  ...........          100          200          100
424430 Dairy Product (except Dried or Canned)              28          419         $6.7  ...........  ...........        0.813  ...........  ...........
 Merchant Wholesalers...........................          250          200          200  ...........  ...........          200          200          100
424440 Poultry and Poultry Product Merchant                26          105         $4.8  ...........  ...........        0.719  ...........  ...........
 Wholesalers....................................          200          100          150  ...........  ...........          100          150          100
424450 Confectionery Merchant Wholesalers.......           31        1,584         $5.9  ...........  ...........        0.870  ...........  ...........
                                                          250          250          150  ...........  ...........          250          200          100
424460 Fish and Seafood Merchant Wholesalers....           11           54         $1.6          9.7  ...........        0.462  ...........  ...........
                                                           50           50           50  ...........  ...........           50           50          100
424470 Meat and Meat Product Merchant                      19          143         $3.1         20.3  ...........        0.731  ...........  ...........
 Wholesalers....................................          150          150          100  ...........  ...........          150          150          100
424480 Fresh Fruit and Vegetable Merchant                  23          166         $2.5          8.8  ...........        0.607  ...........  ...........
 Wholesalers....................................          200          150           50  ...........  ...........           50          100          100
424490 Other Grocery and Related Products                  29        1,019         $6.9         21.6  ...........        0.873  ...........  ...........
 Merchant Wholesalers...........................          250          250          200  ...........  ...........          250          250          100
424510 Grain and Field Bean Merchant Wholesalers           19          129        $16.4         27.3  ...........        0.766  ...........  ...........
                                                          150          100          250  ...........  ...........          150          200          100
424520 Livestock Merchant Wholesalers...........            8           27         $1.6         24.4  ...........        0.258  ...........  ...........
                                                           50           50           50  ...........  ...........           50           50          100
424590 Other Farm Product Raw Material Merchant             9           46         $6.0         29.2  ...........        0.627  ...........  ...........
 Wholesalers....................................           50           50          150  ...........  ...........           50          100          100
424610 Plastics Materials and Basic Forms and              14           50         $5.5         33.8  ...........        0.735  ...........  ...........
 Shapes Merchant Wholesalers....................          100           50          150  ...........  ...........          150          150          100
424690 Other Chemical and Allied Products                  18          192         $6.9         14.5  ...........        0.783  ...........  ...........
 Merchant Wholesalers...........................          150          150          200  ...........  ...........          150          150          100
424710 Petroleum Bulk Stations and Terminals....           23           70        $20.8         31.9  ...........        0.811  ...........  ...........
                                                          200           50          250  ...........  ...........          200          200          100
424720 Petroleum and Petroleum Products Merchant           14           62        $17.0         30.4  ...........        0.787  ...........  ...........
 Wholesalers (except Bulk Stations and                    100           50          250  ...........  ...........          200          200          100
 Terminals).....................................
424810 Beer and Ale Merchant Wholesalers........           61          273        $10.0         14.0  ...........        0.704  ...........  ...........
                                                          250          200          250  ...........  ...........          100          200          100
424820 Wine and Distilled Alcoholic Beverage               45        1,569        $13.3         28.1  ...........        0.852  ...........  ...........
 Merchant Wholesalers...........................          250          250          250  ...........  ...........          250          250          100
424910 Farm Supplies Merchant Wholesalers.......           18          234         $7.2         19.3  ...........        0.779  ...........  ...........
                                                          150          200          200  ...........  ...........          150          200          100
424920 Book, Periodical, and Newspaper Merchant            31          556         $5.8         33.8  ...........        0.886  ...........  ...........
 Wholesalers....................................          250          250          150  ...........  ...........          250          200          100
424930 Flower, Nursery Stock, and Florists'                16          141         $1.2          7.5  ...........        0.589  ...........  ...........
 Supplies Merchant Wholesalers..................          100          150           50  ...........  ...........           50          100          100
424940 Tobacco and Tobacco Product Merchant                48        1,063        $10.2         53.0        4,554        0.870  ...........  ...........
 Wholesalers....................................          250          250          250  ...........          250          250          250          100
424950 Paint, Varnish, and Supplies Merchant               17          152         $4.6         42.3          943        0.818  ...........  ...........
 Wholesalers....................................          150          150          150  ...........          100          200          150          100
424990 Other Miscellaneous Nondurable Goods                 7           42         $1.1         11.0  ...........        0.585  ...........  ...........
 Merchant Wholesalers...........................           50           50           50  ...........  ...........           50           50          100
425110 Business to Business Electronic Markets..            7           40         $9.3         63.7           77        0.417  ...........  ...........
                                                           50           50          250  ...........           50           50          100          100

[[Page 28639]]

 
425120 Wholesale Trade Agents and Brokers.......            7          471         $4.2         22.8  ...........        0.563  ...........  ...........
                                                           50          250          100  ...........  ...........           50          100          100
441110 New Car Dealers..........................           53          444         $9.4          6.0  ...........        0.594  ...........  ...........
                                                          250          200          250  ...........  ...........           50          200          200
454310 Fuel Dealers.............................           15          219         $1.6         16.4  ...........        0.605  ...........  ...........
                                                          100          200           50  ...........  ...........           50          100           50
--------------------------------------------------------------------------------------------------------------------------------------------------------

Size Standards for NAICS 441110, New Car Dealers and NAICS 454310, Fuel 
Dealers

    As stated above, this proposed rule also covers NAICS 441110 (New 
Car Dealers) and NAICS 454310 (Fuel Dealers) that currently have 
employee based size standards in NAICS Sector 44-45 (Retail Trade). The 
size standards for these industries are, respectively, 200 employees 
and 50 employees for SBA's financial assistance and other federal 
nonprocurement programs. However, as explained elsewhere in this 
proposed rule, for Federal Government procurement of supplies or 
products, the applicable size standards for all industries in Retail 
Trade and Wholesale Trade is 500 employees under the nonmanufacturer 
rule and NAICS codes within these sectors do not apply to such 
procurements.
    Because there are only two industries with employee based size 
standards in Retail Trade (Sector 44-45), it is not possible to rank 
and compare their characteristics with other industries in the sector, 
as done for Wholesale Trade (Sector 42). It is also not possible to 
determine whether they warrant a higher or lower employee based size 
standard relative to other industries, because the rest of the 
industries in the sector have receipts based size standards. The 200-
employee size standard for NAICS 441110 and 50-employee size standard 
for NAICS 454310 are used for SBA's loan and other Federal 
nonprocurement programs as the 100-employee size standard for all 
industries in Wholesale Trade. SBA, therefore, derived the new size 
standards for these two Retail Trade industries by applying the same 
methodology that it applied for the Wholesale Trade industries. In 
other words, the two industries in Retail Trade were ranked with all 
industries in Wholesale Trade based on each industry factor. The 
results for each industry factor and supported size standards for NAICS 
codes 441110 and 454310 are also shown in the last two rows of Table 2, 
Size Standards Supported by Each Factor for Each Industry (Number of 
Employees), above. The results support the current 200-employee size 
standard for NAICS 441110 and a higher 100-employee size standard for 
NAICS 454310.

Size Standard for Federal Procurement

    The previous sections presented SBA's analyses of size standards 
for all industries in Wholesale Trade and two industries in Retail 
Trade for firms seeking SBA's financial assistance. SBA proposed 
replacing the common 100-employee size standard currently in place for 
financial programs for all industries in Wholesale Trade (NAICS Sector 
42) with separate size standards based on characteristics of individual 
industries within the sector. For purposes of Federal procurement 
programs, however, SBA proposes to retain the single size standard for 
nonmanufacturers instead of breaking the sector into separate, industry 
specific size standards. SBA's regulation requires that a Wholesale 
Trade or Retail Trade business concern submitting an offer or quote on 
a supply acquisition as a nonmanufacturer is deemed small if it, along 
with its affiliates, has 500 or fewer employees. Under the regulation, 
NAICS codes in Wholesale Trade and Retail Trade sectors cannot be used 
for classifying Federal Government acquisitions for supplies or 
products. Instead, the applicable manufacturing NAICS code associated 
with manufacturing, production, or processing of the product being 
procured shall be used.
    SBA believes that a single size standard is more appropriate than 
separate size standards to determine eligibility of Wholesale or Retail 
Trade firms that compete for a small business supply acquisition as 
nonmanufacturers, regardless of which Wholesale or Retail Trade NAICS 
codes they belong to. Moreover, the current 500-employee single size 
standard under the nonmanufacturer rule has gained general public 
acceptability and seems to be working well in practice. Firms in 
Wholesale Trade and Retail Trade industries generally carry multiple 
items from different industries as inventory, and therefore identify 
themselves with multiple NAICS codes. Different size standards for 
individual industries in Wholesale Trade and Retail Trade under the 
nonmanufacturer rule would further complicate the contracting decision 
process, which already entails the decision to establish an applicable 
manufacturing industry, along with its size standard, associated with 
manufacturing, production, or processing of the product being procured.
    While SBA supports a single size standard for Wholesale and Retail 
Trade firms bidding for Federal procurements of supplies or products as 
nonmanufacturers, in this proposed rule, the Agency still examined 
whether the current 500-employee size standard is appropriate. For 
this, SBA compared the average industry factors (i.e., average firm 
size, average assets, industry concentration, and distribution of firms 
by size) of all Wholesale and Retail Trade industries combined with 
those of the manufacturing industries in the 500-employee size standard 
group by applying the Agency's ``Size Standards Methodology'' for 
employee based size standards. SBA believes this makes sense because 
Wholesale and Retail Trade firms have to compete with manufacturers for 
supply or product contracts set aside for small businesses. Moreover, 
the 500-employee size standard that currently applies to 
nonmanufacturers is also the anchor and most common size standard for 
the manufacturing industries. The results supported the current 500-
employee size standard under the nonmanufacturer rule.

[[Page 28640]]

Proposed Changes to Size Standards

    The results from Table 2, Size Standards Supported by Each Factor 
for Each Industry (Number of Employees), are summarized in Table 3, 
Summary of Size Standards Analysis, below. The summary pertains to the 
size standards that apply for SBA's financial assistance programs. Of 
the 71 industries in Wholesale Trade, the results might support 
increases in size standards for 47 industries, decreases for nine 
industries, and no changes for 16 industries. Of the two Retail Trade 
industries that SBA reviewed in this proposed rule, the results support 
an increase in size standard for one and no change in other.

               Table 3--Summary of Size Standards Analysis
------------------------------------------------------------------------
                                            Calculated     Current size
                           NAICS U.S.      size standard     standard
      NAICS Code         industry title     (number of      (number of
                                            employees)      employees)
------------------------------------------------------------------------
423110................  Automobile and               250             100
                         Other Motor
                         Vehicle
                         Merchant
                         Wholesalers.
423120................  Motor Vehicle                200             100
                         Supplies and
                         New Parts
                         Merchant
                         Wholesalers.
423130................  Tire and Tube                200             100
                         Merchant
                         Wholesalers.
423140................  Motor Vehicle                 50             100
                         Parts (Used)
                         Merchant
                         Wholesalers.
423210................  Furniture                     50             100
                         Merchant
                         Wholesalers.
423220................  Home Furnishing              100             100
                         Merchant
                         Wholesalers.
423310................  Lumber, Plywood,             150             100
                         Millwork, and
                         Wood Panel
                         Merchant
                         Wholesalers.
423320................  Brick, Stone,                150             100
                         and Related
                         Construction
                         Material
                         Merchant
                         Wholesalers.
423330................  Roofing, Siding,             200             100
                         and Insulation
                         Material
                         Merchant
                         Wholesalers.
423390................  Other                        100             100
                         Construction
                         Material
                         Merchant
                         Wholesalers.
423410................  Photographic                 200             100
                         Equipment and
                         Supplies
                         Merchant
                         Wholesalers.
423420................  Office Equipment             200             100
                         Merchant
                         Wholesalers.
423430................  Computer and                 250             100
                         Computer
                         Peripheral
                         Equipment and
                         Software
                         Merchant
                         Wholesalers.
423440................  Other Commercial              50             100
                         Equipment
                         Merchant
                         Wholesalers.
423450................  Medical, Dental,             200             100
                         and Hospital
                         Equipment and
                         Supplies
                         Merchant
                         Wholesalers.
423460................  Ophthalmic Goods             150             100
                         Merchant
                         Wholesalers.
423490................  Other                        150             100
                         Professional
                         Equipment and
                         Supplies
                         Merchant
                         Wholesalers.
423510................  Metal Service                200             100
                         Centers and
                         Other Metal
                         Merchant
                         Wholesalers.
423520................  Coal and Other               100             100
                         Mineral and Ore
                         Merchant
                         Wholesalers.
423610................  Electrical                   200             100
                         Apparatus and
                         Equipment,
                         Wiring
                         Supplies, and
                         Related
                         Equipment
                         Merchant
                         Wholesalers.
423620................  Household                    200             100
                         Appliances,
                         Electric
                         Housewares, and
                         Consumer
                         Electronics
                         Merchant
                         Wholesalers.
423690................  Other Electronic             250             100
                         Parts and
                         Equipment
                         Merchant
                         Wholesalers.
423710................  Hardware                     150             100
                         Merchant
                         Wholesalers.
423720................  Plumbing and                 200             100
                         Heating
                         Equipment and
                         Supplies
                         (Hydronics)
                         Merchant
                         Wholesalers.
423730................  Warm Air Heating             150             100
                         and Air-
                         Conditioning
                         Equipment and
                         Supplies
                         Merchant
                         Wholesalers.
423740................  Refrigeration                100             100
                         Equipment and
                         Supplies
                         Merchant
                         Wholesalers.
423810................  Construction and             250             100
                         Mining (except
                         Oil Well)
                         Machinery and
                         Equipment
                         Merchant
                         Wholesalers.
423820................  Farm and Garden              100             100
                         Machinery and
                         Equipment
                         Merchant
                         Wholesalers.
423830................  Industrial                   100             100
                         Machinery and
                         Equipment
                         Merchant
                         Wholesalers.
423840................  Industrial                   100             100
                         Supplies
                         Merchant
                         Wholesalers.
423850................  Service                      100             100
                         Establishment
                         Equipment and
                         Supplies
                         Merchant
                         Wholesalers.
423860................  Transportation               150             100
                         Equipment and
                         Supplies
                         (except Motor
                         Vehicle)
                         Merchant
                         Wholesalers.
423910................  Sporting and                  50             100
                         Recreational
                         Goods and
                         Supplies
                         Merchant
                         Wholesalers.
423920................  Toy and Hobby                150             100
                         Goods and
                         Supplies
                         Merchant
                         Wholesalers.
423930................  Recyclable                   100             100
                         Material
                         Merchant
                         Wholesalers.
423940................  Jewelry, Watch,               50             100
                         Precious Stone,
                         and Precious
                         Metal Merchant
                         Wholesalers.
423990................  Other                        100             100
                         Miscellaneous
                         Durable Goods
                         Merchant
                         Wholesalers.
424110................  Printing and                 200             100
                         Writing Paper
                         Merchant
                         Wholesalers.
424120................  Stationery and               150             100
                         Office Supplies
                         Merchant
                         Wholesalers.
424130................  Industrial and               150             100
                         Personal
                         Service Paper
                         Merchant
                         Wholesalers.
424210................  Drugs and                    250             100
                         Druggists'
                         Sundries
                         Merchant
                         Wholesalers.
424310................  Piece Goods,                  50             100
                         Notions, and
                         Other Dry Goods
                         Merchant
                         Wholesalers.
424320................  Men's and Boys'              150             100
                         Clothing and
                         Furnishings
                         Merchant
                         Wholesalers.
424330................  Women's,                     100             100
                         Children's, and
                         Infants'
                         Clothing and
                         Accessories
                         Merchant
                         Wholesalers.
424340................  Footwear                     200             100
                         Merchant
                         Wholesalers.
424410................  General Line                 250             100
                         Grocery
                         Merchant
                         Wholesalers.
424420................  Packaged Frozen              200             100
                         Food Merchant
                         Wholesalers.
424430................  Dairy Product                200             100
                         (except Dried
                         or Canned)
                         Merchant
                         Wholesalers.
424440................  Poultry and                  150             100
                         Poultry Product
                         Merchant
                         Wholesalers.
424450................  Confectionery                200             100
                         Merchant
                         Wholesalers.
424460................  Fish and Seafood              50             100
                         Merchant
                         Wholesalers.
424470................  Meat and Meat                150             100
                         Product
                         Merchant
                         Wholesalers.
424480................  Fresh Fruit and              100             100
                         Vegetable
                         Merchant
                         Wholesalers.
424490................  Other Grocery                250             100
                         and Related
                         Products
                         Merchant
                         Wholesalers.
424510................  Grain and Field              200             100
                         Bean Merchant
                         Wholesalers.
424520................  Livestock                     50             100
                         Merchant
                         Wholesalers.
424590................  Other Farm                   100             100
                         Product Raw
                         Material
                         Merchant
                         Wholesalers.
424610................  Plastics                     150             100
                         Materials and
                         Basic Forms and
                         Shapes Merchant
                         Wholesalers.
424690................  Other Chemical               150             100
                         and Allied
                         Products
                         Merchant
                         Wholesalers.
424710................  Petroleum Bulk               200             100
                         Stations and
                         Terminals.

[[Page 28641]]

 
424720................  Petroleum and                200             100
                         Petroleum
                         Products
                         Merchant
                         Wholesalers
                         (except Bulk
                         Stations and
                         Terminals).
424810................  Beer and Ale                 200             100
                         Merchant
                         Wholesalers.
424820................  Wine and                     250             100
                         Distilled
                         Alcoholic
                         Beverage
                         Merchant
                         Wholesalers.
424910................  Farm Supplies                200             100
                         Merchant
                         Wholesalers.
424920................  Book,                        200             100
                         Periodical, and
                         Newspaper
                         Merchant
                         Wholesalers.
424930................  Flower, Nursery              100             100
                         Stock, and
                         Florists'
                         Supplies
                         Merchant
                         Wholesalers.
424940................  Tobacco and                  250             100
                         Tobacco Product
                         Merchant
                         Wholesalers.
424950................  Paint, Varnish,              150             100
                         and Supplies
                         Merchant
                         Wholesalers.
424990................  Other                         50             100
                         Miscellaneous
                         Nondurable
                         Goods Merchant
                         Wholesalers.
425110................  Business to                  100             100
                         Business
                         Electronic
                         Markets.
425120................  Wholesale Trade              100             100
                         Agents and
                         Brokers.
441110................  New Car Dealers.             200             200
454310................  Fuel Dealers....             100              50
------------------------------------------------------------------------

    Although the results might support lowering size standards for some 
industries, as shown in the above table, 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 6.3 percent 
in April 2014 (www.bls.gov) and is forecast to remain around this level 
at least through the end of 2014 (http://www.federalreserve.gov/monetarypolicy/mpr_20140211_part3.htm).
    In 2010, Congress passed and the President signed the Jobs Act to 
promote small business job creation. The Jobs Act puts, among many 
other measures to help small businesses grow and create jobs, more 
capital into the hands of entrepreneurs and small business owners. 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 SBA's financial assistance programs for small 
businesses. It would also affect small businesses that are now exempt 
or receive some form of relief from other Federal programs that use 
SBA's size standards. That impact could take the form of increased 
fees, extra 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 the nine industries 
for which analytical results might have supported lowering their size 
standards, about 875 businesses would lose their small business 
eligibility for SBA's financial assistance if their size standards were 
lowered. 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 small business assistance, 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 will be 
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, of the 73 industries (71 in 
Sector 42 and two in Sector 44-45) reviewed in this rule, SBA proposes 
to increase size standards for 47 industries and retain the current 
size standards for 26 industries, including nine for which the results 
might support lowering their size standards. The proposed size 
standards are in Table 4, Summary of Proposed Size Standards Revisions, 
below.

[[Page 28642]]



          Table 4--Summary of Proposed Size Standards Revisions
------------------------------------------------------------------------
                                           Proposed size   Current size
                           NAICS U.S.        standard        standard
      NAICS Code         industry title     (number of      (number of
                                            employees)      employees)
------------------------------------------------------------------------
423110................  Automobile and               250             100
                         Other Motor
                         Vehicle
                         Merchant
                         Wholesalers.
423120................  Motor Vehicle                200             100
                         Supplies and
                         New Parts
                         Merchant
                         Wholesalers.
423130................  Tire and Tube                200             100
                         Merchant
                         Wholesalers.
423310................  Lumber, Plywood,             150             100
                         Millwork, and
                         Wood Panel
                         Merchant
                         Wholesalers.
423320................  Brick, Stone,                150             100
                         and Related
                         Construction
                         Material
                         Merchant
                         Wholesalers.
423330................  Roofing, Siding,             200             100
                         and Insulation
                         Material
                         Merchant
                         Wholesalers.
423410................  Photographic                 200             100
                         Equipment and
                         Supplies
                         Merchant
                         Wholesalers.
423420................  Office Equipment             200             100
                         Merchant
                         Wholesalers.
423430................  Computer and                 250             100
                         Computer
                         Peripheral
                         Equipment and
                         Software
                         Merchant
                         Wholesalers.
423450................  Medical, Dental,             200             100
                         and Hospital
                         Equipment and
                         Supplies
                         Merchant
                         Wholesalers.
423460................  Ophthalmic Goods             150             100
                         Merchant
                         Wholesalers.
423490................  Other                        150             100
                         Professional
                         Equipment and
                         Supplies
                         Merchant
                         Wholesalers.
423510................  Metal Service                200             100
                         Centers and
                         Other Metal
                         Merchant
                         Wholesalers.
423610................  Electrical                   200             100
                         Apparatus and
                         Equipment,
                         Wiring
                         Supplies, and
                         Related
                         Equipment
                         Merchant
                         Wholesalers.
423620................  Household                    200             100
                         Appliances,
                         Electric
                         Housewares, and
                         Consumer
                         Electronics
                         Merchant
                         Wholesalers.
423690................  Other Electronic             250             100
                         Parts and
                         Equipment
                         Merchant
                         Wholesalers.
423710................  Hardware                     150             100
                         Merchant
                         Wholesalers.
423720................  Plumbing and                 200             100
                         Heating
                         Equipment and
                         Supplies
                         (Hydronics)
                         Merchant
                         Wholesalers.
423730................  Warm Air Heating             150             100
                         and Air-
                         Conditioning
                         Equipment and
                         Supplies
                         Merchant
                         Wholesalers.
423810................  Construction and             250             100
                         Mining (except
                         Oil Well)
                         Machinery and
                         Equipment
                         Merchant
                         Wholesalers.
423860................  Transportation               150             100
                         Equipment and
                         Supplies
                         (except Motor
                         Vehicle)
                         Merchant
                         Wholesalers.
423920................  Toy and Hobby                150             100
                         Goods and
                         Supplies
                         Merchant
                         Wholesalers.
424110................  Printing and                 200             100
                         Writing Paper
                         Merchant
                         Wholesalers.
424120................  Stationery and               150             100
                         Office Supplies
                         Merchant
                         Wholesalers.
424130................  Industrial and               150             100
                         Personal
                         Service Paper
                         Merchant
                         Wholesalers.
424210................  Drugs and                    250             100
                         Druggists'
                         Sundries
                         Merchant
                         Wholesalers.
424320................  Men's and Boys'              150             100
                         Clothing and
                         Furnishings
                         Merchant
                         Wholesalers.
424340................  Footwear                     200             100
                         Merchant
                         Wholesalers.
424410................  General Line                 250             100
                         Grocery
                         Merchant
                         Wholesalers.
424420................  Packaged Frozen              200             100
                         Food Merchant
                         Wholesalers.
424430................  Dairy Product                200             100
                         (except Dried
                         or Canned)
                         Merchant
                         Wholesalers.
424440................  Poultry and                  150             100
                         Poultry Product
                         Merchant
                         Wholesalers.
424450................  Confectionery                200             100
                         Merchant
                         Wholesalers.
424470................  Meat and Meat                150             100
                         Product
                         Merchant
                         Wholesalers.
424490................  Other Grocery                250             100
                         and Related
                         Products
                         Merchant
                         Wholesalers.
424510................  Grain and Field              200             100
                         Bean Merchant
                         Wholesalers.
424610................  Plastics                     150             100
                         Materials and
                         Basic Forms and
                         Shapes Merchant
                         Wholesalers.
424690................  Other Chemical               150             100
                         and Allied
                         Products
                         Merchant
                         Wholesalers.
424710................  Petroleum Bulk               200             100
                         Stations and
                         Terminals.
424720................  Petroleum and                200             100
                         Petroleum
                         Products
                         Merchant
                         Wholesalers
                         (except Bulk
                         Stations and
                         Terminals).
424810................  Beer and Ale                 200             100
                         Merchant
                         Wholesalers.
424820................  Wine and                     250             100
                         Distilled
                         Alcoholic
                         Beverage
                         Merchant
                         Wholesalers.
424910................  Farm Supplies                200             100
                         Merchant
                         Wholesalers.
424920................  Book,                        200             100
                         Periodical, and
                         Newspaper
                         Merchant
                         Wholesalers.
424940................  Tobacco and                  250             100
                         Tobacco Product
                         Merchant
                         Wholesalers.
424950................  Paint, Varnish,              150             100
                         and Supplies
                         Merchant
                         Wholesalers.
454310................  Fuel Dealers....             100              50
------------------------------------------------------------------------

    Maintaining current size standards when the analytical results 
suggested lowering them 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 51, Information (77 FR 72702 (December 6, 2012)); NAICS Sector 
53, Real Estate and Rental and Leasing (77 FR 88747 (September 24, 
2012)); NAICS Sector 56, Administrative and Support, Waste Management 
and Remediation Services (77 FR 72691 (December 6, 2012)); NAICS Sector 
61, Educational Services (77 FR 58739 (September 24, 2012)); and NAICS 
Sector 62, Health Care and Social Assistance (77 FR 58755 (September 
24, 2012)); NAICS Sector 11, Agriculture, Forestry, Fishing and Hunting 
(78 FR 37398 (June 20, 2013)); NAICS Subsector 213, Support Activities 
for Mining (78 FR 37404 (June 20, 2013)); NAICS Sector 52, Finance and 
Insurance and Sector 55, Management of Companies and Enterprises (78 FR 
37409 (June 20, 2013)); NAICS Sector 71, Arts, Entertainment and 
Recreation (78 FR 37417 (June 20, 2013)); and NAICS Sector 23, 
Construction (78 FR 77334) (December 23, 2013)). In each of those final 
rules, SBA retained the existing

[[Page 28643]]

size standards for those that it could have reduced.
    SBA also proposes to retain the current 500-employee size standard 
under the nonmanufacturer rule.

Evaluation of Dominance in Field of Operation

    SBA has determined that for the industries 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 for which SBA has proposed to increase 
their size standards is, on average, 0.5 percent, varying from a 
minimum of 0.02 percent to a maximum of 7.8 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. SBA proposes to replace the current 100-employee common size 
standard for SBA's financial programs for all industries in Wholesale 
Trade with five separate industry specific size standards, namely 50 
employees, 100 employees, 150 employees, 200 employees, and 250 
employees. SBA invites comments on whether replacing the 100-employee 
level with these five different levels is necessary and appropriate. 
SBA also welcomes suggestions, along with supporting data and analysis, 
on different size standards levels if the commenters believe they will 
be more appropriate.
    2. Of the 73 industries (71 in Sector 42 and 2 in Sector 44-45) 
reviewed in this proposed rule, SBA proposes to increase size standards 
for 47 and retain the current size standards for remaining 26, 
including the nine for which the results might support lowering their 
size standards. SBA seeks comments on whether the proposed increases 
are appropriate given the industry data. SBA also invites comments on 
whether its proposal to retain the current size standards for 26 
industries is appropriate, including the nine for which the analytical 
results supported lower size standards. SBA welcomes suggestions, along 
with supporting data and analysis, on different size standards if they 
would be more appropriate.
    3. While SBA proposes to replace the current 100-employee size 
standard for Wholesale Trade industries with separate industry specific 
size standards for its financial programs, the Agency proposes to 
retain the current 500-employee size standard for firms in Wholesale 
and Retail Trade industries to qualify as nonmanufacturers for the 
Federal government procurement of supplies or products. SBA invites 
comments on whether it should continue using a common size standard 
under its nonmanufacturer rule and on whether the current 500-employee 
size standard is appropriate. SBA also welcomes suggestions, with 
supporting data, on whether a different size standard would be more 
appropriate for the nonmanufacturer rule.
    4. For several industries in NAICS Sector 42, based on industry 
structure, SBA proposes relatively large increases for some industries, 
while for others the proposed increases are modest. SBA seeks feedback 
on whether, as a policy, the Agency should limit the increase or 
decrease of a size standard, or establish minimum or maximum values for 
its size standards. SBA also invites suggestions on alternative levels 
of changes to size standards and on their minimum or maximum levels if 
commenters think they are more appropriate.
    5. SBA's proposed size standards for its financial programs are 
based on the evaluation of four industry factors--average firm size, 
average assets size (as a proxy of startup costs and entry barriers), 
four-firm concentration ratio, and the distribution of firms by size. 
SBA welcomes comments on the appropriateness of these factors, and/or 
suggestions of other factors that it should consider when evaluating or 
revising size standards. SBA also seeks information on alternative data 
sources, if the data it used have weaknesses or issues.
    6. SBA gives equal weight to each industry factor in all industries 
in this rule. These include average firm size (as measured by the 
average of the simple average and the weighted average), startup cost 
and entry barriers as measured by average asset size per firm in an 
industry, industry competition as measured by the four-firm 
concentration ratio, and the size distribution of economic activity as 
measured by the Gini coefficient of receipts within employee firm size 
distributions within an industry. SBA seeks feedback on whether it 
should continue giving equal weights 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.
    7. For analytical simplicity and efficiency, in this proposed rule, 
SBA has refined its size standard methodology to obtain a single value 
as a proposed size standard instead of a range of values in the past. 
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 proposed size standards revisions and size standards 
methodology that the Agency applied in this proposed rule. Commenters 
addressing size standards for specific industries or a group of 
industries should include relevant data and/or other information 
supporting their comments or suggestions. 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, 
startup 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 of this proposed rule below. This is also not a 
``major rule'' under the Congressional Review Act.

Cost Benefit Analysis

1. Is there a need for the regulatory action?
    SBA believes that proposed revisions to employee based size 
standards in Wholesale Trade and Retail Trade sectors will better 
reflect the economic characteristics of small businesses in those 
sectors and maximize benefits small businesses receive from Federal 
programs. 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

[[Page 28644]]

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 Small Business Jobs Act of 2010 
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 
the size standards of industries covered by this rule.
2. What are the potential benefits and costs of this regulatory action?
    The most significant benefit to businesses obtaining small business 
status because of proposed increases in employee based size standards 
in this proposed rule, if adopted, is gaining eligibility for SBA's 
financial assistance programs. These include SBA's 7(a), CDC/504, and 
Economic Injury Disaster Loan (EIDL) programs. The following groups 
would benefit from the proposed size standards revisions in this rule, 
if adopted as proposed: (1) Some businesses that are above the current 
size standards would gain small business status under the higher size 
standards, thereby enabling them to participate in SBA's financial 
assistance programs; and (2) growing small businesses that are close to 
exceeding the current size standards would be able to retain their 
small business status under the higher size standards, thereby enabling 
them to continue their participation in those programs.
    SBA estimates that in 47 industries for which it proposes to 
increase employee based size standards in Sectors 42 and 44-45, nearly 
4,000 firms, not small under the existing size standards, will become 
small under the proposed size standards, if adopted, and therefore will 
become eligible for SBA's financial assistance programs. That is an 
increase of 1.1 percent of all firms classified as small under the 
current employee based size standards in those sectors. For the 
industries reviewed in this rule, the data indicate that it is mostly 
businesses much smaller than the current size standards that use the 
SBA's 7(a) and 504 loan programs. Based on the fiscal years 2010-2012 
data, SBA estimates up to about 50 loans totaling about $20 million 
could be made under its 7(a) and CDC/504 Programs 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 those 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, 
explained above, 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 EIDL 
program. Since this program is contingent on the occurrence and 
severity of a disaster, SBA cannot make a meaningful estimate of this 
impact.
    Since NAICS codes in Wholesale Trade and Retail Trade sectors and 
their industry specific size standards do not apply to Federal 
procurement programs and SBA has proposed no change to the 500-employee 
size standard under the nonmanufacturer rule, the proposed changes in 
industry specific size standards would have no impact on Federal 
procurement dollars. However, SBA's proposal to retain the current 500-
employee size standard under the nonmanufacturer rule will enable firms 
in Wholesale and Retail Trade industries to maintain their eligibility 
for Federal supply procurements 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).
    More businesses will benefit from a variety of Federal regulatory 
and other programs that use SBA's size standards. Such benefits may 
include, but are not limited to, reduced fees, less paperwork, or 
exemption from compliance or other regulatory requirements.
    To the extent that those 4,000 newly defined additional small firms 
under the proposed employee based size standards become active in 
seeking Federal assistance, the proposed changes, 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 
guaranteed loans, more firms eligible for enrollment in the System of 
Award Management (SAM) database, and more firms seeking certification 
as 8(a) or HUBZone firms or qualifying for small business, WOSB, 
EDWOSB, 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.
    The proposed revisions to the existing employee based size 
standards in Sectors 42 and 44-45 are consistent with SBA's statutory 
mandate to assist those businesses that it considers small. 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 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 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

[[Page 28645]]

needs (both procurement and non-procurement). SBA considered all input, 
suggestions, recommendations, and relevant information obtained from 
industry groups, individual businesses, and federal agencies in 
preparing this proposed rule.
    The review of employee based size standards in NAICS Sectors 42 and 
44-45 is consistent with E.O. 13563, Sec. 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 of 2010 requires SBA to conduct a 
detailed review of all size standards and to make appropriate 
adjustments to reflect market conditions. Specifically, it 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 than once every 
five 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 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 Sector 42, Wholesale Trade, and some small businesses in 
Sectors 44-45, Retail Trade. As described above, this rule may affect 
small businesses seeking loans under SBA's 7(a), 504, and Economic 
Injury Disaster Loan Programs, and assistance under other federal small 
business programs.
    Immediately following, SBA sets forth an initial regulatory 
flexibility analysis (IRFA) of this proposed rule addressing the 
following questions: (1) What are the need for and objectives of the 
rule? (2) What are SBA's description and estimate of the number of 
small businesses to which the rule will apply? (3) What are the 
projected reporting, record keeping, and other compliance requirements 
of the rule? (4) What are the relevant federal rules that may 
duplicate, overlap, or conflict with the rule? and (5) What 
alternatives will allow the Agency to accomplish its regulatory 
objectives while minimizing the impact on small businesses?
1. What are the need for and objective of the rule?
    Changes in industry structure, technological changes, productivity 
growth, mergers and acquisitions, and updated industry definitions have 
changed the structure of many industries in Sectors 42 and 44-45. 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 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, nearly 4,000 
more firms in Sectors 42 and 44-45 will become small for financial 
assistance under the revised employee based size standards. That 
represents 1.1 percent of total firms that are small under current 
employee based size standards in all industries within those sectors 
that are covered by this proposed rule. The proposed size standards, if 
adopted, will enable more small businesses to retain their small 
business status for a longer period. Additionally, many firms that may 
have exceeded the current size standards and lost their eligibility for 
SBA's financial assistance and other Federal programs for small 
businesses will regain eligibility for those programs under the 
proposed employee based size standards, if adopted.
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. Qualifying for 
SBA's financial does not require that businesses register in the 
Systems of Award Management (SAM) database and certify in SAM that they 
are small at least once annually. However, some newly qualified small 
businesses under the proposed size standards may want to participate in 
the federal government procurement and other programs that require 
firms to register and certify in SAM. Therefore, those businesses must 
comply with SAM requirements. There are no costs associated with either 
SAM registration or annual certification. Changing size standards 
alters the access to SBA's financial and other Federal programs that 
assist small businesses, but does not impose a regulatory burden 
because they neither regulate nor control business behavior.
4. What are the relevant federal rules, which may duplicate, overlap, 
or conflict with the rule?
    Under section 3(a)(2)(C) of the Small Business Act, 15 U.S.C. 
632(a)(2)(c), Federal agencies must 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 develop different size standards if they believe that SBA's 
size standards are not appropriate for their programs, with the 
approval of SBA's Administrator (13 CFR 121.903). The RFA authorizes a 
Federal agency to establish an alternative small business definition, 
after consultation with the Office of Advocacy of the U.S. Small

[[Page 28646]]

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

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

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

0
2. In Sec.  121.201, in the table ``Small Business Size Standards by 
NAICS Industry'' revise the entries for ``423110'', ``423120'', 
``423130'', ``423310'', ``423320'', ``423330'', ``423410'', ``423420'', 
``423430'', ``423450'', ``423460'', ``423490'', ``423510'', ``423610'', 
``423620'', ``423690'', ``423710'', ``423720'', ``423730'', ``423810'', 
``423860'', ``423920'', ``424110'', ``424120'', ``424130'', ``424210'', 
``424320'', ``424340'', ``424410'', ``424420'', ``424430'', ``424440'', 
``424450'', ``424470'', ``424490'', ``424510'', ``424610'', ``424690'', 
``424710'', ``424720'', ``424810'', ``424820'', ``424910'', ``424920'', 
``424940'', ``424950'', and ``454310'' to read as follows:


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

* * * * *

             Small Business Size Standards by NAICS Industry
------------------------------------------------------------------------
                                          Size standards  Size standards
   NAICS C odes     NAICS U.S. industry   in millions of   in number of
                           title              dollars        employees
------------------------------------------------------------------------
 
                              * * * * * * *
423110...........  Automobile and Other   ..............             250
                    Motor Vehicle
                    Merchant Wholesalers.
423120...........  Motor Vehicle          ..............             200
                    Supplies and New
                    Parts Merchant
                    Wholesalers.
423130...........  Tire and Tube          ..............             200
                    Merchant Wholesalers.
 
                              * * * * * * *
423310...........  Lumber, Plywood,       ..............             150
                    Millwork, and Wood
                    Panel Merchant
                    Wholesalers.
423320...........  Brick, Stone, and      ..............             150
                    Related Construction
                    Material Merchant
                    Wholesalers.
423330...........  Roofing, Siding, and   ..............             200
                    Insulation Material
                    Merchant Wholesalers.
 
                              * * * * * * *
423410...........  Photographic           ..............             200
                    Equipment and
                    Supplies Merchant
                    Wholesalers.
423420...........  Office Equipment       ..............             200
                    Merchant Wholesalers.
423430...........  Computer and Computer  ..............             250
                    Peripheral Equipment
                    and Software
                    Merchant Wholesalers.
 
                              * * * * * * *
423450...........  Medical, Dental, and   ..............             200
                    Hospital Equipment
                    and Supplies
                    Merchant Wholesalers.
423460...........  Ophthalmic Goods       ..............             150
                    Merchant Wholesalers.
423490...........  Other Professional     ..............             150
                    Equipment and
                    Supplies Merchant
                    Wholesalers.
423510...........  Metal Service Centers  ..............             200
                    and Other Metal
                    Merchant Wholesalers.
 
                              * * * * * * *
423610...........  Electrical Apparatus   ..............             200
                    and Equipment,
                    Wiring Supplies, and
                    Related Equipment
                    Merchant Wholesalers.
423620...........  Household Appliances,  ..............             200
                    Electric Housewares,
                    and Consumer
                    Electronics Merchant
                    Wholesalers.
423690...........  Other Electronic       ..............             250
                    Parts and Equipment
                    Merchant Wholesalers.
423710...........  Hardware Merchant      ..............             150
                    Wholesalers.
423720...........  Plumbing and Heating   ..............             200
                    Equipment and
                    Supplies (Hydronics)
                    Merchant Wholesalers.
423730...........  Warm Air Heating and   ..............             150
                    Air-Conditioning
                    Equipment and
                    Supplies Merchant
                    Wholesalers.
 
                              * * * * * * *
423810...........  Construction and       ..............             250
                    Mining (except Oil
                    Well) Machinery and
                    Equipment Merchant
                    Wholesalers.
 
                              * * * * * * *
423860...........  Transportation         ..............             150
                    Equipment and
                    Supplies (except
                    Motor Vehicle)
                    Merchant Wholesalers.
 
                              * * * * * * *
423920...........  Toy and Hobby Goods    ..............             150
                    and Supplies
                    Merchant Wholesalers.
 
                              * * * * * * *
424110...........  Printing and Writing   ..............             200
                    Paper Merchant
                    Wholesalers.
424120...........  Stationery and Office  ..............             150
                    Supplies Merchant
                    Wholesalers.
424130...........  Industrial and         ..............             150
                    Personal Service
                    Paper Merchant
                    Wholesalers.
424210...........  Drugs and Druggists'   ..............             250
                    Sundries Merchant
                    Wholesalers.
 

[[Page 28647]]

 
                              * * * * * * *
424320...........  Men's and Boys'        ..............             150
                    Clothing and
                    Furnishings Merchant
                    Wholesalers.
 
                              * * * * * * *
424340...........  Footwear Merchant      ..............             200
                    Wholesalers.
424410...........  General Line Grocery   ..............             250
                    Merchant Wholesalers.
424420...........  Packaged Frozen Food   ..............             200
                    Merchant Wholesalers.
424430...........  Dairy Product (except  ..............             200
                    Dried or Canned)
                    Merchant Wholesalers.
424440...........  Poultry and Poultry    ..............             150
                    Product Merchant
                    Wholesalers.
424450...........  Confectionery          ..............             200
                    Merchant Wholesalers.
 
                              * * * * * * *
424470...........  Meat and Meat Product  ..............             150
                    Merchant Wholesalers.
 
                              * * * * * * *
424490...........  Other Grocery and      ..............             250
                    Related Products
                    Merchant Wholesalers.
424510...........  Grain and Field Bean   ..............             200
                    Merchant Wholesalers.
 
                              * * * * * * *
424610...........  Plastics Materials     ..............             150
                    and Basic Forms and
                    Shapes Merchant
                    Wholesalers.
424690...........  Other Chemical and     ..............             150
                    Allied Products
                    Merchant Wholesalers.
424710...........  Petroleum Bulk         ..............             200
                    Stations and
                    Terminals.
424720...........  Petroleum and          ..............             200
                    Petroleum Products
                    Merchant Wholesalers
                    (except Bulk
                    Stations and
                    Terminals).
424810...........  Beer and Ale Merchant  ..............             200
                    Wholesalers.
424820...........  Wine and Distilled     ..............             250
                    Alcoholic Beverage
                    Merchant Wholesalers.
424910...........  Farm Supplies          ..............             200
                    Merchant Wholesalers.
424920...........  Book, Periodical, and  ..............             200
                    Newspaper Merchant
                    Wholesalers.
 
                              * * * * * * *
424940...........  Tobacco and Tobacco    ..............             250
                    Product Merchant
                    Wholesalers.
424950...........  Paint, Varnish, and    ..............             150
                    Supplies Merchant
                    Wholesalers.
 
                              * * * * * * *
454310...........  Fuel Dealers.........  ..............             100
 
                              * * * * * * *
------------------------------------------------------------------------


    Dated: May 5, 2014.
Maria Contreras-Sweet,
Administrator.
[FR Doc. 2014-11269 Filed 5-16-14; 8:45 am]
BILLING CODE 8025-01-P