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April 24, 2014

What's New Out There? A Business Regulatory Update

When it comes to government regulations, nothing ever stays the same. Following are some key regulatory updates/proposed changes over the last month that we thought might be of interest to government contractors, particularly small businesses who often bear the brunt of the government regulations.

Proposed Rule Regarding FAR Uniform Procurement Identification (FAR Case 2012-023)

A proposed rule was published on June 6, 2013 to amend the FAR to include information regarding implementation of a uniform Government-wide numbering system for procurements, which is part of an on-going initiative to standardize procurement transactions and enhance transparency of Federal spending data. See 78 Fed. Reg. 34020. The Procurement Instrument Identification (PIID) system utilizes unique Activity Address Codes (AACs), which are codes consisting of six alpha and/or numeric characters that identify specific agency offices or units, as well as other alpha and numeric characters to identify the instrument type, year, and vehicle number provided by the issuing agency. The PIID may be anywhere between thirteen and seventeen characters. The AAC will be the first six characters while the seventh and eighth characters will identify the fiscal year in which the solicitation or contract was issued or awarded. The ninth character will be a letter designated to correspond to the type of instrument at issue, and the remaining characters will be a number assigned to the instrument by the issuing agency. The rule proposes that the new PIID system be used for new solicitations and contracts beginning no later than October 1, 2014 and shall be applied to all existing contract actions no later than October 1, 2016. Comments on the proposed rule are due August 5, 2013.

So… time will tell whether this new system actually streamlines the procurement process and provides higher fidelity data with regard to government spending. But if it works to improve coordination among government purchasers, we support.

Small Business Administration Updates

June 16 through June 22, 2013 was National Small Business Week, during which we (the public) were encouraged by the President to continue to invest in and enable the success of America’s small businesses. See 78 Fed. Reg. 37425. Coincident with this recent “observance,” the Small Business Administration (SBA) published the following final rules (all of which are effective July 22, 2013) regarding changes to small business size standards:

  • Size standards were increased for 11 industries in North American Industry Classification System (NAICS) Sector 11, Agriculture, Forestry, Fishing and Hunting. See 78 Fed. Reg. 37398.
  • Size standards were increased for three industries in NAICS Subsector 213, Support Activities for Mining. See 78 Fed. Reg. 37404. The size standard more than doubled for these three industries.
  • Size standards were increased for 36 industries in NAICS Sector 52, Finance and Insurance, and for two industries in Sector 55, Management of Companies and Enterprises. See 78 Fed. Reg. 37409. The size standard increased dramatically for the majority of these industries.
  • Size standards were increased for 17 industries in NAICS Sector 71, Arts, Entertainment, and Recreation. See 78 Fed. Reg. 37417. The size standard more than doubled for the majority of these industries.

What this means is that a number of companies in these various industries that once qualified as “other than small” (the oddly-phrased description that the government gives companies that are not small businesses) may soon be able to receive additional benefits and/or opportunities as a small business.

Copyright © 2014, Sheppard Mullin Richter & Hampton LLP.

About the Author

Associate

Ms. Bourne is an associate in the Government Contracts & Regulated Industries Practice Group in the firm's Washington, D.C. office. 

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