Size always matters–even on unrestricted procurements.   That’s the message coming from SBA in light of a proposed rule making a number of changes to its size regulations, primarily to address small business set-asides within the context of multiple-award award contracts.  Buried in the proposed regulation is an interesting change: the SBA intends to give the SBA Office of Hearings and Appeals the right to hear challenges to NAICS code designations, even when a procurement is not set-aside for small businesses.

For many years, SBA OHA has dismissed NAICS appeals on unrestricted procurements, stating, in essence, that there is no purpose in appealing the NAICS code when no set-aside is involved.  Although the SBA’s proposed rule doesn’t go into great detail, it seems to me that size can be advantageous, even on an unrestricted procurement.  For instance, a small business generally is exempt from the subcontracting plan requirement, but an “other than small” business typically must submit a subcontracting plan.  Likewise, a HUBZone-certified company will only qualify for the HUBZone price preference if it qualifies as small for the procurement.

Kudos to SBA for recognizing that size always matters, and proposing to amend the NAICS appeal rules accordingly.  Let’s hope that this proposal sticks in the final regulation.