Back on August 19, 2026, SBA issued proposed rules–one covering what would change and one covering the underlying methodology. This would, in most cases, monumentally increase the size standards for the various industries that perform federal contracts, along with simplifying how industries are categorized and switching several industries from receipts-based to employee-based size standards. Indeed, we had two separate posts on these changes, one exploring the actual size standard increases and the other exploring the recategorization and switch to employee-based size standards. SBA initially set a deadline of September 21, 2026, for comments on these changes. Now, it is extending that date, as we’ll explore briefly below.
When SBA issued the above proposed rules, it was almost immediately deluged by comments. The main rule received over 60,000 comments (at least that’s what the Federal Register says, whether it is actually that number is hard to tell as only approximately 2,700 comments have been published) by the time of the initial September 21, 2026, deadline. We have, of course, not been able to review each and every comment, but from what we have seen, the response to SBA’s proposal has been sharply negative. Indeed, SBA quickly announced and conducted a virtual town hall on September 17, 2026, to get feedback on its proposed rules. It is our understanding that an overwhelming majority of commentators disapproved of SBA’s plans.
On September 20, 2026, right before the comments deadline, SBA issued a memorandum extending the comment period to November 20, 2026. In this memorandum, SBA stated:
The Agency requested comments on its size standards notice of proposed rulemaking and methodology. Initially, SBA established a 30-day comment period for the proposed rulemaking and methodology, with closing dates of September 21, 2026. In response to requests for additional time to comment and following the SBA’s clarification of the impacts of SBA’s proposed changes, the Agency is extending the comment periods for an additional 60 days after September 21, 2026, the date the initial comment periods were scheduled to close. Comments must now be received on or before November 20, 2026.
With regards to “the SBA’s clarification of the impacts of SBA’s proposed changes,” on the same day as the town hall, SBA released a statement stating that it now anticipates the changes to the size standards would result in “4,000 to 6,000” federal contractors gaining small business status. This is, to say the least, quite the far cry from the SBA’s initial estimate that approximately 114,000 businesses would gain small business status. This might provide some consolation to small business contractors worried about the potential of the changes to massively expand their competitor numbers. However, it is unclear what is the basis for SBA’s adjustment in estimate or why there is such a stark difference between the initial estimate and the new estimate. SBA has, as of the date of this post, not provided any of the figures or data upon which its analysis is based. As such, it may be wise to maintain a cautious view towards SBA’s analysis.
In any case, in addition to appearing to provide some reprieve to those contractors that opposed the size standard changes, contractors can continue to get their thoughts on the proposed size standard changes to SBA. We recommend any and all small business contractors provide their thoughts, be it that they are in support or opposition, as the scale of the proposed changes are truly unparalleled and demand as much commentary as can be made.
If you wish to submit commentary, you may do so here: https://www.federalregister.gov/documents/2026/09/24/2026-19546/small-business-size-standards#open-comment,
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