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Barry McVay's FEDERAL CONTRACTS DISPATCH

DATE: May 15, 2000

FROM: Barry McVay, CPCM

SUBJECT: Small Business Administration (SBA); North American Industry Classification System (NAICS) Small Business Size Standards

SOURCE: Federal Register, May 15, 2000, Vol. 65, No. 94, page 30836

AGENCIES: Small Business Administration (SBA)

ACTION: Final Rule

SYNOPSIS: The SBA is amending its small business size regulations by establishing a new set of small business size standards for industries based on the NAICS. These new size standards are effective for all small business programs on October 1, 2000, and will replace the existing size standards based on the Standard Industrial Classification (SIC) system.

EDITOR'S NOTE: NAICS is a system devised by the United States, Canada, and Mexico for classifying establishments by type of economic activity. Its purposes are: (1) to facilitate the collection, tabulation, presentation, and analysis of data relating to establishments, and (2) to promote uniformity and comparability in the presentation and analysis of statistical data describing the economy. The NAICS was first published in 1997, and it is replacing the Standard Industrial Classification (SIC), which was originally developed in the 1930s and last updated by the Office of Management and Budget (OMB) in 1987. The NAICS reflects the enormous changes in technology and the growth and diversification of services that have marked recent years much better than does the SIC.

The NAICS uses a 6-digit hierarchical structure to classify establishments, as follows:

SectorFirst two digitsSector 21 -- Mining
SubsectorFirst three digitsSubsector 212, Mining (except Oil and Gas)
Industry GroupFirst four digitsIndustry Group 2122 -- Metal Ore Mining
NAICS IndustryFirst five digitsNAICS Industry 21223 -- Copper, Nickel, Lead, and Zinc (in general, this is the lowest level of compatibility among the three countries)
National IndustryAll six digitsU.S. Industry 212231 -- Lead Ore and Zinc Ore (the sixth digit provides the necessary detail for national economic statistics, and reflects the fact that the economies of the three countries are structured very differently)

The existing SIC-based small business size standards, which were in Federal Acquisition Regulation (FAR) 19.102, Size Standards, until December 27, 1999, are published by the SBA on the Internet at http://www.sba.gov/regulations/siccodes.

The Bureau of the Census maintains an NAICS web site. Available on the web site are tables cross-referencing SIC codes to the comparable NAICS codes and NAICS codes to the comparable SIC codes.

For more on a proposal to restructure the construction (Sector 23), wholesale trade (Sector 42), and information sectors (Sector 51) of NAICS, see the April 20, 2000, FEDERAL CONTRACTS DISPATCH "Office of Management and Budget; North American Industry Classification System -- Update for 2002."

EFFECTIVE DATE: October 1, 2000.

FOR FURTHER INFORMATION CONTACT: Carl Jordan, Office of Size Standards, 202-205-6618.

SUPPLEMENTAL INFORMATION: On October 22, 1999, the Small Business Administration (SBA) published a proposal to amend its small business size regulations by replacing the SIC-based size standards with NAICS-based size standards. Three comments were submitted, two from industry groups (moving and storage companies; environmental contractors) and one from an SBA office. All supported the proposed rule, so the proposed rule is adopted without change except for a few editorial corrections -- SBA has not made any changes to the NAICS size standards that were proposed on October 22, 1999.

The following are the NAICS sectors (2-digit) and subsectors (3-digit) to aid in locating applicable size standards (see page 30836 of the May 15, 2000, Federal Register):

Sector 11 -- Agriculture, Forestry and Fishing
      Subsector 111 -- Crop Production
      Subsector 112 -- Animal Production
      Subsector 113 -- Forestry and Logging
      Subsector 114 -- Fishing, Hunting and Trapping
      Subsector 115 -- Support Activities for Agriculture and Forestry

Sector 21 -- Mining
      Subsector 211 -- Oil and Gas Extraction
      Subsector 212 -- Mining (except Oil and Gas)

Sector 22 -- Utilities
      Subsector 221 -- Utilities

Sector 23 -- Construction
      Subsector 233 -- Building, Developing and General Contracting
      Subsector 234 -- Heavy Construction
      Subsector 235 -- Special Trade Contractors

Sectors 31 to 33 -- Manufacturing
      Subsector 311 -- Food Manufacturing
      Subsector 312 -- Beverage and Tobacco Product Manufacturing
      Subsector 313 -- Textile Mills
      Subsector 314 -- Textile Product Mills
      Subsector 315 -- Apparel Manufacturing
      Subsector 316 -- Leather and Allied Product Manufacturing
      Subsector 321 -- Wood Product Manufacturing
      Subsector 322 -- Paper Manufacturing
      Subsector 323 -- Printing and Related Support Activities
      Subsector 324 -- Petroleum and Coal Products Manufacturing
      Subsector 325 -- Chemical Manufacturing
      Subsector 326 -- Plastics and Rubber Products Manufacturing
      Subsector 327 -- Nonmetallic Mineral Product Manufacturing
      Subsector 331 -- Primary Metal Manufacturing
      Subsector 332 -- Fabricated Metal Product Manufacturing
      Subsector 333 -- Machinery Manufacturing
      Subsector 334 -- Computer and Electronic Product Manufacturing
      Subsector 335 -- Electrical Equipment, Appliance and Component Manufacturing
      Subsector 336 -- Transportation Equipment Manufacturing
      Subsector 337 -- Furniture and Related Product Manufacturing
      Subsector 339 -- Miscellaneous Manufacturing

Sector 42 -- Wholesale Trade
      Subsector 421 -- Wholesale Trade -- Durable Goods
      Subsector 422 -- Wholesale Trade -- Nondurable Goods

Sectors 44 and 45 -- Retail Trade
      Subsector 441 -- Motor Vehicle and Parts Dealers
      Subsector 442 -- Furniture and Home Furnishings Stores
      Subsector 443 -- Electronics and Appliance Stores
      Subsector 444 -- Building Material and Garden Equipment and Supplies Dealers
      Subsector 445 -- Food and Beverage Stores
      Subsector 446 -- Health and Personal Care Stores
      Subsector 447 -- Gasoline Stations
      Subsector 448 -- Clothing and Clothing Accessories Stores
      Subsector 451 -- Sporting Good, Hobby, Book and Music Stores
      Subsector 452 -- General Merchandise Stores
      Subsector 453 -- Miscellaneous Store Retailers

Sectors 48 and 49 -- Transportation
      Subsector 481 -- Air Transportation
      Subsector 482 -- Rail Transportation
      Subsector 483 -- Water Transportation
      Subsector 484 -- Truck Transportation
      Subsector 485 -- Transit and Ground Passenger Transportation
      Subsector 486 -- Pipeline Transportation
      Subsector 487 -- Scenic and Sightseeing Transportation
      Subsector 488 -- Support Activities for Transportation
      Subsector 491 -- Postal Service
      Subsector 492 -- Couriers and Messengers
      Subsector 493 -- Warehousing and Storage

Sector 51 -- Information
      Subsector 511 -- Publishing Industries
      Subsector 512 -- Motion Picture and Sound Recording Industries
      Subsector 513 -- Broadcasting and Telecommunications
      Subsector 514 -- Information Services and Data Processing Services

Sector 52 -- Finance and Insurance
      Subsector 522 -- Credit Intermediation and Related Activities
      Subsector 523 -- Financial Investments and Related Activities
      Subsector 524 -- Insurance Carriers and Related Activities
      Subsector 525 -- Funds, Trusts and Other Financial Vehicles

Sector 53 -- Real Estate and Rental and Leasing
      Subsector 531 -- Real Estate
      Subsector 532 -- Rental and Leasing Services
      Subsector 533 -- Lessors of Nonfinancial Intangible Assets (except Copyrighted Works)

Sector 54 -- Professional, Scientific and Technical Services
      Subsector 541 -- Professional, Scientific and Technical Services

Sector 55 -- Management of Companies and Enterprises
      Subsector 551 -- Management of Companies and Enterprises

Sector 56 -- Administrative and Support, Waste Management and Remediation Services
      Subsector 561 -- Administrative and Support Services
      Subsector 562 -- Waste Management and Remediation Services

Sector 61 -- Educational Services
      Subsector 611 -- Educational Services

Sector 62 -- Health Care and Social Assistance
      Subsector 621 -- Ambulatory Health Care Services
      Subsector 622 -- Hospitals
      Subsector 623 -- Nursing and Residential Care Facilities
      Subsector 624 -- Social Assistance

Sector 71 -- Arts, Entertainment and Recreation
      Subsector 711 -- Performing Arts, Spectator Sports and Related Industries
      Subsector 712 -- Museums, Historical Sites and Similar Institutions
      Subsector 713 -- Amusement, Gambling and Recreation Industries

Sector 72 -- Accommodation and Food Services
      Subsector 721 -- Accommodation
      Subsector 722 -- Food Services and Drinking Places

Sector 81 -- Other Services
      Subsector 811 -- Repair and Maintenance
      Subsector 812 -- Personal and Laundry Services
      Subsector 813 -- Religious, Grantmaking, Civic, Professional and Similar Organizations

FOR FURTHER INFORMATION CONTACT: Barry McVay at 703-451-5953 or by e-mail to BarryMcVay@FedGovContracts.com.

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