New SBA Rule Adjusts Alternative Size Standards

February 26, 2024

Delaney Sexton
Contributing Editor

New SBA Rule Adjusts Alternative Size Standards

A new rule that goes into effect on March 18, 2024, will increase SBA’s alternative size standards to adjust for inflation. The change will expand access to financial assistance and other resources for small businesses.

• The inflation adjustment increases the size standards to $20 million for tangible net worth and $6.5 million for net income.
• The Federal contract limit is increased to $9 million and can be increased to $14 million if a federal contracting officer certifies that such a guarantee is necessary.

This rule will apply to more than 8.1 million employer firms. Of those firms, 98.2% are small under industry-based size standards and 92.5% are small under the interim statutory alternative size standard. SBA is estimating that at least 500 7(a) or CDC/504 loans will be approved under alternative size standards that would not have qualified under the industry-based size standard.

Source:
SBA Final Rule