This bill would allow the Small Business Administration (SBA) to establish size standards for small agricultural businesses by using the same SBA standards applied to regular small businesses. That would enable farms and their affiliates that have annual revenue exceeding $750,000 to be considered small businesses if they meet other criteria like net income or number of employees.
Within 18 months of this legislation’s enactment the SBA would be required to establish its size standards, which would then be subject to rolling review procedures.
Under current law, the SBA considers all agricultural producers with less than $750,000 per year in revenue to be “small” — which has ramifications when those businesses compete for federal contracts that may give an advantage to small businesses. Prior to 2000, when the $750,000 standard was set, small farms were defined as those with less than $500,000 in annual revenue.