Clarifying the Small Business Runway Extension Act

Floor Speech

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Mr. DELGADO. Mr. Speaker, I move to suspend the rules and pass the bill (H.R. 2345) to amend the Small Business Act to clarify the intention of Congress that the Administrator of the Small Business Administration is subject to certain requirements with respect to establishing size standards for small business concerns, and for other purposes, as amended.

The Clerk read the title of the bill.

The text of the bill is as follows: H.R. 2345

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, SECTION 1. SHORT TITLE.

This Act may be cited as the ``Clarifying the Small Business Runway Extension Act''. SEC. 2. SENSE OF CONGRESS.

It is the sense of Congress that--

(1) the Small Business Runway Extension Act of 2018 (Public Law 115-324) applies to calculations of the size of a business concern made by the Administrator of the Small Business Administration;

(2) Federal agencies rely upon such calculations to award contracts, including governmentwide acquisition contracts, to small business concerns; and

(3) the Small Business Runway Extension Act of 2018 has been effective since the date it was signed into law, on December 17, 2018. SEC. 3. CLARIFYING AMENDMENT TO THE SMALL BUSINESS RUNWAY EXTENSION ACT OF 2018.

Section 3(a)(2)(C) of the Small Business Act (15 U.S.C. 632(a)(2)(C)) is amended by inserting ``(including the Administration when acting pursuant to subparagraph (A))'' after ``no Federal department or agency''. SEC. 4. FINALIZATION OF SMALL BUSINESS RUNWAY EXTENSION ACT OF 2018 RULES.

The Administrator of the Small Business Administration shall issue a final rule implementing the Small Business Runway Extension Act of 2018 (Public Law 115-324) not later than December 17, 2019. SEC. 5. AMENDMENT TO SIZE STANDARDS FOR CERTAIN SMALL BUSINESS CONCERNS.

(a) Size Standards for Small Business Concerns Providing Services.--Section 3(a)(2)(C)(ii)(II) of the Small Business Act (15 U.S.C. 632(a)(2)(C)(ii)(II)) is amended by striking ``not less than''.

(b) Size Standards for Other Business Concerns.--Section 3(a)(2)(C)(ii)(III) of the Small Business Act (15 U.S.C. 632(a)(2)(C)(ii)(III)) is amended by striking ``not less than 3 years'' and inserting ``5 years''. SEC. 6. TRANSITION PLAN FOR THE SMALL BUSINESS RUNWAY EXTENSION ACT OF 2018.

(a) Plan Required.--Not later than 90 days after the date of the enactment of this Act, the Administrator of the Small Business Administration shall implement a transition plan to assist business concerns and Federal agencies with compliance with the requirements of the Small Business Runway Extension Act of 2018 (Public Law 115-324).

(b) 3-Year Calculation for Size Standards.--

(1) In general.--The transition plan described under subsection (a) shall include a requirement that, during the period beginning on December 17, 2018, and ending on the date that is 6 months after the date on which the Administrator issues final rules implementing the Small Business Runway Extension Act of 2018 (Public Law 115-324), allows the use of a 3-year calculation for a size standard to be applied to a business concern if the use of such 3-year calculation allows such concern to be considered a small business concern under section 3(a)(1) of the Small Business Act (15 U.S.C. 632(a)(1)).

(2) 3-year calculation defined.--In this subsection, the term ``3-year calculation'' means--

(A) with respect to a business concern providing services described under clause (ii)(II) of such section, a determination of the size of such concern on the basis of the annual average gross receipts of such concern over a period of 3 years; and

(B) with respect to a business concern described under clause (ii)(III) of such section, a determination of the size of such concern on the basis of data over a period of 3 years. SEC. 7. REQUIREMENT TO UPDATE SAM.

Not later than 90 days after the date of the enactment of this Act, the System for Award Management (or any successor system) shall be updated to comply with the requirements of this Act.

Mr. Speaker, I rise in support of H.R. 2345, the Clarifying the Small Business Runway Extension Act of 2019.

The Federal Government recognizes two categories of businesses: small and other-than small. Since there is no Federal definition for ``other- than small,'' this category can encompass firms that barely exceed the SBA's small business size standards, up to the multibillion-dollar household names.

To ease the transition from ``small'' to ``other-than small'' to give growing businesses a real chance at competing against some of the biggest companies in the world, we enacted the Small Business Runway Extension Act last year.

By increasing the average-receipts-based calculation for SBA size standards, transitioning firms will have more time to grow and develop their competitiveness and infrastructure.

However, since the Runway Extension Act became law, its interpretation and implementation have been thwarted by the agency responsible for its implementation. This conflict between law and regulation has created much confusion in the Federal contracting community.

The bill before us today clearly and unequivocally states Congress' intention regarding the Runway Extension Act of 2018. It sets forth a specific date by which SBA must complete their rulemaking process while also creating a transition plan for small firms caught up in this tug of war.

Mr. Speaker, I commend Representatives Stauber and Golden for collaborating to find a resolution to this issue, and I urge my colleagues to support the bill.

Mr. Speaker, I thank Representative Stauber and Representative Golden for working together on this important bill to ensure that congressional intent is not thwarted when it comes to the adequate and prompt implementation of the Small Business Runway Extension Act of 2018. That law was intended to make it easier for small Federal contractors to transition into the open marketplace.

The SBA has interpreted that the Small Business Runway Extension Act of 2018 applies to every other agency adopting its own size standard but not the SBA itself. Many small businesses and legal experts disagreed with the SBA's position, as did our committee.

This bipartisan bill reiterates that the law has been effective since its enactment and requires the SBA to issue a final rule for its implementation before the end of this year.

Mr. Speaker, I urge my colleagues to support the bill, and I yield back the balance of my time.

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