On October 1, 2017, the U.S. Small Business Administration (“SBA”) updated its table of the North American Industry Classification System (“NAICS”) codes, which resulted in numerous changes, including additional industries, the merger of industries, and increased and decreased size standards. For example, NAICS 452210 (Department Stores) was combined into one industry from two 2012 NAICS Codes: 452111 (Department Stores except Discount Department Stores) and 452112 (Discount Department Stores). Additionally, NAICS 452210’s size standard increased from 29.5 Million to 32.5 Million. These NAICS code changes may not affect your company, but it remains important to stay informed about changes to the NAICS codes when updating your System for Award Management profile. Furthermore, when bidding on government procurements on the updated NAICS codes, it is crucial to make sure the Government is using the 2017 NAICS codes. But what if you raise the issue and the Government does not change the industry or size standard?
If you think the agency assigned the wrong or outdated NAICS code for a solicitation, you may file a NAICS code appeal with the SBA’s Office of Hearings and Appeals (“OHA”). To do so, you’ll have to move quickly, because OHA requires bidders to file a NAICS code appeal within ten calendar days of the solicitation’s issuance. In your appeal, you get to inform OHA about why the NAICS code designation is wrong, with supporting evidence. Moreover, OHA must issue a decision “as soon as practicable . . .” which could result in OHA directing the agency to change the solicitation prior to the deadline for final offers. Depending on the NAICS code, this could result in your firm having the ability to bid as small or even change the scope of your competition so that you do not have to compete with large businesses.
Relatedly, on October 11, 2017, SBA also updated the NAICS codes applicable for the WOSB Program to align with the 2017 NAICS codes. This update impacts the applicability of eight six-digit NAICS codes within the Program. For a detailed list of changes to the WOSB NAICS codes, click here.
About the Author: Tim Valley is an associate with PilieroMazza in the Government Contracting and Litigation Law groups. He may be reached at firstname.lastname@example.org.