H.R. 3714, Small Agriculture Producer Size Standards Improvements Act of 2015

H.R. 3714

Small Agriculture Producer Size Standards Improvements Act of 2015

Sponsor
Rep. Mike Bost

Committee
Small Business

Date
April 18, 2016 (114th Congress, 2nd Session)

Staff Contact
John Huston

Floor Situation

On Tuesday, April 19, 2016, the House will consider H.R. 3714, the Small Agriculture Producer Size Standards Improvements Act of 2015 , under suspension of the rules. The bill was introduced on October 8, 2015, by Rep. Mike Bost (R-IL) and was referred to the Committee on Small Business, which considered this legislation as part of the markup of H.R. 4341, which was ordered reported, as amended, by voice vote, on January 13, 2016.

Bill Summary

H.R. 3714 requires the Small Business Administration (SBA) to establish small business size standards for agricultural producers through the notice and comment rulemaking process, in a similar manner to how it establishes standards for other sectors of the economy. Under current law, the size standard is statutorily set to only include agricultural businesses with less than $750,000 in annual receipts.

Background

The Small Business Administration (SBA) administers several programs to support small businesses, including loan guaranty programs, disaster loan programs, management and technical assistance training programs, and federal contracting programs.[1] The SBA administers various programs specifically targeted at assisting small businesses in the agriculture industry.[2]

The SBA generally establishes the maximum size a business can be and still be considered “small,” and subsequently eligible to participate in certain SBA programs. For all other industries, SBA sets the size standards every five years using a statutory process that is subject to notice and comment.  However, the SBA size standard for small farms and agricultural producers is statutorily set at less than $750,000 in annual receipts and cannot be reevaluated by the SBA. This size standard applies to 46 diverse subsectors of the agriculture industry including soybeans, citrus, beef cattle and poultry. The agricultural size standard has remained at the $750,000 receipts level since 2000. H.R. 3714 requires the SBA to regularly reevaluate agricultural size standards to adjust the size for inflation and other economic conditions.

According to the Small Business Subcommittee on Agriculture, Energy and Trade Chair Carlos Curbelo, “The size standard setting process for agricultural enterprises needs to be modernized.  The existing statutory size standard does not account for changes in industry structure, costs of production, economic conditions, or other factors.”

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[1] See CRS Report, “Small Business Administration and Job Creation,”  March 8, 2016.
[2] See SBA Website, Agriculture

Cost

A Congressional Budget Office (CBO) estimate is currently unavailable.

Additional Information

For questions or further information please contact John Huston with the House Republican Policy Committee by email or at 6-5539.