House Committee Revisits Runway Extension Act

Most contractors are aware that President Trump signed into law the Small Business Runway Extension Act of 2018 on December 17, 2018. The Act modified how the Small Business Administration (SBA) calculates a business’ size for revenue-based size standards. Size has been calculated based on a three fiscal year average of annual receipts. The Act increased the period of time in the calculation from three years to five.

The Act, however, contained no effective date. On December 21, 2018, SBA issued an information notice announcing the new statute would not take effect until the SBA revised its regulations. It is settled law, however, that absent an express effective date, enactments of Congress are effective when executed by the President. Johnson v. United States, 529 U.S. 694 (2000).

On May 1, 2019, The House Committee on Small Business passed a bill titled “Clarifying the Small Business Runway Extension Act.” The bill requires SBA to finalize implementing regulations no later than December 17, 2019, one year from the original enactment. In a jab to SBA, the Committee also passed an amendment stating the Act was intended to be effective when enacted.

This bill must still pass the full House and Senate and be signed by the President to become law.

More to follow…

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