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PA Makes Changes for More Businesses to Qualify as Small Business

Department of General Services (DGS) Secretary Reggie McNeil announced that DGS has updated the Commonwealth’s definition of a small business by raising the revenue limit from $38.5 million to $47 million effective January 1, 2024, ensuring more small businesses can qualify and increasing opportunities for small businesses (SBs), small diverse businesses (SDBs), and veteran business enterprises (VBEs) to compete for state business contracts.

The changes in revenue limit thresholds will further align the Department of General Service’s definition of small business with the U.S. Small Business Administration’s (SBA), which accounts for inflation. The revenue limit threshold was last increased by DGS in 2018. By raising the revenue cap, more small businesses who have been priced out of qualifying for Commonwealth small business programs because of inflation will now be able to qualify for these programs.

“Being able to accept more small businesses is instrumental to increasing their participation in state contracts, and providing assistance to them is key to retaining their business. We have been taking the steps to fully implement the Executive Order and now we can move at full speed to put it to work,” said Secretary McNeil.

Additionally, the Executive Order directs DGS to lead and coordinate efforts with other Commonwealth agencies to grow their total operational spend and participation in the Commonwealth’s Small Business Reserve (SBR) program; increases opportunities for SBS, SDBs, and VBEs to secure prime contracts; and instructs DGS, the Pennsylvania Department of Transportation (PennDOT), and other state agencies to provide key technical and capital access support to small and small diverse businesses. To track and ensure spending growth with SBs, SDBs, and VBEs, DGS will post semiannual data for each agency’s total operational spend for SBR procurements.


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