What is a small business in Virginia?

Some would say 50 employees, while others might say 10 or less. However, the official definition is any business with fewer than 250 employees or gross sales of less than $10 million. It makes no difference what you produce or sell, be it pencils or high-end luxury cars. It makes no difference if you are making products that require many employees or, through automation, require only a few employees. In effect, we use one measuring stick to compare every business in Virginia. With this definition, an overwhelming number of Virginia’s businesses qualify under Virginia law for certain benefits. When most businesses qualify for a benefit, the value of that program is limited.

Several years ago, several of us concluded that our citizens would be better served by a system that acknowledges that there is a difference in businesses and, therefore, would better serve different size businesses. Last year, doing this, my proposed legislation passed the Senate with no opposition. It was killed in the House for political reasons because I had worked with Democrats on the bill. This year, I introduced the exact same bill, and it passed the committee 14-0. However, I was told Friday that some would oppose the bill, not understanding the intent of the legislation even though they voted for it last year.

What the Bill Does

It requires the administration to evaluate the current policy and determine if we would not better serve citizens by grouping businesses according to type of business, just as it is in the federal government. Doing so could adjust for a fairer definition based on what the business produces or sells, better reflecting our ever-evolving business markets.

What the Bill Does Not Do

While the bill is part of the legislative code that deals with small businesses in the state, it has nothing whatsoever to do with women-owned or minority-owned businesses. This seems to be from where the opposition will come. Some erroneously think it will harm women-owned or minority businesses. The exact opposite is true. Others believe this will interfere with the micro business set-aside program that Gov. Terry McAuliffe used to assist the smallest of businesses that have fewer than five employees. This bill addresses that program not one iota.

My hope is to assist true small businesses while protecting the taxpayers of Virginia.

Marginal Bills

Senate committees worked diligently to hear those bills that were most controversial or that had limited chance of passage because of their cost to taxpayers or consumers. This will allow us more time to focus on those issues that are most important to Virginians over all.

Frank Ruff represents Lunenburg in the state Senate. His email address is Sen. Ruff@verizon.net.