28 CFR Part 36 Nondiscrimination on the Basis of Disability by Public Accommodations - Movie Theaters; Movie Captioning and Audio Description Final Rule

C. Characteristics of Impacted Small Entities

The Regulatory Flexibility Act defines a “small entity” as a small business (as defined by the SBA Size Standards) or a small organization such as a nonprofit that is “independently owned and operated” and is “not dominant in its field.” See 5 U.S.C. 601(3), (4). For Motion Picture Theaters (except Drive-Ins) (NAICS Code 512131), the SBA Size Standards categorize any firm with less than $38.5 million in annual revenue as a small business.^[26] As a result, small entities constitute the vast majority of firms in the movie exhibition industry. The latest data providing detailed breakouts of annual revenue by industry comes from the 2012 Statistics of U.S. Businesses (SUSB).^[27] This dataset provides information regarding the number of firms,^[28] establishments,^[29] and estimated annual receipts ^[30] (annual revenue) for each of the 17 revenue size categories in the movie exhibition industry. According to this data, 12 of the 17 revenue size categories contain firms with estimated annual receipts of less than the $38.5 million SBA size standard for a small business in this industry. Because these firms are considered small businesses by the SBA size standards, they are also considered small entities for purposes of this FRFA. An additional category of firms with annual receipts between $35 million and $40 million contains firms that may or may not have annual revenue below the $38.5 million threshold. For the purposes of this analysis, however, all firms in this category are assumed to have revenues lower than the $38.5 million size standard and are therefore considered to be small entities.

The 2012 SUSB data on the movie exhibition industry includes both digital and analog movie theaters but excludes drive-in movie theaters. The number and percentage of firms and establishments by revenue category is presented in table 8. According to the 2012 SUSB, 1,876 movie theater firms operated 4,540 movie theater establishments. Approximately 1,833 of those firms (98 percent) are categorized as a small business according to the SBA size standard ($38.5 million) and therefore are small entities for purposes of this FRFA. The 1,833 firms categorized as small entities operated approximately 2,381 movie theater establishments (52 percent of the total).

* This category sums the firms and establishments included in the following categories: $40,000,000 to $49,999,999; $50,000,000 to $74,999,999; $75,000,000 to $99,999,999; $100,000,000 and greater.

Table 9 presents the number of firms, the number of establishments, and the annual revenue of firms by revenue size category. The calculated average annual revenue per firm and the average annual revenue per establishment are also provided.

* Calculated.

** Annual revenue data withheld and value set to 0 to avoid disclosing information of individual businesses.

26.  U.S. Small Business Administration, Table of Small Business Size Standards Matched to North American Industry Classification System Codes at 28 (July 14, 2014), available at https://www.sba.gov/​sites/​default/​files/​files/​Size_​Standards_​Table.pdf (last visited Sept. 12, 2016).

27.  The SBA's Office of Advocacy partially funds the Census Bureau to produce data on employer firm size including the number of firms, number of establishments, employment, and annual payroll and annual sales/receipts/revenue for employment size of firm categories by location and industry as part of the SUSB program. See U.S. Census Bureau, Statistics of U.S. Businesses, available at https://www.census.gov/​data/​tables/​2012/​econ/​susb/​2012-susb-annual.html (see Data by Enterprise Receipt Size, U.S., 6-digit NAICS) (last visited Sept. 12, 2016). The information is available in an Excel file which lists all information by NAICS Code.

28.  The U.S. Census Bureau defines a “firm” as a “business organization consisting of one or more domestic establishments in the same state and industry that were specified under common ownership or control. The firm and the establishment are the same for single-establishment firms. For each multi-establishment firm, establishments in the same industry within a state will be counted as one firm—the firm employment and annual payroll are summed from the associated establishments.” U.S. Census Bureau, Statistics of U.S. Businesses: Glossary, available at https://www.census.gov/​programs-surveys/​susb/​about/​glossary.html (last visited Sept. 12, 2016).

29.  The U.S. Census Bureau defines an “establishment” as “a single physical location where business is conducted or where services or industrial operations are performed.” U.S. Census Bureau, North American Industry Classification System: Frequently Asked Questions (FAQs), available at http://www.census.gov/​eos/​www/​naics/​faqs/​faqs.html#q2 (last visited Sept. 12, 2016).

30.  “Receipts (net of taxes collected from customers or clients) are defined as operating revenue for goods produced or distributed, or for services provided. Receipts excludes local, state, and federal sales and other taxes collected from customers or clients and paid directly to a tax agency. Receipts are acquired from economic census data for establishments in industries that are in-scope to the economic census; receipts are acquired from IRS tax data for single-establishment businesses in industries that are out-of-scope to the economic census; and payroll-to-receipts ratios are used to estimate receipts for multi-establishment businesses in industries that are out-of-scope to the economic census. Statistics of U.S. Businesses tabulations provide summed establishment receipts which creates some duplication of receipts for large multi-establishment enterprises. Receipts data are available for years ending in 2 and 7 only.” U.S. Census Bureau, Statistics of U.S. Businesses: Glossary, available at https://www.census.gov/​programs-surveys/​susb/​about/​glossary.html (last visited Sept. 12, 2016).