10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2015

OR

[   ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _____ to _____

Commission file number 001-35164

ONVIA, INC.

(Exact name of registrant as specified in its charter)

Delaware	91-1859172
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

509 Olive Way, Suite 400, Seattle, Washington 98101

(Address of principal executive offices, including zip code)

Registrant's telephone number, including area code: (206) 282-5170

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  [X] Yes    [  ] No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  [X] Yes    [  ] No 

Indicate by checkmark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.  See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act:

Large accelerated filer [  ]   Accelerated filer [  ]   Non-accelerated filer [  ]   Smaller reporting company [X]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  [  ] Yes    [X] No

Common stock, par value $.0001 per share: 7,413,916 shares outstanding as of April 30, 2015.

ONVIA, INC.

INDEX

	Page
PART I. FINANCIAL INFORMATION	1
Item 1. Unaudited Condensed Consolidated Financial Statements	1
Condensed Consolidated Balance Sheets (Unaudited)	1
Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited)	2
Condensed Consolidated Statements of Cash Flows (Unaudited)	3
Notes to Condensed Consolidated Financial Statements (Unaudited)	4
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations	11
Item 3. Quantitative and Qualitative Disclosures about Market Risk	18
Item 4. Controls and Procedures	18
PART II. OTHER INFORMATION	18
Item 1. Legal Proceedings	18
Item 1A. Risk Factors	18
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	18
Item 3. Defaults Upon Senior Securities	18
Item 4. Mine Safety Disclosure	18
Item 5. Other Information	18
Item 6. Exhibits	19
SIGNATURES	20

 

PART I.  FINANCIAL INFORMATION

Item 1.  Unaudited Condensed Consolidated Financial Statements

Onvia, Inc.

Condensed Consolidated Balance Sheets

	March 31, 2015			December 31, 2014
	(Unaudited) (In thousands, except share data)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	1,981		$	1,577
Short-term investments, available-for-sale		6,315			6,436
Accounts receivable, net of allowance for doubtful accounts of $42 and $42		1,543			1,735
Prepaid expenses and other current assets		1,088			682
Total current assets		10,927			10,430
LONG TERM ASSETS:
Property and equipment, net of accumulated depreciation		1,197			1,358
Internal use software, net of accumulated amortization		5,072			5,059
Long-term investments, available-for-sale		249			-
Other long-term assets		185			181
Total long term assets		6,703			6,598
TOTAL ASSETS	$	17,630		$	17,028
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable	$	993		$	873
Accrued expenses		926			1,098
Unearned revenue, current portion		9,462			8,478
Other current liabilities		86			82
Total current liabilities		11,467			10,531
LONG TERM LIABILITIES:
Unearned revenue, net of current portion		456			405
Deferred rent, net of current portion		640			590
Other long-term liabilities		62			69
Total long term liabilities		1,158			1,064
TOTAL LIABILITIES		12,625			11,595
COMMITMENTS AND CONTINGENCIES (Note 9)
STOCKHOLDERS’ EQUITY:
Preferred stock; $.0001 par value: 2,000,000 shares authorized; no shares issued or outstanding		-			-
Common stock; $.0001 par value: 11,000,000 shares authorized; 8,651,127 and 8,643,460 shares issued; and 7,408,320 and 7,400,653 shares outstanding		1			1
Treasury stock, at cost: 1,242,807 and 1,242,807 shares		(4,398	)		(4,398	)
Additional paid in capital		353,901			353,852
Accumulated other comprehensive gain		(1	)		(1	)
Accumulated deficit		(344,498	)		(344,021	)
Total stockholders’ equity		5,005			5,433
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	17,630		$	17,028

See accompanying notes to the unaudited Condensed Consolidated Financial Statements.

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Onvia, Inc.

Condensed Consolidated Statements of Operations and Comprehensive Income

	Three Months Ended March 31,
	2015			2014
	(Unaudited) (In thousands, except per share data)
Revenue
Subscription	$	5,263		$	5,025
Content license		462			474
Management information reports		48			53
Other		72			64
Total revenue		5,845			5,616
Cost of revenue (exclusive of depreciation and amortization included below)		793			825
Gross margin		5,052			4,791
Operating expenses:
Sales and marketing		3,090			2,934
Technology and development		1,032			1,120
General and administrative		1,409			829
Total operating expenses		5,531			4,883
Loss from operations		(479	)		(92	)
Interest and other income, net		2			3
Net loss	$	(477	)	$	(89	)
Unrealized gain on available-for-sale securities		-			1
Comprehensive loss	$	(477	)	$	(88	)
Basic and diluted net loss per common share	$	(0.06	)	$	(0.01	)
Basic and diluted weighted average shares outstanding		7,401			7,352

See accompanying notes to the unaudited Condensed Consolidated Financial Statements.

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Onvia, Inc.

Condensed Consolidated Statements of Cash Flows

	Three Months Ended March 31,
	2015			2014
	(Unaudited) (In thousands)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(477	)	$	(89	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization		649			816
Stock-based compensation		22			54
Loss on sale of property and equipment		2			-
Change in operating assets and liabilities:
Accounts receivable		192			(34	)
Prepaid expenses and other assets		(633	)		(339	)
Accounts payable		78			(145	)
Accrued expenses		(172	)		(262	)
Unearned revenue		1,035			664
Deferred rent		53			57
Net cash provided by operating activities		749			722
CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to property and equipment		(68	)		(97	)
Additions to internal use software		(407	)		(597	)
Purchases of investments		(2,712	)		(4,256	)
Sales of investments		-			1,570
Maturities of investments		2,833			2,039
Proceeds from sale of equipment		8			-
Net cash used in investing activities		(346	)		(1,341	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Principal payments on capital lease obligations		-			(63	)
Proceeds from exercise of stock options		1			205
Net cash provided by financing activities		1			142
Net increase / (decrease) in cash and cash equivalents		404			(477	)
Cash and cash equivalents, beginning of period		1,577			2,073
Cash and cash equivalents, end of period	$	1,981		$	1,596
SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
Unrealized gain on available-for-sale investments	$	-		$	1
Purchases under capital lease obligations		(6	)		(6	)
Property and equipment additions in accounts payable		-			(31	)
Internal use software additions in accounts payable		(227	)		(217	)

See accompanying notes to the unaudited Condensed Consolidated Financial Statements.

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Onvia, Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited)

1.   Accounting Policies

Basis of Presentation

The unaudited interim Condensed Consolidated Financial Statements and related notes thereto have been prepared pursuant to generally accepted accounting principles in the United States of America, or GAAP, and the rules and regulations of the Securities and Exchange Commission.  Accordingly, certain information and note disclosures normally included in annual financial statements prepared in accordance with GAAP have been omitted pursuant to such rules and regulations.  The accompanying unaudited interim Condensed Consolidated Financial Statements and related notes thereto should be read in conjunction with the audited Consolidated Financial Statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2014 (“2014 Annual Report”).

Onvia had a wholly-owned subsidiary in Canada that was dissolved effective December 19, 2014; however, there was no business activity in this subsidiary during the three month periods ended March 31, 2015 or 2014.  The wholly-owned subsidiary owned no assets or liabilities as of the date of dissolution.

The information furnished is unaudited, but reflects, in the opinion of management, all adjustments, consisting of only normal recurring items, necessary for a fair presentation of the results for the interim periods presented. In addition, certain reclassifications of prior period balances have been made to conform to the current period presentation.

Interim results are not necessarily indicative of results for a full year.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires the Company’s management to make estimates and judgments that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period.  Significant estimates include the fair value of stock-based compensation, allowance for doubtful accounts, capitalization of costs for internally developed software, recoverability of long-lived assets, including internally developed software, and the valuation allowance for Onvia’s net deferred tax assets.  The Company bases its estimates on historical experience and on various other assumptions that it believes to be reasonable under the circumstances.  Actual results may differ significantly from the Company’s estimates.  In addition, any significant unanticipated changes in any of the Company’s assumptions could have a material adverse effect on its business, financial condition, and results of operations.

Recently Issued Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update ("ASU") No. 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”). The standard provides companies with a single model for accounting for revenue arising from contracts with customers and supersedes current revenue recognition guidance, including industry-specific revenue guidance. The core principle of the model is to recognize revenue when control of the goods or services transfers to the customer, as opposed to recognizing revenue when the risks and rewards transfer to the customer under the existing revenue guidance.  The guidance permits companies to either apply the requirements retrospectively to all prior periods presented, or apply the requirements in the year of adoption, through a cumulative adjustment.  The guidance is effective for annual reporting periods and interim periods within those annual reporting periods beginning after December 15, 2016.  Early adoption is not permitted.  The Company is in the process of evaluating the impact of the new guidance on our financial statements and has not yet selected a transition approach to implement the standard.

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2.   Stock-Based Compensation

The impact on Onvia’s results of operations of recording stock-based compensation was as follows for the periods presented (in thousands):

	Three Months Ended March 31,
	2015			2014
Cost of revenue	$	-		$	2
Sales and marketing		(9	)		9
Technology and development		5			6
General and administrative		26			37
Total stock-based compensation	$	22		$	54

3.   Loss per Share

Basic loss per share is calculated by dividing the net loss for the period by the weighted average shares of common stock outstanding for the period.  Diluted loss per share is calculated by dividing the net loss per share by the weighted average common stock outstanding for the period, plus dilutive potential common shares using the treasury stock method.  In periods with a net loss, basic and diluted earnings per share are identical because inclusion of potentially dilutive common shares would be anti-dilutive.

The following table sets forth the computation of basic and diluted net loss per share for the three months ended March 31, 2015 and 2014 (in thousands, except per share data):

	Three Months Ended March 31,
	2015			2014
Net loss	$	(477	)	$	(89	)
Shares used to compute basic net loss per share		7,401			7,352
Dilutive potential common shares:
Stock options		-			-
Shares used to compute diluted net loss per share		7,401			7,352
Basic and diluted net loss per share	$	(0.06	)	$	(0.01	)

For the three months ended March 31, 2015, the weighted average effect of approximately 879,000 options to purchase shares of common stock were not included in the calculation because the effect would have been anti-dilutive.

For the three months ended March 31, 2014, the weighted average effect of approximately 373,000 options to purchase shares of common stock were not included in the calculation because the effect would have been anti-dilutive.

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4.   Investments

Onvia classifies short-term and long-term investments in debt securities as available-for-sale, stated at fair value as summarized in the following tables (in thousands):

	March 31, 2015
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Short-Term Investments
U.S. Government backed securities	$	768	$	-	$	-		$	768
Certificates of Deposit (1)		5,548		-		(1	)		5,547
Total Short-Term Investments		6,316		-		(1	)		6,315
Long-Term Investments
Certificates of Deposit (1)		249		-		-			249
Total Long-Term Investments		249		-		-			249
Total Investments	$	6,565	$	-	$	(1	)	$	6,564

	December 31, 2014
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
U.S. Government backed securities	$	158	$	-	$	-		$	158
Certificates of Deposit (1)		6,279		-		(1	)		6,278
Total Investments	$	6,437	$	-	$	(1	)	$	6,436

(1) We evaluated certificates of deposits held as of March 31, 2015 and  December 31, 2014 and concluded that they meet the definition of securities as available for sale.

Onvia accounts investments available for sale according to their fair values, which is defined as the exchange price that would be received for an asset, or paid to transfer a liability (an exit price), in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.  The Company utilizes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.  The following are the three levels of inputs that may be used to measure fair value:

Level 1 — Quoted prices in active markets for identical assets or liabilities.

Level 2 — Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

Onvia uses the market approach to measure fair value for its financial assets and liabilities.  The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities.

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The following tables summarize, by major security type, investments classified as available-for-sale at March 31, 2015 and at December 31, 2014, stated at fair value (in thousands):

	Fair Value Measurements as of March 31, 2015
	Level 1		Level 2		Level 3		Total
U.S. Government backed securities	$	-	$	768	$	-	$	768
Certificates of Deposit		-		5,796		-		5,796
Total Investments	$	-	$	6,564	$	-	$	6,564

	Fair Value Measurements as of December 31, 2014
	Level 1		Level 2		Level 3		Total
U.S. Government backed securities	$	-	$	158	$	-	$	158
Certificates of Deposit		-		6,278		-		6,278
Total Investments	$	-	$	6,436	$	-	$	6,436

There were no transfers in or out of Level 2 investments during the first quarter of 2015 and fourth quarter of 2014, and there was no activity in Level 3 fair value measurements during those periods.

5.   Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consist of the following (in thousands):

	March 31, 2015		December 31, 2014
Prepaid expenses	$	1,068	$	673
Interest receivable		6		4
Other receivables		14		5
	$	1,088	$	682

6.   Property and Equipment

Property and equipment to be held and used consist of the following (in thousands):

	March 31, 2015			December 31, 2014
Computer equipment	$	3,673		$	3,676
Software		1,855			1,855
Furniture and fixtures		109			109
Leasehold improvements		883			883
Total cost basis		6,520			6,523
Less accumulated depreciation and amortization		(5,323	)		(5,165	)
Net book value	$	1,197		$	1,358

For the three months ended March 31, 2015, Onvia disposed of computer equipment with a remaining net book value of $10,000 for proceeds of $8,000 and recorded a $2,000 loss on sale of property and equipment which is included in the unaudited Condensed Consolidated Statement of Operations as general and administrative operating expenses.

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Depreciation expense was $164,000 and $183,000 for the three months ended March 31, 2015 and 2014, respectively.

7.   Internal Use Software

Onvia capitalizes qualifying computer software costs incurred during the “application development stage” and other costs.  Amortization of these costs begins once the product is ready for its intended use.  These costs are amortized on a straight-line basis over the estimated useful life of the product, typically 3 to 5 years.  The amount of costs capitalized within any period is dependent on the nature of software development activities and projects in each period.

Onvia periodically evaluates the remaining useful lives and carrying values of internal use software.  If management determines that all or a portion of the asset will no longer be used, or the estimated remaining useful life differs from existing estimates, an abandonment will be recorded to reduce the carrying value or adjust the remaining useful life to reflect revised estimates.  In addition, if the carrying value of the software exceeds the estimated future cash flows, an impairment will be recorded to reduce the carrying value to the expected realizable value. No impairment has been recorded during the three months ended March 31, 2015 and March 31, 2014.

The following table presents a roll-forward of capitalized internal use software for the three months ended March 31, 2015 (in thousands):

	Balance at December 31, 2014			Additions			Balance at March 31, 2015
Capitalized Internal Use Software	$	17,107		$	498		$	17,605
Accumulated amortization		(12,048	)		(485	)		(12,533	)
	$	5,059		$	13		$	5,072

Amortization expense was $485,000 and $633,000 for the three months ended March 31, 2015 and 2014, respectively. Amortization expense is included in operating expenses in the unaudited Condensed Consolidated Statements of Operations and Comprehensive Income.

8.   Accrued Expenses and Other Current Liabilities

Accrued expenses consist of the following (in thousands):

	March 31, 2015		December 31, 2014
Payroll and related liabilities	$	854	$	966
Taxes payable and other		72		132
	$	926	$	1,098

Other current liabilities consist of the following (in thousands):

	March 31, 2015		December 31, 2014
Obligations under capital leases, current portion	$	24	$	24
Deferred rent, current portion		62		58
	$	86	$	82

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9.   Commitments and Contingencies

Operating Leases

During the first quarter of 2013, Onvia entered into the first amendment to lease agreement for its corporate offices located in Seattle, Washington.  The amendment, among other things, extends the lease term for an additional sixty-five (65) months with a new expiration date of April 30, 2021.  In addition, the amendment reduces the rental area of the premises to approximately 29,606 square feet, after surrender of 5,394 square feet after the execution of the amendment.  Onvia has an additional right to surrender up to 8,898 square feet on or after November 30, 2015 in exchange for reimbursement of unamortized landlord incentives.  In addition to base rent, Onvia will be responsible for its proportionate share of annual incremental increases in the building’s operating expenses, insurance, and real estate taxes over the 2013 base year.  Onvia has a one-time right to terminate the amended lease in its entirety on or after December 1, 2017 in exchange for payment of a significant termination fee.

Rent expense is being recognized on a straight-line basis over the term of the lease.  Onvia also has a non-cancellable operating lease for office equipment, which expires in July 2019.

As of March 31, 2015, remaining future minimum lease payments required on non-cancellable operating leases are as follows for the years ending December 31 (in thousands):

	Real Estate Operating Leases		Office Equipment Operating Lease		Total Operating Leases
2015	$	622	$	15	$	637
2016		780		20		800
2017		873		20		893
2018		896		20		916
2019		918		9		927
2020 and thereafter		1,261		-		1,261
	$	5,350	$	84	$	5,434

Purchase Obligations

Onvia has non-cancellable purchase obligations for software development and license agreements, co-location hosting arrangements, telecom agreements, marketing agreements and third-party content agreements.  The agreements expire in dates ranging from April 2015 to 2017.  Future required payments under these non-cancellable agreements are as follows for the years ending December 31 (in thousands):

	Purchase Obligations
2015	$	481
2016		878
2017		479
	$	1,838

Legal Proceedings

From time to time, legal proceedings may arise in the ordinary course of business.  Although the outcomes of legal proceedings are inherently difficult to predict, we are not currently involved in any legal proceeding in which the outcome, in our judgment based on information currently available, is likely to have a material adverse effect on our business or financial position.

9

10.   Income Taxes

As of March 31, 2015 and December 31, 2014, Onvia has recorded a valuation allowance against its net deferred tax assets because the Company has determined it is not more likely than not that the asset will be realized. Onvia will continue to evaluate the likelihood that these tax benefits may be realized, and may reverse all or a portion of its valuation allowance in the future if it is determined that realization of these benefits is more likely than not.

Pursuant to Section 382 of the Internal Revenue Code of 1986, as amended (the “Code”), utilization of net operating loss (NOL) carryforwards to offset future taxable income are subject to substantial annual limitations if we experience a cumulative change in ownership as defined by the Code. In general, an ownership change, as defined by the Code, results from transactions increasing the ownership of certain stockholders or public groups in the stock of a corporation by more than 50 percentage points over a three-year period.

As of March 31, 2015 and December 31, 2014, Onvia’s Federal NOL carryforwards for income tax purposes were approximately $76.0 million.  The Federal NOL carryforwards are subject to limitations under Section 382 of the Internal Revenue Code. If not utilized, the Federal NOL carryforwards will begin to expire in 2022.  The latest date available for a portion of the Federal NOL carryforwards to be utilized to offset future income is 2033.

11.   Security Deposits

Pursuant to Onvia’s lease for its current corporate office space, Onvia has established a stand by letter of credit as security to the lease increasing from $100,000 in April 2013, to $125,000 in January 2014 and to $150,000 on January 2015. The letter of credit will be returned at lease termination in April 2021, or earlier as discussed above, subject to standard office lease conditions. As of March 31, 2015, the stand by letter of credit is secured by a security deposit of $150,000 and reported as other long-term assets on the unaudited Condensed Consolidated Balance Sheets.

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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

CAUTIONARY STATEMENT

In addition to historical information, the discussion and analysis in this report contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “believes,” “anticipates,” “should,” “expects,” “plans,” “intends,” “indicates” and similar expressions identify forward-looking statements. Forward-looking statements include, but are not limited to, statements about our future results of operations, the progress to be made on the 2015 initiatives, Onvia’s future financial flexibility and future cash flows and Onvia’s future product and content offerings. Such statements are based on current expectations that involve a number of known and unknown risks, uncertainties and other factors, which may cause actual events to be materially different from those expressed or implied by such forward-looking statements. Our actual results could differ materially from those anticipated in these forward-looking statements.

The following factors, among others, could cause actual results to differ materially from those described in the forward-looking statements:  Onvia fails to increase and retain contract value of customers using the “target market” strategy; Onvia fails to execute properly on new products, or customers fail to adopt these products or services; Onvia’s investment in technology and new content fails to improve sales penetration and client retention rates; and changes made to Onvia’s technology infrastructure fails to handle the increased demands caused by increasing network traffic and the volume of aggregated data.

Additional information on factors that may impact these forward-looking statements can be found under “Risk Factors,” “Business,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” as applicable, in this report, in our 2014 Annual Report on Form 10-K for the year ended December 31, 2014.  Onvia assumes no obligation to update forward-looking statements as a result of new information or future events or developments, except as may be required by law.  The following discussion should also be read in conjunction with the unaudited Condensed Consolidated Financial Statements and  accompanying Notes thereto.

In this Report, the words “we,” “our,” “us,” “Onvia,” or the “Company” refer to Onvia, Inc. and its wholly- owned subsidiary.

Company Overview

Onvia is a leading provider of business information and research solutions that help companies plan, market and sell to government agencies throughout the United States (or U.S.).  Onvia’s business solutions provide clients online access to proprietary information about government procurement activity across local, state, and federal government agencies.  The business intelligence derived from our solutions allows clients to identify and research new market opportunities, analyze market trends, and obtain valuable insights about their competitors and channel partners.  We believe our business solutions provide clients with a distinct competitive advantage, increased revenue opportunities, and strategic insight into the public sector market.

Onvia’s target client prospects operate regionally or nationally, have a long-term strategic interest in the public sector and focus primarily on the decentralized State, Local and Education (SLED) market.  We believe this model will produce higher margins, providing the flexibility to price products based upon the value that we create for clients, not based upon the cost of fulfillment.

In 2011, we began executing a business transformation plan intended to leverage the Company’s investment in a rich public sector procurement database.  Over the last four years we have repositioned Onvia’s value proposition from an aggregator of public procurement documents to a provider of comprehensive public sector business. We believe the business is now positioned for continuing growth in subscription revenue and Adjusted EBITDA (see “Management’s Discussion and Analysis of Financial Condition and Results of Operations” below for more information regarding Adjusted EBITDA).

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The Onvia solution includes access to the Onvia Database, Spending Forecast Center, Term Contract Center, Vendor Center, Purchase Order Analytics and the Onvia Guide.  These services are sometimes bundled with management information reports in multiple element arrangements.  We allocate revenue from these bundled sales ratably between the subscription services and the management reports based on established list prices for those offerings. Subscriptions to the Onvia Database are typically prepaid, have a minimum term of one year and revenues are recognized ratably over the term of the subscription.  Subscriptions are generally priced based upon the geographic range, nature of content purchased, and the number of users accessing the database.

Most of Onvia’s revenues are generated from sales to companies that leverage our information for their own internal use, and to businesses that license our content for redistribution.  Revenue from businesses which license our content for resale is classified as Content License revenue.  Content license contracts are generally multi-year arrangements and typically have higher annual contract values than our subscription-based services.  Revenue from content license agreements is recognized over the term of the agreement.

Onvia was incorporated in January 2000 in the state of Delaware.  Our principal corporate office is located in Seattle, Washington.  Our securities trade on The NASDAQ Capital Market under the symbol ONVI.

Strategic Initiatives

In 2015, we are executing three initiatives intended to build on the results achieved in 2014 and further accelerate growth in subscription revenue and Adjusted EBITDA.

· Our first 2015 initiative is to further accelerate year over year bookings growth.  This growth is planned in three key areas: sales to new customers, contract enhancements with existing customers and improved retention of our existing customers.  The measure of success for this initiative includes the overall growth in new client bookings, growth in Annual Contract Value (ACV) and improvement in dollar retention.  For a discussion of these and other key operating metrics refer to the Executive Summary of Operations and Financial Position below.

· Our second 2015 initiative is to enhance the existing Onvia platform and provide improved content which further aligns to customer needs.  This initiative includes the continued rollout of Onvia 7 search features to our target market clients.  We measure success of this initiative through the effectiveness of product releases and the impact on new client Annual Contract Value per Client (ACVC) and dollar retention.   In 2014 we completed the software changes to the Onvia platform to include the new Onvia 7 user interface.  In the first quarter of 2015 we continued to build proprietary taxonomies for each of our markets served.  We expect to migrate clients to the new Onvia 7 search paradigm by the end of 2015.  Onvia 7 is intended to have two major benefits.  First, Onvia 7 provides a better search experience for our clients.  Clients should be able to mine data more effectively to obtain more relevant opportunities for their business.  Secondly, Onvia 7 provides scalability by substantially automating the content categorization process.  All future content will be consistently indexed through machine learning and automation, not by using human indexers.

· Our third and final 2015 initiative is to improve the existing information technology infrastructure as a means to reduce complexity, accelerate product development and reduce costs long-term.  We continue to focus this initiative on three major areas.  The first focus is moving to an open source search technology which will increase our capacity for search and improve search speed.  We have identified the technology of choice and have started the architecting work.  Secondly, we’ll be changing database structures to allow for faster more agile product enhancements in the future. The technology of choice has been identified and we intend to release the first phase of this project in the second quarter of 2015.  Finally, we are addressing areas where data capture can be automated to allow for cost effective scaling of data aggregation.  We do not anticipate annual capital expenditures to increase over historical levels as a result of these technology improvements.

12

Executive Summary of Operations and Financial Position

Our primary clients are businesses that are strategically focused on selling their goods and services into the public sector.  As discussed above, we sell into this target market through two sales channels: businesses that leverage our information for their own internal use and businesses that license our content for redistribution (i.e. content license).

We manage the business using the following key client metrics:

Annual Contract Value, or ACV

ACV represents the annualized aggregate revenue value of all subscription contracts as of the end of the quarter.  ACV is driven by Annual Contract Value per Client (ACVC) and the number of clients.  Most of Onvia’s revenues are generated from subscription contracts, which are typically prepaid and have a minimum term of one year, with revenues recognized ratably over the term of the subscription.  Onvia also receives revenue from multi-year content distribution partnerships, stand-alone management reports, document download services, and list rental services, which are not included in the calculation of ACV.  Content license contracts are excluded from ACV.

ACV increased by 7% to $21.8 million in the first quarter of 2014 from $20.3 million for the same period one year ago.  The continued growth in ACV indicates that new client acquisitions, contract expansions and improving client retention rates have more than offset the impact of client attrition.  The growth rate in ACV can fluctuate from year to year based on timing in the amount of ACV available for renewal in addition to the mix of tenured and first year clients expiring in each period as tenured clients tend to renew at a higher rate than first year clients.

Dollar Retention

Since the first quarter of 2014 we have reported dollar retention which measures the dollars renewed on the available base of expiring contracts over the preceding twelve months. Dollar retention is calculated on a percentage basis by dividing the contract value of subscription contracts renewed, including the value of contract upgrades, during the most recent twelve-month period by the total value of subscription contracts expiring over the same period.  Dollar retention measures the percentage of dollars retained from the population of expiring contracts over a twelve month period.

In the twelve months ended March 31, 2015, dollar retention was 88% compared to 85% in the twelve months ended March 31, 2014.  Dollar retention can fluctuate from period to period due to the mix of first year and tenured clients expiring in each period.  Dollar retention, in conjunction with ACV, provides insight in to our subscription retention rate and ability to generate future subscription revenue.

Number of Clients

Number of clients represents the number of individual businesses subscribing to our products.

At the end of the first quarter, our total client base decreased 7% to 3,250 clients compared to 3,500 clients in the same year-ago period decreased 2% compared to the fourth quarter of 2014.  Our strategy is to continue to improve profitability by acquiring and managing fewer, but more strategic clients at higher ACVC.  We believe that ACV is a better measure of sales effectiveness than the number of clients.

Annual Contract Value per Client, or ACVC

Annual contract value per client is the ACV divided by the number of clients and indicates the average value of each of our subscriptions.

ACVC increased 16% to $6,729 in the first quarter of 2015 compared to $5,789 in the first quarter of 2014.  ACVC for new clients decreased 14% to $14,240 from $16,577 in the first quarter of 2014. Management anticipates new client ACVC will fluctuate from period to period based on the mix of product levels included in acquisition bookings for a particular period.

13

Growth in overall ACVC demonstrates that an increasing number of clients have a strategic interest in the public sector at a regional or national level.  Companies within this target market typically have higher ACVC and renew at higher rates, which are key attributes of a profitable long-term client.

Adjusted EBITDA

Adjusted EBITDA is not a financial measure calculated and presented in accordance with U.S. generally accepted accounting principles (“GAAP”) and should not be considered as an alternative to net income, operating income or any other financial measures so calculated and presented, nor as an alternative to cash flow from operating activities as a measure of the company’s liquidity.  Onvia defines Adjusted EBITDA as net income/(loss) before interest expense and other non-cash financing costs; taxes; depreciation; amortization; and non-cash stock-based compensation.  Other companies (including Onvia’s competitors) may define Adjusted EBITDA differently.  Onvia presents Adjusted EBITDA because it believes Adjusted EBITDA to be an important supplemental measure of performance that is commonly used by securities analysts, investors and other interested parties in the evaluation of companies in similar industries and size. Management also uses this information internally for forecasting and budgeting.  It may not be indicative of the historical operating results of Onvia nor is it intended to be predictive of potential future results.  Investors should not consider Adjusted EBITDA in isolation or as a substitute for analysis of results as reported under GAAP.

The following table provides a reconciliation of GAAP Net Loss to Adjusted EBITDA for the periods indicated (in thousands of dollars):

	Three Months Ended
	March 31, 2015			March 31, 2014
GAAP net loss	$	(477	)	$	(89	)
Reconciling items from GAAP to adjusted EBITDA
Interest and other income, net		(2	)		(3	)
Depreciation and amortization		649			816
Amortization of stock-based compensation		22			54
Adjusted EBITDA	$	192		$	778

Seasonality

Our client acquisition business is subject to some seasonal fluctuations.  The second and third quarters are generally slower than the first and fourth quarters for client acquisition.  Infrastructure is our single largest market and these prospects are typically engaged on projects during the spring and summer months, not prospecting for new work, which causes new client acquisition to decline compared to the first and fourth quarters in the year.  For this reason, comparisons of the performance of our business quarter to consecutive quarter may not provide the most relevant information, and so in addition to sequential quarter comparisons, our quarterly results and metrics should be considered on the basis of results for the whole year or by comparing results in a quarter with the results in the same quarter of the previous year.

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Results of Operations for the Three Months Ended March 31, 2015 Compared to the Three Months Ended March 31, 2014

Revenue and Cost of Revenue

The following table provides a breakdown of revenue for the periods presented as a percentage of total revenue:

	Three Months Ended March 31,
	2015			2014
Revenue	$	5,845		$	5,616
Revenue:
Subscription		90	%		89	%
Content license		8	%		9	%
Management information reports		1	%		1	%
Other		1	%		1	%
Total revenue		100	%		100	%

Subscription revenue for the quarter ended March 31, 2015 grew 5% to $5.3 million over the same period in 2014.  The growth in subscription revenue is primarily a result of improved sales to new clients and retention of existing clients compared to the same period last year.

Total revenue for the quarter ended March 31, 2015 was $5.8 million, up by 4% compared to the same period last year.  In addition to subscription revenue, total revenue includes content license and report revenue.

Cost of revenue for the three months ended March 31, 2015 and March 31, 2014 was as follows (in thousands of dollars):

							Increase / (Decrease)
	2015			2014			Amount			Percent
Three months ended March 31,	$	793		$	825		$	(32	)		(4	%)
Percentage of Revenue		14	%		15	%

Our cost of revenue primarily represents payroll-related expenses associated with the research, capture and enhancement of data in our proprietary database and third-party content fees, and also includes credit card processing fees.  Certain amounts in cost of revenue for 2014 have been reclassified as operating expenses to conform to current period presentation.  The reclassification is a result of organization changes made in the first quarter of 2015 to adopt our current content strategy and, as a result, certain payroll-related expenses are now reflected in operating expenses as technology and development and sales and marketing.

Sales and Marketing

Sales and marketing expenses for the three months ended March 31, 2015 and March 31, 2014 were as follows (in thousands of dollars):

							Increase / (Decrease)
	2015			2014			Amount		Percent
Three months ended March 31,	$	3,090		$	2,934		$	156		5	%
Percentage of Revenue		53	%		52	%

The increase in expenses for the comparable three month periods is primarily related to a $138,000 increase in commission expenses as a result of higher bookings and other individually immaterial changes.

15

Technology and Development

Technology and development expenses for the three months ended March 31, 2015 and March 31, 2014 were as follows (in thousands of dollars):

							Increase / (Decrease)
	2015			2014			Amount			Percent
Three months ended March 31,	$	1,032		$	1,120		$	(88	)		(8	%)
Percentage of Revenue		18	%		20	%

The decrease in expenses for the comparable three month periods is primarily related to a $81,000 decrease in amortization expenses and other individually immaterial changes.

General and Administrative

General and administrative expenses for the three months ended March 31, 2015 and March 31, 2014 were as follows (in thousands of dollars):

							Increase / (Decrease)
	2015			2014			Amount		Percent
Three months ended March 31,	$	1,409		$	829		$	580		70	%
Percentage of Revenue		24	%		15	%

The increase in expenses for the comparable three month periods is primarily due to $435,000 of non-recurring legal and consulting fees authorized by our Board of Directors in the first quarter of 2015.  Beginning with Onvia 7, we expect to significantly enhance the value of content sourced from the public domain.  We performed a complete review of our content capture, content processing and content enhancement methods, processes and systems.  We incurred these incremental costs to ensure that our intellectual property rights to the enhanced content are properly protected.  This expense is largely confined to the first quarter with some residual cost remaining for the balance of 2015.  In addition, we incurred a $109,000 increase in payroll related costs during the first quarter of 2015 primarily because of the human resource function being fully staffed compared to the same period one year earlier, and other individually immaterial changes.

Interest and Other Income, Net

Net interest and other income was $2,000 for the three months ended March 31, 2015, compared to $3,000 for the same period in 2014.

Net Income and Net Income per Share

We reported net loss of $477,000 for the three months ended March 31, 2015 compared to net loss of $89,000 for the same period of 2014.  On a diluted per share basis, net loss was $0.06 and $0.01 for the three months ended March 31, 2015 and 2014, respectively.

Critical Accounting Policies and Management Estimates

Our discussion and analysis of our financial condition and results of operations is based upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States.  The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenue and expenses, and related disclosure of contingent assets and liabilities.  On an on-going basis, we evaluate our estimates including, but not limited to, those affecting the fair value of stock-based compensation, allowance for doubtful accounts, capitalization of costs for internally developed software, recoverability of long-lived assets, including internally developed software, and the valuation allowance for net deferred tax assets..  The brief discussion below is intended to highlight some of the judgments and uncertainties that can impact the application of these policies and the specific dollar amounts reported on our financial statements.

16

We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form our basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources.  Actual results may differ from these estimates under different assumptions or conditions, or if management made different judgments or utilized different estimates.  Many of our estimates or judgments are based on anticipated future events or performance, and as such are forward-looking in nature, and are subject to many risks and uncertainties, including those discussed in our Annual Report on Form 10-K for the year ended December 31, 2014 and elsewhere in this Quarterly Report on Form 10-Q.  Except as otherwise required by law, we do not undertake any obligation to update or revise this discussion to reflect any future events or circumstances.

For a detailed discussion of our critical accounting policies and estimates, please refer to our Annual Report on Form 10-K for the year ended December 31, 2014.

There have been no material changes in the application of our critical accounting policies and estimates subsequent to that report.

See Note 1 to the unaudited Consolidated Financial Statements for the issuance of recent accounting pronouncements.

Liquidity and Capital Resources

Our principal sources of liquidity are cash, cash equivalents and available for sale investments.  Our combined cash and cash equivalents and available for sale investments were $8.5 million at March 31, 2015.  At March 31, 2015, we held $6.6 million in available for sale investments, primarily in FDIC insured or U.S. government backed securities.

If we engage in merger or acquisition transactions or our overall operating plans change, we may require additional equity or debt financing to meet future working capital needs, which may have a dilutive effect on existing stockholders or may include securities that have rights, preferences or privileges senior to those of the rights of our common stock.  We cannot make assurances that if additional financing is required, it will be available, or that such financing can be obtained on satisfactory terms.

From December 31, 2014 to March 31, 2015, cash, cash equivalents and available for sale investments increased by $530,000 for the reasons described below.

Operating Activities

Net cash provided by operating activities was $749,000 for the three months ended March 31, 2015, compared to $722,000 in the same period in 2014.

Investing Activities

Net cash used in investing activities was $346,000 in the three months ended March 31, 2015, compared to $1.3 million in the same period in 2014.  The decrease of $995,000 in cash used in investing activities is attributable to a $1.5 million decrease in purchases of investments and a $219,000 decrease in additions to property and equipment and internal use software, offset by a $776,000 decrease in sales and maturities of investments.

Financing Activities

Net cash provided by financing activities was $1,000 in the three months ended March 31, 2015, compared to $142,000 in the same period in 2014.  The decrease in cash provided by financing activities is due to $204,000 decrease in proceeds from stock option exercises offset by a $63,000 decrease in lease payments.

17

Item 3. Quantitative and Qualitative Disclosures about Market Risk.

The disclosures under this Item are not required for smaller reporting companies.

Item 4. Controls and Procedures

The Company conducted an evaluation (pursuant to Rule 13a-15(b) of the Securities Exchange Act of 1934 (the "Exchange Act")), under the supervision and with the participation of management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the Company's disclosure controls and procedures (as defined in Rule 13a-15(e)) as of March 31, 2015.  Based on the evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that these disclosure controls and procedures were effective as of March 31, 2015.

We made no change in our internal control over financial reporting during the fiscal quarter ended March 31, 2015 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. We intend to continue to refine our internal control over financial reporting on an ongoing basis, as we deem appropriate with a view towards continuous improvement.

PART II. OTHER INFORMATION

Item 1.  Legal Proceedings

From time to time, legal proceedings may arise in the ordinary course of business.  Although the outcomes of legal proceedings are inherently difficult to predict, we are not currently involved in any legal proceeding in which the outcome, in our judgment based on information currently available, is likely to have a material adverse effect on our business or financial position.

Item 1A.  Risk Factors

There have been no material changes in our risk factors from those disclosed in Part I, Item 1A. Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2014.

Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds

None.

Item 3.  Defaults Upon Senior Securities

None.

Item 4.  Mine Safety Disclosures

Not applicable

Item 5.  Other Information

None.

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Item 6.  Exhibits

Number	Description
31.1++	Certification of Henry G. Riner, Chief Executive Officer and President of Onvia, Inc., Pursuant to Rule 13a-14(a)/15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2++	Certification of Cameron S. Way, Chief Financial Officer and Principal Accounting Officer of Onvia, Inc., Pursuant to Rule 13a-14(a)/15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1++	Certification of Henry G. Riner, Chief Executive Officer and President of Onvia, Inc., Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2++	Certification of Cameron S. Way, Senior Vice President and Chief Financial Officer of Onvia, Inc., Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101++	101.INS	XBRL Instance Document
	101.SCH	XBRL Taxonomy Extension Schema
	101.CAL	XBRL Taxonomy Extension Calculation Linkbase
	101.LAB	XBRL Taxonomy Extension Label Linkbase
	101.PRE	XBRL Taxonomy Extension Presentation Linkbase
	101.DEF	XBRL Taxonomy Extension Definition Linkbase

++ Furnished Herewith

19

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned thereunto duly authorized.

ONVIA, INC.
By:	/s/ Henry G. Riner
	Henry G. Riner President and Chief Executive Officer
By:	/s/ Cameron S. Way
	Cameron S. Way Chief Financial Officer and Principal Accounting Officer

Date:  May 8, 2015

20

EX-31.1

Exhibit 31.1

CERTIFICATION PURSUANT TO

18 U.S.C. Rule 13a-14(a)/15d-14(a)

AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Henry G. Riner, certify that:

1. I have reviewed this quarterly Report on Form 10-Q for the period ending March 31, 2015 of Onvia, Inc.;

2. Based on my knowledge, this Report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this Report;

3. Based on my knowledge, the financial statements, and other financial information included in this Report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this Report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this Report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this Report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this Report based on such evaluation; and

d. Disclosed in this Report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting.

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s Board of Directors (or persons performing the equivalent function):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

/s/ Henry G. Riner

Henry G. Riner

President and Chief Executive Officer

May 8, 2015

EX-31.2

Exhibit 31.2

CERTIFICATION PURSUANT TO

18 U.S.C. Rule 13a-14(a)/15d-14(a)

AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Cameron S. Way, certify that:

1. I have reviewed this quarterly Report on Form 10-Q for the period ending March 31, 2015 of Onvia, Inc.;

2. Based on my knowledge, this Report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this Report;

3. Based on my knowledge, the financial statements, and other financial information included in this Report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this Report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this Report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this Report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this Report based on such evaluation; and

d. Disclosed in this Report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting.

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s Board of Directors (or persons performing the equivalent function):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

/s/ Cameron S. Way

Cameron S. Way

Chief Financial Officer and Principal Accounting Officer

May 8, 2015

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Onvia, Inc. (the “Company”) on Form 10-Q for the period ending March 31, 2015 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Henry G. Riner, President and Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Henry G. Riner

Henry G. Riner

President and Chief Executive Officer

May 8, 2015

A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to Onvia, Inc. and will be retained by Onvia, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Onvia, Inc. (the “Company”) on Form 10-Q for the period ending March 31, 2015 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Cameron S. Way, Chief Financial Officer and Principal Accounting Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Cameron S. Way

Cameron S. Way

Chief Financial Officer and Principal Accounting Officer

May 8, 2015

A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to Onvia, Inc. and will be retained by Onvia, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

XML

Note 9 - Commitments and Contingencies (Details) - Remaining Future Minimum Operating Lease Payments (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015
Note 9 - Commitments and Contingencies (Details) - Remaining Future Minimum Operating Lease Payments [Line Items]
2015	$ 637
2016	800
2017	893
2018	916
2019	927
2020 and thereafter	1,261
	5,434
Real Estate Operating Leases [Member]
Note 9 - Commitments and Contingencies (Details) - Remaining Future Minimum Operating Lease Payments [Line Items]
2015	622
2016	780
2017	873
2018	896
2019	918
2020 and thereafter	1,261
	5,350
Office Equipment Operating Lease [Member]
Note 9 - Commitments and Contingencies (Details) - Remaining Future Minimum Operating Lease Payments [Line Items]
2015	15
2016	20
2017	20
2018	20
2019	9
	$ 84

XML

Note 6 - Property and Equipment (Details) - Property and Equipment (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Property and Equipment [Abstract]
Computer equipment	$ 3,673	$ 3,676
Software	1,855	1,855
Furniture and fixtures	109	109
Leasehold improvements	883	883
Total cost basis	6,520	6,523
Less accumulated depreciation and amortization	(5,323)	(5,165)
Net book value	$ 1,197	$ 1,358

XML

Note 9 - Commitments and Contingencies (Tables)

3 Months Ended

Mar. 31, 2015

Commitments and Contingencies Disclosure [Abstract]

Schedule of Future Minimum Rental Payments for Operating Leases [Table Text Block]

	Real Estate Operating Leases		Office Equipment Operating Lease		Total Operating Leases
2015	$	622	$	15	$	637
2016		780		20		800
2017		873		20		893
2018		896		20		916
2019		918		9		927
2020 and thereafter		1,261		-		1,261
	$	5,350	$	84	$	5,434

Long-term Purchase Commitment [Table Text Block]

	Purchase Obligations
2015	$	481
2016		878
2017		479
	$	1,838

XML

Note 11 - Security Deposits (Details) (USD $)	Jan. 31, 2015	Jan. 31, 2014	Apr. 30, 2013	Mar. 31, 2015
Secured By Stand By Letter of Credit [Member]
Note 11 - Security Deposits (Details) [Line Items]
Letters of Credit Outstanding, Amount	$ 150,000	$ 125,000	$ 100,000
Other Noncurrent Assets [Member]
Note 11 - Security Deposits (Details) [Line Items]
Security Deposit				$ 150,000

XML

Note 8 - Accrued Expenses and Other Current Liabilities (Details) - Other Current Liabilities (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Other Current Liabilities [Abstract]
Obligations under capital leases, current portion	$ 24	$ 24
Deferred rent, current portion	62	58
	$ 86	$ 82

XML

Note 4 - Investments

3 Months Ended

Mar. 31, 2015

Investments, Debt and Equity Securities [Abstract]

Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block]

4.   Investments

Onvia classifies short-term and long-term investments in debt securities as available-for-sale, stated at fair value as summarized in the following tables (in thousands):

	March 31, 2015
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Short-Term Investments
U.S. Government backed securities	$	768	$	-	$	-		$	768
Certificates of Deposit (1)		5,548		-		(1	)		5,547
Total Short-Term Investments		6,316		-		(1	)		6,315
Long-Term Investments
Certificates of Deposit (1)		249		-		-			249
Total Long-Term Investments		249		-		-			249
Total Investments	$	6,565	$	-	$	(1	)	$	6,564

	December 31, 2014
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
U.S. Government backed securities	$	158	$	-	$	-		$	158
Certificates of Deposit (1)		6,279		-		(1	)		6,278
Total Investments	$	6,437	$	-	$	(1	)	$	6,436

(1) We evaluated certificates of deposits held as of March 31, 2015 and  December 31, 2014 and concluded that they meet the definition of securities as available for sale.

Onvia accounts investments available for sale according to their fair values, which is defined as the exchange price that would be received for an asset, or paid to transfer a liability (an exit price), in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.  The Company utilizes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.  The following are the three levels of inputs that may be used to measure fair value:

Level 1 — Quoted prices in active markets for identical assets or liabilities.

Level 2 — Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

Onvia uses the market approach to measure fair value for its financial assets and liabilities.  The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities.

The following tables summarize, by major security type, investments classified as available-for-sale at March 31, 2015 and at December 31, 2014, stated at fair value (in thousands):

	Fair Value Measurements as of March 31, 2015
	Level 1		Level 2		Level 3		Total
U.S. Government backed securities	$	-	$	768	$	-	$	768
Certificates of Deposit		-		5,796		-		5,796
Total Investments	$	-	$	6,564	$	-	$	6,564

	Fair Value Measurements as of December 31, 2014
	Level 1		Level 2		Level 3		Total
U.S. Government backed securities	$	-	$	158	$	-	$	158
Certificates of Deposit		-		6,278		-		6,278
Total Investments	$	-	$	6,436	$	-	$	6,436

There were no transfers in or out of Level 2 investments during the first quarter of 2015 and fourth quarter of 2014, and there was no activity in Level 3 fair value measurements during those periods.

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Note 4 - Investments (Details) - Short-term Investments in Debt Securities as Available-For-Sale at Fair Value (USD $) In Thousands, unless otherwise specified	3 Months Ended		12 Months Ended
	Mar. 31, 2015		Dec. 31, 2014
Note 4 - Investments (Details) - Short-term Investments in Debt Securities as Available-For-Sale at Fair Value [Line Items]
Amortized Cost	$ 6,565		$ 6,437
Gross Unrealized Losses	(1)		(1)
Fair Value	6,564		6,436
Short-term Investments [Member] | US Government Agencies Debt Securities [Member]
Note 4 - Investments (Details) - Short-term Investments in Debt Securities as Available-For-Sale at Fair Value [Line Items]
Amortized Cost	768		158
Fair Value	768		158
Short-term Investments [Member] | Certificate Of Deposit [Member]
Note 4 - Investments (Details) - Short-term Investments in Debt Securities as Available-For-Sale at Fair Value [Line Items]
Amortized Cost	5,548	[1]	6,279	[1]
Gross Unrealized Gains		[1]		[1]
Gross Unrealized Losses	(1)	[1]	(1)	[1]
Fair Value	5,547	[1]	6,278	[1]
Short-term Investments [Member]
Note 4 - Investments (Details) - Short-term Investments in Debt Securities as Available-For-Sale at Fair Value [Line Items]
Amortized Cost	6,316
Gross Unrealized Losses	(1)
Fair Value	6,315
Long-term Investments [Member] | Certificate Of Deposit [Member]
Note 4 - Investments (Details) - Short-term Investments in Debt Securities as Available-For-Sale at Fair Value [Line Items]
Amortized Cost	249	[1]
Gross Unrealized Gains		[1]
Gross Unrealized Losses		[1]
Fair Value	249	[1]
Long-term Investments [Member]
Note 4 - Investments (Details) - Short-term Investments in Debt Securities as Available-For-Sale at Fair Value [Line Items]
Amortized Cost	249
Fair Value	$ 249

[1] We evaluated certificates of deposits held as of March 31, 2015 and December 31, 2014 and concluded that they meet the definition of securities as available for sale.

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Note 3 - Loss per Share (Details) - Basic and Diluted Net Loss Per Share Calculation (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Basic and Diluted Net Loss Per Share Calculation [Abstract]
Net loss (in Dollars)	$ (477)	$ (89)
Shares used to compute basic net loss per share	7,401	7,352
Shares used to compute diluted net loss per share	7,401	7,352
Basic and diluted net loss per share (in Dollars per share)	$ (0.06)	$ (0.01)

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Note 4 - Investments (Details) - Short-term Investments Classified as Available-For-Sale Stated At Fair Value (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Note 4 - Investments (Details) - Short-term Investments Classified as Available-For-Sale Stated At Fair Value [Line Items]
Available for sale securities	$ 6,564	$ 6,436
US Government Agencies Debt Securities [Member] | Fair Value, Inputs, Level 2 [Member]
Note 4 - Investments (Details) - Short-term Investments Classified as Available-For-Sale Stated At Fair Value [Line Items]
Available for sale securities	768	158
US Government Agencies Debt Securities [Member]
Note 4 - Investments (Details) - Short-term Investments Classified as Available-For-Sale Stated At Fair Value [Line Items]
Available for sale securities	768	158
Certificate Of Deposit [Member] | Fair Value, Inputs, Level 2 [Member]
Note 4 - Investments (Details) - Short-term Investments Classified as Available-For-Sale Stated At Fair Value [Line Items]
Available for sale securities	5,796	6,278
Certificate Of Deposit [Member]
Note 4 - Investments (Details) - Short-term Investments Classified as Available-For-Sale Stated At Fair Value [Line Items]
Available for sale securities	5,796	6,278
Fair Value, Inputs, Level 2 [Member]
Note 4 - Investments (Details) - Short-term Investments Classified as Available-For-Sale Stated At Fair Value [Line Items]
Available for sale securities	$ 6,564	$ 6,436

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Note 5 - Prepaid Expenses and Other Current Assets (Details) - Prepaid Expenses and Other Current Assets (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Prepaid Expenses and Other Current Assets [Abstract]
Prepaid expenses	$ 1,068	$ 673
Interest receivable	6	4
Other receivables	14	5
	$ 1,088	$ 682

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Note 3 - Loss per Share

3 Months Ended

Mar. 31, 2015

Earnings Per Share [Abstract]

Earnings Per Share [Text Block]

3.   Loss per Share

Basic loss per share is calculated by dividing the net loss for the period by the weighted average shares of common stock outstanding for the period.  Diluted loss per share is calculated by dividing the net loss per share by the weighted average common stock outstanding for the period, plus dilutive potential common shares using the treasury stock method.  In periods with a net loss, basic and diluted earnings per share are identical because inclusion of potentially dilutive common shares would be anti-dilutive.

The following table sets forth the computation of basic and diluted net loss per share for the three months ended March 31, 2015 and 2014 (in thousands, except per share data):

	Three Months Ended March 31,
	2015			2014
Net loss	$	(477	)	$	(89	)
Shares used to compute basic net loss per share		7,401			7,352
Dilutive potential common shares:
Stock options		-			-
Shares used to compute diluted net loss per share		7,401			7,352
Basic and diluted net loss per share	$	(0.06	)	$	(0.01	)

For the three months ended March 31, 2015, the weighted average effect of approximately 879,000 options to purchase shares of common stock were not included in the calculation because the effect would have been anti-dilutive.

For the three months ended March 31, 2014, the weighted average effect of approximately 373,000 options to purchase shares of common stock were not included in the calculation because the effect would have been anti-dilutive.

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Note 6 - Property and Equipment (Details) (USD $)	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014	Dec. 31, 2014
Note 6 - Property and Equipment (Details) [Line Items]
Property, Plant and Equipment, Net	$ 1,197,000		$ 1,358,000
Proceeds from Sale of Property, Plant, and Equipment	8,000
Gain (Loss) on Disposition of Property Plant Equipment	(2,000)
Depreciation	164,000	183,000
Computer Equipment [Member]
Note 6 - Property and Equipment (Details) [Line Items]
Property, Plant and Equipment, Net	10,000
Proceeds from Sale of Property, Plant, and Equipment	8,000
Gain (Loss) on Disposition of Property Plant Equipment	$ (2,000)

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Note 9 - Commitments and Contingencies (Details) - Non-Cancellable Purchase Obligations For Software Development And License Agreements (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015
Non-Cancellable Purchase Obligations For Software Development And License Agreements [Abstract]
2015	$ 481
2016	878
2017	479
	$ 1,838

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Condensed Consolidated Balance Sheets (Unaudited) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
CURRENT ASSETS:
Cash and cash equivalents	$ 1,981	$ 1,577
Short-term investments, available-for-sale	6,315	6,436
Accounts receivable, net of allowance for doubtful accounts of $42 and $42	1,543	1,735
Prepaid expenses and other current assets	1,088	682
Total current assets	10,927	10,430
LONG TERM ASSETS:
Property and equipment, net of accumulated depreciation	1,197	1,358
Internal use software, net of accumulated amortization	5,072	5,059
Long-term investments, available-for-sale	249
Other long-term assets	185	181
Total long term assets	6,703	6,598
TOTAL ASSETS	17,630	17,028
CURRENT LIABILITIES:
Accounts payable	993	873
Accrued expenses	926	1,098
Unearned revenue, current portion	9,462	8,478
Other current liabilities	86	82
Total current liabilities	11,467	10,531
LONG TERM LIABILITIES:
Unearned revenue, net of current portion	456	405
Deferred rent, net of current portion	640	590
Other long-term liabilities	62	69
Total long term liabilities	1,158	1,064
TOTAL LIABILITIES	12,625	11,595
COMMITMENTS AND CONTINGENCIES (Note 9)
STOCKHOLDERS’ EQUITY:
Preferred stock; $.0001 par value: 2,000,000 shares authorized; no shares issued or outstanding	0	0
Common stock; $.0001 par value: 11,000,000 shares authorized; 8,651,127 and 8,643,460 shares issued; and 7,408,320 and 7,400,653 shares outstanding	1	1
Treasury stock, at cost: 1,242,807 and 1,242,807 shares	(4,398)	(4,398)
Additional paid in capital	353,901	353,852
Accumulated other comprehensive gain	(1)	(1)
Accumulated deficit	(344,498)	(344,021)
Total stockholders’ equity	5,005	5,433
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$ 17,630	$ 17,028

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Note 1 - Accounting Policies

3 Months Ended

Mar. 31, 2015

Disclosure Text Block [Abstract]

Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block]

1.   Accounting Policies

Basis of Presentation

The unaudited interim Condensed Consolidated Financial Statements and related notes thereto have been prepared pursuant to generally accepted accounting principles in the United States of America, or GAAP, and the rules and regulations of the Securities and Exchange Commission.  Accordingly, certain information and note disclosures normally included in annual financial statements prepared in accordance with GAAP have been omitted pursuant to such rules and regulations.  The accompanying unaudited interim Condensed Consolidated Financial Statements and related notes thereto should be read in conjunction with the audited Consolidated Financial Statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2014 (“2014 Annual Report”).

Onvia had a wholly-owned subsidiary in Canada that was dissolved effective December 19, 2014; however, there was no business activity in this subsidiary during the three month periods ended March 31, 2015 or 2014.  The wholly-owned subsidiary owned no assets or liabilities as of the date of dissolution.

The information furnished is unaudited, but reflects, in the opinion of management, all adjustments, consisting of only normal recurring items, necessary for a fair presentation of the results for the interim periods presented. In addition, certain reclassifications of prior period balances have been made to conform to the current period presentation.

Interim results are not necessarily indicative of results for a full year.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires the Company’s management to make estimates and judgments that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period.  Significant estimates include the fair value of stock-based compensation, allowance for doubtful accounts, capitalization of costs for internally developed software, recoverability of long-lived assets, including internally developed software, and the valuation allowance for Onvia’s net deferred tax assets.  The Company bases its estimates on historical experience and on various other assumptions that it believes to be reasonable under the circumstances.  Actual results may differ significantly from the Company’s estimates.  In addition, any significant unanticipated changes in any of the Company’s assumptions could have a material adverse effect on its business, financial condition, and results of operations.

Recently Issued Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update ("ASU") No. 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”). The standard provides companies with a single model for accounting for revenue arising from contracts with customers and supersedes current revenue recognition guidance, including industry-specific revenue guidance. The core principle of the model is to recognize revenue when control of the goods or services transfers to the customer, as opposed to recognizing revenue when the risks and rewards transfer to the customer under the existing revenue guidance.  The guidance permits companies to either apply the requirements retrospectively to all prior periods presented, or apply the requirements in the year of adoption, through a cumulative adjustment.  The guidance is effective for annual reporting periods and interim periods within those annual reporting periods beginning after December 15, 2016.  Early adoption is not permitted.  The Company is in the process of evaluating the impact of the new guidance on our financial statements and has not yet selected a transition approach to implement the standard.

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Note 7 - Internal Use Software (Details) - Roll-forward of Capitalized Internal Use Software (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2015
Roll-forward of Capitalized Internal Use Software [Abstract]
Capitalized Internal Use Software	$ 17,107
Capitalized Internal Use Software	498
Capitalized Internal Use Software	17,605
Accumulated amortization	(12,048)
Accumulated amortization	(485)
Accumulated amortization	(12,533)
	5,059
	13
	$ 5,072

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Note 6 - Property and Equipment (Tables)

3 Months Ended

Mar. 31, 2015

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment [Table Text Block]

	March 31, 2015			December 31, 2014
Computer equipment	$	3,673		$	3,676
Software		1,855			1,855
Furniture and fixtures		109			109
Leasehold improvements		883			883
Total cost basis		6,520			6,523
Less accumulated depreciation and amortization		(5,323	)		(5,165	)
Net book value	$	1,197		$	1,358

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Note 8 - Accrued Expenses and Other Current Liabilities (Details) - Accrued Expenses (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Accrued Expenses [Abstract]
Payroll and related liabilities	$ 854	$ 966
Taxes payable and other	72	132
	$ 926	$ 1,098

XML

Note 8 - Accrued Expenses and Other Current Liabilities (Tables)

3 Months Ended

Mar. 31, 2015

Payables and Accruals [Abstract]

Schedule of Accounts Payable and Accrued Liabilities [Table Text Block]

	March 31, 2015		December 31, 2014
Payroll and related liabilities	$	854	$	966
Taxes payable and other		72		132
	$	926	$	1,098

Schedule of Other Assets and Other Liabilities [Table Text Block]

	March 31, 2015		December 31, 2014
Obligations under capital leases, current portion	$	24	$	24
Deferred rent, current portion		62		58
	$	86	$	82

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Note 2 - Stock-Based Compensation

3 Months Ended

Mar. 31, 2015

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Disclosure of Compensation Related Costs, Share-based Payments [Text Block]

2.   Stock-Based Compensation

The impact on Onvia’s results of operations of recording stock-based compensation was as follows for the periods presented (in thousands):

	Three Months Ended March 31,
	2015			2014
Cost of revenue	$	-		$	2
Sales and marketing		(9	)		9
Technology and development		5			6
General and administrative		26			37
Total stock-based compensation	$	22		$	54

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Condensed Consolidated Balance Sheets (Unaudited) (Parentheticals) (USD $) In Thousands, except Share data, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Allowance for doubtful accounts (in Dollars)	$ 42	$ 42
Preferred stock par value (in Dollars per share)	$ 0.0001	$ 0.0001
Preferred stock, shares authorized	2,000,000	2,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock par value (in Dollars per share)	$ 0.0001	$ 0.0001
Common stock, shares authorized	11,000,000	11,000,000
Common stock, shares issued	8,651,127	8,643,460
Common stock, shares outstanding	7,408,320	7,400,653
Treasury stock, Shares	1,242,807	1,242,807

XML

Accounting Policies, by Policy (Policies)

3 Months Ended

Mar. 31, 2015

Accounting Policies [Abstract]

Consolidation, Policy [Policy Text Block]

Basis of Presentation

The unaudited interim Condensed Consolidated Financial Statements and related notes thereto have been prepared pursuant to generally accepted accounting principles in the United States of America, or GAAP, and the rules and regulations of the Securities and Exchange Commission.  Accordingly, certain information and note disclosures normally included in annual financial statements prepared in accordance with GAAP have been omitted pursuant to such rules and regulations.  The accompanying unaudited interim Condensed Consolidated Financial Statements and related notes thereto should be read in conjunction with the audited Consolidated Financial Statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2014 (“2014 Annual Report”).

Onvia had a wholly-owned subsidiary in Canada that was dissolved effective December 19, 2014; however, there was no business activity in this subsidiary during the three month periods ended March 31, 2015 or 2014.  The wholly-owned subsidiary owned no assets or liabilities as of the date of dissolution.

The information furnished is unaudited, but reflects, in the opinion of management, all adjustments, consisting of only normal recurring items, necessary for a fair presentation of the results for the interim periods presented. In addition, certain reclassifications of prior period balances have been made to conform to the current period presentation.

Interim results are not necessarily indicative of results for a full year.

Use of Estimates, Policy [Policy Text Block]

Use of Estimates

The preparation of financial statements in conformity with GAAP requires the Company’s management to make estimates and judgments that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period.  Significant estimates include the fair value of stock-based compensation, allowance for doubtful accounts, capitalization of costs for internally developed software, recoverability of long-lived assets, including internally developed software, and the valuation allowance for Onvia’s net deferred tax assets.  The Company bases its estimates on historical experience and on various other assumptions that it believes to be reasonable under the circumstances.  Actual results may differ significantly from the Company’s estimates.  In addition, any significant unanticipated changes in any of the Company’s assumptions could have a material adverse effect on its business, financial condition, and results of operations.

New Accounting Pronouncements, Policy [Policy Text Block]

Recently Issued Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update ("ASU") No. 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”). The standard provides companies with a single model for accounting for revenue arising from contracts with customers and supersedes current revenue recognition guidance, including industry-specific revenue guidance. The core principle of the model is to recognize revenue when control of the goods or services transfers to the customer, as opposed to recognizing revenue when the risks and rewards transfer to the customer under the existing revenue guidance.  The guidance permits companies to either apply the requirements retrospectively to all prior periods presented, or apply the requirements in the year of adoption, through a cumulative adjustment.  The guidance is effective for annual reporting periods and interim periods within those annual reporting periods beginning after December 15, 2016.  Early adoption is not permitted.  The Company is in the process of evaluating the impact of the new guidance on our financial statements and has not yet selected a transition approach to implement the standard.

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Document And Entity Information	3 Months Ended
	Mar. 31, 2015	Apr. 30, 2015
Document and Entity Information [Abstract]
Entity Registrant Name	ONVIA INC
Document Type	10-Q
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding		7,413,916
Amendment Flag	false
Entity Central Index Key	0001100917
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Filer Category	Smaller Reporting Company
Entity Well-known Seasoned Issuer	No
Document Period End Date	Mar. 31, 2015
Document Fiscal Year Focus	2015
Document Fiscal Period Focus	Q1

XML

Note 2 - Stock-Based Compensation (Tables)

3 Months Ended

Mar. 31, 2015

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Schedule of Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Table Text Block]

	Three Months Ended March 31,
	2015			2014
Cost of revenue	$	-		$	2
Sales and marketing		(9	)		9
Technology and development		5			6
General and administrative		26			37
Total stock-based compensation	$	22		$	54

XML

Condensed Consolidated Statements of Operations and Comprehensive Income (Unaudited) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Revenue
Subscription	$ 5,263	$ 5,025
Content license	462	474
Management information reports	48	53
Other	72	64
Total revenue	5,845	5,616
Cost of revenue (exclusive of depreciation and amortization included below)	793	825
Gross margin	5,052	4,791
Operating expenses:
Sales and marketing	3,090	2,934
Technology and development	1,032	1,120
General and administrative	1,409	829
Total operating expenses	5,531	4,883
Loss from operations	(479)	(92)
Interest and other income, net	2	3
Net loss	(477)	(89)
Unrealized gain on available-for-sale securities		1
Comprehensive loss	$ (477)	$ (88)
Basic and diluted net loss per common share (in Dollars per share)	$ (0.06)	$ (0.01)
Basic and diluted weighted average shares outstanding (in Shares)	7,401	7,352

XML

Note 7 - Internal Use Software

3 Months Ended

Mar. 31, 2015

Internal Use Software Disclosure [Abstract]

Internal Use Software Disclosure [Text Block]

7.   Internal Use Software

Onvia capitalizes qualifying computer software costs incurred during the “application development stage” and other costs.  Amortization of these costs begins once the product is ready for its intended use.  These costs are amortized on a straight-line basis over the estimated useful life of the product, typically 3 to 5 years.  The amount of costs capitalized within any period is dependent on the nature of software development activities and projects in each period.

Onvia periodically evaluates the remaining useful lives and carrying values of internal use software.  If management determines that all or a portion of the asset will no longer be used, or the estimated remaining useful life differs from existing estimates, an abandonment will be recorded to reduce the carrying value or adjust the remaining useful life to reflect revised estimates.  In addition, if the carrying value of the software exceeds the estimated future cash flows, an impairment will be recorded to reduce the carrying value to the expected realizable value. No impairment has been recorded during the three months ended March 31, 2015 and March 31, 2014.

The following table presents a roll-forward of capitalized internal use software for the three months ended March 31, 2015 (in thousands):

	Balance at December 31, 2014			Additions			Balance at March 31, 2015
Capitalized Internal Use Software	$	17,107		$	498		$	17,605
Accumulated amortization		(12,048	)		(485	)		(12,533	)
	$	5,059		$	13		$	5,072

Amortization expense was $485,000 and $633,000 for the three months ended March 31, 2015 and 2014, respectively. Amortization expense is included in operating expenses in the unaudited Condensed Consolidated Statements of Operations and Comprehensive Income.

XML

Note 6 - Property and Equipment

3 Months Ended

Mar. 31, 2015

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment Disclosure [Text Block]

6.   Property and Equipment

Property and equipment to be held and used consist of the following (in thousands):

	March 31, 2015			December 31, 2014
Computer equipment	$	3,673		$	3,676
Software		1,855			1,855
Furniture and fixtures		109			109
Leasehold improvements		883			883
Total cost basis		6,520			6,523
Less accumulated depreciation and amortization		(5,323	)		(5,165	)
Net book value	$	1,197		$	1,358

For the three months ended March 31, 2015, Onvia disposed of computer equipment with a remaining net book value of $10,000 for proceeds of $8,000 and recorded a $2,000 loss on sale of property and equipment which is included in the unaudited Condensed Consolidated Statement of Operations as general and administrative operating expenses.

Depreciation expense was $164,000 and $183,000 for the three months ended March 31, 2015 and 2014, respectively.

XML

Note 7 - Internal Use Software (Tables)

3 Months Ended

Mar. 31, 2015

Internal Use Software Disclosure [Abstract]

Capitalized Internal Use Software Roll Forward [Table Text Block]

	Balance at December 31, 2014			Additions			Balance at March 31, 2015
Capitalized Internal Use Software	$	17,107		$	498		$	17,605
Accumulated amortization		(12,048	)		(485	)		(12,533	)
	$	5,059		$	13		$	5,072

XML

Note 3 - Loss per Share (Tables)

3 Months Ended

Mar. 31, 2015

Earnings Per Share [Abstract]

Schedule of Weighted Average Number of Shares [Table Text Block]

	Three Months Ended March 31,
	2015			2014
Net loss	$	(477	)	$	(89	)
Shares used to compute basic net loss per share		7,401			7,352
Dilutive potential common shares:
Stock options		-			-
Shares used to compute diluted net loss per share		7,401			7,352
Basic and diluted net loss per share	$	(0.06	)	$	(0.01	)

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Note 10 - Income Taxes

3 Months Ended

Mar. 31, 2015

Income Tax Disclosure [Abstract]

Income Tax Disclosure [Text Block]

10.   Income Taxes

As of March 31, 2015 and December 31, 2014, Onvia has recorded a valuation allowance against its net deferred tax assets because the Company has determined it is not more likely than not that the asset will be realized. Onvia will continue to evaluate the likelihood that these tax benefits may be realized, and may reverse all or a portion of its valuation allowance in the future if it is determined that realization of these benefits is more likely than not.

Pursuant to Section 382 of the Internal Revenue Code of 1986, as amended (the “Code”), utilization of net operating loss (NOL) carryforwards to offset future taxable income are subject to substantial annual limitations if we experience a cumulative change in ownership as defined by the Code. In general, an ownership change, as defined by the Code, results from transactions increasing the ownership of certain stockholders or public groups in the stock of a corporation by more than 50 percentage points over a three-year period.

As of March 31, 2015 and December 31, 2014, Onvia’s Federal NOL carryforwards for income tax purposes were approximately $76.0 million.  The Federal NOL carryforwards are subject to limitations under Section 382 of the Internal Revenue Code. If not utilized, the Federal NOL carryforwards will begin to expire in 2022.  The latest date available for a portion of the Federal NOL carryforwards to be utilized to offset future income is 2033.

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Note 8 - Accrued Expenses and Other Current Liabilities

3 Months Ended

Mar. 31, 2015

Payables and Accruals [Abstract]

Accounts Payable and Accrued Liabilities Disclosure [Text Block]

8.   Accrued Expenses and Other Current Liabilities

Accrued expenses consist of the following (in thousands):

	March 31, 2015		December 31, 2014
Payroll and related liabilities	$	854	$	966
Taxes payable and other		72		132
	$	926	$	1,098

Other current liabilities consist of the following (in thousands):

	March 31, 2015		December 31, 2014
Obligations under capital leases, current portion	$	24	$	24
Deferred rent, current portion		62		58
	$	86	$	82

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Note 9 - Commitments and Contingencies

3 Months Ended

Mar. 31, 2015

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies Disclosure [Text Block]

9.   Commitments and Contingencies

Operating Leases

During the first quarter of 2013, Onvia entered into the first amendment to lease agreement for its corporate offices located in Seattle, Washington.  The amendment, among other things, extends the lease term for an additional sixty-five (65) months with a new expiration date of April 30, 2021.  In addition, the amendment reduces the rental area of the premises to approximately 29,606 square feet, after surrender of 5,394 square feet after the execution of the amendment.  Onvia has an additional right to surrender up to 8,898 square feet on or after November 30, 2015 in exchange for reimbursement of unamortized landlord incentives.  In addition to base rent, Onvia will be responsible for its proportionate share of annual incremental increases in the building’s operating expenses, insurance, and real estate taxes over the 2013 base year.  Onvia has a one-time right to terminate the amended lease in its entirety on or after December 1, 2017 in exchange for payment of a significant termination fee.

Rent expense is being recognized on a straight-line basis over the term of the lease.  Onvia also has a non-cancellable operating lease for office equipment, which expires in July 2019.

As of March 31, 2015, remaining future minimum lease payments required on non-cancellable operating leases are as follows for the years ending December 31 (in thousands):

	Real Estate Operating Leases		Office Equipment Operating Lease		Total Operating Leases
2015	$	622	$	15	$	637
2016		780		20		800
2017		873		20		893
2018		896		20		916
2019		918		9		927
2020 and thereafter		1,261		-		1,261
	$	5,350	$	84	$	5,434

Purchase Obligations

Onvia has non-cancellable purchase obligations for software development and license agreements, co-location hosting arrangements, telecom agreements, marketing agreements and third-party content agreements.  The agreements expire in dates ranging from April 2015 to 2017.  Future required payments under these non-cancellable agreements are as follows for the years ending December 31 (in thousands):

	Purchase Obligations
2015	$	481
2016		878
2017		479
	$	1,838

Legal Proceedings

From time to time, legal proceedings may arise in the ordinary course of business.  Although the outcomes of legal proceedings are inherently difficult to predict, we are not currently involved in any legal proceeding in which the outcome, in our judgment based on information currently available, is likely to have a material adverse effect on our business or financial position.

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Note 11 - Security Deposits

3 Months Ended

Mar. 31, 2015

Lease Security Deposit [Abstract]

Lease Security Deposit [Text Block]

11.   Security Deposits

Pursuant to Onvia’s lease for its current corporate office space, Onvia has established a stand by letter of credit as security to the lease increasing from $100,000 in April 2013, to $125,000 in January 2014 and to $150,000 on January 2015. The letter of credit will be returned at lease termination in April 2021, or earlier as discussed above, subject to standard office lease conditions. As of March 31, 2015, the stand by letter of credit is secured by a security deposit of $150,000 and reported as other long-term assets on the unaudited Condensed Consolidated Balance Sheets.

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Note 7 - Internal Use Software (Details) (USD $)	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Note 7 - Internal Use Software (Details) [Line Items]
Asset Impairment Charges	$ 0	$ 0
Operating Expense [Member]
Note 7 - Internal Use Software (Details) [Line Items]
Amortization of Intangible Assets	$ 485,000	$ 633,000
Minimum [Member]
Note 7 - Internal Use Software (Details) [Line Items]
Capitalized Internal Use Software Useful Life	3 years
Maximum [Member]
Note 7 - Internal Use Software (Details) [Line Items]
Capitalized Internal Use Software Useful Life	5 years

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Note 5 - Prepaid Expenses and Other Current Assets (Tables)

3 Months Ended

Mar. 31, 2015

Disclosure Text Block Supplement [Abstract]

Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Table Text Block]

	March 31, 2015		December 31, 2014
Prepaid expenses	$	1,068	$	673
Interest receivable		6		4
Other receivables		14		5
	$	1,088	$	682

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Note 2 - Stock-Based Compensation (Details) - Impact on Results of Operations of Recording Stock Based Compensation (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Share-based Compensation Allocation of Recognized Period Costs	$ 22	$ 54
Cost of Sales [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Share-based Compensation Allocation of Recognized Period Costs		2
Selling and Marketing Expense [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Share-based Compensation Allocation of Recognized Period Costs	(9)	9
Technology And Development [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Share-based Compensation Allocation of Recognized Period Costs	5	6
General and Administrative Expense [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Share-based Compensation Allocation of Recognized Period Costs	$ 26	$ 37

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Note 10 - Income Taxes (Details) (USD $) In Millions, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Income Tax Disclosure [Abstract]
Operating Loss Carryforwards	$ 76.0	$ 76.0

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Condensed Consolidated Statements of Cash Flows (Unaudited) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$ (477)	$ (89)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization	649	816
Stock-based compensation	22	54
Loss on sale of property and equipment	2
Change in operating assets and liabilities:
Accounts receivable	192	(34)
Prepaid expenses and other assets	(633)	(339)
Accounts payable	78	(145)
Accrued expenses	(172)	(262)
Unearned revenue	1,035	664
Deferred rent	53	57
Net cash provided by operating activities	749	722
CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to property and equipment	(68)	(97)
Additions to internal use software	(407)	(597)
Purchases of investments	(2,712)	(4,256)
Sales of investments		1,570
Maturities of investments	2,833	2,039
Proceeds from sale of equipment	8
Net cash used in investing activities	(346)	(1,341)
CASH FLOWS FROM FINANCING ACTIVITIES:
Principal payments on capital lease obligations		(63)
Proceeds from exercise of stock options	1	205
Net cash provided by financing activities	1	142
Net increase / (decrease) in cash and cash equivalents	404	(477)
Cash and cash equivalents, beginning of period	1,577	2,073
Cash and cash equivalents, end of period	1,981	1,596
SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
Unrealized gain on available-for-sale investments		1
Purchases under capital lease obligations	(6)	(6)
Property and equipment additions in accounts payable		(31)
Internal use software additions in accounts payable	$ (227)	$ (217)

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Note 5 - Prepaid Expenses and Other Current Assets

3 Months Ended

Mar. 31, 2015

Disclosure Text Block Supplement [Abstract]

Other Current Assets [Text Block]

5.   Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consist of the following (in thousands):

	March 31, 2015		December 31, 2014
Prepaid expenses	$	1,068	$	673
Interest receivable		6		4
Other receivables		14		5
	$	1,088	$	682

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Note 3 - Loss per Share (Details) (Equity Option [Member])	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Equity Option [Member]
Note 3 - Loss per Share (Details) [Line Items]
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	879,000	373,000

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Note 9 - Commitments and Contingencies (Details)	3 Months Ended
	Mar. 31, 2013 sqft
Note 9 - Commitments and Contingencies (Details) [Line Items]
Lessee Leasing Arrangements, Operating Leases, Term of Contract	65 months
Area of Real Estate Property	29,606
Area Surrenderd After Execution Of Amendment [Member]
Note 9 - Commitments and Contingencies (Details) [Line Items]
Area of Real Estate Property	5,394
Right To Surrender Additional Area [Member]
Note 9 - Commitments and Contingencies (Details) [Line Items]
Area of Real Estate Property	8,898

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Note 4 - Investments (Tables)

3 Months Ended

Mar. 31, 2015

Investments, Debt and Equity Securities [Abstract]

Schedule of Available-for-sale Securities Reconciliation [Table Text Block]

	March 31, 2015
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Short-Term Investments
U.S. Government backed securities	$	768	$	-	$	-		$	768
Certificates of Deposit (1)		5,548		-		(1	)		5,547
Total Short-Term Investments		6,316		-		(1	)		6,315
Long-Term Investments
Certificates of Deposit (1)		249		-		-			249
Total Long-Term Investments		249		-		-			249
Total Investments	$	6,565	$	-	$	(1	)	$	6,564

	December 31, 2014
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
U.S. Government backed securities	$	158	$	-	$	-		$	158
Certificates of Deposit (1)		6,279		-		(1	)		6,278
Total Investments	$	6,437	$	-	$	(1	)	$	6,436

Fair Value, Assets Measured on Recurring Basis [Table Text Block]

	Fair Value Measurements as of March 31, 2015
	Level 1		Level 2		Level 3		Total
U.S. Government backed securities	$	-	$	768	$	-	$	768
Certificates of Deposit		-		5,796		-		5,796
Total Investments	$	-	$	6,564	$	-	$	6,564

	Fair Value Measurements as of December 31, 2014
	Level 1		Level 2		Level 3		Total
U.S. Government backed securities	$	-	$	158	$	-	$	158
Certificates of Deposit		-		6,278		-		6,278
Total Investments	$	-	$	6,436	$	-	$	6,436