ATTENTION ALL WOMAN OWNED & ECONOMICALLY WOMAN OWNED SMALL BUSINESSES and 8(a) BUSINESS DEVELOPMENT PROGRAM BUSINESSES.
The U.S. Small Business Administration (SBA) is proposing changes to both the Woman-Owned Small Business and the 8(a) Business Development Program. These changes will impact the future of both programs. Let your voice be heard. Now is the time for you to comment on these changes BEFORE SBA implements them.
What are the proposed changes to the rules? Let’s find out what SBA wants to change to WOSB and 8(a) programs.
Changes to the Woman-Owned Small Business Program?
The U.S. Small Business Administration (SBA) is asking for the public to comment on the proposed rule to amend its regulations. SBA is wanting to implement a statutory requirement to certify Women-Owned Small Businesses (WOSBs) and Economically Disadvantaged Women-Owned Small Businesses (EDWOSBs) participating in the SBA’s Women-Owned Small Business Program. Both Women-Owned Small Businesses and Economically Disadvantaged Woman-Owned Small business are eligible for set-aside and sole source awards through the Federal Government. Presently, SBA is allowing WOSBs and EDWOSBs to self-certify through their web-based system or to certify through an approved third-party certifier.
Why Change the Woman-Owned Small Business Program?
The WOSB and EDWOSB are authorized by Congress in section 8(m) of the Small Business Act, 15 U.S.C. 637(m). The 2015 National Defense Authorization Act (NDAA) amended the Small Business Act giving contracting officers the authority to restrict federal contracts competition to eligible WOSBs or EDWOSBs for certain industries. In addition, the 2015 NDAA amended the Small Business Act to create a requirement that a small business must be certified as a WOSB or EDWOSB by a federal agency, a state government, SBA or national certifying entity approved by SBA. If a WOSB or EDWOSB is not certified by one of these entities then they cannot be awarded a set-aside or sole source contract under the WOSB Federal Contract Program. This includes those Woman-Owned Small Businesses that self-certified through SBA’s database! (certify.sba.gov)
What if my Woman-Owned Small Business Application is still Pending?
SBA’s proposed rule would permit a WOSB or EDWOSB to be eligible for an award under the WOSB program as long as its application is still pending. If that WOSB or EDWOSB were selected for an award, then SBA would prioritize the application and a determination would be made within 15 days. SBA does acknowledge that they may have difficulty processing all the potential applications in a timely manner. Why? Well, there are approximately 10,000 WOSB in SBA’s database. The anticipated influx of applications from WOSB would likely overwhelm SBA, which currently processes approximately 3,000 applications a year for 8(a) status and 1,500 a year for HUBZone status.
What if My Business Is Not Currently Woman-Owned Small Business Certified? Can I Still Receive a Contract?
If or once the rule is finalized, the certification requirement will apply to participants wishing to compete for set-aside or sole source contracts under the WOSB Program. If your business is not certified then it will not be eligible to compete on set-aside contract under this program.
Importantly, WOSBs that elect not to participate in this program can continue to self-certify their status, receive contract awards outside of this program as WOSBs and count towards an agency’s goal for award to WOSBs. For these purposes, which include subcontracts, full and open awards, and small business set-aside, contracting officers would be able to accept self-certification without verification.
Is There Any Benefit For the WOSB Rule Change?
SBA states that the proposed rule will increase the number of federal contracts awarded to WOSB and EDWOSB-certified businesses. In addition, it will empower agencies to meet the 5 percent federal contracting goal for women-owned small businesses. How? Because presently contracting officers must review a contract awardee’s documentation to verify an applicant’s WOSB and EDWOSB eligibility. This new process will give contracting officers reassurance that the businesses participating in this program are eligible for awards. Thus encouraging more contracting officers to set-aside contracts for women-owned small businesses.
Proposed Changes to 8(a) BD Program
SBA is proposing a change to the economically disadvantaged requirements for 8(a) BD Program. This change would be consistent with the economic disadvantage requirements for woman-owned small businesses seeking EDWOSB status. Currently, the economic disadvantage for the 8(a) program is $250,000. By changing this requirement to $350,000 would bring it in line with the EDWOSB program. Thus the change to the 8(a) program would consistent with that for a woman seeking to qualify as economically disadvantaged for the EDWOSB program.
WAIT SBA NEEDS YOUR INPUT ON SOMETHING ELSE!
You can help SBA by providing public comment on the changes proposed above and also on the net worth standard to be used for both EDWOSB and 8(a) programs. A recent study by SBA’s Office of Business supports a $375,000 adjusted net worth for initial eligibility as compared to the current $250,000 threshold. SBA is considering applying a $375,000 net worth to both programs. But the study did not consider differences in economic disadvantage between businesses applying to the 8(a) BD program and net worth once accepted into the program. SBA wants your input on whether they should do away with the $750,000 net worth should be the new standard or use $375,000.
You have until July 15, 2019, to provide your comments on these rules. Don’t wait!!! Comment Now.
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