Does your firm qualify for 8(a) status and the sole sourcing that comes along with it?

If you are a small business you have heard of contractors receiving a sole source because they are 8(a) certified. What does this mean and how do you get one?

First, you have to go through the grueling 8(a) certification process, which seems like you are allowing the Small Business Administration access to your life. If you make it to the end of the process with a certification than you are very lucky, these days SBA has been cracking down on requirements. So what exactly does is mean and what is this sole source?

A sole source contract means that the agency that is purchasing does not have to put that service and/or product out for bid. Right now this can only be done for firms that hold the 8(a) status, soon to be woman owned small businesses as well. The reasoning behind it comes from what it means to be an 8(a) firm.

To qualify to submit an application for the certification you need to meet the following:

·         Business must be majority-owned by an individual(s) (aka no holding companies)

·         That individual(s) must be an American citizen

·         Business must be majority-owned and controlled/managed by socially and economically disadvantaged individual (s)

o   In order to qualify as socially disadvantaged you need to belong to one of the following:

§  Black American

§  Hispanic American

§  Native American

§  Asian Pacific American

§  Subcontinent Asian American

o   In order to qualify as economically disadvantaged the individual(s) your net worth must be below $250,000

§  That does not include the value of the primary home, business or any retirement funds

·         Business must be considered a small business

·         Business must demonstrate potential for success

·         Principals must show good character

These are just the initial requirements, if you want to find out more information and if your firm qualifies take a look at the SBA’s 8(a) Certification Q&A: https://www.sba.gov/blogs/sbas-8a-certification-program-explained

What’s changing for WOSBs

Woman Owned Small Business are going to be granted the same privileges as 8(a) businesses when it comes to set aside a rules. The SBA is planning on amending the WOSB and EDWOSB set aside, allowing contracting officers award sole source contracts and setting the procurement goal at 5% of all small business.

The SBA was looking for input on the proposed program changes are the responses have been positive. Here’s some great highlights.

·         “Fast tracking” the Sole Source Authority for WOSBs will promote Women Owned Small Businesses to contracting officers who have found the business they want to work with. There won’t be a need for the long and drawn out RFQ/RFP process under the value thresholds of $6.5 million for manufacturing contracts and $4 million for all others.

·         Setting the procurement goal at 5% on par with 8(a) programs will create the “level playing field” that WOSB have long desired. This will have the great effect of promoting WOSB to the government in not only “underrepresented” industries but across the board.

·         Efforts to meet the new deadline for January 2, 2016 to determine “underrepresented” industries within the WOSB is a great approach to determining where WOSBs are needed

But what will change for Women Owned Small Business? Most importantly, self-certification will be a thing of the past.

If you’re interested in taking a look at the proposed rules, check out the Federal Register document here: http://www.gpo.gov/fdsys/pkg/FR-2015-05-01/pdf/2015-10331.pdf. The document also give you the chance to cross reference some FAR and CFR regulation on Women Owned Small Business programs that will be changes once this proposed rule goes into effect.