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April 28, 2011
Thanks to recent changes in federal policy, women-owned small businesses now have a greater chance to be awarded federal contracts.
As of Feb. 4, women-owned small businesses and economically disadvantaged WOSBs can gain greater access to federal contracting opportunities through the Small Business Administration’s WOSB Program.
“Women-owned businesses are one of the fastest growing sectors of our nation’s economy, and even during the economic downturn of the last few years, have been one of the key job creation engines in communities across the country,” SBA Administrator Karen Mills said. “Despite their growth and the fact that women lead some of the strongest most innovative companies, women-owned firms continue to be underrepresented in the federal contracting marketplace.”
For the first time, contracting officers are allowed to set aside specific contracts for certified WOSBs and EDWOSBs, which will help federal agencies achieve the existing statutory goal of 5 percent of federal contracting dollars being awarded to WOSBs.
The program focuses on 83 industries in which women are under- or substantially under-represented in the federal contract marketplace, and is part of the Obama administration’s overall commitment to expanding federal contracting opportunities for small businesses owned by women.
Find out more about the program, including compliance guides for WOSBs and contracting officers.|
Phone: (800) 827-5722
The program was published in the Federal Register in early October 2010 and will be fully implemented over the next several months, with the first contracts expected to be awarded by the fourth quarter of 2011. It has the potential to benefit nearly 684,000 women-owned businesses.
What’s in the program?
The creation of a rule to increase federal contracting opportunities for WOSBs was first approved by Congress in 2000. Since that time, in an effort to increase effectiveness, the SBA has taken a number of steps to analyze the market, including a study of WOSB participation in a number of industries.
The proposed rule was published for comment on March 2, 2010. After receiving over 1,000 comments, the SBA published its final rule in the Federal Register in October 2010. A complete copy of the rule is available on the SBA’s website at http://www.sba.gov/wosb.
Some of the program’s essential elements are:
• To be eligible, a small business must be 51 percent owned and controlled by one or more women who are U.S. citizens. A woman must hold the highest officer position in the company. For example, even if your company is 51 percent owned and controlled by women, you cannot have a male president. However, the woman that holds the highest officer position does not have to be an owner different women can own and control the company, so long as they own and control at least 51 percent.
The entity’s corporate documents whether a partnership agreement, articles of organization, or bylaws determine whether the WOSB meets the control requirements.
• The final rule authorizes a set-aside of federal contracts for WOSBs where the anticipated contract price does not exceed $5 million in the case of manufacturing and $3 million in the case of other contracts. Contracts with values in excess of these limits are not subject to set-aside under the program.
The $3 million and $5 million anticipated award price of the contract includes all options. For example, if the estimated price of the base year of requirements for services is $2 million and there are four one-year options with an estimated price of $2 million each year, the anticipated award price of the contract would exceed the $3 million statutory threshold.
• The firm must classify as “small” within its primary industry in accordance with SBA standards for that industry.
In order for a WOSB to be deemed economically disadvantaged, its owners must demonstrate “economic disadvantage” in accordance with the requirements set forth in the final rule. The rule allows WOSBs or EDWOSBs to be certified by a third party, or to self-certify.
A third-party certifier is a federal agency, state government, or national certifying entity approved by the administrator to provide certifications of WOSBs or EDWOSBs. The SBA has not yet approved any third-party certifiers, but will maintain a list of approved certifiers at http://www.sba.gov/wosb.
For those who self-certify, the rule requires the WOSB to submit a certification verification, to complete the certifications at the federal Online Representation and Certification Application website, and submit a set of eligibility-related documents to an online “document repository,” which will be maintained by the SBA.
The SBA intends to conduct a significant amount of certification verification to confirm eligibility of WOSBs. In the event of a contract protest or program review, the SBA has the authority to request additional documentation from the WOSB, and to initiate punitive action against ineligible firms that seek to take advantage of the program.
How to participate
The SBA has released instructions on how to participate in the program and has implemented a secure, online data repository for WOSBs to upload required documents, all of which can be accessed at http://www.sba.gov/wosb.
In the interim, the SBA encourages small business owners to familiarize themselves with the program’s requirements and ensure that the required documents are uploaded to the repository.
WOSBs will also need to update their status in the Central Contractors Registration and the Online Representation and Certification Application to indicate their eligibility in the program to contracting officers. These systems are being updated, and are expected to be up and running this month.
Finally, male-owned businesses can take part in the program by partnering with women-owned businesses to pursue federal contracts.
Meredith Thielbahr joined Oles Morrison Rinker & Baker in 2009 after graduating cum laude from Seattle University School of Law. She is a member of the firm’s Construction Litigation Practice Group and the Federal Practice Group, which focuses on assisting contractors in public procurement and contract dispute resolution with the federal government.