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SBA Programs and Government Contracting

SELLING TO THE FEDERAL GOVERNMENT

U.S. Small Business Administration

www.sba.gov/mo

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Government Procurement

FY 2016 Federal Government spent

$409.1B

on prime contracts

The Small Business Act requires that the Federal

Government set aside 23% contract dollars for small

business.

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Government Procurement

$94 Billion

5%, $4.7B - Small Disadvantaged Business, 8(a)

5%, $4.7B Women Owned Business and EDVOSB

3%, $2.8B HUBZone -Historically Underutilized Business Zone

3%, $2.8B Service Disabled Veteran Owned Business

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Getting Started:Does Your Business Qualify for Small Business

Government Contracts?

Four questions:

• Does the Government buy what you are selling

• Are you a small business

• What is the size standard for my business

• Do you fall under a specific certification

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Small Business Programs

– SBA Certification Programs

– 8(a) Business Development Certification

– HUBZone Certification

– Women Owned Small Business (WOSB)

– Economically Disadvantaged Woman Owned Small

Business (EDWOSB)

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SBA 8(a) Business Development Program

Purpose:– To assist eligible small disadvantaged businesses to compete in the

American economy through business development.

– To provide federal contract preferences to qualified small businesses

8 (a) Program Benefits:– 9 year program to help the small business grow and develop

– Participants can receive sole-source contracts, up to a ceiling of $4 million for goods and services and $7 million for manufacturing.

– 8(a) firms are also able to form joint ventures to bid on contracts.

– 8(a) firms may participate in the mentor/protégé program.

– Training workshops

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Who is socially disadvantaged?

Social disadvantage must stem from circumstances

beyond ones control

– Subject to racial or ethnic prejudice

– Cultural bias within American society

– Members of a designated group:

Black Americans; Hispanic Americans; Native Americans Asian Pacific Americans, Subcontinent Asian Americans

– Other disadvantaged individuals will be required to provide a narrative regarding social disadvantage 13CFR124.103(c)

– preponderance of evidence

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Who is economically disadvantaged?• Individuals whose ability to compete in the free enterprise system

has been impaired

• Everyone applying for 8(a) must complete a narrative on economic disadvantage

• Federal Regulation Citation: 13CFR124.104

SBA Will Consider:

1. Personal Financial Condition/net worth

2. Excluding the individual’s equity in the firm, equity in the primary residence, and retirement funds that are not accessible without significant penalties.

3. Personal Income for 3-yrs average must not exceed $250,000 ($350,000)

4. Total Assets must not exceed $4M ($6M)

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Other Requirements

• Be a US citizen

• Must be small according to SBA’s size standards

• At least 51% unconditional ownership by the disadvantaged person(s).

• Must be controlled, managed and operated full-time by the disadvantaged person(s).

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Other Requirements

Good Character

• Violations of any SBA regulations

• Debarred or suspended individuals or firms

• Any firm or any of its principals that fail to pay financial obligations to the Federal Government

• Evidence that the firm knowingly submitted false information during the application process

• Applicant firms and principals that lack business integrity as shown by an indictment, guilty plea or civil judgment

• Any principal who is incarcerated or on parole or probation

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Other Requirements

• Potential for Success: must be in business in its primary NAICS code for at least two full years immediately prior to the date of its 8(a) application.

• Proof of two years operation is verified by revenues reported in business tax returns.

• Exception (13CFR124.107)

• Financial capability: sufficient capitalization, financial performance, bonding capacity, manageable debts.

• Managerial and Technical capability: performance on previous contracts, firm has the necessary personnel, licenses, certifications, and facilities.

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Applying to the 8(a) Business Development Program

– www.sba.gov => Contracting => 8(a) Business Development

– How to Apply

– Steps to Applying to the 8(a) Program

– Before you Apply

– Additional Information Before you Apply

– 8(a) Application Checklist

The Division of Eligibility & Certification

San Francisco, CA

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Applying to the 8(a) Business Development Program

– SBA reviews application for completeness and notifies firm of deficiencies within 15 days.

– If incomplete, applicant submits corrections within 15 days and a determination of completeness is made by SBA within 10 days of receipt of firm’s response.

– Applicant advised of outcome by the Associate Administrator within 90 days from the date completed application was accepted.

– If declined, applicant advised of right to request reconsideration within 45 days of date of decline. Should the concern not seek reconsideration, there is a mandatory 12 month waiting period before firm may reapply.

– If declined after reconsideration, there is a mandatory 12 month waiting period before firm may reapply.

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HUBZone Program

Historically Underutilized Business Zone

– Established in 1997 by Public Law 105-135;

– Purpose of the program:

– To help distressed communities reverse a sluggish economy;

– To provide federal contract preferences to qualified small businesses.

– What is a HUBZone? – www.sba.gov HUBZone maps

– An area as small as a city block and as large as a county;

– Areas typically are located in distressed urban areas and rural communities with low median household incomes and high unemployment

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HUBZone Requirements

Qualifying for HUBZone:

– Principal Office must be in a HUBZone

• Principal office is the office with the most employees

– Worksite can be anywhere;

– At least 35% of its employees must reside in any

designated HUBZone area – at least 180 days

– NAICS Code determines size standards

• Must be a Small Business

– 51% of the ownership and control must be US Citizens;

• Definition of employee : 40hrs/month = full-time

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Benefits of the HUBZone Program

• 10% price evaluation preference in full and open

contract competitions, as well as subcontracting

opportunities.

• Competitive and sole source contracting

• The federal government has a goal of awarding 3% of all

dollars for federal prime contracts to HUBZone-certified

firms.

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How to Apply to the HUBZone Program

www.sba.gov » Contracting » Government Contracting Programs »

HUBZone Program » Applying for the HUBZone Program

You will see:

• The Application Process Before You Begin

• Application Process Steps

• Frequently Asked Questions

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Women Owned Small Businesses Programs WOSB/EDWOSB

– Established February 4, 2011

• Makes it easier for women-owned companies to

compete for and win federal contracts.

• Provides agencies a tool to achieve WOSB contracting

goal (5% of its prime contracting dollars must be

awarded to WOSBs)

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Women Owned Small Businesses Programs

• Meet small business size standard for primary NAICS code and

contract

• At least 51% unconditionally and directly owned by women who

are U.S. citizens

• The woman must manage the day-to-day operations

• The woman must make the long-term decisions for the business

• A woman must the hold highest officer position in the company

• This woman must work at business full-time during normal

working hours.

• No minimum amount of time for the business to be operational

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Women Owned Small Businesses Programs

Economically Disadvantaged

Women Owned Small Businesses All WOSB criteria PLUS

– Personal net worth of less than $750,000

• EXCLUDES: ownership in business and primary personal residence

• EXCLUDES: income reinvested or used to pay taxes of business

• EXCLUDES: funds reinvested in official retirement account

• EXCLUDES: transferred assets within two years if to or on behalf of

immediate family member for specific purpose

– Adjusted gross yearly income averaged over the three years

preceding the certification less than $350,000

– Fair market value of all assets are less than $6 million

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Women Owned Small Businesses Programs

WOSB• Currently self-certify/ or third party certifiers

• Add documents to repository, https://certify.sba.gov/

– Verification of US citizenship

– Corporate information relating to verifying ownership by a woman or women

EDWOSB• Women claiming economic disadvantage

• Additional documents to repository:

– As required by the program

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Women Owned Small Businesses Programs

For questions relating to the WOSB/EDWOSB program, please email

wosb@sba.gov

For questions relating to the certify.SBA.gov system, please email

certify@sba.gov

or you can always email - kenneth.surmeier@sba.gov

Questions ???

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Useful Websites

• U.S. Small Business Administration

– www.sba.gov

– www.sba.gov/mo

• 8(a) Program

– www.sba.gov/8abd

• Hubzone

– www.sba.gov/hubzone

• Woman Owned/EDWOSB

– www.sba.gov/wosb

• System for Award Management

– www.SAM.gov

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Resource Partners for Assistance

Willis Mushrush417.256.2391

Bronwen Elizabeth Madden 417.255.7966

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For more information about these programs or SBA please contact

Ken Surmeier816.426.4919

kenneth.surmeier@sba.gov

Thank you for attending