Small Disadvantaged Business Benefits

Assuming that a person applying for SBA 8(a) certification is a member of a supposedly socially disadvantaged group and has met the requirements for designation as economically disadvantaged, he or she must: 48 C.F.R. §52.219-10(b) (“If the contractor achieves its subcontracting objectives for small businesses, veterans-owned small businesses, small businesses owned by persons with disabilities, HUBZa small business, a disadvantaged small business and a small business run by women in the execution of this contract will receive _ [The contracting officer must insert the appropriate number between 0 and 10] percent of the dollars above each objective of the plan. “). 8( a) Enterprises, SDF and ESD are all classified as “disadvantaged” because at least 51% of them are owned and controlled by one or more socially and economically disadvantaged individuals or groups. However, social and economic disadvantage is defined slightly differently for each program. Members of certain racial and ethnic groups are considered socially disadvantaged for the purposes of 8(a) and SDS, while women are also considered socially disadvantaged for the purposes of DBE. Similarly, the net worth of individuals must be $250,000 or less to participate in Program 8(a), while net worth can be as high as $750,000 for newly appointed SDSs and $1.32 million for newly appointed SFDs. Companies must apply to participate in the 8(a) program and generally cannot receive a contract or other federal assistance based on 8(a) status until the SBA approves their application.24 The application form requires the filing of various documents, including, but not limited to, financial statements, individual and corporate federal tax returns, and personal history statements.25 13 C.F.R. §124. 103 (c) (2) (i) to (iii). In assessing the third factor, the SBA considers all relevant evidence provided by the applicant, but must consider education, employment and business history in determining whether all the circumstances present disadvantages.

13 C.F.R. §124.103(c)(2)(iii). See for example Petit Bus. Admin., The Small Business Economy: A Report to the President 3 (2009). Many entrepreneurs have started businesses only to find that they are missing some aspects of the industry. There are many government programs that help new business owners deal with these challenging aspects, including the U.S. Small Business Administration`s Program 8(a). The program connects entrepreneurs with mentors, helps them understand and find appropriate business insurance, and can help them understand contract terms and loan agreements, as needed. On the portal`s home page, you can determine if it`s appropriate for your business to become a government supplier, learn how to become a supplier, and get information on finding and tracking government contracts.

This website also includes a list of set-asides, such as the percentages of contracts that must be awarded to minorities and disadvantaged businesses, that apply to each federal purchase of $2,500 to $100,000. At, you`ll also find additional resources that can help you grow a minority-owned business, including a questionnaire to help you explore government contracts. By completing the questionnaire, you are taken to a results page that lists all the federal government programs for which your business may be eligible. This website also contains a list of resources specifically for socially and economically disadvantaged businesses with national, state, and local lists. You can even search by postal code to find programs for minority business owners in your area. Prime contractors who “act in good faith” may rely on the subcontractors` written declaration of their SDS status.54 However, the SBA reserves the right to review the status of non-certified companies posing as SDSs for the purposes of subcontracting by the Confederation if it receives “credible information” that they are not disadvantaged.55 The SBA, Agency contractors and other “interested parties” (e.g. ) may also protest the SDF status of companies.56 The process of certifying as a minority-owned company for the purpose of participating in special programs such as those of NMSDC and SBA 8(a) is important, but the benefits of being a minority-owned company with certification are also significant. From federal and government agencies to private companies, many organizations want to do business with minority-owned companies and would even prefer to do so. Certification can provide your business with opportunities that it might not otherwise be able to compete for.