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Government Contractors

SBA Confusion and Update

Earlier this month several major news outlets reported that according to a U.S. Department of Commerce study, women-owned businesses receive only 4.7 percent of all Federal contract dollars, falling short of the Small Business Administration’s (“SBA”) goal of five percent. Additionally, the U.S. Department of Commerce found that women-owned businesses are 21 percent less likely to be awarded government contracts.

While hard data has not yet been released, in a February testimony to the House Small Business Committee, John Shoraka, Associate Administrator of the SBA’s Office of Government Contracting and Business Development, touted the success of the SBA’s socio-economic programs. Mr. Shoraka noted that small business contracting goals were met for each of the following 8(a) programs:

  1. Women-Owned Small Businesses;
  2. Service Disabled Veteran-Owned Small Businesses; and
  3. Small Disadvantaged Businesses.

Mr. Shoraka also noted that, in contrast to earlier reports, women-owned small business goals were met for the first time in the program’s history and overall goals for small business prime contracting were exceeded for the second consecutive year.

Perhaps this is why clarifications are being called for in the latest SBA reauthorization bill currently being discussed in the House. Among other provisions of the Defending America’s Small Contractors Act of 2016 (the Act), small business contracting goals receive considerable attention. The Act proposes that the SBA report the value of contracts credited to each socio-economic goal if the contract is being performed by a company that is no longer small or no longer qualifies for that procurement program; and the value of contracts credited to each small business goal if a set-aside or sole-source program for a different goal was used for the award. Additionally, the proposed Act seeks to amend the Small Business Act to make sure the government-wide small business goals are measured against the total contract dollars spent that year, not just eligible small business dollars. This proposed change would help alleviate differing opinions on whether women-owned companies are receiving their appropriate share of Federal contracting dollars.

As always, Cherry Bekaert will continue to monitor updates and changes to the Act to give your business an edge.

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