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Source : Contractor News
September 29, 2022
Author : Patty Allen
The Small Business Administration (SBA) has announced a proposed rule that would significantly alter SBA's 8(a) program standards. It will also impact its program for Women-Owned Small Business (WOSB) and HUBZone firms.
It entails a slew of issues related to federal-funded construction projects, from subcontracting to protests when awarding agencies receive bids.
SBA's rules strictly impact its socio-economic programs. One of them is that an eligible woman should manage the company as a full-timer in the same line of business. However, SBA officials have expressed that the law regarding women is very restrictive and proposed revising the rule.
As per the current regulations, a woman or economically disadvantaged woman who holds a management position in a small business should not engage in any outside obligations that will hinder her from devoting full attention to the company’s work.
The new rules also require the individual to handle the business full-time during normal business hours. The woman owner or economically disadvantaged woman owner can work outside regular business hours if it doesn't prohibit her from managing and running the firm. It lays out that she can engage in outside employment, but only if such employment occurs outside the normal working hours of the main business she manages.
The new rules clarify SBA's different treatment of joint ventures. The current law says that a joint venture with a formal separate legal entity may not be intended to perform contracts awarded to the joint venture. The proposed rule will decide if the requirement was meant to apply to small or women-owned small businesses, HUBZone, or Service-Disabled Veteran-Owned Small Businesses (SDVOSB) contracts. This will help SBA and other agencies track each partner's work associated with the joint venture.
Currently a person that maintains SBA certifications, such as a WOSB or EDWOSB (Economically Disadvantaged Women-Owned Small Business), must undergo an annual attestation, and an entire program examination every three years. But with the new rule, one needs not to have yearly attestations and instead can undergo them every three years.
The same rule is applied to SDVOSBs, certified by the CVE. CVE stands for Center for Verification and Evaluation, which is run by the Department of Veteran Affairs.
Another breakthrough change in the SBA regulations is in regard to the eligibility to become an EDWOSB. To be certified under EDWOSB, a company has to be a small business and register under specific NAICS codes laying out the trade and services it provides. But for a WOSB, an intending company has to only be a small business.
The new rules state that SBA has made several changes regarding contracts. The rules propose revisions to 8(a) contracts, such as clarifying that a contracting officer cannot limit an 8(a) competition to participants with more than one certification and clarifying the criteria for issuing sole source 8(a) orders under an 8(a) multiple award contract.
The new rules also mention the HUBZone application process, such as when it will omit a firm from the HUBZone program.
The new rules lay out the norms for filing a protest against an individual who violates them. Now with the new updates, small business contractors can file a protest against any contracting opportunity breach.
The new rules state who can raise a status protest in SBA’s small business program, as this relates to competition over the low bid and who receives projects. Currently, only WOSB or SDVOSB status holders can raise a protest. Ultimately, the new rules will expand the ability to protest to all firms certified under SBA’s small business programs.
The public has until November 8, 2022, to comment on SBA's suggestions. Government contractors participating in any of the SBA's small business programs should take note of the proposed modifications and determine whether to submit public comments.
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