Type: Law Bulletins
Date: 10/15/2010

Final Rule Issued for SBA Women-Owned Small Business Contract Program

On March 19, 2010, we published an e-Bulletin to inform you that the Small Business Association had issued a notice of proposed rulemaking to create a Women-Owned Small Business (“WOSB”) contracting program. After receipt and review of 998 comments on the proposed rule, the SBA issued a Final Rule on October 7, 2010, which, while not yet effective, is expected to be implemented in February 2011. The provisions have generally remained the same, with some clarifications.

In order for a contracting officer to restrict competition to WOSBs or Economically Disadvantaged WOSBs (“EDWOSB”), there are still six requirements:

  1. The bidder must be at least 51% owned by at least one woman and
    1. the women are economically disadvantaged; or
    2. the agency waives the economic disadvantage requirement, finding that WOSBs are “substantially underrepresented in that industry.”
  2. All WOSBs must be certified as a qualifying entity either by submitting the required certification and supporting documentation to the contracting officer, or by submitting certification from a third-party that is approved by the SBA.
  3. The subject-matter of the contract must relate to an industry that the SBA has identified as having an underrepresentation of WOSBs. The current proposed rule identifies 83 qualifying industries. There are 45 industries designated in which WOSBs are underrepresented and 38 industries in which WOSBs are considered substantially underrepresented. The list can be found at 75 Fed. Reg. 62262.
  4. The dollar amount estimated for the WOSB set-aside contract will not exceed $5 million for a manufacturing contract or $3 million for other contracts.
  5. The agency must have a reasonable expectation of receiving offers from two or more WOSBs.
  6. The agency anticipates that the prices obtained will be fair and reasonable.

The Final Rule provides more specific guidelines as to how the SBA will evaluate ownership/control of a WOSB and whether a woman is economically disadvantaged. The Rule also clarifies, in light of recent case law and legislative action, that there is “no order of precedence among” the SBA’s contracting programs for particular groups (i.e., Historically Underutilized Business Zone, 8(a) program for disadvantaged business concerns, Service Disabled Veteran Owned Businesses, or the WOSBs). The text of the Final Rule can be found at 75 Fed. Reg. 62258.

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