Posted by Husch Blackwell Associate David Newman
The Small Business Administration is continuing the task of implementing several regulatory changes required by the National Defense Authorization Act for Fiscal Year 2013 (NDAA) [pdf]. One such change occurred on May 7th when the SBA published an interim final rule (RIN 3245-AG55) [pdf] enacting section 1697 of the NDAA and amending 13 CFR 127.503 [pdf]. The interim final rule removes the statutory cap on set-aside contracts for Women Owned Small Businesses (WOSB) and Economically Disadvantaged Women Owned Small Businesses (EDWOSBs).
Prior to this rule, the WOSB Program regulations did not allow contracting officers to set aside contracts over $4 million ($6.5 million for manufacturing contracts). This new rule lifts those restrictions. Agencies are now allowed to set aside contracts at any dollar value under the WOSB Program as long as two determinations are made. First, if the contract is in an industry designated by the SBA as “substantially” underrepresented, then the contracting officer must conduct market research to confirm that there is a reasonable expectation that multiple WOSBs will submit offers. If the contract is in an industry that is designated as underrepresented, then the contracting officer must expect that multiple EDWOSBs will submit offers. Second, the contracting officer must determine that the government will obtain a “fair and reasonable price” be using a set-aside. While the SBA is accepting comments to the interim final rule until June 6, the new rule is effective immediately and applies to all solicitations issued on or after May 7, 2013.
The SBA also recently announced an initiative named ChallengeHER, which is designed to help women business owners compete for government contracts. The SBA is teaming with the Women Impacting Public Policy (WIPP) and American Express OPEN to provide online training, mentoring, and networking opportunities for WOSBs.
The removal of the set-aside ceiling and the ChallengeHER initiative demonstrate the government’s renewed emphasis on obtaining the 5% of contracting dollars goal for WOSBs. In FY11, the government only awarded 3.97% of its contracts to WOSBs.
A previous post on other changes specific to small businesses required by NDAA 2013 is available here.