Small Business Administration (SBA) Programs (Guide 2 of 4)

Many government programs exist to help small businesses—especially minority-owned small businesses—secure a foothold in government contracting.  Read on to learn more about some common programs, the basic eligibility requirements, and how to register for them.  These programs are quite complicated and you should consult counsel if you have questions regarding whether you qualify.  Note: misunderstandings of the rules is not a defense to non-compliance.

Which Program is Best for You?

8(a) Business Development Program

To qualify, your business must meet the following requirements, among others:

• Be a small business as defined by the SBA[1] for your primary NAICS code
• Not have participated in the 8(a) program previously
• Be majority-owned and controlled by U.S. citizens who are economically and socially disadvantaged as defined by the SBA[2]

Full criteria available at Title 13 Part 124 of the CFR.

HUBZone Program

To qualify, your business must:

• Be a small business as defined by the SBA[1] for your primary NAICS code[3]
• Be majority-owned and controlled by U.S. citizens, Indian tribes, or other specific groups
• Have its principal office located, and have at least 35% of its employees live, in a HUBZone[4]

Full criteria available at Title 13 Part 126 Subpart B of the CFR.

Women-Owned Small Business (WOSB) Federal Contracting Program

To qualify, your business must:

• Be a small business as defined by the SBA[1]
• Be majority-owned and controlled by women who are U.S. citizens

Full criteria available at Title 13 Part 127 Subpart B of the CFR.

Economically Disadvantaged WOSB (EDWOSB) Program

To qualify, your business must:

• Be a small business as defined by the SBA[1] for your primary NAICS code
• Be majority-owned and controlled by women who are economically disadvantaged[5]

Service-Disabled Veteran-Owned Small Business (SDVOSB) Program

To qualify, your business must:

• Be a small business as defined by the SBA[1]
• Be majority-owned and controlled by one or more service-disabled veterans[6]

Full criteria available at Title 13 Part 125 Subpart B of the CFR.

See various other veteran-owned business programs fostered by the Office of Veterans Business Development (OVBD)

You can see which programs you may qualify for by completing SBA’s 16-question assessment.

What are some benefits of the program?

8(a) Business Development Program

• Eligibility for contracts designated exclusively for 8(a) participants, called “set-aside contracts”
• Eligibility for contracts issued directly to a 8(a) participants without competition, called “sole-source set-aside contracts”
• Guidance from established businesses—including financing, trade education, and help competing for government contracts,— through the Mentor-Protégé Program
• Receive training, executive education , and one on one consulting in marketing, accounting, contract management, opportunity development and capture, financial analysis, and compliance through the 7(j) Management and Technical Assistance Program
• The federal government aims to dedicate 5% of all federal contract money to  small disadvantaged businesses.  In 2019, it exceeded that goal and awarded 10.29% to small disadvantaged businesses.

HUBZone

• Eligibility for contracts designated exclusively for HUBZone businesses, called “set-aside contracts”
• Eligibility for contracts issued directly to a HUBZone business without competition, called “sole-source set-aside contracts”
• Guidance from established businesses—including financing, trade education, and help competing for government contracts,— through the Mentor-Protégé Program
• Receive a 10 percent price evaluation preference in open contract competitions: if a HUBZone business’s price is higher than a large business’s price, but not more than 10% higher, the HUBZone business’s price will be deemed lower
• The federal government aims to dedicate 3% of all federal contract money to HUBZone businesses.  In 2019, it awarded 2.28% to HUBZone businesses.

WOSB & EDWOSB

• Eligibility for contracts designated exclusively for WOSBs and EDWOSBs, called “set-aside contracts”
• Eligibility for contracts issued directly to WOSBs and EDWOSBs without competition, called “sole-source set-aside contracts
• Guidance from established businesses—including financing, trade education, and help competing for government contracts,— through the Mentor-Protégé Program
• The federal government aims to dedicate 5% of all federal contract money to WOSBs.  In 2019, it exceeded that goal and awarded 5.19% to WOSBs.

SDVOSB

• Eligibility for contracts designated exclusively for SDVOSBs, called “set-aside contracts.”
• Eligibility for contracts issued directly to SDVOSBs without competition, called “sole-source set-aside contracts”
• Guidance from established businesses—including financing, trade education, and help competing for government contracts,— through the Mentor-Protégé Program
• The federal government aims to dedicate 3% of all federal contract money to SDVOSBs.  In 2019, it exceeded that goal and awarded over 4.39% to SDVOSBs.

How Do I Become Certified?

The most important step is to contact your local SBA office and your local Chamber of Commerce office, both of which can offer specific advice for your area.

8(a) Business Development Program

To become certified as an 8(a) business:

1. Set up a profile at https://sam.gov/.
2. Complete the certification process at SBA.gov.
3. Update your SAM business profile to show contracting officers your new 8(a) certification.

Important:  Once you are registered in SAM, make sure to sign up for alerts.

HUBZone

To certify as a HUBZone business:

1. Set up a profile at https://sam.gov/.
2. Set up an account with the General Login System (click “Create New SBA GLS Account”).
3. Use the General Login System to apply for HUBZone certification.
4. Verify your account electronically by following steps in an email you will receive within 10 business days. Submit all required documentation.
5. After receiving confirmation from the SBA, update your SAM business profile to show contracting officers your new HUBZone certification.

WOSB & EDWSOB

To certify as a WOSB, you can either (1) apply to SBA for certification (for free)or (2) be certified by an approved Third-Party Certifier (at a cost).  Both require setting up an account with beta.certify.sba.gov:

1. Set up a profile at https://sam.gov/
2. Set up a profile at certify.sba.gov.   and upload requested documents (either documents evidencing eligibility requirements or a copy of certification from an approved Third Party Certifier).
3. Update your beta.SAM.gov profile to show contracting officers your new WOSB certification.

Note:  You need to update your certification information once a year through both the Dynamic Small Business Search database and  beta.certify.sba.gov to maintain your status as a WOSB.

SDVOSB

To certify as a SDVOSB:

1. Set up a profile at SAM.gov
2. Outside of the Department of Veterans Affairs, self-represent your business as a SDVOSB within the socio-economic status section of your beta.SAM.gov business profile.   The Department of Veterans Affairs has a separate process for its contracts.

[1]To qualify as a small business for a particular procurement, a concern, together with its affiliates, must meet the size standard associated with the North American Industry Classification (“NAICS”) code assigned to the procurement.  Size standards are measured either in average annual receipts (with the option to average the previous 3 or 5 years) or average number of employees over the previous 12 months.  Visit the SBA’s Size Standards Tool to see if you qualify as a small business.

[2] See our 8(a) guide for more information on how the SBA defines “socially and economically disadvantaged.”

[3] However, in order to remain eligible as a HUBZone small business concern, the concern need only qualify as small under one or more NAICS codes in which it does business.

[4] See our HUBZone guide for more information on how the SBA designates HUBZones.

[5] To be economically disadvantaged, the women upon whom EDWOSB eligibility relies must each have: (1) a personal net worth not more than $750,000; (2) average adjusted gross income not more than $350,000; and (3) not more than $6 million in personal assets.

[6] If you want to qualify as an SDVOSB for procurements with the Department of Veterans Affairs (“VA”), you must also be verified by the VA’s Center for Verification and Evaluation (“CVE”) and be listed in the VA’s Vendor Information Pages database.