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Tonya Saunders of MTA explains why Federal agencies will soon be able to award sole source contracts to WOSBs and EDWOSBs.
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This is a guest post by Tonya Saunders of Mid-Tier Advocacy, Inc.

On September 14, 2015, the SBA published the final rule to establish the procedures whereby Federal agencies may award sole source contracts to WOSBs and EDWOSBs.

Under the rule, a contracting officer may award a sole source contract to a WOSB or EDWOSB where:

(1) the firm is a responsible contractor and the contracting officer does not have a reasonable expectation that two or more EDWOSBs or WOSBs (as the case may be) will submit offers;

(2) the anticipated award price of the contract (including options) will not exceed $6.5 million for manufacturing or $4 million for any other contract; and

(3) in the estimation of the contracting officer, award can be made at a fair and reasonable price.

This rule will become effective on October 14, 2015, 30 days after its publication in the Federal Register.

The final rule represents the next step in creating parity among the set-aside programs. WOSBs and EDWOSBs are now on equal footing with HUBZone and Service Disabled Veteran Owned Small Businesses eligible for sole source contracts.

In addition to putting the WOSB Program on a level playing field with other SBA government contracting programs with sole source authority, it provides an additional, needed tool for agencies to meet the statutorily mandated 5% prime contracting goal for WOSBs.

Legislative history

Congress, through the 2015 NDAA, made several changes/updates to the WOSB/EDWOSB majority-women-owned small business set-aside program. These changes included:

(1) Ending the self-certification option (self-certification has brought about a high level of ineligible firms receiving contracts intended for WOSB/EDWOSB firms) and requiring that firms be certified as a WOSB or EDWOSB by a federal agency, a state government, SBA, or a national certifying entity approved by the SBA.

(2) Adding sole source authority to the program (for contracts that do not exceed $4M/$6.5M for manufacturing contracts).

(3) Completing a study by January 2, 2016 to update eligible industries for the program.

Self-certification not addressed…yet

As explained in the proposed rule, SBA recognized that the new certification requirement for WOSBs would require a more prolonged rulemaking.

Because SBA did not want to delay the implementation of the WOSB sole source authority by combining it with the new certification requirement, SBA did not propose any changes to implement the certification requirement but rather indicated that it would do so through a separate future rulemaking.

Who will benefit?

SBA searched the Dynamic Small Business Search (DSBS) database and determined that there were approximately 34,000 firms listed as either WOSBs or EDWOSBs under the WOSB Program.

In addition, according to the fiscal year 2013 small business goal report, there were a little over 250,000 actions concerning women-owned small businesses and the total dollar value of those actions was approximately $15 billion.

An analysis of the Federal Procurement Data System from April 1, 2011 (the implementation date of the WOSB Program) through January 1, 2013, revealed that there were approximately 26,712 women-owned small business concerns, including 131 EDWOSBs and 388 WOSBs eligible under the WOSB program, that received Federal contract awards, task or delivery orders, and modifications to existing contracts.

SBA officials believe the WOSB Program will expand opportunities for women-owned firms in the industries determined by SBA to be substantially underrepresented by WOSB concerns.

Now that federal agencies have sole source authority, women-owned firms will have greater access to Federal contracting opportunities. It’s about time for the WOSB sole source.

About the author: For more than two decades, Tonya Saunders has worked on Capitol Hill, lobbied for client interests, and started her own businesses. As founder and director of Mid-Tier Advocacy, Inc., a 501(c)3 nonprofit national coalition of small, emerging, and medium-sized businesses (primarily federal contractors), Tonya was instrumental in passing legislation that helped these engines of our economy grow and create jobs.

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