What is the SBA Section 8(a) Program?
Section 8(a) of the Small Business Act empowers the Small Business Administration (SBA) to enter into contracts with other federal agencies to provide supplies, services and construction. In contracting with another agency, the SBA subcontracts all of the performance requirements to a “socially and economically disadvantaged small business concern.” Firm participation is divided into two phases over the nine year program: a four-year developmental stage and a five-year transition stage. A firm may only be certified once under the SBA Section 8(a) nine year program. During the first four years of this program, firms are in a developmental stage or growth stage. For the next five years, firms are in a transitional stage. The 8(a) program is SBA’s effort to promote equal access for socially and economically disadvantaged individuals to participate in the business sector. This program assists Section 8(a) approved firms to participate in the business sector by applying for government contracts and to become independently competitive in the marketplace.
To qualify for the program, a small business must be owned and controlled by a socially and economically disadvantaged individual. Presumed disadvantaged groups include African Americans, Hispanic Americans, Asian Pacific Americans, and Subcontinent Asian Americans.
Other individuals can be admitted to the program if they show through a “preponderance of the evidence” that they are disadvantaged because of race, ethnicity, gender, physical handicap, or residence in an environment isolated from the mainstream of American society. Individual applicants must be a U.S. citizen, be fully employed by the subject firm, possess and demonstrate the technical, managerial, operational experience to manage the firm. Individuals must have a net worth of less than $250,000, excluding the value of the business and primary residence.
Why you need an SBA Section 8(a) Designation and Certification
The biggest and most powerful benefit of 8(a) participation: vendors can receive sole-source contracts up to a cap of $3.5 million for goods and services and $5 million for manufacturing.
The SBA undertakes an extensive effort to provide contracting opportunities to those businesses certified under their 8(a) program. The SBA maintains close contact with various federal agencies to keep government personnel informed of the 8(a) program goals and procedures and to request that contract opportunities be reserved for the 8(a) program. There are some federal contracts that are set aside so that only 8(a) certified or Socially Disadvantaged Businesses (SDB) can bid on them. There are other cases where federal contracts are awarded to 8(a) firms without being put out for open bidding. These are called sole source contracts. It is imperative that 8(a) certified firms conduct independent marketing activities for contract opportunities both in the public and private sector. When a 8(a) firm soliciting business with federal government agencies identifies contractual opportunities, it may attempt to convince the federal agency that it is qualified to undertake the work, and that the firm’s name should be submitted to the SBA as the recommended contractor. The SBA has signed Memorandums of Understanding (MOUs) with 25 federal agencies allowing them to contract directly with certified 8(a) firms. Section 8(a) firms are also permitted to form joint ventures and teams to bid on contracts.
Spadea & Associates, LLC Offers Superior Assistance for the Entire Certification Process
Our staff provides expert assistance in the preparation and submission of the 8(a) application. Our Services are Complete and Comprehensive: We collect, analyze, prepare submission documents and professionally format your application, ensuring that it is responsive to the requirements as outlined by the Small Business Administration. We collect, prepare, package and submit your application to the respective SBA office in either King of Prussia, PA for east coast applicants or San Francisco, CA for west coast applicants. We provide on-going support, including representation at the SBA Office of Hearing and Appeals, until a final determination on the Certification Application is rendered. Our Services are all inclusive: initial strategic planning, preparing the application, submission to SBA, follow-up with SBA 8(a) officials, face-to-face representation before SBA’s Division of Program Certification and Eligibility and finally, if necessary, representation at the Office of Hearing Appeals by our trained and experienced attorneys. We also proactively address certain issues that our staff identifies which the SBA will be critical of in evaluating your application enabling your application to be processed faster. In the event the SBA raises issues in reviewing your proposal, we present strong and convincing arguments citing specific code sections of the Federal Regulations to overcome any objections preventing your application’s approval. If you have any questions or would like more information on Section 8(a) please call Gregory Spadea of Spadea & Associates, LLC at 610-521-0604 in Ridley Park, Pennsylvania.