Each time a new administration assumes office, it puts its mark on policies and implements its priorities. From Day one, the Trump Administration has focused on leveling the playing field. An executive order titled “Ending Illegal Discrimination and Restoring Merit-Based Opportunity” was issued. The bill put an end to certain DEI-based hiring practices.
Despite the rhetoric and the executive order, some small business set-asides remain. Let’s examine the programs that continue to operate and help small subcontractors compete for federal contracts.
The Remaining Programs
8(a)
What is it/what are the benefits?
The 9-year-long certification program is focused primarily on training for “…socially and economically disadvantaged small business owners…” Certified businesses are “…eligible to compete for the program’s sole-source and competitive set-aside contracts.”
Some of the other 8(a) benefits, according to the SBA:
Certified firms in the 8(a) program can:
- Pursue opportunity for mentorship from experienced and technically capable firms through the SBA Mentor-Protégé program
- Connect with procurement and compliance experts who understand regulations in the context of business growth, finance, and government contracting
- Pursue joint ventures with established businesses to increase capacity
- Qualify to receive federal surplus property on a priority basis
What businesses are eligible?
Businesses that qualify as a small business based on the U.S. Small Business Administration (SBA) criteria.
Other program qualifications include:
- Not have previously participated in the 8(a) program
- Be at least 51% owned and controlled by U.S. citizens who are socially and economically disadvantaged
- Have a personal net worth of $850 thousand or less, adjusted gross income of $400 thousand or less, and assets totaling $6.5 million or less
- Demonstrate good character
- Demonstrate the potential for success such as having been in business for two years
The SBA notes that businesses owned by one of the following groups are eligible to participate in the program: Alaska Native corporations, Community Development Corporations, Indian tribes, and Native Hawaiian organizations.
Interested in applying? Subs should go here to learn more and apply.
HUBZone
What is it/what are the benefits?
HUBZone, which stands for (Historically Underutilized Business Zone), certification is based on location. Businesses need to recertify every three years.
There is limited competition for some government contracts for certified businesses. The government has set … “a goal of awarding of awarding at least 3% of federal contract dollars to HUBZone-certified companies each year.”
Other benefits for HUBZone-certified businesses include … “a 10% price evaluation preference in full and open contract competitions.”
What businesses are eligible?
The criteria according to the SBA:
- Be a small business according to SBA size standards
- Be at least 51% owned and controlled by U.S. citizens, a Community Development Corporation, an agricultural cooperative, an Alaska Native corporation, a Native Hawaiian organization, or an Indian tribe
- Have its principal office located in a HUBZone
- Have at least 35% of its employees living in a HUBZone
Interested in applying? Subs should go here to learn more and apply.
WOSB
What is it/what are the benefits?
WOSB, or Woman-Owned Small Business, certification qualifies the company to compete for certain federal government contracts with limited competition. Note that the federal government has a goal of awarding 5% of all federal contracting dollars annually to WOSBs.
The SBA notes that WOSBs can apply for multiple certifications. “Provided they are eligible, WOSB-certified firms can still compete for contract awards under other socio-economic programs, including 8(a) and HUBZone.”
Firms must renew their WOSB certification annually.
What businesses are eligible?
The SBA has the following criteria for eligibility to be recognized as a WOSB:
- Be a small business according to SBA size standards
- Be at least 51% owned and controlled by women who are U.S. citizens
- Have women manage day-to-day operations who also make long-term decisions
In addition, the industry must be one where WOSBs have limited representation.
Interested in applying? Subs should go here to learn more and apply.
VOSB
What is it/what are the benefits?
VOSB, veteran-owned small business, certification allows these businesses to “compete for federal sole-source and set-aside contracts across the federal government…. [and] have additional opportunities to pursue sole-source and set-aside contracts at the U.S. Department of Veterans Affairs (VA) under the VA’s Vets First program.
Note that the federal government aims to award VOSB-certified companies at least 5% of all federal contracting dollars.
What businesses are eligible?
The criteria for VOSB certification, according to the SBA:
- Be identified by the VA as a Veteran or Service-Disabled Veteran.
- Be considered a small business, as defined by the size standard corresponding to any NAICS code listed in the business’s SAM profile.
- Have no less than 51% of the business owned and controlled by one or more veterans.
- For certification as a SDVOSB, have no less than 51% of the business owned and controlled by one or more veterans rated as service-disabled by the VA.
- For those veterans who are permanently and totally disabled and unable to manage the daily business operations of their business, their business may still qualify if their spouse or appointed, permanent caregiver is assisting in that management.
Interested in applying? Subs should go here to learn more and apply.
Since the federal government has significantly reduced set-asides for small and certified subcontractors, some subs might wonder if it’s worth their time to be certified.
In a word, yes. In 2024, the Federal Government awarded over $773 billion in contracts. The massive expenditure is not going away, and there will continue to be a need for talented, effective subcontractors. The new normal for set-asides – 5%- means there is $ 38.65 billion targeted for small and certified businesses.
The programs noted above are active. If your subcontracting business qualifies for one (or more) of the certifications, it’s a no-brainer to go for it. Utilize every available opportunity and help your business succeed.
Tough Leaf helps small and certified firms get noticed. Reach out to learn more.