On May 11, 2020, the SBA published a final rule implementing a certification requirement for Women-Owned Small Businesses (WOSBs) and Economically Disadvantages Women-Owned Small Businesses (EDWOSBs) and adjusting the economic disadvantage thresholds for determining whether an individual qualifies as economically disadvantaged for both the EDWOSB and 8(a) programs.
WOSB/EDWOSB Certification Requirements
Beginning on October 15, 2020, WOSBs will need to be certified to compete for WOSB set-aside and sole source contracts, as well as to be awarded multiple award contracts for pools reserved for WOSBs. Firms will be able to begin submitting applications for processing under the new certification process on July 15, 2020. All current WOSB program participants will need to create a new account under the SBA’s new certification platform.
A WOSB with active WOSB set-aside contracts who was eligible as a WOSB at the time of its offer for that contract is considered a WOSB throughout the life of that contract, provided, however, that if the contract is longer than five years (including options), the firm must be certified prior to the end of the fifth year of the contract. The final rules require WOSBs to “annually attest to SBA that they meet the Program requirements, and undergo a full program examination and recertification every three years.”
On its website, the SBA has noted the following important timelines for WOSBs:
- The current self-certification process will remain available for firms until October 15, 2020, in certify.sba.gov.
- Between now and July 15, 2020, certified WOSBs must download their documentation, currently housed in the WOSB Program Repository, from certify.sba.gov.
- On July 15, 2020, firms can begin submitting applications under the new certification process for initial processing.
- On October 15, 2020, SBA will begin issuing decisions on certification.
WOSBs will have the option to obtain the certification either through the SBA’s free certification process or through an approved Third-Party Certifier (TPC). All WOSBs who are currently certified through a TPC will need to create a new account in SBA’s new platform and upload their current TPC certificate to complete initial processing, and will need to recertify three years after their most recent TPC-certification. A firm may also submit evidence of certification through the Department of Veterans Affairs Center for Verification and Evaluation (CVE) or SBA’s 8(a) certification to establish its status as a small and/or disadvantaged business, along with evidence that the applicant meets the additional ownership and control requirements. SBA has provided a certifications options table on its website.
The SBA will be releasing additional information about the certification process prior to July 15, 2020. Firms can obtain information regarding these updates on SBA’s website for the WOSB Federal Contracting Program.
Updated 8(a) Economic Disadvantage Criteria
Effective July 15, 2020, the SBA has revised the initial 8(a) economic disadvantage criteria to $750,000, so that it is consistent across both the 8(a) and EDWOSB programs. Prior to the final rule, the EDWOSB’s initial eligibility threshold was higher than that of the 8(a) program, which meant that a concern applying to both programs could be found economically disadvantaged for the EDWOSB program but not the 8(a) program. As of July 15, 2020, the economic disadvantage criteria for both the EDWOSB and 8(a) programs will be: $750,000 net worth, $350,000 adjusted gross income, and $6 million total assets.
Additionally, the final rule revises the regulation to clarify that funds in a legitimate retirement account “will not be considered in determining an individual’s net worth.”
If you have any questions regarding the new WOSB and EDWOSB certification requirements or the updates to the 8(a) and EDWOSB economic disadvantage criteria, please contact one of our attorneys.