SBA Loans for Women: Women’s Procurement Program

Women today are generally accustomed to competing with men in many walks of life. But being presented with data showing that men are heavily favored can still often …

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Women today are generally accustomed to competing with men in many walks of life. But being presented with data showing that men are heavily favored can still often be daunting.

In the interest of encouraging fairness, along with the growth and development of women-owned small businesses, Congress declared in 1994 that at least 5 percent of U.S. procurement dollars should go toward women-owned small businesses.

"Six years passed before Congress ordered the SBA to study and implement a set-aside program for women—which it did only after the Women’s Chamber sued and a federal judge ordered action. Another six years—apparently a popular unit of delay at the SBA—passed before the agency launched a study with the Rand Corp. to identify industry sectors where qualified female bidders win a low proportion of contract awards," according to Fortune Small Business.

![filekey=|1800| align=|left| caption=|Women-owned businesses receive few procurement dollars| alt=|Small businesses owned by women get less than 5 percent of US procurement dollars|]Rand found women to be awarded a disproportionately small number of contracts in 87 percent of 2,300 business categories, according to Fortune Small Business.

"Then Rand looked at the dollar value of contracts and found women underrepresented in only four categories (presumably because a few female-owned firms won big contracts in the others)," according to Fortune Small Business. "The SBA decided to emphasize the latter finding and offer set-asides only to women in those four niches."

The result?

"The SBA issued a proposed regulation Dec. 27 [2007] that would allow federal agencies to set aside contracts for women-owned businesses in four industries: national security and international affairs; coating, engraving, heat treating and allied activities; household and institutional furniture and kitchen cabinet manufacturing; and other motor vehicle dealers. These are the industries where women have been under-represented in federal contracting, based on the dollar amounts of contracts awarded, according to the SBA’s analysis of a study conducted by the Rand Corp.," according to the Denver Business Journal. "The regulation includes far fewer industries than Congress intended when it passed legislation in December 2000 that directed the SBA to establish the contracting program."

In fact, "The Women Impacting Public Policy group calculated that only 1,247 of America’s 10.4 million female-owned businesses could benefit," according to Fortune Small Business.

The federal government has not once met the goal of awarding 5 percent of procurement dollars to women-owned small businesses. Congress never tasked any agency with the responsibility of ensuring that the goal was met.

"In fiscal 2006, women-owned businesses received $11.6 billion in federal contracts, an increase of $1.4 billion over the previous year. That total, however, represented only 3.4 percent of all federal prime contracts," according to the Denver Business Journal.

The SBA is taking the next month to review "scorching" public comments, according to Fortune Small Business.
The U.S. Women’s Chamber of Commerce "sued the SBA in 2004 over the program’s delay. Two years ago, a federal judge ruled the agency had ‘sabotaged’ the program and ordered the SBA to submit a timeline for implementing it," according to the Denver Business Journal.

Women business owners will turn to Congress and the courts once again if the SBA does not expand the program.

"Failure to implement the Women’s Procurement Program has cost women business owners at least $6 billion in lost contracts," Sen. John Kerry, D-Mass., chair of the Senate Small Business and Entrepreneurship Committee, said in a statement.

Women small business owners should keep themselves apprised of the situation for further developments.

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