A new Small Business Administration initiative, the Woman-Owned Small Business Federal Contract Program, was recently launched to spur the development of woman-owned businesses by increasing the amount of federal contracts awarded to them. See the following article from The Street for more on this.
The U.S. Small Business Administration is encouraging more women small-business owners to apply for federal contracts.
The program, called the Woman-Owned Small Business Federal Contract Program, was officially launched today, but has been in the works for several years — and arrives just as House and Senate committees on small business have launched a critical look at administration programs, hoping to cut its budget and save money.
The SBA plans to implement the women’s federal contract program over the next several months, the administration says, with plans to award the first contracts by the fourth quarter — when the largest percent of federal contracts are awarded.
"Women-owned businesses are one of the fastest-growing sectors of the economy," SBA Administrator Karen Mills said in a statement. "That’s why providing them with all the tools necessary to compete for and win federal contracts is so important. Federal contracts can provide women-owned small businesses with the oxygen they need to take their business to the next level."
Meanwhile, the administration is to identify by Feb. 10 programs that could be cut or reduced without hurting the SBA’s mission, and at least one minority-based program — for Native American entrepreneurs — and another helping veterans have been named by a House committee led by Rep. Sam Graves (R-Mo.) as an example of where to look.
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Still, the administration is keeping in place the requirement that 5% of federal contracting dollars be awarded to women-owned businesses and economically disadvantaged women-owned businesses.
To qualify for the program, a firm must:
- Be at least 51% owned and controlled by one or more women and considered "small" by to SBA size standards. The owners must be U.S. citizens.
- A woman must manage the day-to-day operations, make long-term decisions for the business, hold the highest position at the business and work there full time.
A women-owned business is presumed "economically disadvantaged" if the owner has a personal net worth of less than $750,000, her adjusted gross yearly income averaged over three years is less than $350,000 and the fair market value for all her assets is less than $6 million.
Today, the SBA will be releasing instructions on how to participate in the program and an application to become an SBA-approved third party certifier for the program. The SBA is also launching its online data repository for applicants at www.sba.gov/wosb.
According to the National Association of Women Business Owners, 10.1 million firms are owned by women, with three-quarters of all women-owned businesses majority owned by women as of 2008.
The association says women-owned firms account for 40% of all privately held firms. One in five of women-owned firms have revenue of $1 million or more.
Association leadership was among the attendees at the White House in March to discuss the original proposal. At the time the organization expressed its support for the program, after criticizing a rule proposed by the SBA in December 2007 regarding federal contracts for women-owned businesses that was eventually withdrawn.
As part of the rule, which was finalized in October, the SBA listed 83 industries in which women-owned small businesses were underrepresented among contractors doing business with the federal government.
"While the regulatory process is not complete and achievement of the 5% federal contracting goal established by Congress in 1994 remains to be accomplished, the publication of this rule represents a concrete and important step forward," according to a statement at the time by Deborah Stallings, secretary of the association’s board of directors and its representative at the meeting.
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