BPW Foundation's Women Misbehavin' Blog

Well behaved women never make history

Feds Try to Increase Number of Women Contractors

Posted by espressodog on May 19, 2010

Women-owned businesses account for some 41% of all privately held firms and are growing at twice the rate of all other firms. Despite this phenomenal growth women-owned businesses continue to face challenges, including limited access to the federal contracting pipeline. Why does this matter? Because, the U.S. government is the world’s largest buyer of products and services. Purchases by military and civilian installations amount to nearly $500 billion a year, and include everything from complex space vehicles to janitorial services. In 2008, women-entrepreneurs benefited from $14.7 billion dollars in Federal contracts but that represents only 3.4% of all government buys. Decades of sex discrimination has inhibited the ability of women-owned businesses to compete equally for federal contracts, but that is about to change.

On March 2, the Small Business Administration (SBA) released a Proposed Rule to expand federal contracting opportunities for women-owned small businesses. The Proposed Rule is aimed at leveling the playing field for women-owned small businesses to compete for and win federal contacts, while also achieving the existing statutory goal that 5% of federal contracting dollars go to women-owned small businesses.

BPW Foundation submitted comments in support of the SBA program to set-aside contracts for women owned small business.  In April, BPW Foundation surveyed our supporters about the proposed rule. An overwhelming majority (73 percent) of survey respondents support a women-owned small business federal contracting program and 45 percent said they would be taking advantage of such a program. Those surveyed represent over 40 industries, most of which have been identified as one of the 83 industries in which women are underrepresented or substantially underrepresented.

A little history
In 1979, Women-Owned Small Businesses received less than 1% of all federal contracts and that number did not grow beyond 1% over the next decade. In 1988, the Women’s Business Ownership Act was enacted to assist women in starting, managing and growing small businesses. This program has assisted thousands of women in obtaining business financing and information, but it has had less success at increasing the percentage of the total value of all prime contract and subcontract awards going to Women-Owned Small Businesses.

In 2000, Congress attempted to address the difficulties women-owned businesses have endured in competing for federal procurement contracts by authorizing federal contracting officers to restrict competition for federal contracts in certain industries to eligible Women-Owned Small Businesses. The WOSB Federal Contracting Program Proposed Regulations developed in 2001 by the SBA had many problems including identifying only 4 industries in which women-owned small businesses were under-represented and a requirement that each federal agency certify that it had engaged in discrimination against women-owned small businesses in order for the program to apply to contracting by that Agency. Seventy-five percent of the comments opposed some portion of the proposed regulation.

The Obama Administration has chosen to draft a new, comprehensive Women-Owned Small Business Federal Contracting Program Regulation, based on the analysis of the prior studies and on all the questions and comments previously received.

How the Proposed Women Owned Small Business Rule Works

  • A firm must be 51% owned and controlled by one or more women, and primarily managed by one or more women.
  • The women must be U.S. citizens.
  • The firm must be “small” in its primary industry in accordance with SBA’s size standards for that industry.
  • A firm must be in one of 83 industries in which women-owned small businesses are under-represented or substantially under-represented in federal procurement. There are 45 North American Industry Classification System (NAICS) codes in which Women-Owned Small Businesses are underrepresented and 38 NAICS codes in which Women-Owned Small Businesses are substantially underrepresented.
  • Applies to contracts under $5 million in the case of manufacturing and under $3 million in the case of other contracts.
  • Each competing concern must be duly certified by a Federal agency, a State government, or an SBA-approved entity as a Women-Owned Small Business, or must certify to the contracting officer and provide adequate documentation that it is a Women-Owned Small Business.
  • Women-owned small businesses can self-certify as Women Owned Small Business or can be certified by a third party entity. If you self-certify, you must certify your status as a Women-Owned Small Business in the Online Representations and Certifications Application website and submit a core set of eligibility-related documents to an online “document repository” to be maintained by the SBA.

BPW Foundation applauded the Obama Administration for drafting a new, comprehensive Women-Owned Small Business Federal Contracting Program regulation, rather than going forward with the ill-conceived previous regulation.

Read more about the Women-Owned Small Business Federal Contracting Program Proposed Rule.

Learn More About Navigating the Federal Contracting Process


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