Client Alert: SBA Reopens 8(a) Program After Court Decision
Date: November 1, 2023
The SBA certifies small businesses considered to be socially and economically disadvantaged under its nine-year 8(a) Business Development (BD) Program. The 8(a) BD Program provides significant opportunities for participants to develop and grow their businesses, generate wealth, and create jobs in historically underserved communities through powerful contracting tools. In reaction to the court decision, however, the SBA pushed the pause button on the 8(a) program and required those already in the program to write statements certifying discrimination they had suffered in the past. Recently, the SBA reopened the 8(a) Program with SBA Administrator Isabella Guzman giving the following statement in part:
“Though the administration of the 8(a) Program has been impacted by a recent court injunction and order, the program is open for business. In the weeks since the injunction, the SBA has reviewed or recertified thousands of current 8(a) participants through a process consistent with the court’s order. And now the SBA has reopened the 8(a) application to new participants – ensuring a vast, talented pool of vendors are available to federal agencies.
The 8(a) Program has more than a 50-year track record of making contracting with the U.S. government more accessible for thousands of small businesses who in turn provide critical products and services to advance agency missions. Leveling the playing field not only provides entrepreneurs from historically underserved communities the opportunity to grow their businesses, create jobs, and contribute to their local economies – it is also crucial to enhancing performance across our federal government.
As we await a final ruling, the SBA and the Biden-Harris Administration remain committed to supporting the 8(a) Program and standing up for the small business owners who have helped drive America’s historic economic growth. We will not let attacks from those who seek to take us backward chill our efforts to promote equity, expand access to the American Dream, and ultimately strengthen our country’s industrial base.”
The 8(a) Program has more than a 50-year track record of making contracting with the U.S. government more accessible for thousands of small businesses who in turn provide critical products and services to advance agency missions. Leveling the playing field not only provides entrepreneurs from historically underserved communities the opportunity to grow their businesses, create jobs, and contribute to their local economies – it is also crucial to enhancing performance across our federal government.
As we await a final ruling, the SBA and the Biden-Harris Administration remain committed to supporting the 8(a) Program and standing up for the small business owners who have helped drive America’s historic economic growth. We will not let attacks from those who seek to take us backward chill our efforts to promote equity, expand access to the American Dream, and ultimately strengthen our country’s industrial base.”
Thus, the SBA has reopened its online “Certify Portal” that it closed shortly after the Ultima decision. In Certify, 8(a) participants and applicants can now continue to upload previously prepared narratives, but SBA also added a plain language fillable questionnaire for applicants to identify social disadvantage. The questionnaire asks applicants to describe the event(s) that have negatively affected entry or advancement in the business world, prompting responses to the following six questions:
1) What happened?
2) How did it affect opportunities to start or expand your business?
3) What contributed to the discrimination?
4) When did it happen?
5) Where did it happen?
6) Who contributed?
2) How did it affect opportunities to start or expand your business?
3) What contributed to the discrimination?
4) When did it happen?
5) Where did it happen?
6) Who contributed?
Once submitted, SBA will review the narrative to determine that the firm’s owner(s) has demonstrated personal social disadvantage. Once approved, SBA will provide a social disadvantage qualification letter documenting that the 8(a) participant or applicant has established social disadvantage and may continue to receive 8(a) contracts and otherwise participate in the 8(a) BD Program. Consistent with existing regulations, 8(a) Participants will only need to establish social disadvantage once for their program term, unless there are ownership/control or other changes which affect eligibility.
The updated application process does not apply to entity-owned firms, such as firms owned by Indian tribes, Alaska Native Corporations, Native Hawaiian Organizations or Community Development Corporations. These firms will not need to submit narratives to apply for the 8(a) program. A Guide for Writing a Social Disadvantage Narrative is available on the Certify Knowledge Base. In addition, interested parties are encouraged to review the SBA’s webinar session 8(a) information videos.
The information contained here is not intended to provide legal advice or opinion and should not be acted upon without consulting an attorney. Counsel should not be selected based on advertising materials, and we recommend that you conduct further investigation when seeking legal representation.