Effective February 4, 2011, the U.S. Small Business Administration (SBA) launched its Women-Owned Small Business (WOSB) Program. The program provides federal contracting preferences for women-owned small businesses and economically disadvantaged women-owned small businesses. To implement the WOSB Program, Federal agencies are authorized to award contracts to women in industries which the SBA deems underrepresented in the federal contract marketplace.  

How to Qualify as a Women-Owned Small Business?

To qualify, a business must be 51 percent owned and controlled by one or more women who are U.S. citizens, and primarily managed by one or more women. The firm must be “small” in its primary industry in accordance with the SBA’s size standards for that industry. In order to be considered an “economically disadvantaged” WOSB (“EDWOSB”) its owners must demonstrate economic disadvantage in accordance with the requirements set forth in the final rule. However, the SBA may waive the requirement of economic disadvantage for procurement in industries in which WOSBs are “substantially underrepresented.”  

How is the Program Implemented?

The rule authorizes a set-aside of federal contracts for WOSBs where the anticipated contract price does not exceed $5 million in the case of manufacturing contracts and $3 million in the case of other contracts. Contracts with values in excess of these limits are not subject to set-aside under the WOSB Program. The contracting officer must have a reasonable expectation that at least two WOSBs will submit offers for the contract. In addition, the contracting officer must determine whether the contract can be awarded at a fair and reasonable price.  

What Industries are Affected by the Regulation?

Currently, the WOSB Program applies to 83 industries, designated by North American Industry Classification System (NAICS) codes, in which EDWOSBs are underrepresented or substantially underrepresented or WOSBs are substantially underrepresented. A few of the NAICS codes identifying WOSBs as “substantially underrepresented” are: cut and sew apparel; printing and related support activities; office furniture (including fixtures) manufacturing; medical equipment and supplies manufacturing; newspaper, periodical, book, and directory publishers; software publishers; data processing, hosting, and related services; offices of real estate agents and brokers; legal services, and accounting, tax preparation, bookkeeping, and payroll services. “Underrepresented” industries include: utility system construction; apparel accessories and other apparel manufacturing; navigational, measuring, electromedical, and control instruments manufacturing; specialized freight trucking; support activities for air transportation; architectural, engineering, and related services; outpatient care centers; and other ambulatory health care services.

How is a Women-Owned Small Business Certified Under the Program?

To be certified as an EDWOSB or WOSB, the rule allows women-owned small businesses to self-certify as an EDWOSB or WOSB or to be certified by third-party certifiers, including government entities and private certification groups. The rule requires WOSBs which self-certify to complete the certifications at the federal Online Representation and Certification Application (“ORCA”) website, and also to submit a core set of eligibility-related documents to an online “document repository” to be maintained by the SBA.

What to Expect?

The SBA has never implemented a set-aside program based on gender, however, existing SBA programs for small businesses owned by minorities and veterans may lend some perspective going forward. Obviously with any set-aside program legal challenges may follow, but even if lawsuits arise, the WOSB Program should increase the presence of women-owned businesses in the federal contracting market. Source: Women-Owned Small Business Federal Contract Program, 75 Fed. Reg. 62,258, 62,258, 62,262 (Oct. 7, 2010) (to be codified at 13 C.F.R. pts. 121, 124, 125, 126, 127 & 134).