THIS ARTICLE PROVIDES AN OVERVIEW OF PROGRAMS AND certifications offered by the U.S. Small Business Administration (SBA) that benefit women, veterans, and disadvantaged groups. Specifically, this article discusses the following SBA programs: WOSB and EDWOSB: Women-Owned Small Business and Economically Disadvantaged Women-Owned Small Business VOSB and SDVOSB: Veteran-Owned Small Business and Service-Disabled Veteran-Owned Small Business WBENC: Women’s Business Enterprise National Council 8(a): Section 8(a) Business Development Program (socially and economically disadvantaged individuals) HUBZone Program: Historically Underutilized Business Zone Program General WOSB & VOSB Requirements The WOSB and VOSB programs aim to increase federal contracting opportunities for women-owned businesses and veteran-owned businesses. 1. GENERAL WOSB & VOSB PROGRAM REQUIREMENTS In general, to qualify as a WOSB or VOSB, the business must be: (i) a small business according to SBA size standards;1 (ii) at least 51% owned and controlled by women or veterans who are U.S. citizens;2 and (iii) women or veterans must manage the day-to-day operations and also make long-term decisions.3 A.Small Business Requirement The SBA’s size standards define whether a business constitutes a “small business” based on its industry or economic activity as classified under the North American Industry Classification System (NAICS). Businesses can enter their NAICS code, as listed in its System for Award Management (SAM) profile, on the SBA’s website (sba.gov/ size-standards/index.html) to determine if it qualifies as a small business.4 B. 51% Ownership Requirement To qualify as a WOSB or VOSB, women or veterans must “unconditionally” and “directly” own at least 51% of the business.5 For ownership to be “unconditional,” ownership must not be subject to any conditions, executory agreements, voting trusts, or other arrangements that divert ownership benefits to another person, except in cases after death or incapacity.6 Ownership must also be held “directly,” meaning, not through another entity or trust, such as an employee stock ownership plan (ESOP).7 However, if ownership is held through a revocable living trust where the woman or veteran is the grantor, trustee, and sole beneficiary, then it will be treated as direct ownership.8 In partnerships or limited liability companies, women or veterans must own at least 51% of each type of ownership interest.9 For corporations, they must own at least 51% of the company’s stock, both in terms of its voting stock and total outstanding shares.10 C.Management & Day-to-Day Decision-Making Requirement To qualify as a WOSB or VOSB, women or veterans (as applicable) must control the management and daily operations of the business.11 They must hold the highest officer position in the business, with ultimate managerial and supervisory control.12 They are not, however, required to possess the professional or occupational license needed to operate in the industry, nor do they need to have the technical skills for specific tasks within the business.13 They UNDERSTANDING FEDERAL BUSINESS CERTIFICATIONS NAVIGATING OPPORTUNITIES FOR WOMEN, VETERANS & DISADVANTAGED GROUPS BY HANNAH FISCHER FREY, STEVE KOO & JACK SUTER, BAIRD HOLM CONTINUED ON PAGE 24 23 nescpa.org
RkJQdWJsaXNoZXIy ODQxMjUw