Editorial · August 12, 2017
WOSB Certification: Federal Contracts for Women Owners
WOSB certification is how a women-owned small business shows a federal buyer that it qualifies for contracts set aside for women. In 2017, a firm can still do this on its own. It does not need a letter from the government. Here is how the program works and what a firm must do.
What the WOSB program is
The Women-Owned Small Business (WOSB) Federal Contract Program began in February 2011. The U.S. Small Business Administration (SBA) runs it. Its goal is to open more industries to women-owned firms that want federal work.
The program has two tiers. One is the Economically Disadvantaged WOSB, or EDWOSB. The other is the plain WOSB. A contracting officer may set a deal aside for EDWOSBs in industries where women-owned firms are underrepresented. A set-aside for WOSBs is allowed in industries where they are substantially underrepresented. SBA lists those industries by NAICS code. It added to the lists in March 2016.
Sources: SBA, Women-Owned Small Business Program page, as archived July 5, 2017; 13 CFR 127.500 to 127.503.
Who qualifies
A firm must first be a small business under SBA size rules for its industry. Then it must be at least 51 percent owned and controlled by one or more women who are U.S. citizens.
The ownership must be direct and unconditional. That means the women hold the shares or interests themselves, with no side deal that sends the benefits to someone else. Control has a plain meaning too. A woman must hold the top officer job. She must have the management experience to run the firm. She must work at it full time.
She does not need the technical license, if she truly supervises the people who do. But if a man holds the needed license and owns part of the firm, he may be found to control it.
Sources: 13 CFR 127.200 to 127.202, Code of Federal Regulations.
What makes a firm an EDWOSB
An EDWOSB must meet every test above. In addition, the women who own it must be economically disadvantaged. The rule sets one clear number. A woman's personal net worth must be under $750,000. SBA leaves out her stake in the firm and the equity in her main home. Funds in an IRA or other official retirement account also do not count, if she shows SBA the account's terms and certifies that it is legitimate.
SBA also asks whether her ability to compete has been held back by weaker access to capital and credit than others in her line of business.
Sources: 13 CFR 127.203, Code of Federal Regulations.
How self-certification works
SBA does not approve firms into the program or hand out certificates. A firm certifies itself. Rule 127.300 sets the steps. The firm must be registered in the System for Award Management, known as SAM. It must post a current statement in SAM that it is a WOSB or EDWOSB. It must also give its papers to the WOSB Program Repository.
The papers include a signed Women-Owned Small Business Program Certification. They also include documents that back up ownership and control. A firm must keep these records for six years. A contracting officer can ask to see them when the firm is the apparent winner of a set-aside deal.
The statement is made under penalty. If a firm says it qualifies and it does not, it faces real trouble. Check each rule before you sign.
A firm can instead use a third party. SBA accepts certifications from approved certifying groups. It also accepts SBA 8(a) status. That firm still must put a copy in the repository.
Sources: 13 CFR 127.300, Code of Federal Regulations; SBA, Women-Owned Small Business Program page, as archived July 5, 2017.
The repository and what is changing
The repository now lives on SBA's new portal at certify.sba.gov. It replaced the older General Login System. In the portal, owners can manage their documents, fill out forms online and get notices of upcoming deadlines. SBA has posted slide guides on self-certification for firms. Contracting officers must check that the apparent winner supplied all the required papers, and they may view them only if the firm approves.
The SBA page says self-certification is still allowed while the agency develops new criteria. So the process may change. A firm should watch the SBA site for news and keep its records current.
Sources: SBA, Women-Owned Small Business Program page, as archived July 5, 2017.
Steps to take first
- Confirm your size. Look up your main NAICS code and the size standard for it.
- Check that your industry is on SBA's list of eligible NAICS codes.
- Test ownership and control against the rules above. Write down the proof.
- Register in SAM and post your WOSB or EDWOSB status.
- Create your account at certify.sba.gov and upload your documents.
- Look for set-aside notices in your industry, and read each limit on subcontracting before you bid.
A set-aside is not a promise of work. It only means fewer firms compete. You still have to write a strong offer and price it fairly. Local SBA offices and Women's Business Centers can help with the paperwork at no charge or low cost.
Sources: 13 CFR 127.300 and 127.504; SBA, Women-Owned Small Business Program page, as archived July 5, 2017.
Sources
- U.S. Small Business Administration, Women-Owned Small Business Program, sba.gov (archived July 5, 2017).
- 13 CFR Part 127, Women-Owned Small Business Federal Contract Program (sections 127.200 to 127.203, 127.300, 127.500 to 127.504).