There has been a lot of buzz surrounding the WOSB program this year, as the SBA has worked to implement changes set forth in the 2015 National Defense Authorization act.
This buzz has left a lot of WOSBs and EDWOSBs wondering what changes would be coming, and how they would affect their business.
As you may be aware, the NDAA set forth many changes to the WOSB program. These changes include adding sole source authority, eliminating self-certification, and a revised timeline for studies to determined “underrepresented” industries. Since its signing, there have been many discussions (often heated) about how these changes would impact WOSBs in federal contracting. In particular, many businesses have been concerned about the elimination of self-certification and the implementation of sole source contracts.
In May of 2015, the SBA published a proposed rule to address implementing the changes brought forth by the NDAA. In the proposed rule, the SBA established guidelines for contracting officers to award sole source contracts to WOSBs and EDWOSBs, and addressed changes in their industry study periods. Pointedly, the SBA did not address the changes to certification procedures, as these changes would require further study and time to implement correctly.
After receiving many public comments, the SBA published a final rule on September 14th that grants sole source authority for WOSBs and EDWOSBs. While most of the comments on the sole source regulations were positive, there were many differing comments on the SBA’s decision to delay implementation of new certification requirements. Despite this, the SBA has maintained that the current certification process, including self-certification, will remain in place until they have crafted new regulations.
What does this mean for my WOSB?
Now that the final rule has been published, contracting officers may award sole source contracts to WOSBs or EDWOSBs when:
1) The EDWOSB is a responsible contractor with respect to performance of the requirement and the contracting officer does not have a reasonable expectation that 2 or more EDWOSBs will submit offers;
(2) The anticipated award price of the contract (including options) will not exceed $6,500,000 in the case of a contract assigned a North American Industry Classification System (NAICS) code for manufacturing, or $4,000,000 in the case of any other contract opportunity; and
(3) In the estimation of the contracting officer, the award can be made at a fair and reasonable price.
This represents a great opportunity for many WOSBs and EDWOSBs, particularly in niche fields. As the SBA has not yet implemented changes to the certification procedures, businesses still have the option to self-certify or to pursue third party certification. The NC PTAC will keep clients updated as further changes are proposed and regulations clarified.