Did you know the federal government purchases billions of dollars in goods and services each year ranging from basic office supplies to sophisticated high-tech equipment? 

The 8(a) program is a business development program that offers assistance to business owners who are socially and economically disadvantaged by helping entrepreneurs compete in the federal contracting arena and take advantage of greater subcontracting opportunities available from large firms as the result of public/private partnerships.  The nine-year program includes counseling and training as well as potential federal procurement opportunities. 

What are the qualifications for the 8(a) program?

• The small business must be owned and controlled by a socially and economically disadvantaged individual.
• Demographic groups that are presumed to be socially disadvantaged include African Americans, Hispanic Americans, Asian Pacific Americans, Native Americans, and Subcontinent Asian Americans.
• Other individuals can be admitted to the program if they can show by a “preponderance of the evidence” that they are disadvantaged because of race, ethnicity, gender, physical handicap, or residence in an environment isolated from the mainstream of American society.
• To meet the economic disadvantage test, individuals must have a net worth of less than $250,000, excluding the value of the business and personal residence.
• Applicants’ businesses must meet applicable size standards for small business concerns.
• Applicants must have been in business for at least two years, display reasonable success potential, and display good character.

Nationally, the SBA at present has more than 7,512 8(a) certified companies.  The total number of 8(a) companies in Texas is 596, and the total 8(a) dollars to Texas companies in FY 2008, the most recent verified fiscal year, was $934,819,923 which represents 5.8% of total 8(a) dollars in FY 2008. 

The SBA is working hard to strengthen the 8(a) program for socially and economically disadvantaged small businesses to ensure that those who are eligible benefit from the program. 

The agency has proposed a set of regulatory changes after comprehensive review of the program covering a variety of areas of the program, ranging from providing further clarification on determining economic disadvantage to requirements on Joint Ventures and the Mentor-Protégé program.

Also, the proposed SBA Budget for 2011 promotes expanding opportunities in government contracting and business development.  Those elements reflect the agency’s core belief that federal government contracting opportunities are a critical tool in helping small businesses increase their volume, expand and create jobs.  The budget proposal asks for $2 million for programmatic efforts to reduce fraud, waste and abuse, and meet statutory requirements. This supports SBA’s high-priority performance goal of meeting or exceeding federal government contracting goals and reducing participation by ineligible firms.

The SBA will also focus on meeting contracting goals overall, and for women and service-disabled veteran-owned small businesses, as well as firms in the HUBZone and 8(a) programs.

This Administration and SBA Administrator Karen Mills are committed to helping small businesses reach those contracting goals and to making sure the benefits are flowing to eligible small businesses.

Small businesses interested in the 8(a) program should contact their local district office to attend an informational session.  There are 68 district offices nationwide with six of those offices located right here in Texas, www.sba.gov/localresources.  The 8(a) program and online 8(a) application can be found by going to www.sba.gov/8abd. 

We invite all of you to get a discussion going.  Please submit your comments at the end of this article, Thanks.