Once a contracting officer decides a requirement should go to small businesses, another question follows: which kind? The work might be set aside for small businesses generally, or for participants in one of the socioeconomic programs: 8(a), HUBZone, service-disabled veteran-owned or women-owned small businesses. Contractors sometimes assume there is a fixed ranking. Across most of government, there is not. The FAR describes the relationship among the programs as parity. This overview is general; check the current FAR text before relying on any detail.
What parity means
The FAR has long stated that there is no order of precedence among the 8(a), HUBZone, SDVOSB and WOSB programs. A contracting officer is not required to consider one program before another. Instead, the choice depends on the circumstances of the acquisition. Parity does not make the programs interchangeable for a given firm, though: each has its own eligibility rules, and a firm can compete only for set-asides under programs in which it holds the required status.
The FAR also addresses the relationship between these programs and general small business set-asides. For acquisitions above the simplified acquisition threshold, contracting officers are directed to consider the socioeconomic programs first, before using a set-aside for small businesses generally. Below that threshold, the rule that reserves many purchases for small businesses does not prevent an award under one of the programs.
What shapes the choice
Among the factors the FAR identifies are the results of market research and the agency’s progress toward its small business goals. In practice, the questions look like this:
- Did market research identify at least two capable firms in a particular program likely to offer at a fair market price? That is the rule of two applied within the program.
- Is the agency behind on a particular goal, such as its HUBZone or SDVOSB target?
- Is there an incumbent, and which program, if any, did the current contract use?
- Is the requirement eligible for a particular program, such as a WOSB set-aside, which is limited to designated industries?
Important exceptions
Parity has limits. Once a requirement has been accepted into the 8(a) program, it generally remains there unless SBA agrees to release it, so follow-on work tends to stay in 8(a). The Department of Veterans Affairs operates under its own statute, which gives priority to veteran-owned small businesses, beginning with service-disabled veteran-owned firms, in its contracting decisions. And sole-source authorities differ by program, with their own conditions and dollar limits.
What it means for your firm
Because the choice depends on market research, the information you provide matters. When you answer a sources sought notice, state every certification your firm holds and is eligible to use, and be specific about your capability. If you hold more than one status, say so; you may help the contracting officer see that a particular program set-aside is realistic. Talk with agency small business specialists, who often advise on these decisions, about which programs they use for the work you do.
Keep your certifications current in SBA’s systems and your representations current in SAM.gov, since a lapse can remove your firm from a contracting officer’s count at exactly the wrong moment. The FAR’s rules on choosing among small business programs are in Part 19 at acquisition.gov, and program information is at sba.gov.