The federal government is actively working toward making sure small businesses have a big slice of government contracting dollars. Recently, the General Services Administration (GSA) and the Small Business Administration (SBA) have signed a revised 8(a) Program Partnerships Agreement (PA) and established a final rule that will increase contracting opportunities both sole source and set aside contractors, and make it easier for government customers to use GSA Schedules to access 8(a) company solutions. 8(a) companies are a part of a small disadvantaged business program, and the government has been focused on making federal procurement more accessible for contractors under this program. Let’s discuss 8(a) Business Development, what the new partnership will mean, and other ways small businesses can utilize support from the government.
What is the 8(a) Business Development Program?
The 8(a) Business Development Program was created to assist eligible small, disadvantaged businesses with training and technical assistance so they can compete in the government marketplace. The program is aimed specifically at small business concerns owned and controlled by socially and economically disadvantaged individuals. The four categories of disadvantaged businesses defined by the SBA are:
- Veteran-owned
- Woman-owned
- Minority-owned
- Owned by a person with disabilities
8(a) is one of the several small business set-asides created by the SBA to help companies effectively compete in government contracts.
Small Business Set-Asides
Maybe you’ve heard of the term “set-asides” before or you’re just now reading it for the first time in this blog, but what are they? Small Business set-asides limit competition to qualifying small businesses. This means there may be a contract open to only 8(a) businesses, Women-Owned, Veteran-Owned, or sometimes all types of small businesses. This way a small business doesn’t have to compete for let’s say computer software against large companies like Microsoft. While this is just a generic example, the idea is that entire contracts are set aside only for a specific type of small businesses or just small businesses in general. This leaves more contracting dollars on the table for small businesses.
There are also contract vehicles specific to small businesses. A prime example of this is 8(a) STARS II and 8(a) STARS III. These are not just acquisitions for a specific product or service, but entire contract vehicles dedicated only to 8(a) companies selling IT service-based solutions.
The New 8(a) Program Partnership Agreement (PA)—Establishing an MAS Pool for 8(a) Contractors
As mentioned before, GSA and the SBA have recently signed a revised 8(a) Partnership Agreement that aims to increase contracting opportunities for 8(a) contractors. This includes establishing a Multiple Award Schedule (MAS) pool for 8(a) contractors. The pool will consist of new and existing 8(a) MAS contractors who are current participants in the 8(a) Business Development Program. Once accepted by SBA and GSA into the pool, contractors will be eligible for competitive and sole source 8(a) set-asides under their GSA Schedules.
The idea for this pool is to increase opportunities for 8(a) companies, including:
- Giving government agencies more access to 8(a) companies for a wide array of products and services.
- Increasing ordering flexibility through GSA Schedules, including sole source awards to 8(a) companies.
- Streamlining acquisition to incentivize agencies to purchase 8(a) solutions from GSA Schedules.
- Creating standardized processes for reaching agreements on acquisition strategies between GSA and the SBA.
This pool presents itself as a big deal for 8(a) companies—as a smaller group of contractors, the action items above would generate more contracting opportunities to go after and make it easier for government agencies to access solutions. This means more agencies will be seeking out 8(a) products and services, creating more customers for 8(a) businesses.
Increased Opportunities for Sole Source 8(a) Contractors
Along with the Partnership Agreement, the SBA has also recently established a final rule regarding sole source 8(a) awards. This rule provided much needed clarity as to when an individually owned 8(a) may be awarded a sole source contract.
An amended regulation in the Department of Defense (DoD) back in 2020 raised the threshold for 8(a) companies to receive sole source awards without a justification and approval to $100 million, and the civilian agencies threshold was increased to $25 million. However, this mainly applied to entity owned 8(a) concerns such as Alaskan Native Corporations (ANCs) and Tribal Concerns and not individually owned 8(a) concerns. Individually owned 8(a) companies were limited to sole source contract under $4.5 million competitive thresholds.
With the new final rule, the SBA amended C.F.R. § 124.506(d) to clarify that the Federal Acquisition Regulation (FAR) and Defense Federal Acquisition Regulation Supplement (DFARS) provisions allowing sole source awards up to $25 million for civilian and $100 million for DoD without justification and approvals are also applicable to individually owned 8(a) concerns. Individually owned 8(a) entities are also eligible to receive sole source awards for a longer period of time.
Small Business Resources
Small businesses, including 8(a) companies, have a lot of resources at their disposal. The Small Business Administration (SBA) has several training resources for businesses just starting out as well as detailed information on all their federal contracting assistance programs. SBA has local branches too so you can get help and join relevant virtual and in-person events in your state. The Office of Small and Disadvantaged Business Utilization (OSDBU) partners with GSA to hold webinars and events for small businesses, and also supports SBAs federal contracting assistance programs. There is also Procurement Technical Assistance Centers (PTACs) which provide localized one-on-one counseling, workshops, and matmaking events for agency buyers and businesses. Check out our blog on small business resources to get a more comprehensive list.
If you want to learn more about becoming a GSA contractor, becoming a small business, or just general contracting help or advice, we are here to help answer any of your questions.
