BY BORIS HERTSLET
The federal government has a goal of awarding 23% of all prime, government contracts to small businesses. Furthermore, the federal government breaks down this percentage into four small business set-asides: 5% for Women-Owned Small Businesses, 5% for 8(a) Certified Small Businesses, 3% for HUBZone Certified Small Businesses, and 3% for Service-Disabled Veteran-Owned Small Businesses. With prime contracts on Guam averaging $650 million annually, local small businesses are set to win $150 million in prime contracts this year. To get a piece of this action, small business owners should give some serious thought to the various small business certifications available to them.
The must-have certification for local small businesses is the Historically Underutilized Business Zone. Annually, the federal government falls short of the 3% HUBZone goal. Because all of Guam and the Northern Marianas Islands are in a Historically Underutilized Business Zone, contracting officers operating here try to make up that national shortfall by using the HUBZone set-aside as much as possible. As of this writing, 129 Guam-based and seven NMI-based companies have taken advantage of this situation and are HUBZone certified. Last year, HUBZone certified companies won over $61million in federal prime contracts on Guam.
The 8(a) certification is reserved for small businesses that are owned and operated by the socially and economically disadvantaged. When applying for 8(a) certification, a mountain of paperwork is required and the process can take more than a year. In the end, though, 8(a) certified companies can receive sole-source (no competition) opportunities and avail of a mentor-protégé program to rapidly grow their businesses. Last year, 8(a) certified companies won over $123 million in federal prime contracts on Guam.
Unlike HUBZone and 8(a), certifications issued and maintained by the Small Business Administration, WOSB and SDVOSB are self-certifications. The SBA does not issue actual certification documents for the WOSB and SDVOSB programs. These certifications, for the most part, require checking a box in the System for Award Management and attesting to the fact that the rules and regulations associated with these programs are understood by the business owner(s).
WOSB certification requires the business owner(s) to upload documents to a repository that can be inspected by the contracting officer on a WOSB set-aside solicitation. WOSB certification also requires extra effort from the contracting officer issuing the solicitation as he/she must complete a checklist that states required documents proving the business is a WOSB are readily available. This set-aside is rarely used on Guam. In fact, it has been over a year since a WOSB set-aside solicitation was issued on Guam. SBA has given the WOSB certification a little more clout by offering sole-source opportunities, but until the WOSB certification is actually run and maintained by the SBA, it is a tough sell for contracting officers. So, they achieve their WOSB goals through the 8(a) and HUBZone programs.
SDVOSB certification is also a self-certification. The only federal agency that requires a SDVOSB to go through a formal verification process is the U.S. Department of Veteran Affairs. SDVOSB certified companies are eligible for sole-source opportunities as well. Unfortunately, with the exception of the VA, the SDVOSB set-aside is seldom used as self-certification opens itself up to more scrutiny and protest, in turn creating more work for the contracting officer. Just like the WOSB program, the SBA or even the VA need to run and maintain the SDVOSB program across all federal agencies for its use to increase.
Guam Procurement Technical Assistance Center counselors are familiar with the ins and outs of these set-aside programs and can assist you with obtaining these certifications. Best of all, Guam PTAC services are free of charge. To learn more about government procurement or to contact one of our procurement counselors, please visit our website: www.guamptac.com.
— Boris Hertslet is the program manager for the Guam Procurement Technical Assistance Center. He can be reached at firstname.lastname@example.org.