To participate in the Women-Owned Small Business (WOSB) or Economically Disadvantaged Women-Owned Small Business (EDWOSB) Program, a company must either self-certify through the Small Business Administration (SBA) website or through a third-party organization. However, the program is making some changes in the near future. Effective October 15, 2020, WOSBs will no longer be able to self-certify.
As part of the 2015 The National Defense Authorization Act (NDAA), Congress eliminated self-certification for WOSB set asides and sole source. Despite the change, the SBA insisted that WOSB self-certification remain a viable option while they figured out how to address the change. Now, that change is coming.
According to reports by the SBA Office of Inspector General (OIG), 89% of all WOSB sole source contracts were awarded improperly. It was determined that federal agencies, contracting officers, and firms did not comply with the federal regulations for 50 out of a total 56 sole source contracts, which are valued at a total of $52.2 million.
Before awarding a WOSB or EDWOSB contract, the contracting officer is required to confirm that WOSBs/EDWOSBs have provided supporting certification documentation in the SBA system. Yet, SBA OIG found that contracting officers awarded 18 contracts valued at $11.7 million on a sole source base to companies with no documentation in the system. Additionally, 32 sole source contracts were awarded to companies with incomplete documentation in the system.
SBA OIG pointed out that the 2015 NDAA, which allowed WOSBs to receive sole source contracts, also required the SBA to implement a certification program for these businesses. Though the SBA implemented the sole source authority in October 2015, they have not issued regulations pertaining to a certification process for the program. The SBA estimated another year of implementing a certification process. This is not the first time that an oversight body has questioned whether WOSB self-certification may be causing ineligible companies to win set asides and sole source contracts.
With self-certification going away, WOSBs must turn to third-party organizations for certification. There are currently four organizations approved by the SBA to provide third-party certification:
- The National Women’s Business Owners Corporation (NWBOC);
- The Women’s Business Enterprise National Council (WBENC);
- The U.S. Women’s Chamber of Commerce;
- And the El Paso Hispanic Chamber of Commerce (EPHCC).
Companies certifying for the first time must either certify through one of the third-party organizations mentioned above or through https://certify.sba.gov/, which will be offering a free online certification program. SBA will also allow participation from firms certified by the U.S. Department of Veterans Affairs Center of Verification and Evaluations, provided they meet all eligibility requirements.