The 8(a) program is a nine-year business development program to help firms owned and controlled by socially and economically disadvantaged individuals. This Small Business Administration (SBA) program is a valuable tool for those firms who have already been in business for at least two years or more and are interested in expanding in the federal marketplace. However, the 8(a) program was on hold earlier this summer while the SBA figured out the implications of a recent court case but applications are now open! Find out how these changes will affect your business, whether you are already 8(a) certified or looking to join this program.
How do you qualify for this program?
To qualify for the 8(a) program, businesses must meet the following eligibility criteria:
- Be a small business
- Not have previously participated in the 8(a) program.
- Be at least 51% owned and controlled by U.S. citizens who are socially and economically disadvantaged.
- Have a personal net worth of $850 thousand or less, adjusted gross income of $400 thousand or less, and assets totaling $6.5 million or less.
- Demonstrate good character.
- Demonstrate the potential for success by having been in business for two years.
Participation in the 8(a) program requires certification from the SBA through certify.sba.gov. Before you apply, make sure you have identified your NAICS codes, have an active System for Awards Management (SAM) account, and make sure you are eligible using the Am I Eligible tool from SBA.
What Are The Benefits Of The 8(a) Program?
Certified firms in the 8(a) program can receive these perks for all 9 years that they are active in the program:
- Efficiently compete and receive set-aside and sole-source contracts
- Receive one-on-one business development assistance for their nine-year term from dedicated Business Opportunity Specialists focused on helping firms grow and accomplish their business objectives.
- Pursue opportunities for mentorship from experienced and technically capable firms through the SBA Mentor-Protégé program.
- Connect with procurement and compliance experts who understand regulations in the context of business growth, finance, and government contracting.
- Pursue joint ventures with established businesses to increase capacity.
- Qualify to receive federal surplus property on a priority basis.
- Receive free training from SBA’s 7(j) Management and Technical Assistance program.
Recent Changes To The 8(a) Program
On July 19, 2023, the U.S. District Court for the Eastern District of Tennessee issued a ruling in Ultima Servs. Corp. V. Dep’t of Ag. affecting the 8(a) Business Development program.
Prior to this ruling, individual Black Americans, Hispanic Americans, Native Americans, Asian Pacific Americans, and Subcontinent Asian Americans applying for the program could establish that they were socially disadvantaged by demonstrating that they held themselves out as a member of one of those designated groups. While most 8(a) firms established their 8(a) program eligibility through this presumption of social disadvantage, other 8(a) firms were admitted to the 8(a) program because the qualifying individual owner established social disadvantage by submitting a narrative with their original application.
Due to this Tennessee court ruling, the SBA is now barred from using the presumption of social disadvantage to administer the 8(a) Program. This means all 8(a) participants who established themselves as Black Americans, Hispanic Americans, Native Americans, Asian Pacific Americans, and Subcontinent Asian Americans are now required to submit a social disadvantage narrative prior to receiving new 8(a) contracts.
All current 8(a) participants who must meet this requirement were notified via email by the SBA in late August. The email explained the process for establishing social disadvantage through a social disadvantage narrative. Participants will receive a letter from the SBA that confirms their participation in the SBA program once their narrative is reviewed and approved. While they were working out the details of the court case and changing the 8(a) process the SBA put a hold on accepting applications. However, as of September 29, 2023, the SBA is accepting new applications.
Tools For A Successful 8(a) Application
The SBA website, certify.sba.gov, has a variety of tools to determine eligibility, frequently asked questions and answers, definitions, and regulations. Additionally, the SBA holds monthly meetings to help firms understand and navigate the 8(a) process.
When: Third Wednesday of each month – 2:00p.m. to 3:00p.m. (ET)
How: Call 202-765-1264 (Washington, DC) and enter phone conference ID#: 217 121 169
And of course, your APEX Accelerator Counselor can provide guidance and assistance on all aspects of the 8(a) Program from initial eligibility through the recent changes, help you with reports, and how to gain the most benefit while you are in the program.
There are many nuances to this program and your APEX Accelerator counselors are equipped to help you so reach out to your Norcal APEX Accelerator counselor for assistance or apply for services today!
If you have more questions, please contact us at email@example.com or 707.267.7561
Authored by: Mary Jo Juarez, Norcal APEX Accelerator Procurement Specialist