Magazine article Black Enterprise

Is 8(a) Doing the Two-Step?

Magazine article Black Enterprise

Is 8(a) Doing the Two-Step?

Article excerpt

The Small Business Administration recently announced proposed changes to the 8(a) minority procurement program designed to level the playing field in securing federal contracts. Yet, one of the proposals has many minority contractors crying foul.

The proposed new rule would allow non-minority 8(a) applicants to meet a lesser standard to establish social disadvantage. "Clear and convincing" evidence would be replaced by a "preponderance" of evidence. While the change in wording might seem insignificant to some, others see it as opening the floodgates for non-minority firms seeking 8(a) business.

"This change would conform SBA's rules and procedures to the Department of Justice's post-Adarand guidelines," explains the SBA's Darryl Dennis, counselor to the administrators. According to government statistics, of the 6,000 firms enrolled in the program, only nine are currently owned by white women. With the change, it's widely believed--and feared in some circles--this will encourage Caucasian women to compete much more aggressively for 8(a) contracts.

"We are very bothered by that," says Sam Carradine, executive director of the National Association of Minority Contractors. "Unless there's a significant increase in the pie, some of the work that would have gone to minority contractors will now go to female white contractors."

William W. Davis Sr., CEO of Pulsar Data Systems (No. 4 on the BE INDUSTRIAL/SERVICE 100 list) agrees. "My gut feeling is that there will be some negative impact because the rules will create more competition for companies that have been struggling all along to find business."

Other SBA changes include a proposed rule limiting the amount of non-competition, or sole-source, contracts a firm can receive. That limit is triggered when a company exceeds its primary standard industrialization code, which is based on either revenue or size. …

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