On March 2, 2010 the Small Business Administration (SBA) released a proposed rule that is "aimed at expanding federal contracting opportunities for women-owned small businesses." In large part, this rule is seen as a critical component of the Obama administration's efforts toward expanding opportunities for small businesses in the federal procurement sector, especially those owned by women, minorities and veterans.

The proposed rule identifies 83 industries in which women-owned small businesses (WOSBs) are under-represented or substantially under-represented in the federal contract marketplace. Within this framework, the rule is targeted at providing greater opportunities for WOSBs to compete for federal contracts, while achieving the existing statutory goal that five percent of federal contracting dollars go to WOSBs.

Various versions of this rule have been previously contemplated since 2000, during which time SBA took a number of steps to study and analyze the market. Several draft rules were unsuccessfully created and made available for public comment, but all met repeated delays, rewrites, and eventual elimination.

The latest version is the result of the Obama administration's choice to take into account the prior analyses, studies and comments, and create a comprehensive rule that melds these concepts into a workable product that achieves the intended results.

This proposed rule authorizes set-aside contracts under a certain dollar amount for WOSBs in the industries in which they are deemed to be under-represented. The selection of these industries was a result of analyzing both the share of contracting dollars awarded to women-owned firms and the share of contracts awarded; a contrast to previous versions in which an under-represented industry was only determined on the share of contracting dollars awarded to women-owned firms.

Other important considerations of the new proposed rule include:

•· Eligible companies must be 51% owned and controlled by one or more women, and primarily managed by one or more women. The women must be U.S. citizens, and the firm must be "small in its primary industry according to SBA's size standards.

•· In order to be eligible for the set-aside, the anticipated contract price cannot exceed $5 million in the case of manufacturing contracts, and $3 million in the case of other contracts.

•· The requirement (that existed in previous draft versions) that each federal agency certify that it had engaged in discrimination against WOSBs in order for the program to apply to contracting by that agency has been eliminated.

•· WOSBs can self-certify, or be certified by third-party certifiers. If firms choose to self-certify, they must submit a lengthy set of documents to the federal ORCA website, as well as to an online document repository maintained by the SBA. Eligibility standards will be strictly enforced, not only if an issue is raised at that protest level, but also through a series of program examinations.

The proposed rule released on March 2, 2010 is open for public comment for 60 days, which will close on May 3.