/ Published in Corporate & Tax

Can Your Small Business Generate Work from the Federal Government?

Some small business owners are unaware of tremendous opportunities available in working with the federal government.  As an owner of a small business, you may be eligible for federal government contracts that are unavailable to larger competitors.

The federal government is the world’s largest purchaser of goods and services, spending over $500 billion on federal contracts across a wide range of industries. The federal government also has an overall goal that at least 23% of all federal prime contracting dollars go to small businesses. Therefore, companies providing goods and services in one of the many industries servicing the federal government may find additional revenue streams in the federal marketplace.There are several government programs that may be of interest to established small businesses seeking to transition into the federal procurement arena. Each of these programs have specific requirements for how the small business is structured and operated, so it is important that you seek counsel from an attorney knowledgeable in government contracts and small business certifications.

The programs listed below are designed to assist small government contractors in receiving contracts with the federal government, typically in the form of “set-aside” contracts, i.e., contract opportunities where the competition is limited to small businesses or certain types of small businesses.

  • 8(a) Small Disadvantaged Business Program
    *Designed for socially and economically disadvantaged individuals
    *Goal of 5% of all federal prime and subcontract dollars go to small disadvantaged businesses.
  • HUBZone Program
    *SBA has designated certain urban and rural areas as Historically Underutilized Business Zones
    *Goal of 3% of all federal prime and subcontract dollars go to HUBZone small businesses
  • Service-Disabled Veteran Owned Small Business Program (SBA)
    *Business may self-certify that it is an SDVO small business (does not apply to Dept. of Veterans Affairs procurements)
    *Goal of 3% of all federal prime and subcontract dollars go to SDVO small businesses
  • Veterans First Contracting Program (Dept. of Veterans Affairs)
    *Business must be certified by the VA as either an SDVOSB or VOSB to be eligible for award of VA set-aside
    *Business must be owned (51%) and controlled by service-disabled veteran(s) (SDVOSB), or veteran(s) (VOSB)
  • Women Owned Small Business Program
    *Provides for set-aside opportunities for both women-owned small businesses (WOSBs) and economically disadvantaged women-owned small businesses (EDWOSBs)
    *Goal of 5% of all federal prime and subcontract dollars go to women-owned small businesses

PRACTICAL COUNSEL: Each of the programs has special requirements that must be followed in order to receive and maintain the certifications that allow small businesses to utilize these programs. To ensure certification, a new business must be set up with these programs in mind, and existing businesses may need to be restructured to meet the applicable requirements.