John R. Luckey
Legislative Attorney
Kate M. Manuel
Legislative Attorney
This report provides an overview of the Small Business Administration’s (SBA’s) Minority Small Business and Capital Ownership Development Program. Based upon authorities given to the SBA by Sections 7(j) and 8(a) of the Small Business Act of 1958, as amended, this program is commonly known as the “8(a) Program.” The 8(a) Program provides participating small businesses with training, technical assistance, and contracting opportunities in the form of setasides and sole-source awards. A “set-aside” is an acquisition in which only certain contractors may compete, while a sole-source award is a contract awarded, or proposed for award, without competition. Eligibility for the 8(a) Program is generally limited to small businesses “unconditionally owned and controlled by one or more socially and economically disadvantaged individuals who are of good character and citizens of the United States” that demonstrate “potential for success.” However, small businesses owned by Indian tribes, Alaska Native Corporations (ANCs), Native Hawaiian Organizations (NHOs), and Community Development Corporations (CDCs) are eligible for the 8(a) Program under somewhat different terms. In FY2008, 9,462 firms participated in the 8(a) Program, and the federal government spent $6.3 billion on contracts with 8(a) firms.
The report surveys the historical development of the 8(a) Program, as well as the legal requirements presently governing (1) eligibility for the 8(a) Program, (2) set-asides and solesource awards under Section 8(a), and (3) related matters. It also discusses potential developments in the 8(a) Program in light of recently proposed legislation, changes in executive branch policies, and legal challenges. It includes the changes that SBA proposed to the regulations governing the 8(a) Program on October 28, 2009. The 8(a) Program is not the only contracting program for small businesses. There are similar programs for women-owned small businesses, Historically Underutilized Business Zone (HUBZone) small businesses, servicedisabled veteran-owned small businesses, and small businesses not belonging to any other category.
The 111th Congress has enacted legislation (P.L. 111-118) that would allow the Department of Defense to convert functions to performance by certain 8(a) firms without conducting the publicprivate competitions normally required under Office of Management and Budget Circular A-76. It is also considering bills that would modify various aspects of the 8(a) Program or otherwise promote contracting with 8(a) firms (e.g., H.R. 456, H.R. 2200, H.R. 2299, H.R. 2682, H.R. 3771, H.R. 4220, H.R. 4253, H.R. 4818, H.R. 4842, H.R. 4929, H.R. 5010, H.R. 5013, H.R. 5109, H.R. 5136, H.R. 5590, S. 1167, S. 2862, S. 3429, S. 3444, S. 3458).
Date of Report: October 14, 2010
Number of Pages: 40
Order Number: R40744
Price: $29.95
Follow us on TWITTER at http://www.twitter.com/alertsPHP or #CRSreports
Document available via e-mail as a pdf file or in paper form.
To order, e-mail Penny Hill Press or call us at 301-253-0881. Provide a Visa, MasterCard, American Express, or Discover card number, expiration date, and name on the card. Indicate whether you want e-mail or postal delivery. Phone orders are preferred and receive priority processing.
Legislative Attorney
Kate M. Manuel
Legislative Attorney
This report provides an overview of the Small Business Administration’s (SBA’s) Minority Small Business and Capital Ownership Development Program. Based upon authorities given to the SBA by Sections 7(j) and 8(a) of the Small Business Act of 1958, as amended, this program is commonly known as the “8(a) Program.” The 8(a) Program provides participating small businesses with training, technical assistance, and contracting opportunities in the form of setasides and sole-source awards. A “set-aside” is an acquisition in which only certain contractors may compete, while a sole-source award is a contract awarded, or proposed for award, without competition. Eligibility for the 8(a) Program is generally limited to small businesses “unconditionally owned and controlled by one or more socially and economically disadvantaged individuals who are of good character and citizens of the United States” that demonstrate “potential for success.” However, small businesses owned by Indian tribes, Alaska Native Corporations (ANCs), Native Hawaiian Organizations (NHOs), and Community Development Corporations (CDCs) are eligible for the 8(a) Program under somewhat different terms. In FY2008, 9,462 firms participated in the 8(a) Program, and the federal government spent $6.3 billion on contracts with 8(a) firms.
The report surveys the historical development of the 8(a) Program, as well as the legal requirements presently governing (1) eligibility for the 8(a) Program, (2) set-asides and solesource awards under Section 8(a), and (3) related matters. It also discusses potential developments in the 8(a) Program in light of recently proposed legislation, changes in executive branch policies, and legal challenges. It includes the changes that SBA proposed to the regulations governing the 8(a) Program on October 28, 2009. The 8(a) Program is not the only contracting program for small businesses. There are similar programs for women-owned small businesses, Historically Underutilized Business Zone (HUBZone) small businesses, servicedisabled veteran-owned small businesses, and small businesses not belonging to any other category.
The 111th Congress has enacted legislation (P.L. 111-118) that would allow the Department of Defense to convert functions to performance by certain 8(a) firms without conducting the publicprivate competitions normally required under Office of Management and Budget Circular A-76. It is also considering bills that would modify various aspects of the 8(a) Program or otherwise promote contracting with 8(a) firms (e.g., H.R. 456, H.R. 2200, H.R. 2299, H.R. 2682, H.R. 3771, H.R. 4220, H.R. 4253, H.R. 4818, H.R. 4842, H.R. 4929, H.R. 5010, H.R. 5013, H.R. 5109, H.R. 5136, H.R. 5590, S. 1167, S. 2862, S. 3429, S. 3444, S. 3458).
Date of Report: October 14, 2010
Number of Pages: 40
Order Number: R40744
Price: $29.95
Follow us on TWITTER at http://www.twitter.com/alertsPHP or #CRSreports
Document available via e-mail as a pdf file or in paper form.
To order, e-mail Penny Hill Press or call us at 301-253-0881. Provide a Visa, MasterCard, American Express, or Discover card number, expiration date, and name on the card. Indicate whether you want e-mail or postal delivery. Phone orders are preferred and receive priority processing.
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