| Q: A friend told me that as a woman of
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| | businesses; 5 percent of prime and
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| Native American descent I might be
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| | subcontracts for women-owned small
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| eligible for a special SBA program that
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| | businesses; 3 percent of prime contracts
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| will help me start a small business. He
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| | for HUBZone small businesses; and 3
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| said I could compete for government
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| | percent of prime and subcontracts for
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| contracts through this program. Can you
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| | service-disabled veteran-owned small
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| tell me what SBA program he's referring
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| | businesses.
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| to?
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| | A HUBZone (Historically Underutilized
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| -- Clara P.
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| | Business Zone) is a designated area
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| A: Your friend is probably referring to
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| | within urban and rural communities that
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| the Small Business Administration's (SBA)
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| | has been given preferential contract
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| 8(a) Business Development (BD) Program.
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| | award consideration in an effort to
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| The 8(a) Program (named after the section
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| | stimulate economic development. A company
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| of the Small Business Act from which it
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| | may qualify for HUBZone status if it is
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| comes) is an SBA program created to help
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| | owned or controlled by one or more U.S.
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| small disadvantaged businesses better
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| | citizens, has at least 35 percent of
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| compete in the U.S. marketplace and
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| | employees who live within the designated
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| within the arena of government
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| | zone, and has a principal office located
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| procurement. The SBA provides business
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| | there. HUBZones are a whole 'nother topic
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| development, technical assistance and
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| | that we can discuss at another time.
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| other services to the small businesses
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| | Suffice it to say that a company that
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| that are accepted into the 8(a) program.
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| | obtains both 8(a) and HUBZone status may
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| The 8(a) program is reserved for what the
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| | be entitled to double dip in the
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| SBA calls "socially disadvantaged
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| | government procurement trough, that's why
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| individuals." Socially disadvantaged
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| | you often find a number of 8(a) companies
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| individuals are defined as those who have
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| | specifically moving into HUBZone areas to
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| been subjected to racial or ethnic
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| | take advantage of the perks both programs
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| prejudice or cultural bias because of
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| | offer.
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| their membership in a disadvantaged
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| | The U.S. government purchases billions of
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| group.
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| | dollars in goods and services every year,
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| The SBA has designated the following
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| | everything from staples to those
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| groups as socially disadvantaged:
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| | wonderfully expensive toilet seats.
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| Black Americans Hispanic Americans
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| | Obtaining 8(a) status allows small
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| Native Americans (Native American
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| | businesses to compete for a portion of
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| Indians, Eskimos, Aleuts, and Native
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| | that business.
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| Hawaiians) Certain Asian Pacific
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| | The basic requirements for applying for
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| Americans Other individuals who can
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| | 8(a) status are your company must be a
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| prove that they meet the SBA's criteria
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| | small business as defined by the SBA,
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| to be considered socially disadvantaged
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| | must be owned and controlled by one or
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| One point where your friend is incorrect
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| | more socially and economically
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| is that the 8(a) program is for new
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| | disadvantaged individuals who are U.S.
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| companies. The 8(a) program is primarily
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| | citizens, and must show a potential for
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| for companies that have been in business
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| | success. The SBA defines a small business
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| for a minimum of two years, though that
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| | as "one that is independently owned and
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| rule may be waived if your company is
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| | operated, is organized for profit, and is
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| able to meet some pretty strict
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| | not dominant in its field."
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| management, financial, and performance
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| | As expected, the 8(a) program has its
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| criteria.
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| | fans and its detractors. It's fans are
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| Obtaining 8(a) status is no guarantee
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| | those companies that obtain 8(a) status
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| that a company will be successful in
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| | and thereby get preferential treatment
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| obtaining government or other contracts,
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| | when competing for government procurement
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| but it certainly doesn't hurt. The Small
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| | contracts.
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| Business Act mandates that all small
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| | The program's detractors are typically
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| businesses have the opportunity to
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| | those companies that fail to obtain 8(a)
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| provide goods and services to the U.S.
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| | status or that do not meet the definition
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| government. To help ensure that mandate,
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| | of socially disadvantaged, i.e.
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| the SBA negotiates annual procurement
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| | businesses owned my white American males
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| preference goals with every Federal
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| | (that's a can of worms we won't open this
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| agency and reviews each agency's results
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| | week).
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| to make sure the goals were met.
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| | You can learn more at the SBA's website
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| The statutory goals are: 23 percent of
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| | (sba.gov) or by calling your local SBA
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| all prime contracts go to small
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| | office.
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| businesses; 5 percent of prime and
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| | Here's to your success!
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| subcontracts for small disadvantaged
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