The Small Business Administration (SBA) has issued several new rules over the past year, changing rules on how small businesses participate in the government market.  Many of SBA’s changes were driven by court cases, some of which were prominent, but others of which flew below most peoples’ radar.  Here are three changes that small, and even large, contractors need to know about.

1.  Proposed Changes to the 8(a) program:  A proposed rule issued in December by the SBA revises applicable rules to clarify that a Certificate of Competency would not be applicable to sole source 8(a) awards, states that the SBA must accept BPA’s awarded to 8(a) companies, and modifies eligibility criteria for sole source 8(a) awards.

2.  Service-Disabled Veteran Owned Business (SDVOSB) Changes:  Veterans seeking to establish their companies as SDVOSB’s must first go to the Department of Veterans Affairs to obtain certification of a service-related disability and then go to the SBA to get certification that their company meets SDVOSB eligibility requirements.  The intent is to ensure that SDVOSB’s are vetted as legitimate companies, but the new two-step requirement may slow approvals, especially since the VA has a backlog of disability certification requests.  The overall SDVOSB contract goal also gets a bump for 2024 from 3% to 5% of all small business awards.

3.  Revisions to Limitations on Subcontracting Rules:  The SBA is proposing to modify FAR 19.505(b)(1) to make clear that only one of the limitations on subcontracting apply to a contract.  In addition, the agency wants to modify FAR 19.505(b)(1)(i) to permit the exclusion of other direct costs that are not the principal purpose of the contract, and are not performed by small businesses, from the limitations on subcontracting requirements for a service contract.  The intent is to provide small businesses with more flexibility and, for a change, fewer rules.  The changes in the small business arena are just one example of how the government procurement marketplace continues to evolve.

Companies may want to keep an eye on these changes lest they discover one day that their path to government business contains more speed bumps.