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SBA Rule Creates New Opportunities for Women-Owned Businesses

February 3, 2011

Effective February 4, 2011, women-owned small business will have a better shot at securing government contracts. The Small Business Administration has authorized a set-aside of federal contracts for women-owned small businesses. The set asides relate to manufacturing projects under $5 million and other contracts that are $3 million or less in amount, if certain conditions are met.

The new program comes after an SBA-commissioned study from the Kauffman-RAND Foundation (referred to as “the RAND Report,” published in 2007) found that women-owned businesses were underrepresented or “substantially underrepresented” in 83 industries. It is hoped that the new program will help the federal government meet its existing goal of having women-owned businesses fill at least 5 percent of federal contracts.

To be eligible, a business must be at least 51 percent owned by women and managed by one or more women. The women must also be U.S. citizens.

A previous version of the program required that each federal agency certify that it had engaged in discrimination against women-owned small business in order for the program to apply to that agency. That requirement does not exist in the final program.

Please contact Fred Schubkegel (800-262-0011; flschubkegel@varnumlaw.com) or your Varnum attorney contact if you have questions or would like assistance with this new program.

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