SBA Suggests Three Pages or Fewer for Social Disadvantage Narratives–But Really?

SBA guidance on Certify.SBA.Gov suggests that an 8(a) Program applicant’s social disadvantage narrative should be “three pages or less.” While we are definitely in the habit of recommending small business contractors to follow SBA’s guidance most of the time, we simply cannot climb aboard the “three-page” ship. In fact, we have significant concerns that submitting a one to three page narrative could potential “sink” your 8(a) application (at a minimum, requiring you to make extensive and time-consuming revisions later on).

For those of you unfamiliar, any applicant for SBA’s 8(a) Business Development Program that is not part of a designated group that SBA presumes to be socially disadvantaged under 13 C.F.R. § 124.103 must submit a “social disadvantage narrative” as part of its application. Socially disadvantaged individuals, according to SBA “are those who have been subjected to racial or ethnic prejudice or cultural bias within American society because of their identities as members of groups and without regard to their individual qualities[,]” which “must stem from circumstances beyond their control.”

Section B of SBA’s social disadvantage regulation lists the designated groups that SBA presumes to be socially disadvantaged, including Black Americans, Hispanic Americans, Native Americans, and Asian Pacific Americans, among many others. While Section C provides the alternative method for establishing social disadvantage, stating:

An individual who is not a member of one of the groups presumed to be socially disadvantaged in paragraph (b)(1) of this section must establish individual social disadvantage by a preponderance of the evidence. Such individual should present corroborating evidence to support his or her claim(s) of social disadvantage where readily available.

Section C of the regulation then goes on to provide a litany of requirements for establishing social disadvantage via one of these narratives. To supplement these regulatory requirements, SBA has also provided further guidance on social-disadvantage narrative-writing via its 8(a) Application Helpful Tips Slides, Standard Operating Procedure for the Office of Business Development, 8(a) application guidance on Certify.SBA.Gov, and various other policy statements. To top it all off, providing even more guidance on SBA’s standards for these narratives are the many years of SBA Office of Hearings and Appeals (OHA) decisions reviewing initial 8(a) Program denials on the basis that the narrative failed to establish social disadvantage for one reason or another.

While we are not going to run through all of the rules and standards from each of these sources here, check out our previous blog on drafting these narratives, as well as our YouTube tutorial on the subject, for more detailed information about SBA’s and SBA OHA’s standards and requirements.

For the purposes of this blog, it will suffice to understand that, in order to meet all of SBA’s rules and standards, these narratives must be extensively detailed and highly formulaic. SBA has a long list of requirements, not just for the narrative in general, but also for each incident of social disadvantage alleged. And you generally need several incidents to establish social disadvantage.

In a nutshell, to meet the “preponderance of the evidence” standard of review, the applicant has to show a “pattern of discrimination” and “chronic” (or constantly recurring) social disadvantage–indicating that one or two instances isn’t going to cut it. SBA also asks for instances that occurred during the applicant’s education, employment, and/or business history. While SBA guidance says that failure to provide instances under all of these categories is not detrimental, it also says: “Evidence relating to all three areas should be addressed, if applicable, to the individual’s case[.]”

But the story doesn’t end there. SBA requires that each alleged incident describe in detail: “When and where each incident occurred”; “Who committed the act”; and “How the incident took place[.]” Additionally, SBA requires, for each instance of social disadvantage, that the applicant include sufficient “facts and evidence that by themselves establish that the individual has suffered social disadvantage that has negatively impacted his or her entry into or advancement in the business world.” This means that every single instance of alleged discriminatory conduct must be accompanied by two things in order for the instance to qualify as social disadvantage: (1) a detailed explanation of the negative impact the instance had on the applicant’s entry into or advancement in the business world; and (2) an explanation for why the applicant believes or knows that the incident was motivated by bias. In SBA’s own words:

SBA may disregard a claim of social disadvantage where a legitimate alternative ground for an adverse employment action or other perceived adverse action exists and the individual has not presented evidence that would render his/her claim any more likely than the alternative ground.

Based on SBA’s extremely high bar for social disadvantage narratives–which does not even touch on all of SBA’s standards and guidance–we generally anticipate well-written narratives to land in the ballpark of 10-15 pages. This is pretty consistent with our experience in drafting and reviewing these narratives too. So you can imagine our concern with SBA’s guidance on the Certify.SBA.Gov website suggesting that a “[n]arrative should be three pages or less.”

Interestingly, this is the only indication in all of SBA’s regulations and guidance (that we are aware of) that these narratives should be so drastically limited in length. In fact, the three-page maximum suggestion only shows up during the application process itself. It can be found under the “Social Narrative” tab under the “Basis of Disadvantage” section where the applicant ultimately uploads the narrative. This raises a few questions, at least on our end, as to where this guidance is coming from, what it is based on, and what the driving policy is behind it–especially given its apparent contradiction to the rest of SBA’s rules and guidance on social disadvantage narratives. And frankly, until we hear more on this “suggestion,” or SBA provides really any other guidance to support it, we remain skeptical about it.

In the end, applicants should keep in mind that these social disadvantage narratives are very much the make-or-break for many 8(a) applications. As such, in drafting and reviewing these narratives here at Koprince, we prioritize (above all else) providing: (i) a sufficient amount of instances to demonstrate chronic social disadvantage; (ii) enough detail to establish discrimination/bias as the cause of each; and (iii) a thorough and developed analysis of the long term impact of each. While we will never recommend that anyone ignore the SBA’s guidance, we will caution our 8(a) applicant readers out there to be careful in prioritizing a “short” narrative over any of these components (or any other SBA rules and guidance). If you have ever applied to the 8(a) Program yourself or know someone who has, you will likely know that SBA is notorious for requesting more detail and more information–very rarely does it ask you for less. Keep that in mind.

Interested in utilizing our expertise in writing one of these social disadvantage narratives or reviewing one prior to submission, or needing general help with the 8(a) Program or any other government contracting legal matter? Email us or give us a call at 785-200-8919.

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