Many of the SBA’s small business programs have restrictions on what are commonly referred to as “extraordinary circumstances” or “extraordinary actions.” It’s a topic that we have discussed many times before, including this blog post discussing a case at SBA’s Office of Hearings and Appeals, reviewing extraordinary circumstances in the context of control and operating agreements. SBA often discusses extraordinary circumstances in the context of joint venture control, where the managing venturer must control decisions except for those considered to be extraordinary. But there is a different meaning in the context of an entity seeking certification under an SBA socioeconomic program, where the qualifying individual must have control over all actions and circumstances except for those determined to be extraordinary. This post will focus on the latter situation. And, as any knowledgeable small business federal government contractor can attest to, knowing what actions are and are not extraordinary, is very important to maintain eligibility for the SBA’s programs.
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Back to Basics: WOSB Eligibility
To level the playing field for women business owners, the Federal Government limits competition for certain contracts to businesses participating in SBA’s Women-Owned Small Business (“WOSB”) Federal Contracting Program. Ideally, those contracts are for specific industries where WOSBs are historically underrepresented. And in fact, the Government even has certain WOSB contracting goals to encourage such set-asides. So, its easy to see why the WOSB Program can be a great opportunity for small businesses to get a leg up in the federal contracting world. But don’t let the name fool you, it takes more than just woman-ownership to get in–and stay in. Let’s take a closer look at SBA’s requirements for becoming certified under the WOSB Program.
Continue readingOHA: Owners Did Not Have Enough Managerial Experience to Qualify Concern as a WOSB
SBA’s socio-economic set-aside programs mandate compliance with multiple control requirements. An important one stipulates that a woman owner of a WOSB (or a veteran for a SDVOSB or a disadvantaged owner for an 8(a) business) must have the “managerial experience of the extent and complexity to run the concern.”
But what, exactly, does this requirement entail? A recent OHA case provides some important guidance.
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