House Passes Bill Supporting Women’s Business Centers

In a slew of recent activity, H.R.4405, the Women’s Business Centers Improvements Act of 2019, sponsored by Rep. Sharice Davids (D-KS) and Rep. Jim Hagedorn (R-MN), was one of many bills to pass the House of Representatives. Most notably, the bill doubles the available grant monies for each Women’s Business Center (“WBC”) and introduces an accreditation program for WBCs. These components, if approved, will help WBCs better serve women-owned businesses across the nation. This post will also highlight some aspects of this already helpful resource.

First, a little background about this program. The SBA first introduced WBCs (albeit under a different name) in 1988 “to better help women overcome continuing barriers to success.” Since their introduction, WBCs have taken on a larger role in 122 communities across the nation. For example, Kansas City’s WBC is an “engine of empowerment for women entrepreneurs” offering assistance on everything from initial funding and startup to exporting goods and services. The national Association of Women’s Business Centers, which supports WBCs across the nation, wholeheartedly endorses H.R.4405.

Possibly the most important aspect of H.R.4405 is the doubling of available grant funding. Until 2007 there was not a statutory dollar amount allocated for WBC grants. On May 25, 2007, in Public Law 110-28, Congress established a $150,000 cap on annual grants to WBCs. This was a static cap and did not increase with inflation or any other consumer or market indexes. According to the Bureau of Labor Statistics, what you could buy for $150,000 in 2007 would cost you more than $185,000 in September 2019.

H.R.4405 significantly changes available WBC grant funding by increasing the annual grant limit to $300,000. This annual amount applies to both the initial grant and continuation grants. The initial grant is for a 5-year term and the continuation grants are also 5 years each. Under H.R.4405 there is “no limitation on the number of continuation grants an eligible entity may receive[.]”

To be eligible for the initial grant, H.R.4405 requires a thorough application demonstrating how the WBC would effectively administer both external training operations as well as internal accounting, reporting, and general back-office tasks. Importantly, the applicant must describe its ability to obtain matching funds as required by H.R.4405. Briefly, WBCs must agree to obtain $1 of non-Federal funding for every $2 of Federal funding in the first two years of the grant and then $1 of non-Federal funding for every $1 of Federal funding in each subsequent year.

The second significant change comes through introduction of an accreditation process for WBCs. While WBCs have always been administered under the SBA, there has not previously been a uniform accreditation process to become a WBC or be eligible for grant funding. H.R.4405 changes this by requiring SBA to introduce accreditation requirements.

The impact of the accreditation process will not be known until SBA publishes the accreditation standards. H.R.4405 mandates SBA publish standards for the program within 270 days of the bill becoming law. No matter the accreditation procedure, receipt of grant funds will require a WBC be accredited.

While H.R.4405 represents a big change for WBCs, there are two key takeaways for our readers. First, this bill is not yet law. It has only passed the House and is currently awaiting action in the Senate. Updates on this, and any other, bill can be found at Congress.gov.

Second, this bill does not impact the women-owned small business (“WOSB”) set-aside regulations. If you are unfamiliar with women-owned small business set-asides here are a couple of introductory blogs for you (here and here). This does not mean that WOSBs will not benefit from this bill. WBCs can be a valuable resource for WOSBs, regardless the type of work or contract set-aside at issue.

As mentioned, this bill has only passed the House and awaits review in the Senate. We encourage you to contact your local Representative or Senators and let them know your thoughts on the bill. We also encourage you to stay tuned for more news on H.R.4405. Even if the bill becomes a law, there is still the regulatory process where SBA will need to describe its accreditation process. As with bills before Congress, agencies also solicit feedback as they draft and finalize the regulations.

We will make sure to update you as things progress, so keep an eye on smallgovcon.com.

Questions about this post? Email us or give us a call at 785-200-8919.