SBA 8(a) Program - How to maximize this powerful tool!

Updated: Nov 27, 2018

Out of the nearly 30 Million companies that are registered with the SBA only a third are considered 'minority owned,' Many business owners believe that the key to being a successful 8(a) firm is that you have to be a minority, this is not necessarily true. Find out how you may be eligible, moreover how to exploit section 8(a) of the Small Business Act to your benefit by reading this Blog -






What is the 8(a) program?


The 8(a) program name is from Section 8(a) of the Small Business Act. The Act, as amended by Congress, created the 8(a) program so the U.S. Small Business Administration (SBA) could help small companies owned and operated by socially and economically disadvantaged persons develop their businesses.


One of the business development tools of the 8(a) program is the award of Federal contracts. Under the program, SBA acts as a prime contractor and enters into contracts with other Federal Government departments and agencies. In its role as a prime contractor, SBA awards subcontracts for their performance by certified companies.


Maximizing the 8(a) Program –

This program is perhaps the most powerful, yet under utilized business development tool available to socio-economic disadvantaged small businesses. Moreover, in our experience we’ve witnessed countless companies that do not market nor leverage this program to the maximum extent practicable. Federal Government Experts (FGE) has a proven track record of securing 8(a) certifications for small businesses. Moreover, our firm is more than just routing and staffing your package for success; we are have developed a proven process to effectively market your 8(a) status, and capture work that makes the initial time and investment of this process well worth it. The typical 8(a) experiences significant growth between years 2 through 7 while in the program; however, the typical 8(a) firm starts to approach a regression toward end of year 7. The SBA publishes its annual report on the program each yet, and lauds its ‘growth and expansion of small businesses,’ however, the fact of the matter is nearly 50% of the companies who are 8(a) graduates become financially insolvent within 5 years of exiting the program.


FGE’s process aides’ clients in understanding the entire program. We provide insight and prudent training to sustain company growth and capture business opportunities that yield residual revenue streams by collaborative partnerships with government agencies as well as other businesses. We embody an ‘agile’ process methodology which adapts with your company as your continue to growth and navigate the federal market place.



How do I apply to the 8(a) program?

The first step in seeking certification with the 8(a) program is to have a thorough understanding of what the program is, how it operates and more importantly how you can benefit from it. Our experts at FGE – will liaise this process between your company and the SBA.


We will contact the local SBA office on your behalf, and aide in drafting, developing and ultimately ascertaining the certification on your behalf. Our client advisor(s) will answer all questions you may have prior, during and after the process concludes. Moreover, there are over 20 forms and numerous background, financial documents necessary to complete this process – our process provides you with a streamline approach and simple check list(s) that alleviate the need for you to dedicate your resources in the preparation of the documentation.


The following forms and documentation are required to be submitted for an eligibility determination:


1. SBA Form 1010A, 8(a) Personal Eligibility Statement

2. SBA Form 1010B, Business Eligibility Statement

3. SBA Form 413, Personal Financial Statement

4. SBA Form 912, Statement of Personal History

5. SBA Form 4506, Request for Copy of Transcript of Tax

6. SBA form 1623, Certification Regarding Debarment, Suspension and Other Responsibility Matters

7. FD 258, Fingerprint Card (if indicated)

8. Business Organization Information

9. Federal Income Tax Returns (personal and business)

10. Business Financial Statements

11. History of the Business

12. Organization Chart

13. Resumes

14. Financing Arrangements

15. Bonding Information

16. Arrangements for Business Premises

17. Arrangements for Business Equipment

18. Licenses

19. Management, Consulting or Other Agreements

20. Schedule of Business Insurance

21. Information Regarding Affiliates


Do I need someone to prepare my 8(a) application package? Will I increase my chances of being approved if I use a specific business consultant?

While there is NO need to hire a consultant to prepare and submit this application packet for you, we’ve encountered companies who have spent well over 6 months of their time and nearly $50,000 of billable hours and were not successful in securing the 8(a) certification.


Who are socially and economically disadvantaged individuals?

Socially disadvantaged individuals are those who have been subjected to racial or ethnic prejudice or cultural bias because of their identities as members of groups without regard to their individual qualities. The social disadvantage must stem from circumstances beyond their control. In the absence of evidence to the contrary, the following individuals are presumed to be socially disadvantaged: Black Americans; Hispanic Americans; Native Americans (American Indians, Eskimos, Aleuts, and Native Hawaiians); Asian Pacific Americans (persons with origins from Japan, China, the Philippines, Vietnam, Korea, Samoa, Guam, U.S. Trust Territory of the Pacific Islands [Republic of Palau], Commonwealth of the Northern Mariana Islands, Laos, Cambodia [Kampuchea], Taiwan; Burma, Thailand, Malaysia, Indonesia, Singapore, Brunei, Republic of the Marshall Islands, Federated States of Micronesia, Macao, Hong Kong, Fiji, Tonga, Kiribati, Tuvalu, or Nauru; Subcontinent Asian Americans (persons with origins from India, Pakistan, Bangladesh, Sri Lanka, Bhutan, the Maldives Islands or Nepal); and members of other groups designated from time to time by the SBA.


In addition, an individual who is not a member of one of the above-named groups may apply for 8(a) certification. (i.e. members of non-minority or disadvantaged concerns) are eligible for 8(a) certification – however, must prove disadvantaged category through documented incidents.


Economically disadvantaged individuals are socially disadvantaged individuals whose ability to compete in the free enterprise system has been impaired due to diminished capital and credit opportunities, as compared to others in the same or similar line of business and competitive market area who are not socially disadvantaged. For purposes of program entry, an individual whose personal net worth (excluding the equity in their personal residence and business) exceeds $250,000 will not be considered economically disadvantaged.


Can a woman-owned business be certified as an 8(a) firm?

A woman-owned business may be recognized as a "socially disadvantaged firm" if the owner is a member of one of the groups for which social disadvantage is presumed.


FGE’s experience has been successful in securing 8(a) certification for women owned businesses – provided that the WOSB is not a member of one of the groups for which social disadvantage is presumed, she must establish her individual disadvantage on the basis of clear and convincing evidence that she has suffered discriminatory treatment because of her gender and that this treatment has impeded her entry into or advancement in the business world.


SBA will consider any pertinent evidence but will give particular attention to evidence of discriminatory practices suffered in the areas of education, employment and the business world.


What is a SIC code?

A SIC code is the Standard Industrial Classification number listed in the Standard Industrial Classification Manual which is published by the Office of Management and Budget. SIC codes are used by the Federal Government to identify and classify specific categories of business activity that represent the primary line of business of a firm. SBA size standards are based on SIC codes.


What is the SBA's definition of a small business?

SBA defines a small business as one that is independently owned and operated and is not dominant in its field. Depending on the industry, size standard eligibility is based on the average number of employees for the preceding 12-months or on sales volume averaged over a three-year period. Examples of SBA general size standards include the following:

 Manufacturing:

 Maximum number of employees may range from 500 to 1500, depending on the type of product manufactured.

 Wholesaling:

 Maximum number of employees may not exceed 100.

 Services:

 Annual receipts may not exceed $2.5 to $21.5 million, depending on the particular service being provided.

 Retailing:

 Annual receipts may not exceed $5.0 to $21.5 million, depending on the particular product being provided.


 General & Heavy Construction:


 General construction annual receipts may not exceed $13.5 to $17 million, depending on the type of construction.

 Special Trade Construction:


 Annual receipts may not exceed $7 million.

 Agriculture:


 Annual receipts may not exceed $0.5 to $5.0 million, depending on the agricultural product.


If my grandmother was a member of one of the ethnic groups designated by 13 C.F.R. 124.105(a)(i.e. Native American), does that automatically make me a member of that ethnic group?

No. You must personally identify yourself with the group culturally, socially and/or racially. It is not enough that your grandmother identified herself as Native American, since your identification with a particular group is in question and not that of your grandmother.


Are Portuguese-Americans presumed to be socially disadvantaged?

Yes. SBA defines "Hispanic American" to include among others, individuals whose origins are from the Iberian peninsula, which encompasses Portugal and Spain.


Do I have to be in business for two years in order to be eligible for the 8(a) program?

Normally yes. However, FGE can secure a waiver of the two-year rule may be granted if a company meets certain criteria. The waiver criteria are:

1. the individual(s) upon whom eligibility is to be based must have substantial and demonstrated business management experience;

2. the applicant must have demonstrated technical expertise to carry out its business plan with a substantial likelihood for success;

3. the applicant must have adequate capital to carry out its business plan;

4. the applicant must have a record of successful performance on contracts from governmental and non-governmental sources in the primary industry category in which the applicant is seeking program certification; and

5. the applicant must have or be able to demonstrate the ability to obtain the personnel, facilities, equipment and any other requirements needed to perform the contract.


How long does the 8(a) application process take?


On average we have seen individuals submission take anywhere from 120 – 180 days, and with multiple revisions throughout the submission process. FGE typically secures these certifications within 45 – 60 days.


By Statute - The DPCE has 15 days to review the application for completeness. If the application is incomplete, the applicant will have 15 days to provide additional information. The application will then be resubmitted to the regional DPCE. If the DPCE determines the application is complete, a final decision regarding 8(a) Program eligibility should be made within 90 days of SBA's determination that the application is complete.


What rights do I have if my application is declined?

Each program applicant has the right to request that SBA reconsider a declined application. During the reconsideration process, the applicant may submit additional or changed information. If an application is declined after reconsideration, a new application will not be accepted until twelve months from the date of the reconsideration decision.


In addition, if an applicant is declined solely on issues of social disadvantage, economic disadvantage, ownership and/or control, the declined applicant may appeal the decline decision to SBA's Office of Hearings and Appeals (OHA). OHA examines the decline decision only to see if it were arbitrary, capricious or contrary to law. No new or changed information will be considered during the appeal process.


Should your 8(a) certification packet be declined – FGE will provide you with a draft statement for rebuttal and work with your company’s legal counsel throughout the process.


After a company is 8(a) certified, how long does it take before its first contract is awarded?

A newly certified firm is not eligible for 8(a) contracts until it submits and receives SBA approval for its business plan.


After the firm has an approved plan, the length of time before the first 8(a) contract is awarded will vary based on the success of the firm's marketing efforts. While SBA will make every effort to assist a firm with its marketing efforts, the 8(a) program is a self-marketing program and SBA cannot guarantee 8(a) contract awards.


FGE helps provide assistance to firm(s) in developing your business plan concurrently throughout the submission process.


Explain the business plan requirement.

Promptly after certification, a program participant must submit a business plan which must be approved by a SBA Business Opportunity Specialist (BOS) prior to the program participant being eligible for 8(a) program benefits. The submitted plan must include the following data:

 An analysis of market potential.

 An analysis of the program participant's strengths and weaknesses.

 Specific targets, objectives and goals for business development.

 A transition management plan.

 Estimates of contract awards pursuant to section 8(a), and from other sources.

In addition, each program participant must annually review its currently approved business plan with its SBA BOS and forecast its needs for contract awards under section 8(a) for the next program year.


How long can a company participate in the 8(a) program?

Program participation is divided into two stages: The developmental stage and the transitional stage. For firms approved for 8(a) program participation after November 15, 1988, the developmental stage is four-years and the transitional stage is five-years.

The developmental stage is designed to help 8(a) certified firms overcome their economic disadvantage by providing business development assistance.

The transitional stage is designed to help participants overcome the remaining elements of economic disadvantage and to prepare participants for leaving the 8(a) program.


What types of assistance are available to 8(a) program participants?

The type of assistance available to a program participant is dependent on its stage of development. FGE provides Federal Acquisition (Contracting) training to each client as a part of the engagement.


The following assistance is available to eligible program participants during the developmental stage:

 Sole source and competitive 8(a) contract support.

 The transfer of technology or surplus property owned by the United States to program participants by grant.

 Training sessions to enhance program participant's skills in the area of business principles.

The following assistance is available to eligible program participants during the transitional stage:

 Sole source and competitive 8(a) contract support.

 The transfer of technology or surplus property owned by the United States to program participants by grant.

 Training sessions to enhance program participant's skills in the area of business principles.

 Assistance from procuring agencies in forming joint ventures.

 Training and technical assistance in business planning to help ensure the firm's successful transition from the 8(a) program to the competitive market.


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