8(a) owners allowed $750K

Under new net worth rule proposed by SBA

      Small business owners would be eligible for participation in the 8(a) Business Development program as long as their net worth was less than $750,000 under a new proposed rule.

      The current limit is $250,000.

      The SBA is making the change to make the 8(a) net worth limit consistent with the net worth limit for its Economically-Disadvantaged Women-Owned Small Business (EDWOSB) Program.

      Both the 8(a) and the EDWOSB program are for assisting disadvantaged individuals in growing their businesses by obtaining government contracts. Both allow set-asides for companies in the programs.

      In a recent study, the SBA determined that lifting the net worth limit to $375,000 for applicants to the 8(a) program was appropriate to determine disadvantage. However, the study did not consider whether that was appropriate on an ongoing basis for 8(a) participants.

      Another issue was to harmonize the net worth limits for 8(a) and EDWOSB. The EDWOSB program currently has a $750,000 limit.

      “The SBA believes that it is important to have the same economic disadvantage criteria for the 8(a) BD program as for the EDWOSB program, to avoid confusion and inconsistency between the programs,” the proposed rule states.

      SBA considered a $375,000 net worth standard for both 8(a) and EDWOSB, but concluded that it was too low for “participation in the free enterprise system as an economically disadvantaged business owner.” So the SBA proposed $750,000 instead.

      Comments on both the $750,000 proposed net worth limit and on a hypothetical $375,000 limit are sought by July 15.

SBA proposes WOSB cert. rule; Wong says certification staff workload may increase 6-fold

8(a) owners allowed $750K

$334B in DOD contracting fraud

Shutdown hit small biz hard

GSA to host FAST in 2020

SBIR/STTR data rights changing

Column: Corporate Transactions and Affiliation Pitfalls

Washington Insider: