WOSB and EDWOSB WOSB and EDWOSB Set-aside Performance Set-aside Performance

IssuesIssues

Dave Pease Dave Pease

NH-PTAPNH-PTAP

October 28, 2011October 28, 2011

WOSB & EDWOSB Set-Asides:WOSB & EDWOSB Set-Asides:How were we doing?*How were we doing?*

172 Solicitations Set-Aside172 Solicitations Set-Aside

74 Different NAICS Codes74 Different NAICS Codes

Lots of confusion, few awards (so far).Lots of confusion, few awards (so far).

*8/24/11*8/24/11

A Rocky start….A Rocky start….7979/172 (46%) were OK.172 (46%) were OK.9393/172 (54%) have problems.172 (54%) have problems.

18 different 18 different non-allowednon-allowed NAICS (25 NAICS (25/172 or 172 or 15%)15%)

65/172 (38%) set-aside for WOSB under EDWOSB-only NAICS

33/172 (2%) set aside for EDWOSB under 172 (2%) set aside for EDWOSB under WOSB-only NAICS.WOSB-only NAICS.

The GOOD NewsThe GOOD News

Contract Officers throughout the Contract Officers throughout the government are trying to set aside government are trying to set aside contracts for women.contracts for women.

They are doing so in many fields of They are doing so in many fields of business.business.

Non-Manufacturer RuleNon-Manufacturer Rule Nonmanufacturer Rule RemindersNonmanufacturer Rule Reminders The NMR does not apply to service contracts. The NMR is an The NMR does not apply to service contracts. The NMR is an

exception to the manufacturing performance requirements exception to the manufacturing performance requirements (limitations on subcontracting) applicable to supply contracts. (limitations on subcontracting) applicable to supply contracts. Service and construction contracts have different performance Service and construction contracts have different performance requirements. See 13 CFR § 125.6; FAR §§ 19.102(f), 19.502-2(c).requirements. See 13 CFR § 125.6; FAR §§ 19.102(f), 19.502-2(c).

You will designate the proper NAICS code and size standard in the You will designate the proper NAICS code and size standard in the solicitation, selecting the NAICS code which best describes the solicitation, selecting the NAICS code which best describes the principal purpose of the product or service being acquired. Primary principal purpose of the product or service being acquired. Primary consideration is given to the industry description in the NAICS, the consideration is given to the industry description in the NAICS, the product or service description in the solicitation and any product or service description in the solicitation and any attachments to it, the relative value and importance of the attachments to it, the relative value and importance of the components of the procurement making up the end item being components of the procurement making up the end item being procured, and the function of the goods or services being procured, and the function of the goods or services being purchased.purchased.

You cannot assign a wholesale or retail trade to NAICS code to a procurement for supplies.

The BAD NewsThe BAD News

Contracting Officers are very, very Contracting Officers are very, very confused.confused.The core problem is that they don’t The core problem is that they don’t

understand the separation between EDWOSB understand the separation between EDWOSB and WOSB NAICS codes.and WOSB NAICS codes.

The documentation is poor. However, it’s The documentation is poor. However, it’s easy to fix with a simple labeling change.easy to fix with a simple labeling change.

Update October 2011Update October 2011

Two more months have passed. Has Two more months have passed. Has performance improved?performance improved?

Examined 100 most recent postings in Examined 100 most recent postings in FedBizOpps that were WOSB or FedBizOpps that were WOSB or EDWOSB set-asides.EDWOSB set-asides.

Methodology not strict – may be some Methodology not strict – may be some double counting – but it’s a good sample.double counting – but it’s a good sample.

Still very rocky ….Still very rocky ….4141/100 (41%) were OK.100 (41%) were OK.5959/100 (59%) have problems.100 (59%) have problems.

46% set-aside for WOSB under EDWOSB-only NAICS

11% 11% non-allowednon-allowed NAICS NAICS 2% set aside for EDWOSB under WOSB-only 2% set aside for EDWOSB under WOSB-only

NAICS.NAICS.

What are the Problems?What are the Problems?

Many Contract Officers may not understand Many Contract Officers may not understand distinction between EDWOSB and WOSB.distinction between EDWOSB and WOSB.

Poor grasp of which NAICS codes permit set-Poor grasp of which NAICS codes permit set-asides for each category.asides for each category.

Is SBA documentation clear?Is SBA documentation clear? Is training adequate?Is training adequate? Is motivation adequate?Is motivation adequate?

Documentation ProblemDocumentation Problem

SBA uses terms “underrepresented” and SBA uses terms “underrepresented” and “substantially underrepresented”.“substantially underrepresented”.

These are terms of art from the rulemaking These are terms of art from the rulemaking process, and were necessary concepts for process, and were necessary concepts for assigning NAICS codes that would be assigning NAICS codes that would be associated with EDWOSB & WOSB set-associated with EDWOSB & WOSB set-asides.asides.

Once the NAICS code associations were made, Once the NAICS code associations were made, these terms these terms increased potential confusion and increased potential confusion and engendered a lack of clarityengendered a lack of clarity..

SolutionSolution

Get rid of them!Get rid of them!SBA replaced the confusing 18-page SBA replaced the confusing 18-page

NAICS list with a clear spreadsheet in mid-NAICS list with a clear spreadsheet in mid-August.August.

The Contracting Officer’s Guide to the The Contracting Officer’s Guide to the WOSB Program has not been updated.WOSB Program has not been updated.

Still need better tools to make this easy to Still need better tools to make this easy to get right, hard to mess up.get right, hard to mess up.

What We Tell Small Businesses -What We Tell Small Businesses -Stay tuned & be patient – progress is Stay tuned & be patient – progress is

being made.being made.Check solicitation NAICS code Check solicitation NAICS code

assignments assignments veryvery carefully. Protest if you carefully. Protest if you are being unfairly excluded. Use NH-PTAP are being unfairly excluded. Use NH-PTAP and SBA for assistance.and SBA for assistance.

Monitor set-aside solicitations for changesMonitor set-aside solicitations for changes

Conclusion!Conclusion!

The program is off to an enthusiastic start.The program is off to an enthusiastic start.Everyone needs to learn how to use the Everyone needs to learn how to use the

program correctly.program correctly. It’s not rocket science – it will smoothe out It’s not rocket science – it will smoothe out

and operate as intended. Eventually.and operate as intended. Eventually.