Agencies launch initiative to better identify minority-owned contractors

The Biden administration has announced a new initiative to increase federal contracting opportunities for small disadvantaged businesses — orSDBs — as the administration works to direct $100 billion worth of expanded contracting opportunities to historically marginalized firms by 2025.

According to an announcement released on Thursday, the General Services Administration and the Small Business Administration will establish a pool of SDBs participating in the 8(a) Business Development Program to assist the selected firms in gaining enhanced access to federal contracts under GSA's Multiple Award Schedule Program.

Many SDBs and other minority-owned businesses have struggled over the years to develop working relationships with the federal government due to a variety of challenges and roadblocks that stem from institutional hurdles, including competition with well-established firms and instances of larger businesses fraudulently abusing opportunity programs. The SBA's 8(a) program has been recognized for successfully fostering partnerships between the government and SDBs while also providing support to minority-owned businesses seeking federal contracts.

The pool of 8(a) firms will "make it easier for procurement officials to locate and contract with small, disadvantaged businesses across industries," according to the announcement, a practice that has historically been a challenge across the federal government in part due to a lack of centralized resources for identifying and engaging SDBs. 

However, the announcement lacked details regarding acceptance requirements for the pool and how solicitations and contracting opportunities would be further directed to the selected firms. The SBA and GSA did not immediately respond to requests for comment. 

According to Courtney Fairchild, president of the government contracting consulting company Global Services and a GSA Schedule specialist, the success of the initiative will depend on such specifics.

Fairchild told Nextgov/FCW that GSA's MAS vehicle "is a far more efficient way to increase the spend in a shorter time frame,” and added that the SBA and GSA will likely conduct an analysis of individual awards that run through the pool and the dollar value in aggregate awards to help determine the success of the new effort. 

"If successful, I would think the logical next step would be to implement similar MAS Pools for Woman-Owned, HubZone and [service-disabled veteran-owned small businesses] to increase opportunities across all SBA-certified socio-economic groups,” she added. 

Experts also suggested that the SBA and GSA can measure the effectiveness of the program using additional specific metrics, such as the size and scope of available opportunities, the length of engagement and the relevance of North American Industry Classification System codes, which can help determine if the pool successfully recruits firms from a wide array of sectors.

Regardless of the approach taken by the agencies to determine its success, the new program will provide an opportunity "to exhibit the strengths, diversity of thoughts and varied technological capabilities across the SDB community,” according to Earl Stafford, CEO of Aperio Global, an SDB specializing in cybersecurity and artificial intelligence solutions.

"It is essential to understand that SDBs do not lack ability but instead accessibility," Stafford said. "This initiative will produce actionable evidence and promote outcome-based SDB opportunities."

President Joe Biden announced a plan in June 2021 to allocate $100 billion in federal contracting opportunities to SDBs over a five-year period, a nearly 50% increase in set-asides for minority-owned businesses. 

Federal agencies appear on track to meet that goal after setting a record last year when SDBs were awarded $62.4 billion in federal contracts, or at least 11% of all federal contracting opportunities. The Office of Management and Budget later raised contracting goals for all agencies and directed the SBA to award at least 12% of all federal contracts to SDBs in fiscal year 2023.