Important News for the Women-Owned Small Business Federal Contract Program
By Amber Reumont
On June 17th, Senator Jeanne Shaheen of New Hampshire introduced the Women’s Small Business Procurement Parity Act with the help of Senators Maria Cantwell of Washington and Kirsten Gillibrand of New York as cosponsors of the bill. The goal of bill S.2481 is to expand the abilities of the Women-Owned Small Business federal contract program. Passing of this bill would be a victory for female entrepreneurs, as it aims to increase accessibility to federal contracts for women-owned small businesses. Currently, the WOSB Federal Contract Program is hindered by the restrictions placed on sole-source authority.
The Women-Owned Small Business federal contract program was created to meet a goal set by the federal government, which aimed to set aside five percent of federal contracting funds to be used for the hiring of women-owned small businesses. To achieve this goal, Congress passed the Women’s Equity in Contracting Act in 2000, which allowed for the construction of the WOSB federal contract program. After many years of stalling under the Bush Administration, the WOSB federal contract program was officially implemented in February of 2011. Due to current law, federal contracts cannot simply be offered to a qualified women-owned small business. Before a contract can be awarded, at least two women owned small businesses must compete for the offer. This is a particularly major flaw of the program, that Shaheen’s bill addresses, because women make up only 30 percent of small business owners. Though a goal of at least five percent was put in place, in 2013 a meager 0.19 percent of federal contracting funds had been awarded to female entrepreneurs.
The bill introduced by Senator Shaheen hopes to remedy the program’s shortcomings and equip it with the tools necessary to better promote women in small business. The most prominent issue with the program, which the bill seeks to eliminate, is the ban on sole source contract awards, otherwise known as ‘no-bid contracts.’ The WOSB federal contract program is the only program with a ban on sole source contract awards. Sole source contracts allow the contract to be given to the only business available if there is no comparable business able to compete. By eliminating such a rule, more women-owned businesses would have an opportunity to acquire federal contracts. Since women-owned businesses make up such a minute sample of small businesses, it is often unrealistic to expect that more than one women-owned business would be able to bid on a federal contract. In addition to the allowance of sole source contract awards, Shaheen’s bill would speed up a study aimed at finding which industries are represented the least in the program, in order to create more diversity.
Senator Jeanne Shaheen, who introduced the bill to the Senate, serves on the Senate committee of Small Business and Entrepreneurship with cosponsor, Senator Maria Cantwell, who currently serves as the chair of the Small Business and Entrepreneurship committee. Once a small business owner herself, Senator Shaheen knows how significant small businesses are to the American economy, and she knows how important it is to empower women as entrepreneurs. It is Senator Shaheen’s dedication to working women and small businesses that prompted her to construct this bill to encourage the growth of women as business owners and to expand opportunities available to female entrepreneurs. Furthermore, it encourages women to participate in business, as women remain particularly underrepresented as entrepreneurs. Small businesses are integral to the American economy, as they create jobs and provide necessary goods and services all over the country, and Shaheen recognizes that women can play a valuable role.