Washington, D.C.– Senate Committee on Small Business Ranking Member Ben Cardin issued a statement today lauding the inclusion of his amendment to the National Defense Authorization Act for Fiscal Year 2021. Cardin’s amendment extends the current 9-year limit on a small business’s participation in the Small Business Administration’s (SBA’s) 8(a) Business Development Program to 10 years. Small businesses are eligible for the extension if they were 8(a) certified on or before September 9, 2020—180 days after the Trump administration declared the COVID-19 pandemic a national emergency.
“SBA’s 8(a) Business Development program remains a critical tool for underserved small businesses to compete for small business contracts with the federal government,” Cardin said. “I am pleased that my amendment was included in the NDAA to provide 8(a) participants that would have graduated from the program during the pandemic with another year of support.”
Minority-owned small businesses have suffered the worst economic effects of the COVID-19 pandemic. A recent report from the SBA Office of Advocacy found that the decline in business activity during the pandemic among Black-owned small businesses has been nearly three times as great as the decline in overall business activity.
The 8(a) Program helps small businesses owned and controlled at least 51 percent by socially and economically disadvantaged individuals, including minorities, gain access to federal government contracts. 8(a) certified businesses can enter into sole-source contracts with the federal government worth up to $4 million for goods and services and $7 million for manufacturing. The program also offers opportunities for participating businesses to collaborate with larger prime contractors and 8(a) certified businesses may participate in SBA’s mentor-protégé program, which helps them build their institutional knowledge and better compete for contracts upon completing the program.
Traditionally, participation in the program is divided into two phases over nine years: a four-year developmental stage and a five-year transition stage, following which businesses graduate from the program. Cardin’s amendment provides 8(a) certified businesses with an additional year in the program to ensure that already-vulnerable small businesses do not lose access to the program amid the economic crisis caused by COVID-19.