December 12, 2014
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Senate Passes Women’s Small Business Provision in Defense Bill

Cantwell-backed provision would give parity to women-owned small businesses in federal contracting

WASHINGTON, D.C. — Today, U.S. Senator Maria Cantwell, Chairwoman of the Senate Committee on Small Business and Entrepreneurship, cheered Senate passage of legislation she introduced to ensure women-owned small businesses have equal access to federal contracting.

 The provision, which was included in the National Defense Authorization Act (NDAA) of 2015, passed the House of Representatives last week. It now heads to President Obama for his signature. 

 Section 825 of the NDAA authorizes federal agencies to award sole-source contracts to women-owned small businesses, which would put women-owned businesses on equal footing with other disadvantaged groups in the contracting process.

 A similar provision authorizing sole-source contracting for women was introduced in the Women’s Small Business Ownership Act of 2014, which Cantwell sponsored in the Senate. It was cosponsored by Senators Ben Cardin (D-MD), Jeanne Shaheen (D-NH), Kirsten Gillibrand (D-NY), Tammy Baldwin (D-WI), and John Walsh (D-MT).

 Separately, Shaheen, Cantwell and Gillibrand introduced stand-alone legislation on the sole-source contracting provision.

“This legislation will help women entrepreneurs across the country break a glass ceiling,” Cantwell said in a speech this week on the Senate floor. “There are 8 million women-owned businesses in the United States. But they only get a tiny percent – 4 percent – of federal contracts. We want to make sure this is changed.”

“While women continue to make significant strides in our economy, they are still under-represented as small business owners and federal contractors,” Shaheen said. “This provision will help women-owned small businesses in New Hampshire and across the country win federal contracts, encouraging greater small business ownership by women and economic growth across the board.”

“I am pleased that the Defense Authorization bill includes provisions that will help ensure a level playing field for women-owned small businesses to compete for federal contacts,” said Senator Kay Hagan (D-NC), a member of the Senate Committee on Small Business and Entrepreneurship. “Removing these unnecessary hurdles will open up new markets and enable female entrepreneurs to grow their businesses and create new jobs.”

In July, the Senate Small Business Committee issued a report showing that women are not getting equal access to federal contracts. The federal government has set a goal of awarding 5 percent of contracts to women-owned small businesses, but that goal has never been reached. As a result, women business owners miss out on an average of $4 billion in federal contracting opportunities each year, according to the report.

Women are losing $4 billion a year in federal contracts because the government has never met its goal of contracting with women,” said Marsha Firestone, President of Women Presidents’ Organization. “Empowering the WOSB procurement program with sole-source authority is a big step toward making this program reach its potential.”

“Access to federal markets remains a challenge for the black community, especially for our women entrepreneurs,” said Ron Busby, President of the U.S. Black Chambers, Inc. “We celebrate the inclusion of sole-source authority for the WOSB procurement program in the NDAA.”

In Washington state, falling short of the 5 percent goal means women business owners miss out on an average of $188 million in contracting opportunities each year, according to a separate committee report.

“The sole source victory is thrilling,” said Trena Payton, President of ABN Technologies in Lacey, Washington. “As the head of a women-owned business, I can tell you that access to the federal marketplace is a huge issue. This change will help millions of women break through barriers of accessing federal contracts."

The NDAA legislation adopts recommendations from the Senate Committee on Small Business and Entrepreneurship report to provide parity for women in federal contracting. 

Sole-source contracting already is available to small businesses owned by minorities and veterans, as well as businesses located in underserved areas. Authorizing sole-source awards for women would give parity to the Women-Owned Small Business Federal Contracting program, creating more opportunities for them to grow their businesses and create jobs.

“The federal marketplace is an enormous opportunity,” said Lisa Firestone of Managed Care Advisors of Bethesda, Maryland. “With sole source finally being added to the WOSB program we are extremely confident in our ability to expand our business with the federal government and in turn, create jobs in Maryland and across the country.”

The legislation also would require the U.S. Small Business Administration to verify the ownership status of women-owned small businesses. Currently, businesses self-report whether they are owned by women when competing for federal contracts. This change will ensure that the women’s contracting program benefits those for whom it was intended.

Women entrepreneurs account for just $1 out of every $23 in small business lending, despite representing 30 percent of all small companies. They are also more likely to be turned down for loans or face less favorable terms than men, according to the committee’s July report, 21st Century Barriers to Women’s Entrepreneurship.