Sole Source Awards for Women-Owned Small Businesses

Federal contracting officers now possess new authority to make sole source awards to Women-Owned Small Businesses (WOSBs) and Economically Disadvantaged Women-Owned Small Businesses (EDWOSBs).

Under the new FAR 19.1506, contracting officers must consider a contract award to a WOSB or EDWOSB on a sole source basis before considering small business set-asides, with limited exclusions set forth in FAR 19.1504, and provided that (1) the acquisition is assigned an appropriate NAICS code; (2) the contracting officer does not have a reasonable expectation that offers would be received from two or more EDWOSBs or WOSBs; (3) the anticipated price of the contract, including options, will not exceed $6.5 million for a contract carrying a manufacturing NAICS code or $4 million for contracts within any other NAICS code; (4) the EDWOSB or WOSB has been determined to be a responsible contractor; and (5) an award can be made at a fair and reasonable price.

In order for a WOSB or EDWOSB to receive a sole source contract, the contract work must fall within a specific industry section, as represented by a NAICS code, which the U.S. Small Business Administration (SBA) has determined to be underrepresented or substantially underrepresented by WOSB concerns.

Section 8(m) of the Small Business Act (15 U.S.C. 637(m)) created the WOSB Program to ensure women-owned small business concerns have an equal opportunity to participate in federal contracting and to assist federal agencies in achieving their women-owned small business participation goals. Qualification as an EDWOSB or WOSB concern eligible under the WOSB Program is set forth in 13 CFR part 127.

WOSBs and EDWOSBs have since been among those government contractors who possess a valid “preference” for securing contract awards, such as small disadvantaged businesses (SDBs) under the SBA 8(a) Program, historically underutilized business zone small businesses (HUBZone companies), service-disabled veteran-owned small business (SDVOSBs) and Alaskan-Native Owned companies (ANCs). A federal contract can be “set-aside” for these types of companies in an effort to increase their share of government contracts. Only companies that meet the requirements for the specific preference are qualified to compete for an award under a set-aside solicitation.

When a contracting officer has regulatory authority to award a contract to a specific company under the contracting officer’s sole source authority (when certain prerequisites are met) the competitive field is narrowed even more. Contracting officers have had sole source authority for 8(a), SDVOSB and HUBZone concerns for many years (FAR 6-302-5). However, WOSBs and EDWOSBs were not eligible for sole source contracts until 2015.

In response to the failure of federal agencies to meet their statutory goal of awarding five percent of federal contracting dollars to WOSBs and EDWOSBs, The National Defense Authorization Act (NDAA) for FY 2015, Public Law 113-291, provided the Congressional authority for sole source awards to WOSBs. SBA guidelines implementing that law went into effect on October 14, 2015, and the FAR Council (DOD, GSA and NASA) issued interim rules amending the Federal Acquisition Regulation (FAR) on December 31, 2015.