8(a) Business Development (BD) Program Suitability Tool Statements

Introduction

The United States Small Business Administration (SBA) administers the section 8(a) Business Development program which is commonly known as the 8(a) BD program.  Sections 7(j) and 8(a) of the Small Business Act (the Act) (15 U.S.C. § 636 (j)   and 15 U.S.C. § 637(a)) authorize SBA to establish a business development program and certify firms as eligible to participate in that program. SBA is responsible for certifying firms as eligible to participate in the program based on criteria established in the Small Business Act and regulations found in title 13, section 124 of the Code of Federal Regulations (13 CFR § 124).

The 8(a) BD program promotes the development of small business concerns owned and controlled by socially and economically disadvantaged individuals so that those concerns can compete in the mainstream of the American economy.

Small business development is accomplished by providing various forms of management, technical, financial and procurement assistance.

Generally, a concern meets the basic requirements for admission to the 8(a) BD program if it is –

By statute, the length of the participation time is limited to nine years and once a concern or disadvantaged individual upon whom eligibility was based has participated in the 8(a) BD program, neither the concern nor that individual will be eligible to participate again.  In other words there is a one-time eligibility restriction.

Firms that participate in the 8(a) BD program benefit from the business development assistance provided by the district offices of SBA located around the country.  The program participants are responsible for maintaining their eligibility and self-marketing their products and services to the Federal government and the private sector.

Because the program is of a limited duration and has a one-time eligibility restriction it is important for firms applying to the program to understand the basic eligibility and reporting requirements for participation.  Once a firm has established its eligibility it is required to maintain that eligibility, which is monitored by SBA on an annual basis.  The following information is designed to assist the applicant in applying to and participating in the 8(a) BD program.

Please answer the following questions to the best of your ability.

Basic Requirements

  1.  Yes            No

  1.  Yes            No

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  2.  Yes            No

  1.  Yes            No

  1. ?
  2.  Yes            No

  1.  Yes            No


8(a) BD Program Requirements

Ownership and Control

  1.  Yes            No

  1.  Yes            No

  1.  Yes            No

  1.  Yes            No

  1.  Yes            No

  1.  Yes            No

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  1.  Yes            No

  1.  Yes            No

  1.  Yes            No

  1.  Yes            No

  1.  Yes            No

Social Disadvantage

The Small Business Act defines socially disadvantaged individuals are those individuals who have been subjected to racial or ethnic prejudice or cultural bias within American society because of their identities as members of groups and without regard to their individual qualities and the social disadvantage must stem from circumstances beyond their control. 
The following groups of individuals are deemed to be socially disadvantaged:

Black Americans
Hispanic Americans
Native Americans2
Asian Pacific Americans3
Subcontinent Asian Americans4 

Being born in a country does not, by itself, make the birth country an individual's country of origin for purposes of being included within a designated group.

Individuals not members of one of the listed designated groups may establish social disadvantage based on personal experiences of substantial and chronic social disadvantage in American society, not in other countries, which is the result of a distinguishing feature (i.e., race, ethnic origin, gender, physical disability) that has contributed to the social disadvantage.

The social disadvantaged must have a negative impact on your entry into or advancement in the business world because of the disadvantage.  SBA considers education, employment and business history.

  1.  Yes            No

  1. Race      Ethnic      Origin      Gender      Disability      Other

  1. If you are not a member of a designated group but believe you have been subject to discrimination has your experience resulted in a negative impact on entry into or advancement in the business word?
  1. Business History     Employment            Education

Economic Disadvantage

Economically disadvantaged individuals are socially disadvantaged individuals whose ability to compete in the free enterprise system has been impaired due to diminished capital and credit opportunities as compared to others in the same or similar line of business who are not socially disadvantaged. 

For initial 8(a) BD eligibility, the net worth 5 of an individual claiming disadvantage must be less than $250,000.

For continued 8(a) BD eligibility after admission to the program, net worth must be less than $750,000.

SBA also determines an individual’s economic disadvantage by comparing the personal income attributable to the individual to IRS statistical data of high income wage earners.

Finally, individuals with total assets (no adjustments) of less than $4 million may be considered economically disadvantaged.

Individuals applying for 8(a) BD certification are required to complete personal financial statements for themselves and their spouse and provided two years of Federal income tax returns.

  1.  Yes            No

  1.  Yes            No

  1.  Yes            No

  1.  Yes            No

  1.  Yes            No

  1.  Yes            No

  1.  Yes            No

Business Development

  1.  Yes            No

  1.  Yes            No

  1.  Yes            No

  1.  Yes            No

  1.  Yes            No

  1.  Yes            No

  1.  Yes            No

  1.  Yes            No

  1.  Yes            No

  1.  Yes            No

  1.  Yes            No

  1.  Yes            No

  1.  Yes            No

  1.  Yes            No

  1.    
  2.  Yes            No

If you are ready to complete an application for 8(a) BD program certification, please click here for a link to the electronic application. Please note that a CCR profile and GLS login
are required to submit an electronic application.

Thank you for completing this 8(a) BD Program Suitability Tool.  It is our hope that you have been able to evaluate whether or not the 8(a) BD Program is right for your business.  If you decided that the 8(a) BD Program is the right business decision for your small business; you are ready to apply for the 8(a) BD Program. 

Please print this document so that you have a copy of your responses for your records.  If you find that the 8(a) BD Program is not right for you at this time, then keep the 8(a) Business Development (BD) Program Suitability Tool for future reference and use it as a gauge in determining when to apply for the 8(a) BD Program. 

Best wishes for success in your entrepreneurial endeavors.