The Biden Administration’s plan to use the federal government’s buying power to advance equity amongst underserved communities is beginning to take shape. The federal government spends more than $650 billion each year on various good and services. In previous years, the government-wide spending goal for small disadvantaged businesses (SDB) has been 5%. In December 2021, the Executive Office of the President released a memo titled, “Advancing Equity in Federal Procurement” that increased the small disadvantaged business goal from 5% in fiscal year 2021 to 11% in fiscal year 2022 with the ultimate goal of 15% by 2025. There will also be an increase in spending for other socio-economic business types like women owned small businesses (WOSBs), Historically Underutilized Business Zones (HUBZones), and service-disabled veteran owned small businesses (SDVOSBs).
Following the December memo that increased the SDB goal, the Administration provided agency decision-makers with an additional memo that recommends numerous strategies for achieving the new spending goal. According to the Office of Management and Budget (OMB), “Almost 70 percent of WOSBs are also SDB contractors and 67 percent of HUBZone-certified small businesses are SDBs” and “When awards are made to WOSBs or HUBZone firms, there is a high likelihood that the action will also reach an SDB…”[1] Additional increases in the other federal socio-economic spending goals are expected in the near future and this strategy in particular prepares agencies to increase their overall spending with small businesses that represent these underserved communities.
The Office of Management and Budget has provided multiple strategies to assist government-decision makers reach the new SDB goal. According to OMB, decision-makers should “maximize opportunities for SDBs when using the General Services Administration’s Federal Supply Schedule (FSS) program.”[2] The General Services Administration’s (GSA) e-buy system is capable of requesting invitations for bid from disadvantaged business specifically and decision-makers should take advantage of this functionality to incorporate more disadvantaged business during the procurement process. Other strategies include using the built in small business set aside for acquisitions under the simplified acquisition threshold and using SBA’s dynamic small business search to find more SDBs.
Contemporaries, Inc. is a family-owned, -operated, and Woman Owned Small Business certified by the Small Business Administration. We provide a full range of talent acquisition, human capital and support solutions, and professional support services to the federal government.
[1] https://www.whitehouse.gov/wp-content/uploads/2022/07/SDB-Quick-Hits-Memo-508-1.pdf
[2] https://www.whitehouse.gov/wp-content/uploads/2022/07/SDB-Quick-Hits-Memo-508-1.pdf
