SBA and Commerce will Expand Outreach to Small and Minority-Owned Firms
President Obama has directed leaders of the Small Business Administration and Commerce Department to renew the push to meet contracting goals for minority-owned and small businesses.
In a statement released through SBA, Obama said it is essential to provide those companies with the greatest possible opportunity to participate in federal contracting.
"Small and minority-owned businesses must play a significant role in our efforts to restore economic growth," Obama said. "Small businesses employ half of the nation's private sector workforce, create a large share of the nation's new jobs and introduce many groundbreaking ideas into the marketplace."
Obama tapped SBA Administrator Karen Mills and Commerce Secretary Gary Locke to lead an initiative to increase outreach to companies and ensure agencies meet or exceed the goal of awarding 23 percent of prime contracts to small businesses.
Mills and Locke announced that procurement officials across government will host and participate in more than 200 events focused on minority-owned and small businesses during the next 90 days. These forums are designed to share information on federal contracting opportunities, including Recovery Act projects.
Commerce and SBA also will expand outreach to federal contracting officials to share best practices and ensure they have the tools to meet annual procurement goals.
SBA press secretary Hayley Matz told Government Executive on Wednesday that as of Aug. 14, 23.7 percent of the $8.37 billion in Recovery Act contract dollars have gone to small businesses. Agencies have been hitting disadvantaged business category goals with stimulus spending as well, awarding 10.6 percent to small disadvantaged businesses, 8.7 percent to 8(a) firms, 6.4 percent to HUBZone firms, 4.3 percent to women-owned firms and 3.1 percent to service-disabled veteran-owned firms.
"It has been a priority from day one of this administration to ensure that small and minority-owned businesses are aware of and have access to federal contracts and funding opportunities," Locke said. "Over the past 40 years, minority-owned businesses have grown from 300,000 to nearly 4 million today. Their success and the success of small American businesses are vital to our economic recovery."
Access to federal contracts can help a small business quickly turn the corner toward expansion and job creation, Mills said.
"But make no mistake, the benefits the government receives are equally as impressive. Working with small businesses allows the federal government to work with some of the most innovative companies in America, with a direct line to the CEO," she said.
Sen. Mary Landrieu, D-La., chairwoman of the Senate Small Business and Entrepreneurship Committee, called the announcement a step in the right direction. She pledged to continue strong oversight of agencies to make certain that all small businesses, including minority-, women- and veteran-owned firms, are receiving their fair share.
Reprinted with permission by GovExec.com
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Selling to the Government: Five Tips for Becoming a Subcontractor and Getting Your Foot in the Door
Whatever your product or service, and whatever the market - whether it be federal, state or local government - winning a share of government business can be a complex and time-consuming process.
And no matter how lucrative government contracting can be, for many small business owners the prospect of contracting directly (called "prime contracting") with a government agency is simply not within their capacity or scope.
This is where government subcontracting comes into play.
As a small business, your best bet for winning a government contract can often be to partner or subcontract with another government contractor - one who has experience and an established network of government contacts.
And this doesn't mean that you'll get a smaller piece of the pie either. The government's goals for subcontracting to small businesses are actually higher than they are for prime contracting. For example, the Department of Defense subcontracting goal for small businesses in 2009 is 37.2 percent, compared to 22.3 percent for prime contracts (source).
Not only can subcontracting be profitable, the experience gained can help you improve your government procurement know-how and prepare you for prime contracting opportunities down the road.
Below are some tips to help you understand the process of government subcontracting and where to find the opportunities.
1. Laws that Support and Enforce Subcontracting to Small Business
Over the years, several laws have been passed regarding subcontracting to small companies. These laws require that prime contractors who have contracts exceeding $500,000 (or $1,000,000 for construction of a public facility) must provide "maximum practicable subcontracting opportunities to small businesses". For the purposes of government contracting, a small business is defined by the Small Business Administration (SBA) according to these guidelines.
Read more about the laws that govern the small business government subcontracting market from the SBA here.
2. Finding Subcontracting Opportunities
Finding subcontracting opportunities requires a multi-pronged approach.
a) Follow the Opportunity Databases
You can find out about potential subcontracting opportunities through the GSA Subcontracting Directory, which publishes subcontracting opportunities with General Services Administration (GSA) prime contractors, or the SBA's own Subcontracting Network (SUB-Net) that is designed to help prime contractors and subcontractors find each other.
b) Identify the Movers and Shakers
However, as with prime contracting, you need to be in front of your target long before these opportunities are published. This means building relationships and networking with these prime contractors well in advance.
A good way to do this is to reach out to those prime contractors who are winning government contracts in your industry. To get the pulse on who's who in government prime contracting take a look at FedBizOpps' award announcements and the Federal Procurement Data Center. These sites publish information about government contract awards and usually include contact information for the prime's procurement manager - the person who negotiates the contract and the subcontracts that support it.
c) Network, Network, Network
3. Teaming Agreements
Another variant of subcontracting is to form what is known as a teaming arrangement. However, you'll need to get a GSA Schedule contract for this, since Contractor Team Arrangements (CTA) involve two or more GSA Schedule holders coming together with complementary solutions or services to meet an agency's particular requirements. Find out more about teaming arrangements here.
4. Always Read the Fine Print
If you do engage in subcontracting, be sure you understand the terms and conditions of your contract with the prime contractor - including methods of payment. It's important to know that if the prime is late to pay you or stops payment altogether, as a subcontractor you will have no way to seek recourse from the government. The SBA advises subcontractors to review this payment checklist with a prime contractor prior to signing any agreement:
- How and when will I receive compensation?
- What is the paperwork process?
- What are my options for payment?
- Will I be paid via Electronic Funds Transfer (EFT)?
- Will I receive progress payments (for percentage of contract completion)?
- Will I receive partial payments (for partial delivery of usable items)?
- Will I receive payment via government credit cards?
5. Get Government Procurement Assistance in your Community
Another great resource for small businesses is the mentoring advice offered by local *Procurement Technical Assistance Centers, which can help you get set up to do business with the government and start building some connections.
The SBA's district offices also sponsor events and participate in a wide variety of procurement events. Find the SBA district office nearest you.
Additional Resources
Other Sources for Prime Contractor Contacts
*Note: Hyperlink directs reader to a non-government Web site.
By Caron Beesley
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FastTrac® NewVenture™ Coming to Schoolcraft in January
In January, the MI-SBTDC at Schoolcraft College will offer a new training program for budding entrepreneurs. FastTrac® NewVenture™ is an intensive, 10-week program that helps entrepreneurs evaluate business opportunities and develop an action plan for owning their own business. The program is designed to provide knowledge, tools and resources to entrepreneurs while they investigate the feasibility of their business idea. Each session highlights a particular goal and includes expert advice, activities and interaction among the participants. The goals include:
- Exploring Entrepreneurship - defining entrepreneurship and how it fits with your personal vision
- Identifying and Meeting Market Needs - conducting market research for your business idea
- Setting Financial Goals - estimating start-up costs, funding sources, financial goals
- Planning the Product/Service - defining & protecting your product/service
- Researching and Analyzing the Market - industry profile, competitive analysis, market analysis, setting prices
- Reaching the Market - branding, marketing strategies, sales methods, marketing budget
- Building the Organization and Team - choosing a legal structure, key business functions, organizational culture and structure
- Planning for a Profitable Business - financial projections
- Monitoring Cash Flow and Seeking Funds - develop projections now and into the future
- Implementing Next Steps - evaluating your business plan
The Ewing Marion Kauffman Foundation was founded by, the late entrepreneur and philanthropist, Ewing Marion Kauffman with a primary focus on entrepreneurship. Kauffman, an entrepreneur himself, found great success and wealth through his pharmaceutical business but was unsatisfied with other charity work he experienced. Therefore, he created his own foundation dedicated to providing education, research and technical assistance to entrepreneurs. The FastTrac® programs help the Foundation reach these goals and provide service to entrepreneurs. They are led by certified facilitators that guide participants through a great experience and provide knowledge through course content and personal experience. The 10-week series begins Thursday, January 14th and continues each Thursday for 10 weeks. The sessions will be held at Schoolcraft College from 9 am to Noon. The registration fee for FastTrac® NewVenture™ is $700/person. To register, go to http://www.schoolcraft.edu/bdc/sbtdc_seminars.asp?p=bc. Questions may be directed to the MI-SBTDC office at (734) 462-4438. |
Rule Requiring Federal Contractors to Use E-Verify Is In Effect
In the Fall of 2008, President Bush signed an Executive Order requiring all federal government contractors to use E-Verify, an internet-based employment verification program used to ensure that certain employees are eligible for work in the United States. Its implementation was delayed due to legal challenges brought in the federal courts. Shortly after these legal challenges to the E-Verify system failed, a new Federal Acquisition Regulation ("FAR") went into effect.
The new E-Verify clause, FAR 52.222-54, is required in prime contract solicitations issued after September 8, 2009 that are above the simplified acquisition threshold of $100,000 with a period of performance longer than 120 days. The rule also requires that contractors flow the clause down to subcontractors (except for COTS contracts) that are for $3,000 or more and performed in the United States.
Under the clause, federal contractors are required, within 30 calendar days of the award of a federal prime contract or subcontract that contains the clause, to enroll in E-Verify at www.dhs.gov/E-Verify. Enrollment in E-Verify is free. As part of the enrollment process, contractors must sign a Memorandum of Understanding (MOU) that provides the terms of the agreement between the enrollee and the Department of Homeland Security (DHS).
Contractors must use E-Verify for both new hires and certain existing employees. For all new hires, the rule requires contractors to use the E-Verify system, regardless of whether they work on the federal contract. Once enrolled in the E-Verify system, the contractor has three business days from the new hire's start date to use E-Verify to verify the employee's status.
For existing employees, the contractor must use E-Verify to verify only those employees that work directly on the federal contract, which must be done within 90 days from the date of contract award.
When using E-Verify, contractors submit information provided on the employee's I-9 form. The E-Verify system queries databases of the Social Security Administration, DHS, and Department of State. The System immediately returns one of three possible results from the query: 1) "Employment Authorized," 2) "SSA Tentative Nonconfirmation," which means there is an information mismatch, or 3) "DHS Verification in Process," which will lead to a further response from DHS within 24 hours.
If the contractor receives a tentative nonconfirmation regarding an employee, that employee can contest the finding and resolve the discrepancy with the appropriate agency. In the meantime, the contractor may not terminate the employee while the issue is pending. The contractor must inform the employee of the tentative nonconfirmation by providing the notice to the employee and referring him to the appropriate agency. The employee has eight federal government workdays from the date of the referral to contact the appropriate agency to resolve the discrepancy. If the employee chooses not to contest the finding, then the contractor receives a final nonconfirmation and a termination action is supported.
The E-Verify system also has a photo screening tool, which enables contractors to match the photo on an employee's Employment Authorization Document or Permanent Resident Card with the photo on file at the United States Citizenship and Immigration Service ("USCIS"). This tool assists contractors with detecting document fraud.
E-Verify procedures must be used for all new hires, regardless of citizenship status. Contractors are not permitted to use E-Verify prior to making a job offer.
E-Verify is not currently a permanent requirement. Under the Department of Homeland Security Appropriations Act of 2010, E-Verify has been extended and funded for three years. Whether or not to make it permanent was a matter of significant political debate and the three-year window was a compromise Congress reached.
Contractors may visit the DHS or USCIS websites at www.dhs.gov and www.uscis.gov for additional information regarding E-Verify.
George W. Ash and Brandi F. Walkowiak are members of the law firm of Foley & Lardner LLP in Detroit, where they specialize in government procurement issues. They may be reached at (313) 234-7100.
Note: This update provides information of general interest presented in summary form, and does not constitute individual legal advice. |
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IRS Reminds Taxpayers that Keeping Good Records Reduces Stress at Tax Time
The tax filing season is just around the corner, so if you haven't already done so, it's time to organize your records.
Whether you are a business owner or an individual taxpayer, you can avoid headaches at tax time with good records because they will help you remember transactions you made during the year.
Keeping well-organized records also ensures you can answer questions if your return is selected for examination or prepare a response if you are billed for additional tax. In most cases, the IRS does not require you to keep records in any special manner. Generally speaking, you should keep any and all documents that may have an impact on your federal tax return.
Small Business Owners
If you are a small business owner, you must keep all your employment tax records for at least four years after the tax becomes due or is paid, whichever is later. Examples of important documents business owners should keep Include:
- Gross receipts: Cash register tapes, bank deposit slips, receipt
books, invoices, credit card charge slips and Forms 1099-MISC
- Proof of purchases: Canceled checks, cash register tape receipts,
credit card sales slips and invoices
- Expense documents: Canceled checks, cash register tapes,
account statements, credit card sales slips, invoices and petty cash
slips for small cash payments
- Documents to verify your assets: Purchase and sales invoices, real
estate closing statements and canceled checks
Individuals
Individual taxpayers should usually keep the following records supporting items on their tax returns for at least three years:
- Bills
- Credit card and other receipts
- Invoices
- Mileage logs
- Canceled, imaged or substitute checks or any other proof of
payment
- Any other records to support deductions or credits you claim on
your return
For more information about recordkeeping, check out IRS Publications:
By John Berger, SB/SE C&L, External Outreach Branch
Room 940, Fallon Federal Building, Baltimore, MD 21012
Tel: 410-962-9025, Fax: 410-96202572, john.r.berger@irs.gov | |
