As expected, the SBA 8(a) Business Development Program made the SBA Office of Inspector General's list of top management challenges facing the SBA in Fiscal Year 2015. On October 17, the OIG issued its Report on the Most Serious Management and Performance Challenges Facing the Small Business Administration In Fiscal Year 2015. According to the Inspector General, the report represents the OIG's "current assessment of Agency programs and/or activities that pose significant risks, including those that are particularly vulnerable to fraud, waste, error, mismanagement, or inefficiencies."
In particular, the OIG noted that the SBA needs to modify the Section 8(a) Business Development Program so more firms receive business development assistance, standards for determining economic disadvantage are justifiable, and the SBA ensures that firms follow 8(a) regulations when completing contracts.
In order to address the challenge the 8(a) BD Program presents, the OIG's recommended actions for FY 2015 are:
Not surprising, the SBA has failed to accomplish any actions with respect to this challenge over the last 4 fiscal years. Significantly, the OIG noted that for the second straight year, the SBA has not completed updating its Standard Operating Procedures (SOP) for the 8(a) BD Program to reflect the 2011 regulatory changes. At this point, it is unclear when the SBA intends to issue revised SOP for the 8(a) BD Program, but I would think that issuance of revised SOP would go a long way toward resolving many inconsistencies in procedures and interpretations the SBA has become known for.
Regarding the issue of the SBA providing business development services to the participant firms, this is not a new issue; rather, it is something the SBA has had issues with probably since inception of the program. The failure of the SBA to provide business development services to participant firms has also been a primary criticism of the program, given that many of the firms are unable to effectively compete in the federal marketplace once they graduate from the program and are no longer able to receive sole-source awards. The GAO noted in its 2010 Report that the SBA's failure to assess the workloads of the Business Development/Opportunity Specialists (BDS/BOS), the "SBA may be bypassing some opportunities to better support the mission of the 8(a) program - that is, to develop and prepare small disadvantaged firms for procurement and other business opportunities."
Given the current state of the economy and consistent budget cuts, it is unlikely we will see any significant changes in the program or significant progress made regarding the issues that continue to plague the program. Nonetheless, the 8(a) BD Program continues to provide a significant benefit to many small businesses - I would just encourage all current participants to take advantage of any and all business development services that actually are offered/provided by your District Office.
In order to address the challenge the 8(a) BD Program presents, the OIG's recommended actions for FY 2015 are:
- Develop and implement a plan, including SOP provisions, which ensures that the 8(a) BD Program identifies and addresses program participants' business development needs on an individual basis.
- Develop and implement regulations and SOP provisions to ensure that participants graduate once they reach the levels defined as "business success."
- Establish objective and reasonable criteria that effectively measure "economic disadvantage," and implement the new criteria.
Not surprising, the SBA has failed to accomplish any actions with respect to this challenge over the last 4 fiscal years. Significantly, the OIG noted that for the second straight year, the SBA has not completed updating its Standard Operating Procedures (SOP) for the 8(a) BD Program to reflect the 2011 regulatory changes. At this point, it is unclear when the SBA intends to issue revised SOP for the 8(a) BD Program, but I would think that issuance of revised SOP would go a long way toward resolving many inconsistencies in procedures and interpretations the SBA has become known for.
Regarding the issue of the SBA providing business development services to the participant firms, this is not a new issue; rather, it is something the SBA has had issues with probably since inception of the program. The failure of the SBA to provide business development services to participant firms has also been a primary criticism of the program, given that many of the firms are unable to effectively compete in the federal marketplace once they graduate from the program and are no longer able to receive sole-source awards. The GAO noted in its 2010 Report that the SBA's failure to assess the workloads of the Business Development/Opportunity Specialists (BDS/BOS), the "SBA may be bypassing some opportunities to better support the mission of the 8(a) program - that is, to develop and prepare small disadvantaged firms for procurement and other business opportunities."
Given the current state of the economy and consistent budget cuts, it is unlikely we will see any significant changes in the program or significant progress made regarding the issues that continue to plague the program. Nonetheless, the 8(a) BD Program continues to provide a significant benefit to many small businesses - I would just encourage all current participants to take advantage of any and all business development services that actually are offered/provided by your District Office.
