DIR's Supplier Diversity Information Resource Guide 20, Jan 2012 | Page 18

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Small Business Administration

Small Disadvantaged Business (SDB) Self-Certification
As of Oct. 3, 2008 companies seeking to obtain federal prime or subcontracts can self-certify their status as small
disadvantaged businesses (an option that has been available since 2004) or use a third-party private certification firm.

In limited circumstances, the procuring agency can certify the company. Companies already certified as small
disadvantaged or 8(a) firms will not be affected until that status is scheduled for renewal.
Note: Effective October 3, 2008
The Small Business Administration will no longer verify the status of companies seeking certification as small
disadvantaged businesses, shifting the time-consuming and costly application process to the companies
themselves or to third parties.In an interim final rule published in the Federal Register, SBA explained that
the value of the small disadvantaged business designation has tailed off in recent years as the financial
incentives have disappeared or been ignored. This rule changes the requirements relating to which firms
may certify their status as small disadvantaged businesses (SDBs) for purposes of federal prime contracts and
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subcontracts. Currently, only those firms that have applied to and been certified as SDBs by SBA may certify
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themselves to be SDBs for federal prime and subcontracts. This rule allows firms to self-represent their
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status for subcontracting purposes without first receiving any SDB certification. It also recognizes that the for m
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benefits of being an SDB for federal prime contracts has been greatly diminished over the past years, and o
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shifts the responsibility of identifying firms as SDBs for federal prime contracts to those limited agencies that
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have authority and chose to use price evaluation adjustments to SDBs.
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Note: Exception to SDB Requirements are Alaskan Native Corporations and Indian Tribes.
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“Alaska Native Corporation (ANC)” means any Regional Corporation, Village Corporation, Urban Corporation,
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or Group Corporation organized under the laws of the State of Alaska in accordance with the Alaska Native
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Claims Settlement Act, which is considered a minority and economically, MN.
disadvantaged concern under the
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criteria. This definition also includes ANC direct and indirect subsidiaryi corporations, joint ventures, and
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partnerships.
“Indian tribe” means any
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Indian tribe, band, group, pueblo, or community, including onative villages and native groups (including
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corporations organized by Kenai, Juneau, Sitka, and Kodiak) as defined in the Alaska Native Claims SettlenR
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This definition also includes Indian-owned economic enterprises.
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Evaluation Factor and Monetary Incentive for Subcontracting with Small Disadvantaged Businesses
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Federal Acquisition Regulations (FAR) subpart 19.12, Small Disadvantaged Business Participation Program, is
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applicable to all solicitations aissued on or after January 1, 1999. This rule creates a source selection evaluay
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tion factor or subfactor for planned SDB participation in the performance of a contract in the NAICS sub
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sectors (formerly SICed o
major groups), as well as a mechanism to evaluate past performance of contractors in
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complying witheprod SDB participation targets. It also creates a monetary incentive for subcontracting with
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SDBs. Fornomore information on the list of authorized industries see http://www.acquisition.gov/references/
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sdbadjustments.htm
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North American Industry Classification System (NAICS)
On October 1, 2000, the SBA began using the North American Industry Classification System (NAICS) in place
of the Standard Industry Classifications, or SIC codes, which had been the method of categorizing businesses
for almost 60 years. NAICS were developed in the early 1990s as a result of the North American Free Trade
Act. Each number identifies an industry or sub sector of an industry. Canada, Mexico, and the US have all
agreed to use the same codes and definitions to track trade flow between the three countries more accurately.
The SBA assigns subcategories f ?????????????????????????????????????????????Q???M ????)????????????????????????????????????????????????????????????????????????????????)????????????????????????????????????U???????9%
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