Tribal Enterprise Business Guide: 8(a) Business Development Program
The 8(a) Business Development Program is designed to assist socially and economically disadvantaged small businesses, including tribally owned enterprises. This course provides a description of the program’s purpose, how it works, eligibility requirements, and the application process.
— 1 Tribal Enterprise Business Guide: 8(a) Business Development Program
This is about tribally owned businesses winning federal contracts.
Welcome to “Tribal Enterprise” – a business guide to the 8(a) Business Development Program.
— 2 Introduction
8(a) Business Development Program is designed to assist socially and economically disadvantaged small businesses, including tribally owned businesses
Designed to inform, educate and engage qualified businesses in the 8(a) program
The 8(a) program is a business development program designed to assist socially and economically disadvantaged small businesses, including tribally owned enterprises.
This guide is designed to inform, educate and engage qualified tribal businesses in the 8(a) program.
— 3 Course Contents Tribal Enterprise
1. Tribally Owned Businesses
2. 8(a) Program Purpose & Summary
3. How the Program Works
4. Eligibility Requirements for Tribal Enterprises
5. Application Process
6. Key Questions & Answers
7. Resources and Assistance
The training module provides an overview of the 8(a) program, including a discussion about tribally owned businesses, a description of the program’s purpose, how it works, tribal eligibility requirements, the application process, key questions and answers and important resources.
In addition many of the –s include highlighted boxes with specific FAR and CFR regulatory references to help users easily access more information about the content in the –s.
Also, the course is designed so that you can easily go to, leave or return to any section of the course, at any time.
— 4 Tribally Owned Businesses
What is a tribally owned business?
– any business concern that is at least 51% owned by an Indian tribe
– Indian tribe means any Indian tribe, band, nation or other organized group or community of Indians, including any ANC, which is recognized as eligible for the special programs and services provided by the United States to Indians because of their status as Indians or is recognized as such by the State in which the tribe, band, nation or community resides.
But first, what is a tribally owned business or concern? For purposes in this training module, the terms tribally owned business or tribally owned enterprise are used interchangeably with the term tribally owned concern.
As defined in federal regulations, a tribally owned business (concern) means any business (concern) that is at least 51% owned by an Indian tribe. An Indian tribe is any Indian tribe, band, nation or other organized group or community of Indians, including any ANC, which is recognized as eligible for the special programs and services provided by the United States to Indians because of their status as Indians or is recognized as such by the State in which the tribe, band, nation or community resides.
— 5 Business Development Growth
Business growth graphic…
The 8(a) program is a tool, a business development tool that may fit within the economic development vision of the tribe or the tribal entities that make up the tribe.
With that said, successful business development within a tribe may be enhanced with a well- defined economic development framework and a strong foundational base of capabilities, strategies and supporting policies.
At the base sits nation building. A strong, effective, self-driven nation serves as the foundation to support all productive activity. Resting above it, is economic development. In this level, a nation builds the capacity to identify, select and manage the community’s endowment of resources and talent that help achieve the community’s vision.
At the top is business development growth. Here tribal entities make critical decisions on starting and growing their businesses. The 8(a) program is but one tool that may help support business development growth.
— 6 Framework for Business Development Growth
o Assess
– What we know
o Strategic choices
– Identify opportunities
o Capabilities
– Alignment and delivery
o Action
– Adapting and learning
o Mobilization
– Willingness to lead change
Achieving business growth requires a plan. A well thought out plan.
As such, a tribe should have a good understanding of where it is today, where it has been and where it wants to go. Five steps can be applied to build a planning framework. First, gather what you know and assess your current circumstances. Second, identify opportunities and make strategic choices. Applying to the 8(a) program, for instance, may be one of those choices.
Third, understand your tribal capabilities and align skills with what your tribe can successfully deliver. Fourth, identify and manage actions and lastly, but most importantly, mobilize change.
— 7 Structural Options
Graphic of business structural options…
The 8(a) program is a tool. And, a tribe may have more than one 8(a) tribal enterprise.
It is important for a tribe to understand how it can be optimally structured so it can be positioned for business development growth. This — shows one structural option, with two affiliated 8(a) firms. There are other options.
At your convenience, review the hyperlinked guides to better understand how a tribe can be positioned for growth.
— 8 Reflection
Does your tribe have a strong foundational base for economic development? Has tribal leadership considered ways the 8(a) program can be used as a business development tool? Is your tribe structurally positioned for optimal business development growth?
— 9 8(a) Program & Summary Program
— 10 Program Purpose
Help small disadvantaged businesses, including tribally owned businesses compete in the marketplace
Provide business development support
Prepare qualifying entities for procurement and other business opportunities
The 8(a) Program — named for Section 8(a) of the Small Business Act – is designed to assist small disadvantaged businesses, including tribally owned businesses to compete in the marketplace. It is also designed to assist such entities in gaining access to federal and private procurement markets.
The primary focus of the program is to provide business development support, such as mentoring, procurement assistance, business counseling, training, financial assistance, surety bonding and other management and technical assistance to qualified firms. The ultimate objective, however, is to prepare small disadvantaged firms for procurement and other business opportunities.
Through the award of sole source and set-aside contracts, the 8(a) program provides market access and growth for qualified tribal enterprises.
— 11 American Indian 8(a) Perspective
8(a) program is a business development tool for American Indian tribes
Federal agencies have strong incentives to contract with tribal concerns
Tribes do have special procurement privileges – an important perspective is that often times proceeds from tribally owned companies are used to benefit the entire tribal membership, rather than individual owners
The program is a business development tool that offers opportunities for American Indian tribes. Under the 8(a) program, Congress granted tribes with unique rights in the federal procurement process. These rights provide federal agencies with strong incentives to contract with tribal enterprises.
Tribes do have special procurement privileges. There are many reasons for this. However, an important perspective is that often times the proceeds from tribally owned companies are used for the benefit of the entire tribal membership, rather than individual owners. Tribes use these proceeds to build, sustain and operate their communities – for the betterment of education, health care, public works and other community sustaining activities.
— 12 Regulatory Guidance
The 8(a) Business Development Program:
o Established by:
– Section 8(a) of the Small Business Act of 1953
o Governed by:
– 13 CFR 124.100-124.704 (Subpart A)
– FAR Part 19.800-19.812
o Specific References to Tribally Owned Businesses:
– 13 CFR 124.3 — Definitions
– 13 CFR 124.103 — Who is Socially disadvantaged?
– 13 CFR 124.105-106 — Eligibility
– 13 CFR 124.109 — Applying to the 8(a) program
– 13 CFR 124.112 — Business criteria to remain eligible
The 8(a) program was established by Section 8(a) of the Small Business Act.
It is primarily governed by 13 CFR 124 Subpart A and FAR Parts 19.8 – 19.812. Specific references to tribally owned businesses are also noted in the –.
— 13 Key Program Objectives
“Promote the business development of small business concerns owned and controlled by socially and economically disadvantaged individuals…”
“Promote the competitive viability of such concerns…”
“Clarify and expand the program for procurement by the United States…”
As articulated in statute and regulations, the key objectives of the 8(a) program are to promote business development of small business concerns owned and controlled by socially and economically disadvantaged individuals; to promote the competitive viability of such concerns; and to use the tools of the program to help qualified small disadvantaged firms benefit from federal procurement opportunities.
Qualifying tribally owned businesses can benefit from these key program objectives.
— 14 Term of Participation
Maximum 9 year participation in the program, beginning from the date of SBA approval
First 4 years are considered the developmental stage
Last 5 years are considered the transitional stage
Continuation in the program is dependent on:
Remaining eligible as a socially and economically disadvantaged firm (includes all applicable requirements)
Staying in compliance with the 8(a) BD participation agreement
Participation in the 8(a) program is limited to 9 years, beginning from the date a firm is approved by the SBA as a certified 8(a) Business Development firm.
The first four years in the program are considered the developmental stage. The last five years in the program are considered the transitional stage.
Continuation in the program, in both the developmental and transitional stages, is dependent on the firm’s continuing eligibility as a socially and economically disadvantaged – owned and operated – firm and that the firm continues to be in compliance with the 8(a) business development agreement.
— 15 Summary Requirements and Goals
Overall goal for 8(a) firms is to graduate from the program and thrive in a competitive business environment
Requirements:
Maintain a balance between commercial and government business
SBA district offices monitor and measure the progress of participating firms
Annual review
Business planning
Systematic evaluations
The 8(a) program is a business development program. As such, the overall goal for 8(a) firms is to graduate from the program and go-on to thrive in a competitive business environment. There are several requirements in place to help firms achieve this goal.
Firms must maintain a balance between their commercial and government business.
In addition, SBA district offices monitor and measure the progress of participating 8(a) firms. It does this through annual reviews, business planning collaboration and systematic evaluations.
— 16 Reflection
Is the purpose of the 8(a) program aligned with the goals and objectives of your tribe? Is your tribe and related tribal businesses positioned to take advantage of opportunities available through the 8(a) program?
— 17 How the 8(a) Program Works
— 18 Driven by Several Key Components
SBA’s role
Business development assistance
Business development support
Contract opportunities
Role of the tribal 8(a) program participant
Capitalize on available business development assistance and support
Learn about government buying needs
Market to the government
Submit information annually to the SBA to prove eligibility
The program is driven by several key components. SBA plays a pivotal role, but the core of the program is focused on business development assistance, business development support, finding contract opportunities and marketing.
The most important role, however, is played by 8(a) firms themselves. Each of these components is explained in the following sections.
— 19 SBA’s Role
Program policy guidance
Review and certify eligible clients
Assign SBA personnel, Business Opportunity Specialists, to 8(a) participating firms
Provide business development assistance
Help identify contract opportunities for 8(a) participating entities
Review progress of 8(a) certified businesses and tribal concerns
As the administrator of the program, SBA provides program policy guidance, reviews and certifies eligible clients, assigns SBA personnel — Business Opportunity Specialists — to approved 8(a) entities, provides business development assistance, helps in identifying potential contract opportunities and reviews the progress of participating 8(a) concerns.
SBA’s role is to build a strong resource-rich program — that helps 8(a) tribal enterprises to become and remain competitive in the economic mainstream.
— 20 Business Development Assistance
Business counseling and mentoring
Online and traditional training
Surety bond guarantees
Contract marketing guidance
Able to acquire federal government surplus property
Other management and technical assistance
Aiding 8(a) tribal enterprises with business development assistance is core to the program. This assistance takes many forms, but includes, business counseling and mentoring; online and traditional training; surety bond guarantees; contract marketing guidance; acquire federal government surplus property; and, other forms of management and technical assistance.
Competitive strength comes from knowledge, financial support and technical assistance – all of which can be gained through SBA’s business development initiatives.
— 21 Business Development Support
Helping firms:
register in the System for Award Management (SAM)
find contract opportunities
maintain a current business plan with a procurement strategy
and other support
Working with agencies and prime contractors to direct contracts to small firms
Assigning Business Opportunity Specialists(BOS)s to work individually with participating 8(a) firms
Providing management, technical and financial assistance is one aspect of the program. Another key dimension is providing business development support to 8(a) clients.
This SBA support is varied and can include: helping 8(a) program clients register in the System for Award Management or SAM — which is a national database of firms seeking to do business with the federal government as well as prime contractors. SBA will also help firms to understand and use government tools to find contract opportunities, assists clients in developing and maintaining a current business plan with a defined procurement strategy, and provides assistance in many other ways. This assistance can be beneficial to a tribal business.
Importantly, SBA also works with federal agencies and prime contractors —- encouraging them to set aside, breakout or otherwise make contracts available to 8(a) and other small firms. In other words, SBA markets the technical capabilities of small businesses to federal buying entities.
In addition, each 8(a) firm is assigned a Business Opportunity Specialist by the SBA. The assigned specialist helps guide the 8(a) business during its tenure in the program.
— 22 Contract Opportunities
SBA staff and Procurement Center Representatives (PCRs) work closely with government and private organizations to identify procurement opportunities for small firms
Government-wide procurement goals that benefit small businesses
23% — Overall small business goal
5% — Small disadvantaged businesses
5% — Women owned small businesses
3% — Certified HUBZone firms
3% — Service-disabled veteran-owned small businesses
The federal government buys in excess of $600 billion dollars in goods and services each year. Government-wide procurement goals help define another aspect of the 8(a) program. Such goals establish procurement targets for agencies that benefit small disadvantaged businesses and other small firms.
SBA personnel, specifically Procurement Center Representatives, work closely with government and private organizations to identify procurement opportunities for small businesses and to help target specific acquisitions for 8(a) participating firms.
In addition, government policy and SBA staff encourage federal agencies to meet or exceed annual small business procurement goals. The current government-wide goal for prime and subcontracts to small disadvantaged businesses is 5%. Overall, however, the government-wide small business goal for all prime contracts is 23%.
Other government-wide procurement goals include: 5 percent of prime and subcontracts for women-owned small businesses; 3 percent of prime and subcontracts for Hubzone businesses and 3 percent of prime and subcontracts for service-disabled veteran-owned small businesses.
— 23 Role of 8(a) Tribal Businesses
SBA opens the door….
8(a) client firms must be competitive and market themselves competitively
Successful 8(a)tribal firms capitalize on available business development resources, educate themselves on government buying needs, and market themselves based on skills and ability to meet such needs
Finally, in describing how the program works, the most important role is played by the 8(a) firms, themselves.
SBA may be able to open some doors, but it is up to the tribal 8(a) firms in the program to be competitive and to market themselves effectively.
It’s all about preparation and self-marketing. Successful 8(a) firms capitalize on available business development resources, educate themselves on government and corporate buying needs, and market themselves based on their skills and ability to support the procurement needs of multiple organizations.
— 24 Reflection
Can the 8(a) program be used successfully by your tribe as a business development tool? How can this be accomplished? Importantly, what specific steps should your tribe take to make this happen?
— 25 8(a) Program Eligibility for Tribal Enterprises Program
eligibility requirements for tribally owned enterprises.
— 26 Eligibility
Special rules
Tribal eligibility
Business eligibility
Eligibility for the 8(a) program is uniquely defined for tribally owned businesses. As such, there are special rules and unique tribal and business eligibility requirements.
— 27 Special Rules
Special rules
– Initial 8(a) eligibility — 13 CFR 124.109
– Remaining in the 8(a) program as a participant — 13 CFR 124.112
Special rules apply to tribal enterprises regarding both initial 8(a) program eligibility and eligibility to remain in the 8(a) program as a participant.
— 28 Tribal Eligibility
Social disadvantage
Economic disadvantage
Required forms and documents
Tribal eligibility in the program requires specific evidence of social and economic disadvantage. It also requires specific forms and documents to be submitted at the time of application.
— 29 Social Disadvantage
An Indian tribe as defined in 13 CFR 124.3 is considered to be socially disadvantaged
“An Indian tribe means any Indian tribe, band nation or other organized group or community of Indians, including any ANC, which is recognized as eligible for the special programs and services provided by the U.S. to Indians because of their status as Indians, or is recognized as such by the state in which the tribe, band, nation, group or community resides”
Regarding social disadvantage and for the purposes of the 8(a) program, an Indian tribe — as defined in 13 CFR 124.3 — is considered to be socially disadvantaged.
Slid 30 Economic Disadvantage
Indian tribe must demonstrate to the SBA that the tribe itself is economically disadvantaged
– Number of tribal members
– Present tribal unemployment rate
– Per capita income of tribal members
– Percentage of local Indian population below the poverty level
– Tribe’s access to capital
– Tribal assets
– List of wholly or partially owned tribal enterprises or affiliates
Regarding economic disadvantage, 8(a) program eligibility requirements require that the tribal applicant’s tribe, demonstrate to the SBA that it is economically disadvantaged. To do this, SBA will consider a number of factors, including:
number of tribal members;
present tribal unemployment rate;
per capita income of tribal members, excluding judgment awards;
percentage of the local Indian population below the poverty level;
tribe’s access to capital;
tribal assets as disclosed in a current tribal financial statement; and
the aggregate of wholly or partially owned tribal enterprises or affiliates.
Importantly, once an Indian tribe establishes that it is economically disadvantaged in connection with the application for one tribally-owned firm, it does not have to reestablish such status in order to have other businesses that it owns, certified for 8(a) program participation, unless specifically requested to do so by the SBA.
— 31 Required Forms and Documents
Tribal applicant is required to submit all of the same documents generally required by all other 8(a) applicants
Other tribal specific documents required include:
– Copy of tribal governing documents
– Evidence of tribal recognition for special programs and services
– Copies of articles of incorporation and bylaws as filed with the organizing or chartering authority, or similar documents needed to establish and govern a non- corporate legal entity
– Documents to show tribe’s economically disadvantaged status
A tribal applicant is required to submit all of the same documents generally required by all other 8(a) applicants.
However, a tribally owned business is also required to submit additional tribal specific documentation, including: a copy of the tribal governing documents; evidence of tribal recognition for special U.S. programs and services; copies of articles of incorporation and bylaws as filed with the organizing or chartering authority, or similar documents needed to establish and govern a non-corporate legal entity; and, documents to demonstrate the tribe’s economically disadvantaged status.
— 32 Tribal Business Eligibility
Legal business entity organized for profit
Size
Ownership
Control and management
Individual eligibility limitation
Potential for success
Besides tribal eligibility requirements, there are business eligibility requirements for the 8(a) program that must be complied with as well. These requirements focus on the legal structure of the tribal business, the size of the concern, ownership rights, control and management of the enterprise, individual eligibility limitation and the potential for success of the tribal enterprise.
— 33 Legal Business Entity Organized for Profit
Applicant must be a separate and distinct legal entity organized by the tribe, federal or state authorities
Governance documentation must express sovereign immunity language, or “sue and be sued” clause which designates U.S. federal courts to be among the courts of competent jurisdiction for all matters relating to SBA’s programs, including, but not limited to 8(a) program participation, loans and contract performance
Tribal enterprise must be organized for profit and the tribe must possess economic development powers in the tribe’s governing documents