Small Business Set-Asides & Equity Mandates

Despite political scrutiny around DEI initiatives, set-aside programs like 8(a), HUBZone, SDVOSB, and WOSB are protected by federal statutes and continue to drive inclusive contracting. Contractors must understand eligibility, compliance, and market research requirements to compete effectively in this space.

What Are Small Business Set-Asides?

Set-asides are procurement mechanisms that reserve federal contracts for small businesses. According to the SBA and FAR guidelines:

Contracts between $10,000 and $250,000 must be reserved for small businesses unless fewer than two are expected to bid.
Above $250,000, agencies must conduct market research to justify set-asides.
Set-asides can be full or partial, and may include sole-source awards.

Key Socioeconomic Programs

The SBA administers several targeted programs:

8(a) Business Development: For disadvantaged businesses.
HUBZone: For firms in historically underutilized business zones.
Service-Disabled Veteran-Owned Small Business (SDVOSB): For veteran entrepreneurs.
Women-Owned Small Business (WOSB): For women-led enterprises.

Each program has unique eligibility criteria and certification requirements. Agencies must consider these programs first when issuing set-aside contracts.

Clarifying the Policy Landscape

While DEI initiatives focus on workforce diversity, equity mandates in procurement are legally grounded in the Small Business Act.

Set-asides are not affected by recent DEI policy debates.
They remain protected by federal law and supported by bipartisan legislation.
Contractors should stay informed but not conflate DEI with procurement equity.

This distinction is crucial for understanding the stability and longevity of set-aside programs.

Eligibility

To qualify and compete:

Businesses must register in SAM.gov and maintain certifications.
Agencies must document market research and rationale for set-asides.
Subcontracting limitations apply: small businesses must perform at least 50% of the work (excluding materials) on supply contracts.

Understanding these rules helps avoid disqualification and ensures compliance.