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Prime Contractors Need Certified SDB Subcontractors

Federal certification of a company as a Small Disadvantaged Business (SDB) is an important consideration for prime contractors that are seeking qualified companies to work on Federal projects as subcontractors.

A prime contractor can obtain evaluation credits and monetary incentives on its Federal contracts by having certified SDB companies working along side it as subcontractors.

Federal certification for SDB companies became an important consideration last fall. In October, the Clinton Administration instituted a program that provides SDBs seeking prime Federal procurements a price evaluation adjustment of up to 10 percent for contracts in industries that still reflect the effects of previous discriminatory practices.

To qualify, the SDB must receive formal certification from the Small Business Administration and be listed in the SBA’s on-line database – PRO-Net.

On January 1, 1999, the subcontracting phase of the SDB Program was activated. This, too, involves only those industries that are eligible for the 10 percent price evaluation adjustment.

Prime contractors who use SDBs for subcontracting can qualify for evaluation credits and monetary incentives. The regulations initially required that the SDB subcontractors must be SBA-certified and appear on the PRO-Net listing earlier, but this will not become mandatory until July 1.

There already are about 5,775 certified SDBs, including 8(a)BD contractors listed in PRO-Net, covering a wide array of goods and services.

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