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White House raises federal SDB goal to 11 percent

News - Published Dec 10, 2021

The Biden-Harris administration recently announced a slate of federal procurement reforms which are taken with the aim of increasing utilization of small disadvantaged businesses (SDBs), a category of minority-owned business overseen by the U.S. Small Business Administration (SBA). 

The primary reform consists of the White House requesting federal agencies to increase their current spending goal for SDBs to 11 percent, up from the current 5 percent statutory goal. The request comes after the Biden-Harris administration announced in June of 2021 its intent to meet a goal of 15 percent of federal spending to be disbursed to SDBs by 2025 (over the last 5 years, spending with SDBs has averaged 9.8 percent per year). The White House also intends on releasing updated goals for other SBA certifications and business categories, including women-owned small businesses (WOSBs), service-disabled veteran owned small businesses (SDVOSBs), and HUBZone businesses.

Additionally, the White House is releasing disaggregated data on federal contracting broken down by race/ethnicity of business owner. This data is being released at this level of granularity for the first time, with the intent of ensuring equity by increasing transparency. 

New changes to "category management" practices (under which agencies buy as an organized entity, rather than as thousands of independent buyers) are also being introduced. Credits for awards made to SDBs and other small businesses under the category management practice will be instituted.

Read the White House press release at https://www.whitehouse.gov/briefing-room/statements-releases/2021/12/02/fact-sheet-biden-harris-administration-announces-reforms-to-increase-equity-and-level-the-playing-field-for-underserved-small-business-owners/.