Disadvantaged Business is not a certification program. If a company meets the necessary criteria, it is considered a Disadvantaged Business. The designation does not exist outside the Request for Proposal (RFP) procurement process.

There are actually types of disadvantaged businesses: 1) Small Disadvantaged Business and 2) Socially Disadvantaged Business. Criteria:

Small Disadvantaged Business

1. Certified as either A) a Minority or Woman Business Enterprise (MBE/WBE) through the Bureau of Minority & Women Business Opportunities (BMWBO), B) an 8(a) business through the U.S. Small Business Administration (SBA), or C) a company that BMWBO determines meets the SBA's criteria for designation as a Small Disadvantaged Business (SDB)*
2. Grosses less than $20 million annually (or $25 million for those companies involved in Information Technology (IT) services or sales)
3. 100 or fewer full-time or full-time equivalent employees
4. Able to do the work in question

Socially Disadvantaged Business

1. Must be bidding as a prime contractor on the RFP
2. Must have suffered chronic and substantial racial or ethnic prejudice or cultural bias in the United States due to the business person’s color, ethnic origin, or gender
3. The prejudice or cultural bias must have negatively impacted the business’ establishment or growth

Both Small and Socially Disadvantaged Businesses must be for-profit and owned by U.S. Citizens.

* SDB was formerly a certification through the U.S. Small Business Administration; however, it is now a self-certification. BMWBO will determine companies meet the criteria for this requirement if they were certified as SDB through the SBA before it moved to self-certification and are able to present a letter from the SBA with a still valid expiration date.

Any type of for-profit business qualifies if it meets the Disadvantaged Business requirements. A disadvantaged business can be the prime bidder, a partner in a joint venture, or a subcontractor.

Yes. Only Small Disadvantaged Businesses cannot exceed the annual revenue and employee limits.

8(a) Business Development Program certification is a federal certification offered through the U.S. Small Business Administration (SBA). The program provides eligible firms with greater access to the resources they need to grow and develop their businesses. This, in turn, improves their ability to compete on an equal footing with other firms in the mainstream American economy. You can learn more about it by visiting www.sba.gov/8abd.

No.

For information on Disadvantaged Business program requirements, you can read the Disadvantaged Business sections of the RFP (should you have one). You can also find information on the Bureau of Minority & Women Business Opportunities (BMWBO) website at www.portal.state.pa.us/portal/server.pt?open=512&objID=1360&mode=2. If you still have questions after reading these documents, contact BMWBO at (717) 783-3119 or gs-bmwbo@pa.gov.

Since Disadvantaged Business is not a certification, there is no actual list of disadvantaged businesses. You can narrow down your search, however, using one of two methods:

1. Create a list of BMWBO-certified MBEs and WBEs. The best way to do this is to search BMWBO’s online database at www.dgsweb.state.pa.us/mbewbe/VendorSearch.aspx. If you have trouble accessing or navigating the database, you can contact BMWBO at (717) 783-3119 or gs-bmwbo@pa.gov and someone will guide you or click here to view step-by-step instructions.
2. Search for SBA-certified 8(a)s. Simply go to the SBA’s online database at www.ccr.gov, and click on Dynamic Small Business Search. Since this database has both certified and non-certified businesses, you must limit your search to bring up only 8(a) certified companies. Scroll down to 8(a) Certified under Government Certifications and mark “Required (Active Certifications only)”. * You can also limit your search by state (recommended if you are searching for Pennsylvania businesses only), NAICS codes (identify and classify specific business categories), area code, zip code, business type, bonding level, size, and name.

Remember, to qualify as a Small Disadvantaged Business, a company must meet one of the above two criteria, plus it must be a for-profit business, have 100 or fewer full-time or full-time equivalent employees, and gross less than $20 million (or $25 million for Information Technology businesses) annually. Additionally, it must be capable of doing the work it will be contracted to do, and the primary owner must be a U.S. citizen.

BMWBO's online MBE/WBE database only displays currently certified companies. If companies do not renew their certifications before they expire, their listings will no longer appear in the database.

In a subcontracting agreement, the prime contractor is contracting with another company (the subcontractor) to provide certain goods or services needed to fulfill the contract needs. The subcontractor’s responsibility only extends to providing those specific goods or services. In a joint venture, two companies share the risks and profits of the contract. You can find a more detailed description on joint ventures at www.portal.state.pa.us/portal/server.pt?open=512&objID=1360&mode=2, or by contacting (717) 787-7629 or gs-bmwbo@pa.gov.

Should a Small or Socially Disadvantaged Business (or Enterprise Zone Small Business) submitting a proposal as a prime contractor subcontract more than 40% of the value of the contract to other vendors, the company may no longer be considered as prime contractor on the proposal and may risk the Disadvantaged Business (or Enterprise Zone Small Business) points awarded to primes. In other words, the company may receive no Disadvantaged Business (or Enterprise Zone Small Business) points or it may be considered the subcontractor itself and, as such, be eligible for fewer points.

The required documentation will vary depending on the type of Disadvantaged Business participation. Information you need to submit might include:

Small Disadvantaged Business Participation

• Name, address, and phone number of DB company(ies) to which committing
• Copy of certificate confirming MBE, WBE, SDB, or 8(a) certification
• Recent audited financial statement or tax statement confirming gross annual revenues less than $20 million (or $25 million for IT sales or service companies)
• Letter attesting Small Disadvantaged Business has no more than 100 employees (required for SBA-certified SDBs or 8(a) businesses only)
• Documentation confirming DB owner's (or owners') U.S. citizenship (required for SBA-certified SDBs or 8(a) businesses only)
• Copy of a signed joint venture agreement OR subcontracting agreement or a letter of intent (letters of intent allowed for subcontracting commitments only)
• Commitment amount to each DB, in dollar amounts, if possible

Socially Disadvantaged Business Participation

• Evidence proving business suffered prejudice or bias due to businessperson's color, ethnic origin, or gender
• Evidence must show prejudice or bias:
  • Chronic and substantial
  • Occurred within the United States
  • Hindered businessperson's entry and/or advancement in business world

You can find other required documentation listed in the RFP, usually in Part II under Disadvantaged Business Information . Always follow the RFP with regards to the required information and documentation that must be included when submitting your proposal.

Sometimes, the nature of an RFP can make specific commitments to disadvantaged business difficult. Some things to remember:

When the information in an RFP, or lack thereof, makes providing specific commitments difficult, you can omit the timeframe and the location information, but you must state the dollar value of the commitment. If you have problems making a specific dollar commitment, you can state it in terms of the percentage of the total services/products and an estimated dollar value (see preceding question).

When making your disadvantaged business commitment, assume that the disadvantaged business’ supplies or services will be needed. If they are, you must purchase them from the disadvantaged business to which you made the commitment. If they are not, you will not be required to purchase them. If you like, use the phrase “as needed” or “when needed” when wording your commitment.

You can only earn disadvantaged business points on specific commitments made to specific businesses. These commitments become a binding part of the awarded contract.

Place all disadvantaged business information (narrative and cost) in a sealed envelope. We recommend that you put your company name, address and telephone number on the outside of the envelope, since the information will go to a separate office for evaluation. Two copies will be needed.

For your own protection, do not include Disadvantaged Business information in the body of the proposal. If the person evaluating the technical aspects of your proposal can determine the total cost by reading the disadvantaged business section, your proposal will be disqualified.

RFPs are scored and awarded using a point system. Each aspect of an RFP — such as technical, cost, disadvantaged business participation, etc. — is allotted certain number of points. The total points and their distribution can vary from RFP to RFP; however, the minimum weight for Disadvantaged Business participation points within an RFP has been set at 20%. A proposal will earn points on the various aspects, and the total will determine which bidder will win the contract.

RFPs are awarded according to a point system. Disadvantaged business points, a portion of all of the points available in a RFP, are determined using a priority ranking system. The higher the ranking, the greater the potential points.

Yes. Disadvantaged Business (DB) points make up only one, albeit significant, portion of the total points available within an RFP. Even without Disadvantaged Business participation, proposals will earn points in other areas, such as technical, cost, etc. The greater the total points a proposal earns, the greater the chances are of winning the contract.

Vendors must understand, however, that the Commonwealth supports DB participation in state contracting. Should the Commonwealth receive a proposal with minimal or no DB participation, the Bureau of Minority & Women Business Opportunties will contact that vendor to discuss increasing participation before the contract can be awarded.

Only DGS-certified MBEs and WBEs, SBA-certified 8(a)s, and those companies that BMWBO determines meet the SBA's criteria for designations as SDBs, and companies meeting the Socially Disadvantaged criteria can qualify as DBs.

We do not have a map of Enterprise Zones, but you can find a list of Enterprise Zone offices (in Adobe format) at www.portal.state.pa.us/portal/server.pt?open=512&objID=1360&parentid=1358&mode=2. To find Enterprise Zone boundaries, contact the local Enterprise Zone office.