SBA fast tracks 8(a) applicants in defense-critical industries

The Small Business Administration is creating a new fast track for defense companies that want to join the 8(a) small contracting program.

The initiative supports both President Trump’s efforts to expand the defense industrial base and the goals of the recently established Smaller War Plants Commission.

SBA has identified 10 NAICS codes that are critical to defense and national security. The agency will prioritize the review and processing of 8(a) applications that fall in the following NAICS codes:

• NAICS 332992: Small Arms Ammunition Manufacturing
• NAICS 332993: Ammunition (except Small Arms) Manufacturing
• NAICS 336414: Guided Missile and Space Vehicle Manufacturing
• NAICS 336413: Other Aircraft Parts and Auxiliary Equipment Manufacturing
• NAICS 334511: Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
• NAICS 334419: Other Electronic Component Manufacturing
• NAICS 331110: Iron and Steel Mills and Ferroalloy Manufacturing
• NAICS 332710: Machine Shops
• NAICS 332999: All Other Miscellaneous Fabricated Metal Product Manufacturing
• NAICS 336611: Ship Building and Repairing

“By fast-tracking defense-critical firms and enforcing the rigorous statutory standards of the 8(a) program, the SBA will strengthen domestic supply chains, expand production capacity, and ensure that the world’s strongest military is backed by the world’s most resilient industrial base,” SBA Administrator Kelly Loeffler said in the agency’s Sept. 10 announcement.

Very few 8(a) businesses currently use these NAICS as their primary code. An analysis of GovTribe data showed that of the nearly 4,000 active 8(a) companies, only 47 (1.2%) use these NAICS codes as their primary registration.

Three of the NAICS codes have no 8(a) companies  – guided missile/space vehicle manufacturing (336414), iron and steel mills (331110), and ammunition manufacturing except small arms (332993)

Two other initiatives are underway at SBA that could greatly increase the pipeline of potential new 8(a) companies.

SBA has proposed revamping how it determines what is a small business. The proposal could add more than 100,000 companies that could qualify as a “small business.”

SBA is also reforming the 8(a) program itself to drop the race-based admissions framework, which would open the program to white-owned businesses. To qualify, 8(a) applicants must show they have been socially disadvantaged regardless of race.

Any individual can qualify by showing that during their lifetime, a government agency, university, or corporation discriminated against their racial, ethnic, or cultural group, or favored a group of which they are not a member, and that the action caused them material harm.

White applicants can point to diversity, equity and inclusion programs, affirmative action policies, and other DEI programs as evidence of social disadvantage.

The rule establishing the new 8(a) qualification became effective Sept. 10. Along with the rule going into effect, SBA has given any pending 8(a) applicants 45 days to resubmit their applications under the new social-disadvantage standard.

Any of those applicants that are in the 10 defense NAICS codes will be on a fast-track review process as well as any future defense applicants.