SBESMALL (Business Enterprise)

What is SBESMALL (Business Enterprise)?

SBESMALL (Small Business Enterprise) is a designation used by state, city, and local government entities to identify and support small businesses within their jurisdiction. Unlike federal small business programs managed by the SBA, SBESMALL programs are tailored to the specific needs and economic goals of the locality. Achieving SBESMALL status can offer significant opportunities for government contractors seeking to do business at the state and local levels.

Definition

SBESMALL, as a term, lacks a single, universally accepted definition. Instead, each state, city, or local government agency establishes its own criteria for defining a "small business" eligible for its SBESMALL program. These criteria typically include maximum revenue, employee size, and other factors specific to the local economy and industry. The purpose of SBESMALL programs is to promote economic development, create jobs, and foster competition within the local business community by providing preferential treatment to certified small businesses in government contracting opportunities. This designation matters to government contractors because it can open doors to set-aside contracts, subcontracts, and other preferences specifically targeted to SBESMALL firms, boosting their chances of securing government work. The regulations governing these programs are generally found within the relevant state or local procurement codes and ordinances.

Key Points

• Local Definition: SBESMALL criteria vary significantly across different state, city, and local jurisdictions. Contractors must research the specific requirements of the entities they wish to contract with.
• Certification Process: Typically, businesses must formally apply for and be certified as an SBESMALL by the relevant government agency. This involves submitting documentation to prove eligibility.
• Set-Aside Opportunities: SBESMALL certification often allows businesses to compete for contracts exclusively set aside for small businesses within that specific jurisdiction.
• Subcontracting Preferences: Prime contractors may receive incentives or preferences for subcontracting portions of their contracts to certified SBESMALL firms.

Practical Examples

1. City Construction Project: A city government might set aside a construction contract for a new park pavilion exclusively for SBESMALL-certified firms located within city limits. A local construction company with SBESMALL status would have a significant advantage in bidding on this project.
2. State IT Services Contract: A state government might require prime contractors bidding on a large IT services contract to subcontract a certain percentage of the work to SBESMALL firms certified by the state's Department of Small Business.
3. County Janitorial Services: A county government could implement a points-based system for evaluating bids on janitorial services contracts, awarding extra points to companies that are SBESMALL-certified by the county.