By: Mark Lee The U.S. Tax Code is a 74,000 page maze of sections, clauses, deductions and exemptions. Small business owners certainly do not have the time to learn every twist and turn, clause and section in the Code. Not only do entrepreneurs have to keep their doors open, take care of their employees, and keep on the right side of state and local regulations, but they must also submit detailed filings to the IRS that vary across the spectrum of the small business ecosystem. So, what should be done to streamline the Code and lessen the burden on our nation’s small business community? The House Small Business Committee (HSBC) held an appropriately titled hearing, “Start-ups Stalling? The Tax Code as a Barrier to Entrepreneurship,” to begin to tackle this issue. The HSBC is one of the more bipartisan committees in the House, so it was no surprise that both Chair Steve Chabot of Ohio and Ranking Member of Nydia Velazquez of New York were in general agreement that the tax code is desperately in need of reform and simplification. The hearing was convened at a time when Speaker of the House Paul Ryan was busy whipping up support for a comprehensive federal tax code overhaul--- one not seen since the Reagan Administration. Ranking Member Velazquez made it clear that small businesses must be at the forefront of any tax overhaul. Since pass-throughs, S-corps and LLCs are all subject to different tax regimes, Rep. Velazquez mentioned, simple business formation is one of the first complicated tax hurdles that an entrepreneur has to clear. Additionally, startups and small businesses are often operating in the red or on very slim revenue margins to where an unexpected hurdle could potentially be ruinous. Chair Chabot asked the panel about the cost of compliance and the fear of audits. As we all know, the majority of small businesses do their taxes in-house and cannot afford accountants and tax attorneys. The panel unanimously agreed that this was amongst the most pressing tax burden they face. Witness Tim Reynolds, President of Tribune, Inc. of Hudson, Ohio and testifying on behalf of the National Small Business Association, recounted his own recent audit costs. His small firm paid thousands of dollars in compliance costs alone: a number that doesn’t account for the lost business and revenue that resulted from the audit process. Other witnesses included Mr. Kyle Pomerleau, Director of Federal Projects at the Tax Foundation; Troy Lewis, CPA, CGMA, the Tax Executive Committee Immediate Past Chair of the American Institute of CPAs, and David Burton, Senior Fellow of Economic Policy at the Institute for Economic Freedom and Opportunity at the Heritage Foundation. In an already wild start to a new Administration and Congress, tax reform remains near the top of both of their agendas. Small businesses everywhere are rightfully screaming for relief. We need to stay on top of advocating for tax reform that is a less burdensome regulatory regime for our nation’s vital job creators.

By Jennifer White What is the number one thing small business owners want Congress to focus on this year? Is a lack of political certainty affecting America’s business environment? What can be done to better help women and minorities obtain capital to start their businesses? These are the questions the House Small Business Subcommittee on Economic Growth, Tax, and Capital Access discussed during a hearing entitled “State of the Small Business Economy,” giving the committee the opportunity to listen to testimony on concerns confronting small business owners in 2017. To no surprise, the committee heard that the most taxing issues to small business right now are healthcare deficiencies, tax reform, and regulatory reform, and Chairman Bland posed the question, “In addressing these issues, where should we spend the most time?” Holly Wade, Director of Research and Policy Analysis for the National Federation of Independent Business (NFIB), said you can’t pick just one. According to NFIB’s 2016 Small Business Problems and Priorities Survey, health insurance is the number one issue plaguing small business, directly followed by burdensome regulations and federal taxes. The small business economy, she said, has struggled to bounce back from the recession due to taxes, regulations, and health insurance, which consume valuable resources of small businesses, including time and profits. To restore the small business economy, all three of these issues must take priority. Another common denominator heard in each witness’ testimony was concern over lack of policy and regulatory certainty regarding the business environment. Steve Veuger, Resident Scholar of the American Enterprise Institute, said that despite measures such as passage of the Small Business Regulatory Flexibility Improvements Act, requiring more careful consideration on rules and regulations and how they affect small business, measures of uncertainty have spiked in the last few months. Mr. Veuger also pointed out that congress must be careful in the repeal and replacement of the ACA – to move forward without a clear direction of policy, he said, could cause individual and small group markets to unravel in a detrimental way. Members of the subcommittee also asked questions about the difficulty that women and minorities still face in regard to obtaining jobs and accessing capital. According to Victor Hwang, Vice President of Entrepreneurship for the Ewing Marion Kauffman Foundation, an important part of that issue is that while the U.S. is increasingly becoming more racially diverse, the American entrepreneurial population does not reflect it. Today, 80.2 percent of American entrepreneurs are white and 64.5 percent are male. Mr. Hwang said that this gap for racial minorities and women is costing the country millions of jobs and that the key piece to increasing diversity in entrepreneurship is by overcoming social barriers, such as lack of a formal degree, race, or gender, that can often prevent individuals from turning an idea into a business reality. Further, Bob Bland, CEO and Founder of Manufacture New York, and the co-chair of the Women’s March on Washington, relayed her own struggles of accessing capital because of past credit. Even with great programs it can still be difficult for women to get loans, she said, because they still don’t qualify for low interest rates, and need something that provides for more risk like venture capital, which can be even harder to obtain. Mr. Hwang agreed that venture capital is not on a level playing field. He suggested that building more opportunities for connections at a local level based on trust would be a very core way of getting obtaining capital to a level playing field. “Being an entrepreneur is hard and there are risks associated – it’s the spirit of being able to take a loss that makes America great – what can we do to spread the risk so that everyone everywhere has the opportunity to be one?” asked Rep. Kelly as the final question of the hearing. We educate people on how to find jobs, not how to make jobs, answered Mr. Hwang. To understand the access issues entrepreneurs face, we have to focus on the people who are starting at the bottom with nothing.

By Ann Sullivan Earlier this month, WIPP submitted comments on a proposed rule changing the rules related to small business participation on multiple award contracts, also known as MACs. The FAR Council, which oversees federal acquisition regulations, sought to clarify the use of set-asides, reserves, and orders placed against MACs. As contactors already know, use of these large contracts is steadily growing. Ensuring all socioeconomic groups, including WOSB’s have access to these opportunities, is a top priority for WIPP. The rule adds coverage for the new concept of a “reserve.” A reserve would be used on MACs where a partial set-aside is not feasible, but where agencies still want small businesses to participate as prime contractors. This “reserve” concept is very similar to the tracks outlined in WIPP’s Do Not Enter report, which shows how agencies have utilized certain socio-economic set-asides, and discriminated against women-owned firms. While the proposal provides clarity for contracting officers, it falls short by including an out-of-date policy regarding the limitations on subcontracting. In May 2016, SBA finalized a rule change that substantially revised the limitations on subcontracting by making it easier for women-owned firms to comply. The new rule focuses on the percentage of the award amount that has been subcontracted, not the percentage of work. The rule also provides an exemption for similarly situated entities, so WOSBs subcontracting to other WOSBs does not count against the percentage of the award subcontracted. This new policy is a win-win for small businesses, but the FAR Council does not acknowledge the new policy in its rule. If one of the purposes of the rule is to clarify small business authorities for contracting officers, the FAR should use the most up-to-date performance of work requirements. WIPP appreciates the interest of the FAR Council in providing greater flexibility and clarity for the role of small businesses in multiple award contracts. But this proposed rule does not do enough. Without additional small business protections, this rule could hurt our nation’s biggest job creators- small businesses.

By: Jake Clabaugh In February, the President released his FY 2017 Budget Proposal, the final budget proposal of his administration. The President’s annual budget is often referred to as an economic blueprint as it outlines the Administration’s spending priorities. Importantly, last year’s Bipartisan Budget Act, already set the top-line spending levels for FY2016 and FY2017. The President’s budget follows the top-line discretionary spending limit, and distributes $4.1 trillion in total across the Administration’s priorities. The Budget proposal has no effect on law, but instead begins the budget season. The President’s Budget Request is supplemented by each Agency’s budget justifications. The chart below highlights programs important to AEO members: The Small Business Administration’s (SBA’s) request for the Microloan program is a win for AEO members. SBA increased their request for the Microloan program lending authority to $44 million – up over 25% from last year’s request of $35 million Like last year, the SBA did not make a budget request for the PRIME program, which provides training and technical assistance to disadvantaged entrepreneurs and microenterprise development organizations. Despite the SBA not making a request, AEO’s advocacy efforts were successful in restoring funding for PRIME to $5 million. AEO will be sure to work with Congress to ensure that appropriators know the value of the PRIME program. Looking Past the Numbers While the budget lays out funding levels, it also allows agencies to highlight their legislative priorities. SBA aligned its FY2017 priorities with issues AEO members will be familiar with. Specifically, SBA requested that Congress eliminate the 25/75 technical assistance rule in the Microloan program. The SBA cited intermediaries’ need to provide “unconstrained" pre- and post-loan technical assistance. Also, the SBA called for changes to the 1/55 rule. SBA pointed out that, “this restriction effectively delays deployment of microloan funds thereby limiting the availability of capital for small businesses regardless of the size of the state or the needs of the small business community.” Moving Forward The President’s submission of a budget to Congress formally kicks off the annual spending process. Since Congress has already agreed upon the top-level of $1.1 trillion in discretionary spending for FY2017, the debate will be about the level of funding for agencies, and certain programs. While it is unclear if there is enough time in the calendar to complete a comprehensive budget process with 12 separate appropriation bills, AEO’s policy team is committed to advocating for our priorities every step of the way. Members can look forward to updates through out the spring and summer on our efforts.

By: Ann Sullivan WIPP Works in Washington You’ve heard the expression, “if it ain’t broke, don’t fix it.” In Washington, that means if the private market has solutions that are working fine, government intervention will probably mess it up. That is precisely what happened to Health Reimbursement Arrangements/Accounts (HRAs). Although anything healthcare-related is annoyingly complex, for simplicity’s sake, let me just explain what HRAs are. HRAs are an easy way to offer health insurance—employees shop for their health insurance and employers reimburse them whatever portion of the premium they choose to. Employees need to show that they are paying premiums in order to get reimbursement from employers. It’s that simple. This arrangement has worked for small employers for many years because of their limited access to affordable group health insurance plans. The important part of this arrangement is the tax treatment. Employers can deduct their payments and the benefit is pre-tax to employees. This is the same tax treatment companies that offer health insurance through a group plan are entitled to. Enter the IRS, the Department of Labor and the Department of Health and Human Services (HHS). These federal agencies determined that the Affordable Care Act (ACA), also known as Obamacare, prohibited these HRAs. According to the agencies, HRAs do not comply with changes made in the ACA. It is their contention (and hosts of government lawyers) that these HRAs are now considered a group plan under the law and are no longer eligible for pre-tax treatment and do not comply with the ACA reforms. In 2013, the IRS decided to begin imposing the $100/day per employee penalty to employers who continue to use this arrangement to offer health insurance to their employees. Ouch. With that fine looming over their heads, small employers were faced with two choices: 1) Stop reimbursing employee health insurance costs; or 2) Put in place a group plan, most likely through the small business (SHOP) exchanges. There are a few things wrong with this approach, beyond the obvious. First, SHOP exchanges were just launched and are not nearly as robust or as user friendly as we hope they will become as they mature. From personal experience, it takes patience—and assistance from a broker—to maneuver SHOP exchanges. Second, the ultimate objective of the ACA is that everyone has access to insurance. So, denying this arrangement results in loss of employer reimbursement, leaving employees to shop and pay for their own insurance. Seems counter to the goals of the law, if you ask me. Finally, many small employers had no idea of the IRS determination. Don’t stop reading this article and throw up your hands in disgust at government. Keep reading because there is actually good news. Secretary Burwell, who heads up HHS, held a roundtable with 10-15 individuals who work with small business associations, of which WIPP was included. The Secretary wanted to hear concerns from the small business community with respect to the ACA and was interested in how she could help. WIPP raised the HRA rulings and the problems associated with the IRS determination. The Secretary listened carefully and then acted. Not long after our meeting, the IRS released Notice 2015-17, delaying the steep penalties for small employers using HRAs. The reprieve lasts until 2016, which should give Congress time to make the necessary fixes to the law to accommodate HRAs. Now it is up to us to seek the permanent legislative fix needed to allow small companies to offer HRAs. A number of other associations are supportive of this common sense change. As is the case in many laws, good solutions are not one-size fits all. What works for large companies, doesn’t necessarily work for small companies. In the case of HRAs, small employers found an easy solution to providing health insurance to their employees. Government should support, not discourage that method of coverage. If it ain’t broke, don’t fix it.

By: John Stanford WIPP recently submitted testimony to the House Small Business Committee on comprehensive tax reform. This blog gives an overview of WIPP’s advocacy efforts. For more details, I encourage you to read the testimony. Our government relations team strives to make official communications as easy-to-read as possible, but should you have questions please reach out to WIPP. Women entrepreneurs deserve a tax system that rewards the effort, tenacity, and risk it takes to start and grow a business. Moreover, they deserve a system of revenue collection (because that’s what taxes are) that is simple and fair. In testimony submitted to the House Small Business Committee, WIPP said just that. Citing reports from the IRS National Taxpayer Advocate as well as the SBA Office of Advocacy, the testimony documents what women business owners already know: the tax system is broken, failing under the weight of complexity, uncertainty and outdated policies. But more importantly, the testimony addresses the impact of possible reforms – and the need for any overhaul to be comprehensive. What does that mean? It means that the idea to lower the corporate tax rate, favored by the White House and some in Congress, must not happen independently of adjusting individual rates in a similar manner. This distinction matters because so many businesses, including almost 9 in 10 women-owned businesses, are structured as “pass-through” entities paying taxes as individuals (including S-Corps, Sole-proprietorships, partnerships, and LLCs). Corporate-only reforms would be unfair to these businesses – and for that reason WIPP has always supported comprehensive (corporate + individual) reform. The testimony underscored this important point. In addition, WIPP identified tax policies that, absent major reforms, would benefit women entrepreneurs. This includes making more small business tax credits and deductions permanent. In recent years, these tax “extenders” have been extended (hence their name) at the last minute, or even retroactively – not a good way for business owners to plan their budgets. WIPP also asked Congress to consider tax credits that benefit new businesses, helping offset the costs of launching a new company. Another policy request was to avoid changing the Employee Stock Ownership Plan (ESOP) provisions in the tax code, as these have proven to be both popular and good tools to incentivize productivity and long-term business health. In agreement with the idea that simple businesses (sales – costs = income) should have simple taxes, WIPP also supports simplifying the cash accounting method and expanding its optional use to more small businesses. Finally, with healthcare costs an always-growing burden on employers, WIPP continues its support of expanding the Small Business Health Care Tax Credit so more women entrepreneurs minimize the cost of providing healthcare to employees. More ideas for reforming the tax system to incentivize entrepreneurship and innovation are out there. WIPP will continue working to identify policies that let women business owners focus more on their business and less on complex tax requirements. At the end of the day, all of these decisions should be made with the basic principles of simplicity and fairness in mind. And that’s exactly what we asked Congress to do.

By: John Stanford, WIPP Government Relations The Department of Labor and FAR Council issued final regulations that require federal contractors to disclose labor violations from the past three years. This blog updates an earlier edition with what you need to know. For more details or if this impacts your business, I encourage you to read official guidance here. Ahhhh, Labor Day. The unofficial end of summer. A century-old government-granted day off to squeeze in another day at the pool, buy the last of the school supplies (who really needs a protractor anyway?), see the grandparents, and now – for federal contractors – an opportunity to review your company’s legal history. It doesn’t sound quite right, does it? But for thousands of federal contractors, that is exactly what newly finalized regulations mean. I will get into to the details and timeline of the new requirement in a moment, but first, a little history on a change WIPP has watched closely. In 2014, President Obama issued an Executive Order with the goal of barring bad companies from winning federal contracts. The following summer the Labor Department (DOL) and the FAR Council (overseers of contracting rulebook, “the FAR”) proposed how this could be achieved. Last week, final rules were published – and contractors nationwide let out a collective groan. You see, excluding companies with a history of bad acts from winning government work – a generally universally accepted idea – is not easy. WIPP said just that in our formal comment last year. We agreed that companies that follow the rules should not have to compete against companies that break them for federal contracts. But the proposed system would place burdens on women-owned contractors and dump paperwork requirements on contracting officers. Our comment, along with hundreds from individual business owners and other trade groups, did little to sway the government from moving forward. The new requirement detailed below goes into effect on October 25, 2016. The regulation requires federal contractors and subcontractors to disclose violations of 14 federal labor laws and the equivalent state laws from the previous three years. Exemptions were provided for companies with contracts valued less than $500,000. Prospective federal contractors will need to declare if they had labor violations in the previous three years when submitting an offer. During an initial evaluation, contracting officers will see that declaration (a simple “yes” or “no”), without any additional detail or explanation. Later, if a contractor were likely to win an award, the contracting officer would have to decide if the contractor is a responsible company (a requirement of all government contracts already). It is in this phase that details like appeals, remediation, or mitigating factors could be explained. Contracting officers will attempt to identify companies with “serious”, “willful”, “repeated”, and/or “pervasive” violations and not award them contracts. Companies with minor violations could still be considered responsible and win contracts. In what the government views as a compromise since their initial proposal, the system will be phased-in over the next two years. The DOL released the following timeline: Phased-In Implementation Schedule · Week of September 12, 2016: Preassessment begins, through which current or prospective contractors may come to DOL for a voluntary assessment of their labor compliance history, in anticipation of bids on future contracts but independent of any specific acquisition. · October 25, 2016: The final rule takes effect. Mandatory disclosure and assessment of labor law compliance begins for all prime contractors under consideration for contracts with a total value greater than or equal to $50 million. The reporting disclosure period is initially limited to one (1) year and will gradually increase to three (3) years by October 25, 2018. · January 1, 2017: The Paycheck Transparency clause takes effect, requiring contractors to provide wage statements and notice of any independent contractor relationship to their covered workers. · April 25, 2017: The total contract value threshold for prime contracts requiring disclosure and assessment of labor law compliance is reduced to $500,000. · October 25, 2017: Mandatory assessment begins for all subcontractors under consideration for subcontracts with a total value greater than or equal to $500,000. Needless to say, our concerns remain. And before I go into a few of them, I would point out that the $50 million threshold sounds like a lot. It includes, however, companies on a multiple award contract with a ceiling amount above $50 million. Meaning a company that wins a BPA or IDIQ valued above $50 million, though not necessarily the amount of work the company will actually perform, will face the October 2016 deadline. On a broader level, the rule simply is not ready for primetime. The Labor Department and FAR Council chose not to include what state labor law violations must be reported. It is impossible to gauge the impact of a regulation when missing significant portions. What is in the rule, however, is equally concerning. In some cases, violations that require reporting will not be be fully adjudicated. That is, companies would have to report decisions against them that may ultimately be overturned – as nearly a third of NLRB decisions have been. This is compounded by WIPP’s worry that simply having violations on record will “blacklist” companies without providing any opportunity to offer explanation. With limited resources and time, contracting officers may elect to avoid companies with any disclosed violations, despite the intent of the order to only bar violations of a certain severity. Burdens on subcontractors are also being created. They must report violation history as well – directly to DOL. This was a notable change in the final rule, by making the subcontractor and the Labor Department engage each other, and not put the responsibility on the prime contractor. At the same time the government has admitted it lacks the resources to answer all questions about weighing different labor violations from hundreds of thousands of subcontractors. Ultimately, this change could be the most damning, as many of these companies are unaware of the new requirements because they never sought business with the government in the first place. Finally, the Fair Pay and Safe Workplaces requirement is one of many in a disconcerting trend of new regulations that specifically target federal contractors. Earlier this year, regulations raised the minimum wage solely for workers on federal contracts. New requirements regarding sick leave were also released. These make contracting with the federal government more onerous, particularly for women entrepreneurs seeking to enter the market. At a time when we want more competition and innovation in government, policies impacting only federal contractors put up barriers for entry. Without question, WIPP supports efforts by the federal government to rid the contracting environment of businesses with a history of abusive and neglectful violations. In doing so, the government levels the playing field for the millions of businesses playing by the rules. But the government already has those tools and this rule will not achieve this goal. Instead, it will be harder to be a contractor, pushing the innovative products and services of women-owned businesses out of the federal market. So to the federal contractors out there gearing up for a warm holiday weekend, fire up those grills, wear that final white outfit, and head into the office – it’s going to be a busy day. John Stanford is part of WIPP's Government Relations team in Washington, D.C., specializing in federal procurement and healthcare policy. When not bothering lawmakers about needed changes, he can be found in the woods at local golf courses.

By: John Stanford, AEO Government Relations Beginning November 1st 2016, the enrollment period to sign up for health insurance is open for both individuals and small businesses. In anticipation of the sign up period, AEO’s policy team has prepared this FAQ to help ensure you know what you need to know. What is an enrollment period? For most individuals and businesses, health insurance can only be selected during an annual enrollment period. Lasting three months, this is a time for consumers to shop between plans and select coverage for the following year. Missing the enrollment period will mean you cannot select insurance for 2016, which comes with a hefty penalty (see below). Throughout the year, special events like starting a business, losing/getting a job, getting married or having/adopting children, allow for special enrollment periods to select new plans. What are the key dates for 2016 Open Enrollment? Here is a timeline for this year’s enrollment period (note the December 15th deadline!): November 1 – enrollment begins: you can shop plans via www.healthcare.gov (you may be directed to your states marketplace) December 15 — Last day to enroll for January 1, 2016 coverage: This is important because if you do not have coverage of some kind on January 1, you may face a penalty January 31 — Individual enrollment period closes April 2016 – Penalties for not having health insurance in 2015 due ($395 or 2% of your income, whichever is higher) Throughout 2016: Small businesses may sign up for insurance through small business (SHOP) marketplaces What are the penalties for not having health insurance insurance? When would I pay them? There are two sets of penalties relating to health insurance. Penalties faced by all of us as individuals, and penalties employers may face. In 2016, the penalty for not having individual insurance is $695 or 2.5% of your income – whichever is higher. This is an increase from 2015. For employers, there are two types of penalties, but only if you have 50+ employees. Again, there are no penalties for businesses with less than 50 employees for not offering health insurance. For more than 50 employee-sized companies, penalties will be assessed for not offering coverage or offering coverage that is deemed unaffordable. More on employer penalties is available here. Penalties are paid on tax returns the following year – failure to get coverage in 2016 would be paid in April 2017. Are more people really signing up for insurance? AEO was recently at the White House to discuss the upcoming enrollment period. At the meeting, the Administration shared the latest numbers on the impact of the Affordable Care Act up until now: Since 2013, 17.6 million Americans have gained insurance, reducing the uninsured rate by 39% 29 states (including DC) have expanded Medicaid Enrollees, however, will now be tougher to find and engage. Of the remaining uninsured, 50% are between 18-34 years of age and 40% fall between 139-250% of the poverty level (up to roughly $60,000 a year for a family of 4). Does that mean healthcare costs are going down? It certainly does not feel that way. Healthcare costs are going up. In the years leading up to the Affordable Care Act (ACA), healthcare spending (not premiums specifically, but all health dollars) was increasing by 10-20% each year. This was a byproduct of the high cost of the uninsured, an aging population, and system inefficiencies. It was generally agreed by economists that reform was necessary to address overall healthcare costs. The ACA sought to solve this by expanding the insured market. The theory was that the high cost of the uninsured would be reined in because insurers generally achieve better pricing for services and prescription medicines. Among other things, the ACA eliminated insurers’ ability to charge differently for pre-existing conditions and removed lifetime caps on coverage. It also had two mandates to achieve increased coverage: individual – requiring everyone have insurance of some kind; and employer — requiring larger employers (more than 50 employees) offer insurance of some kind to their employees. Both mandates have penalties for failure to comply (see above). But Premiums Keep Going Up. Why is that? Now, we have an insured pool that is sicker and costlier than before. This drives the average cost of insurance, and by extension, premiums up. Health insurers are still unsure just how sick these people are and what it will cost. So we can expect to see major fluctuations as insurers get more data on the pools they are covering. For small businesses shopping in the small business marketplace, the pool remains one of the smallest segments of the health insurance market. This means that prices for America’s entrepreneurs are the most likely to face sharp increases.

The WOSB procurement program website is undergoing a facelift. A new website, called SBA ONE, will allow for the electronic submission of SBA forms, as well as a streamlined location to monitor all certifications for your company including the repository. With the change, there are three things you need to know: All WOSBs will need to create a new login for the new system. The new website is actually an entirely new system and as such all WOSBs will need to create a new account and login (but not reload all documents – see next). The SBA is also asking that after creating a new account, all WOSB/EDWOSB companies submit new Form 2413 (WOSB certification) and/or Form 2414 (EDWOSB certification) electronically. Businesses should do this as soon as possible. The repository is being migrated, but is currently closed. This is important for two reasons: 1) your documents previously submitted should move to your new account and not require resubmission (except as mentioned above a new electronic Form 2413/2414); and 2) Contracting officers will not be able to view your repository documents for WOSB awards. Instructions for you to provide to a CO about how they can confirm your eligibility is available at the end of this document. This only impacts WOSB/EDWOSBs about to win EDWOSB or WOSB set-aside or sole source awards. The new site supports self-certification. Self-certification for WOSB/EDWOSBs remains an option until SBA finalizes new certification requirements. The website supports companies electing this option by allowing for the electronic submission of required documents. Third-party certifications can be uploaded as well. SBA ONE, located at certify.sba.gov, will eventually house all program certifications, but is beginning with the WOSB program. Additional programs will be incorporated onto the site on the following projected timeline: 8(a) Business Development Program (Fall 2016), HUBZone Program (Spring 2017) and Dynamic Small Business Search (DSBS) (Spring 2017). If you have any questions about the certification program, or comments on improving the site, please email certify@sba.gov. More details on the transition of repository documents are available at www.sba.gov/wosb. * * * Information for Contracting Officers (Direct from SBA) Due to the system upgrade, access to the WOSB Federal Contract Program Repository will be temporarily unavailable for contracting officers (CO), starting on Wednesday, March 23 at 1:00 EDT. This may be down for several weeks. During this time, in order to comply with the WOSB Program requirements at 13 CFR 127.301 and FAR 19.1505(e) (specifying that a CO shall verify that an apparent successful offeror has provided all the required documents set forth in 127.300(e) to the WOSB Repository), SBA will review the Repository on behalf of a CO. A CO may request that SBA review the Repository on their behalf by sending an email to wosb@sba.gov(link sends e-mail) with the following in the subject line: "PENDING AWARD UNDER FAR 19.505(e) VERIFICATION REQUEST- SOLICITATION NUMBER [insert solicitation number]." In the body of the email, the CO should provide the following: provide the apparent successful offeror’s DUNS, EIN, FIRM NAME, OWNER NAME; indicate whether the pending award is a WOSB or EDWOSB set-aside or sole source award; specify the NAICS code assigned to the procurement; and identify the State where the CO is located. Within 2 business days, SBA will perform the necessary check to determine whether the apparently successful offeror has filed all the required eligibility documents and provide the CO with an email response which either: (a) notifies the CO that all required documents have been provided or (b) identifies which documents are missing in order to allow the CO to file a status protest in accordance with SBA regulations and the FAR. Emails for this information will be processed only for Contracting Officers.

By: Jake Clabaugh, WIPP Government Relations Is the federal regulatory process stacked against entrepreneurs? The Joint Economic Committee sought to answer this question during a hearing entitled “Encouraging Entrepreneurship: Building Business, Not Bureaucracy.” The Committee’s Vice-Chair, Pat Tiberi (R-OH) opened the hearing with this direct question to witnesses: Is the thicket of government bureaucracy strangling private initiative? Before taking on the Vice-Chair’s question, the witnesses began by framing the landscape. Entrepreneurship – the birth of new firms – has been trending downward since President Jimmy Carter’s Administration in the 1970’s. Dr. Tim Kane, a Research Fellow at Stanford University’s Hoover Institution, highlighted the decline in the number of startup firms from 16% of total firms in the U.S. in 1977 to just 8% today. Despite the decline in overall start-ups, National Women’s Business Council (NWBC) Chair Carla Harris lauded the growth in women-owned businesses. Since 2002, the number of women-owned firms has leaped from 6.5 million to 10 million. Women are creating businesses at 2 -1/2 times the national average. The progress made by women business owners provided a bright spot in otherwise gloomy testimony on the outlook for entrepreneurs. When the witnesses were asked what regulations were causing the most headaches, the Affordable Care Act (ACA) was the most commonly cited culprit. Specifically, the ACA defines a full-time employee as an individual working thirty hours a week instead of the traditional forty. This definition determines whether a business is exempt from the employer mandate. The witnesses echoed the experiences of many WIPP members who have found the thirty-hour workweek definition detrimental. To tackle this and other regulatory challenges, WIPP partnered with the National Association of Manufacturers, Small Business & Entrepreneurship Council and International Franchise Association to launch Rethink Red Tape. As part of this initiative, WIPP will be calling on policymakers to produce better, fairer rules. In the opinion of the Joint Economic Committee and WIPP Members alike, regulatory reform will be a win for entrepreneurship.

By: Jake Clabaugh, WIPP Government Relations Federal contractors have been hit with a bevy of new regulations over the past few months – everything from increased reporting of labor and safety violations, a raise in minimum wages and increases in mandatory overtime pay. The next shoe will drop in January 2017, when ALL Federal contractors, primes and subs, will have to provide paid sick leave benefits to workers. The Department of Labor (DOL) proposed rules that would implement this change last month. Contracts issued January 1, 2017 will require all Federal contractors to give employees 1 hour of paid sick leave per 30 hours worked. This rule will only apply to time spent on Federal contracts, so if an employee performs some work for a private sector client, those hours would not count toward sick leave accrual. Additionally, earned sick leave will carry over from one year to the next. Why just contractors? The President issued an Executive Order to make the change. Like other new regulations pertaining to contractors, the President can make these decisions for his workforce. Congress has been unable to decide if or how to move forward on these issues so the President decided to act on his own. As the Commander in Chief, he can determine procurement policy – including requirements for contractors – without Congress having to pass a law. While WIPP members support worker benefits in practice, we don’t believe that the DOL gave enough consideration to how this rule will affect small businesses. Without an exception for small businesses, the vast majority of women-owned business will be compelled to provide the same benefits as multi-billion dollar firms. WIPP’s comments to DOL on the proposed rule can be read in full here.

By: Debbie Kobrin, WIPP Government Relations With the party conventions right around the corner, and a few months to a new President, you might think the current administration would be slowing down. But things are moving in the opposite direction. The Administration is churning out plenty of new contracting rules, and shows no signs of stopping anytime. In June, SBA finalized a new subcontracting rule which will help WOSBs with subcontracting requirements, by easing the “50 percent rule” to allow a WOSB to do less than 50 percent of the work on a contract, as long as the WOSB subcontracts to other WOSBs. The rule also shifts the limitations on subcontracting from requiring a prime to perform at least 50 percent of the labor on the contract, to requiring a prime perform at least 50 percent of the dollar amount of the contract. The rule also contains changes to subcontracting plans, roles for Procurement Center Representatives (PCR), Joint Ventures and more. Also last month, the GSA finalized a new regulation requiring contractors to report transaction or task order level data on goods and services to GSA. Under the transactional data rule, businesses are required to tell GSA what federal agencies purchase through GSA. This rule applies to GSA contracts including the Federal Supply Schedule (FSS) and Government-wide Acquisition Contracts (GWAC). Last week, the FAR Council finalized a rule strengthening subcontracting regulations by finalizing the “ list us, use us” requiring for prime contractors to make a good faith effort to utilize small subcontractors to the same degree as listed in the bid or proposal. WIPP has supported this change for a number of years, and testified on its value to women business owners. The rule also requires prime contractors to assign NAICS codes to subcontracts, and restricts prime contractors from prohibiting a subcontractor from discussing payment issues with the contracting officer. In addition to what we have seen over the past several months, SBA is expected to release a new Mentor-Protégé Program for all-small-businesses any day now. The SBA is also expected to work on rules associated with lower-tier subcontracting credit, WOSB certification, and the WBC program. The FAR Council continues to work through its back-log and plans to release new rules that include creating a government-wide definition for consolidation and bundling, providing subcontractors with additional payment protections, and implementing the Department of Labor Fair Pay, Safe Workplaces Executive Order. As we enter the home stretch of the Obama Administration, there is a clear impetus to do as much as possible over the next several months. As new information about rules becomes available, WIPP is committed to keeping you informed.