Notice on Public Content; WOSB NAICS Study, 62004-62006 [2020-21678]
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62004
Federal Register / Vol. 85, No. 191 / Thursday, October 1, 2020 / Notices
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–90007; File No. SR–CBOE–
2020–072]
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.6
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020–21662 Filed 9–30–20; 8:45 am]
Self-Regulatory Organizations; Cboe
Exchange, Inc.; Notice of Designation
of a Longer Period for Commission
Action on a Proposed Rule Change To
Amend Rules Relating to the
Processing of Auction Responses
jbell on DSKJLSW7X2PROD with NOTICES
September 25, 2020.
On July 30, 2020, Cboe Exchange, Inc.
(the ‘‘Exchange’’ or ‘‘Cboe Options’’)
filed with the Securities and Exchange
Commission (‘‘Commission’’), pursuant
to Section 19(b)(1) of the Securities
Exchange Act of 1934 (‘‘Act’’) 1 and Rule
19b–4 thereunder,2 a proposed rule
change to amend its rules relating to the
processing of auction responses. The
proposed rule change was published for
comment in the Federal Register on
August 18, 2020.3 The Commission has
received no comment letters regarding
the proposed rule change.
Section 19(b)(2) of the Act 4 provides
that within 45 days of the publication of
notice of the filing of a proposed rule
change, or within such longer period up
to 90 days as the Commission may
designate if it finds such longer period
to be appropriate and publishes its
reasons for so finding, or as to which the
self-regulatory organization consents,
the Commission shall either approve the
proposed rule change, disapprove the
proposed rule change, or institute
proceedings to determine whether the
proposed rule change should be
disapproved. The 45th day after
publication of the notice for this
proposed rule change is October 2,
2020. The Commission is extending this
45-day time period.
The Commission finds it appropriate
to designate a longer period within
which to take action on the proposed
rule change so that it has sufficient time
to consider the proposed rule change.
Accordingly, the Commission, pursuant
to Section 19(b)(2) of the Act,5
designates November 16, 2020, as the
date by which the Commission shall
either approve or disapprove, or
institute proceedings to determine
whether to disapprove, the proposed
rule change (File No. SR–CBOE–2020–
072).
1 15
U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 See Securities Exchange Act Release No. 89528
(August 12, 2020), 85 FR 50855 (August 18, 2020).
4 15 U.S.C. 78s(b)(2).
5 Id.
2 17
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BILLING CODE 8011–01–P
SMALL BUSINESS ADMINISTRATION
Notice on Public Content; WOSB
NAICS Study
U.S. Small Business
Administration.
ACTION: 30-Day notice and request for
comments.
AGENCY:
The National Defense
Authorization Act for Fiscal Year 2015
requires the Small Business
Administration (SBA) to produce a
study every five years regarding the
participation of small business concerns
owned and controlled by women. Public
Law 113–291, 128 Stat. 3292 (Dec. 19,
2014). In accordance with this
requirement, SBA is preparing to
conduct the study. SBA is currently
developing the process and
methodology that will be used to
conduct this study and is requesting
public input and feedback.
DATES: Submit comments on or before
November 2, 2020.
FOR FURTHER INFORMATION CONTACT:
Nikki Burley, Office of Government
Contracting and Business Development,
409 3rd Street SW, Washington, DC
20416; 202–921–3356, nikki.burley@
sba.gov.
SUMMARY:
SUPPLEMENTARY INFORMATION:
A. Program Background
The Small Business Act, 15 U.S.C.
637(m), authorizes contracting officers
to restrict competition for Federal
awards to eligible Women-Owned Small
Businesses (WOSBs) and/or
Economically-Disadvantaged WomenOwned Small Businesses (EDWOSBs) in
certain circumstances. Specifically, a
contracting officer may restrict
competition, or ‘‘set aside’’ a
competition for EDWOSBs if:
• There is a reasonable expectation
that two or more EDWOSBs will submit
offers in response to the solicitation;
• The contracting officer believes that
award can be made at a fair and
reasonable price; and
• The procurement is for goods or
services with respect to an industry
identified by the SBA’s Administrator as
underrepresented.
6 17
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Frm 00086
Fmt 4703
Sfmt 4703
A contracting officer may restrict
competition, or ‘‘set aside’’ a
competition for WOSBs, if:
• There is a reasonable expectation
that two or more WOSBs will submit
offers in response to the solicitation;
• The contracting officer believes that
award can be made at a fair and
reasonable price; and
• The procurement is for goods or
services with respect to an industry
identified by the SBA’s Administrator as
substantially underrepresented.
In addition, contracting officers are
allowed to sole source awards to
WOSBs and EDWOSBs in cases where
the estimated dollar value of the award
is equal to or less than $6.5 million for
manufacturing acquisitions and equal to
or less than $4 million for service
acquisitions. FAR Part 19.1506.
With respect to the identification of
industries eligible for a set-aside or sole
source award under the WOSB Program,
the Small Business Act requires the SBA
Administrator to conduct a study to
identify those industries in which small
business concerns owned and
controlled by women are
underrepresented or substantially
underrepresented with respect to
Federal procurement contracting. 15
U.S.C. 637(m)(4).
B. Overview of RAND Study of ‘‘The
Utilization of WOSB in Federal
Contracting’’
In February 2006, SBA awarded a
contract to the Kauffman-RAND
Institute for Entrepreneurship Public
Policy (RAND) to complete a study of
the underrepresentation of WOSBs in
Federal prime contracts by industry
code. The resulting study(the RAND
Report) was published in April 2007
and is available to the public at https://
www.rand.org/pubs/technical_reports/
TR442.html.
As the RAND Report explains more
fully, RAND measured WOSB
representation in each industry code
through a ‘‘disparity ratio,’’ which is a
measure comparing the utilization of
WOSBs in Federal contracting in a
particular code to their availability for
such contracts. The disparity ratio itself
is defined as utilization divided by
availability. Utilization and availability
are also measured as ratios. This
disparity ratio provides an estimate of
the extent to which WOSBs that are
available for Federal contracts in
specific industries are actually being
utilized to perform such contracts.
RAND measured utilization and
availability in two ways: in terms of
dollars and numbers. When using
dollars as the measure, RAND
calculated utilization as the ratio of
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Federal Register / Vol. 85, No. 191 / Thursday, October 1, 2020 / Notices
Federal contract dollars awarded to
WOSBs in a given industry code to total
Federal contract dollars awarded in that
industry code. It calculated availability
as the ratio of the gross receipts
(revenues) of WOSBs in a particular
industry code to the gross receipts
(revenues) of all firms in that code.
When using numbers as the measure,
RAND calculated utilization as the ratio
of the number of Federal contracts
awarded to WOSBs in a particular
industry code to the number of Federal
contracts awarded overall in that code,
and availability as the ratio of the
number of WOSBs in a particular
industry code to the total number of
firms in that code.
According to the RAND Report, if the
disparity ratio in an industry code is
equal to 1.0 when measuring in terms of
dollars, that indicates that WOSBs have
been awarded contract dollars in the
same proportion as their economic
representation in the industry; that is,
they are awarded contracting dollars in
proportion to their share of total
business in that industry, and are
therefore neither over- nor
underrepresented. Similarly, if the
disparity ratio in an industry code is
equal to 1.0 when measuring in terms of
numbers, this indicates that WOSBs are
awarded contracts (of whatever dollar
value) in the same proportion as their
numerical representation in the
industry. A ratio of less than 1.0 (lower
utilization than availability) suggests
some degree of underrepresentation
with respect to that particular means of
measuring disparity (dollars or
numbers); a ratio of greater than 1.0
(greater utilization than availability)
suggests some measure of
overrepresentation with respect to a
given metric. RAND classified an
industry as ‘‘underrepresented’’ if its
disparity ratio was between 0.5 and 0.8
using either the numbers or dollars
approach, and ‘‘substantially
underrepresented’’ if its ratio was less
than 0.5. It is important to note that
RAND states disparity ratios are not in
and of themselves measures of
discrimination, although they have been
used in numerous court cases to infer
discrimination. Nonetheless they are a
starting point, a way to identify whether
there are any differences in outcomes
between different types of firms.
RAND calculated these ratios using a
variety of different data sets. For the
utilization component of the disparity
ratio, RAND used the data from the FY
2005 Federal Procurement Data System/
Next Generation (FPDS/NG)
procurement database. This was the
only data source identified by RAND
with respect to the utilization
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component of the disparity ratio.
However, RAND did adjust the FPDS to
account for possible miscoding of
business size. Specifically, RAND
linked the FPDS data to 2004 Dun and
Bradstreet (D&B) data using the Data
Universal Numbering System (DUNS) to
identify the parent companies of local
establishments, and then used the
DUNS to assess whether a firm was
small. However, because the data file
was also prone to error, RAND
presented results both with and without
the DUNS cross-reference.
For the availability component of the
disparity ratio, RAND used two different
databases: The 2002 Survey of Business
Owners (SBO) from the five-year
Economic Census, and the FY 2006
Central Contractor Registration (CCR)
registration database. Using the SBO
database, RAND presented results only
at the two-digit industry code level, a
comparatively generalized level of
industry disaggregation. Using the CCR,
in contrast, RAND presented results at
the two-, three-, and four-digit industry
code levels. RAND also presented full
sample results and trimmed sample
results (eliminating the top and bottom
0.5 percent of the data) for each
disparity ratio. RAND did this in order
to examine the sensitivity of the
disparity ratio to extreme values, such
as very large contracts or negative dollar
amounts resulting from contract actions
based on multi-year contracts or
modifications to such contracts to
earlier contracts.
Using these different data sources and
various adjustments, the RAND Report
identified twenty-eight different
possible approaches to determining the
degree of underrepresentation of
WOSBs in Federal procurement
contracting.
C. Overview of the Office Chief
Economist Study of the U.S.
Department of Commerce Assisting
SBA To Conduct WOSB NAICS Study
In 2014, Congress amended the Small
Business Act to require SBA to submit
a report to Congress reflecting the
results of a new study by January 2,
2016, and then continue to conduct a
new study every five years. Public Law
113–291 825(c) (Dec. 19, 2014). In
response to this statutory mandate, SBA
asked the Office of the Chief Economist
(OCE) of the U.S. Department of
Commerce for assistance in conducting
a new study on the WOSB Program,
which would analyze data to help SBA
determine those NAICS codes in which
WOSBs are underrepresented and
substantially underrepresented in
Federal contracting. OCE looked at
whether, holding constant various
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62005
factors that might influence the award of
a contract, the odds of winning Federal
prime contracts by firms that were
owned by women were greater or less
than the odds of winning contracts by
otherwise similar businesses.
In its analysis, OCE controlled for the
size and age of the firm; its membership
in various categories of firms for which
the Federal government has
government-wide prime contracting
goals; its legal form of organization; its
level of government security clearance;
and its Federal prime contracting past
performance ratings. OCE also looked at
whether women-owned businesses
typically have significantly different
experiences in winning contracts
depending on their industry. OCE
performed this analysis at the four-digit
NAICS industry group level. OCE
included each firm in its sample in an
industry analysis if the firm had
registered as being able to perform work
in that industry or if the firm had won
a contract assigned to that industry.
OCE found that women-owned
businesses were less likely to win
Federal contracts in 254 of the 304
industries included in the study. In 109
out of the 304 industries, OCE found
that women-owned businesses have
statistically significant lower odds of
winning Federal contracts than
otherwise similar non-women-owned
businesses at the 95% confidence level.
SBA has determined that the finding by
OCE of a statistically significant lower
likelihood of winning contracts
demonstrates that WOSBs are
substantially underrepresented in these
109 NAICS codes. However, of these
industries, 17 are in sectors 42 and 44–
45, which are not applicable to Federal
contracts under SBA’s regulations. 13
CFR 121.201.
Since some industry groups cannot be
used to classify Federal contracts, SBA
has excluded them from the list of
industries designated as substantially
underrepresented. In addition, OCE
found that in 145 out of the 304
industries, the odds of women-owned
businesses winning contracts were
lower than those of otherwise similar
non-women- owned businesses, but
there was not a statistically significant
difference between the odds of winning
for the two groups. Although there was
not a finding of statistical significance
for these industries, 21 of them were
previously found by the RAND study to
be industries in which WOSBs are
underrepresented or substantially
underrepresented. Thus, SBA was
provided with information showing
historical underrepresentation of
women-owned businesses in these 21
industries, which was consistent with
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the OCE finding that women-owned
businesses are less likely to win
contracts. As a result, SBA found that it
possessed sufficient data to determine
that WOSBs are underrepresented in
these 21 industries. SBA also believed
that this decision fulfills the intent of
the Small Business Act, which
demonstrates the intent that the
designations of eligible industries be
based on at least five years of data. The
full OCE study is available on SBA’s
website at www.sba.gov/wosb.
D. Solicitation of Public Comments
As both the RAND and OCE studies
indicate, there is no single solution to
determine underrepresentation, with
each study methodology choice having
its own benefits and shortcomings. As
discussed above, the previous studies
made choices regarding certain
measures. Through this request, SBA
seeks input from stakeholders on the
areas below.
1. For the past two studies SBA has
looked at the value of contracts as part
of determining the utilization ratio. One
issue raised by this approach is that this
may be reflecting very few contracts
awards (meaning awards to a few
companies) which may not be
representative of the actual competitive
balance in the industry. SBA is seeking
input on whether a hybrid approach
should be used accounting for both
value of contracts and number of
contracts in a given industry. SBA is
also considering using higher level
NAICS (meaning fewer digits) for low
volume industries.
2. SBA is also seeking input on how
best to define women-owned businesses
that are ready, willing, and able. Past
studies have used SAM registration as a
measure for ready, willing, and able.
However, it may be that there are
women-owned firms that are ready,
willing, and able to perform government
contracts that are not registered in SAM.
Another option would be to look at
women-owned small businesses in the
US generally rather than limiting it to
sam.gov registered businesses. SBA
would like public comment input if it
should continue to use the ready,
willing, and able that was used in the
previous studies, use general womenowned businesses in the US, or is there
another method that SBA should
consider.
Another issue with the ready, willing,
and able determination is the possible
overestimate of the number of WOSBs
in a given NAICS because of the ability
of firms to self-select NAICS in sam.gov
without regard for capability. It may be
possible to perform a sensitivity
analysis to try to identify if there is a
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problem with overestimates and to
correct the analysis accordingly. SBA
would like public input on whether this
possible overestimate is a problem, and,
if so, is SBA’s proposed solution useful.
3. SBA is seeking comments on the
appropriate thresholds for
underrepresented versus substantially
underrepresented. Currently, the
threshold for underrepresented is <1
and the threshold for substantially
underrepresented is <.5. Another factor
SBA would like the public to consider
is what should the thresholds be if they
are changed? In addition, SBA is also
considering utilizing different
thresholds for low-volume NAICS.
Should it be the same for all industries?
4. The past two studies have each had
issues with low-volume industries. This
occurs when there are either low-dollar
value or low volume of contracts in a
given industry. The result is that minor
changes in in either category can have
extreme effects on the outcome. SBA is
considering the use of power analysis
calculations to determine which
industries have a sufficient number of
firms to detect a small effect size for the
difference between the use of WOSBs
and that of other businesses. SBA is also
considering determining the level of
industry concentration using a
Normalized Herfindahl Index. In
addition, SBA may also consider
measuring disparity metrics
independently by fiscal year and using
pooled data over multiple years. This
could reduce the number of low-volume
NAICS, but could be considered less
reliable if there is significant variance in
disparity metrics over time. SBA would
like public input on whether it should
make changes to the treatment of lowvolume NAICS and whether or not the
proposed methods are a good way to
taking into account low-volume NAICS.
Barbara Carson,
Deputy Associate Administrator, Office of
Government Contracting and Business
Development.
[FR Doc. 2020–21678 Filed 9–30–20; 8:45 am]
The meeting will be held on
Wednesday, October 14, 2020, from 9:30
a.m. to 12:00 p.m. EDT, followed by a
1 hour lunch break and reconvene at
12:55 p.m. EDT. The afternoon session
will end no later than 3:30 p.m. EDT.
ADDRESSES: The meeting is virtual and
open to the public. Public members
must preregister at the following link:
https://bit.ly/RercOct14. Anyone
needing special accommodations should
let the contact below know at least a
week in advance.
FOR FURTHER INFORMATION CONTACT:
Cathy Coffey, ccoffey@tva.gov or 865/
632–4494.
SUPPLEMENTARY INFORMATION: The RERC
was established to advise TVA on its
energy resource activities and the
priorities among competing objectives
and values. Notice of this meeting is
given under the Federal Advisory
Committee Act (FACA), 5 U.S.C. App.2.
The meeting agenda includes the
following:
1. Welcome and Introductions
2. TVA Updates
3. Presentations Regarding TVA Electric
Vehicle Strategy
4. Public Comments
5. Council Discussion
The RERC will hear views of citizens
by providing a public comment session
running from 1:00 p.m.–1:30 p.m. EDT,
that day. Persons wishing to speak must
register at ccoffey@tva.gov by 5:00 p.m.
EDT, on Tuesday, October 13, 2020, and
will be called on during the public
comment period for up to two minutes
to share their views. Written comments
are also invited and may be mailed to
the Regional Energy Resource Council,
Tennessee Valley Authority, 400 West
Summit Hill Drive, WT 9D, Knoxville,
Tennessee 37902.
DATES:
Dated: September 25, 2020.
Joseph J. Hoagland,
Vice President, Innovation and Research,
Tennessee Valley Authority.
[FR Doc. 2020–21747 Filed 9–30–20; 8:45 am]
BILLING CODE 8120–08–P
BILLING CODE 8026–03–P
TENNESSEE VALLEY AUTHORITY
Meeting of the Regional Energy
Resource Council
AGENCY:
Tennessee Valley Authority
(TVA).
ACTION:
Notice of meeting.
PO 00000
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[Docket Number USTR–2020–0035]
2020 Review of Notorious Markets for
Counterfeiting and Piracy: Comment
Request
Office of the United States
Trade Representative.
ACTION: Request for comments.
AGENCY:
The TVA Regional Energy
Resource Council (RERC) will hold a
virtual meeting on Wednesday, October
14, 2020, regarding regional energy
related issues in the Tennessee Valley.
SUMMARY:
OFFICE OF THE UNITED STATES
TRADE REPRESENTATIVE
The Office of the United
States Trade Representative (USTR)
SUMMARY:
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Agencies
[Federal Register Volume 85, Number 191 (Thursday, October 1, 2020)]
[Notices]
[Pages 62004-62006]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-21678]
=======================================================================
-----------------------------------------------------------------------
SMALL BUSINESS ADMINISTRATION
Notice on Public Content; WOSB NAICS Study
AGENCY: U.S. Small Business Administration.
ACTION: 30-Day notice and request for comments.
-----------------------------------------------------------------------
SUMMARY: The National Defense Authorization Act for Fiscal Year 2015
requires the Small Business Administration (SBA) to produce a study
every five years regarding the participation of small business concerns
owned and controlled by women. Public Law 113-291, 128 Stat. 3292 (Dec.
19, 2014). In accordance with this requirement, SBA is preparing to
conduct the study. SBA is currently developing the process and
methodology that will be used to conduct this study and is requesting
public input and feedback.
DATES: Submit comments on or before November 2, 2020.
FOR FURTHER INFORMATION CONTACT: Nikki Burley, Office of Government
Contracting and Business Development, 409 3rd Street SW, Washington, DC
20416; 202-921-3356, [email protected].
SUPPLEMENTARY INFORMATION:
A. Program Background
The Small Business Act, 15 U.S.C. 637(m), authorizes contracting
officers to restrict competition for Federal awards to eligible Women-
Owned Small Businesses (WOSBs) and/or Economically-Disadvantaged Women-
Owned Small Businesses (EDWOSBs) in certain circumstances.
Specifically, a contracting officer may restrict competition, or ``set
aside'' a competition for EDWOSBs if:
There is a reasonable expectation that two or more EDWOSBs
will submit offers in response to the solicitation;
The contracting officer believes that award can be made at
a fair and reasonable price; and
The procurement is for goods or services with respect to
an industry identified by the SBA's Administrator as underrepresented.
A contracting officer may restrict competition, or ``set aside'' a
competition for WOSBs, if:
There is a reasonable expectation that two or more WOSBs
will submit offers in response to the solicitation;
The contracting officer believes that award can be made at
a fair and reasonable price; and
The procurement is for goods or services with respect to
an industry identified by the SBA's Administrator as substantially
underrepresented.
In addition, contracting officers are allowed to sole source awards
to WOSBs and EDWOSBs in cases where the estimated dollar value of the
award is equal to or less than $6.5 million for manufacturing
acquisitions and equal to or less than $4 million for service
acquisitions. FAR Part 19.1506.
With respect to the identification of industries eligible for a
set-aside or sole source award under the WOSB Program, the Small
Business Act requires the SBA Administrator to conduct a study to
identify those industries in which small business concerns owned and
controlled by women are underrepresented or substantially
underrepresented with respect to Federal procurement contracting. 15
U.S.C. 637(m)(4).
B. Overview of RAND Study of ``The Utilization of WOSB in Federal
Contracting''
In February 2006, SBA awarded a contract to the Kauffman-RAND
Institute for Entrepreneurship Public Policy (RAND) to complete a study
of the underrepresentation of WOSBs in Federal prime contracts by
industry code. The resulting study(the RAND Report) was published in
April 2007 and is available to the public at https://www.rand.org/pubs/technical_reports/TR442.html.
As the RAND Report explains more fully, RAND measured WOSB
representation in each industry code through a ``disparity ratio,''
which is a measure comparing the utilization of WOSBs in Federal
contracting in a particular code to their availability for such
contracts. The disparity ratio itself is defined as utilization divided
by availability. Utilization and availability are also measured as
ratios. This disparity ratio provides an estimate of the extent to
which WOSBs that are available for Federal contracts in specific
industries are actually being utilized to perform such contracts.
RAND measured utilization and availability in two ways: in terms of
dollars and numbers. When using dollars as the measure, RAND calculated
utilization as the ratio of
[[Page 62005]]
Federal contract dollars awarded to WOSBs in a given industry code to
total Federal contract dollars awarded in that industry code. It
calculated availability as the ratio of the gross receipts (revenues)
of WOSBs in a particular industry code to the gross receipts (revenues)
of all firms in that code. When using numbers as the measure, RAND
calculated utilization as the ratio of the number of Federal contracts
awarded to WOSBs in a particular industry code to the number of Federal
contracts awarded overall in that code, and availability as the ratio
of the number of WOSBs in a particular industry code to the total
number of firms in that code.
According to the RAND Report, if the disparity ratio in an industry
code is equal to 1.0 when measuring in terms of dollars, that indicates
that WOSBs have been awarded contract dollars in the same proportion as
their economic representation in the industry; that is, they are
awarded contracting dollars in proportion to their share of total
business in that industry, and are therefore neither over- nor
underrepresented. Similarly, if the disparity ratio in an industry code
is equal to 1.0 when measuring in terms of numbers, this indicates that
WOSBs are awarded contracts (of whatever dollar value) in the same
proportion as their numerical representation in the industry. A ratio
of less than 1.0 (lower utilization than availability) suggests some
degree of underrepresentation with respect to that particular means of
measuring disparity (dollars or numbers); a ratio of greater than 1.0
(greater utilization than availability) suggests some measure of
overrepresentation with respect to a given metric. RAND classified an
industry as ``underrepresented'' if its disparity ratio was between 0.5
and 0.8 using either the numbers or dollars approach, and
``substantially underrepresented'' if its ratio was less than 0.5. It
is important to note that RAND states disparity ratios are not in and
of themselves measures of discrimination, although they have been used
in numerous court cases to infer discrimination. Nonetheless they are a
starting point, a way to identify whether there are any differences in
outcomes between different types of firms.
RAND calculated these ratios using a variety of different data
sets. For the utilization component of the disparity ratio, RAND used
the data from the FY 2005 Federal Procurement Data System/Next
Generation (FPDS/NG) procurement database. This was the only data
source identified by RAND with respect to the utilization component of
the disparity ratio. However, RAND did adjust the FPDS to account for
possible miscoding of business size. Specifically, RAND linked the FPDS
data to 2004 Dun and Bradstreet (D&B) data using the Data Universal
Numbering System (DUNS) to identify the parent companies of local
establishments, and then used the DUNS to assess whether a firm was
small. However, because the data file was also prone to error, RAND
presented results both with and without the DUNS cross-reference.
For the availability component of the disparity ratio, RAND used
two different databases: The 2002 Survey of Business Owners (SBO) from
the five-year Economic Census, and the FY 2006 Central Contractor
Registration (CCR) registration database. Using the SBO database, RAND
presented results only at the two-digit industry code level, a
comparatively generalized level of industry disaggregation. Using the
CCR, in contrast, RAND presented results at the two-, three-, and four-
digit industry code levels. RAND also presented full sample results and
trimmed sample results (eliminating the top and bottom 0.5 percent of
the data) for each disparity ratio. RAND did this in order to examine
the sensitivity of the disparity ratio to extreme values, such as very
large contracts or negative dollar amounts resulting from contract
actions based on multi-year contracts or modifications to such
contracts to earlier contracts.
Using these different data sources and various adjustments, the
RAND Report identified twenty-eight different possible approaches to
determining the degree of underrepresentation of WOSBs in Federal
procurement contracting.
C. Overview of the Office Chief Economist Study of the U.S. Department
of Commerce Assisting SBA To Conduct WOSB NAICS Study
In 2014, Congress amended the Small Business Act to require SBA to
submit a report to Congress reflecting the results of a new study by
January 2, 2016, and then continue to conduct a new study every five
years. Public Law 113-291 825(c) (Dec. 19, 2014). In response to this
statutory mandate, SBA asked the Office of the Chief Economist (OCE) of
the U.S. Department of Commerce for assistance in conducting a new
study on the WOSB Program, which would analyze data to help SBA
determine those NAICS codes in which WOSBs are underrepresented and
substantially underrepresented in Federal contracting. OCE looked at
whether, holding constant various factors that might influence the
award of a contract, the odds of winning Federal prime contracts by
firms that were owned by women were greater or less than the odds of
winning contracts by otherwise similar businesses.
In its analysis, OCE controlled for the size and age of the firm;
its membership in various categories of firms for which the Federal
government has government-wide prime contracting goals; its legal form
of organization; its level of government security clearance; and its
Federal prime contracting past performance ratings. OCE also looked at
whether women-owned businesses typically have significantly different
experiences in winning contracts depending on their industry. OCE
performed this analysis at the four-digit NAICS industry group level.
OCE included each firm in its sample in an industry analysis if the
firm had registered as being able to perform work in that industry or
if the firm had won a contract assigned to that industry. OCE found
that women-owned businesses were less likely to win Federal contracts
in 254 of the 304 industries included in the study. In 109 out of the
304 industries, OCE found that women-owned businesses have
statistically significant lower odds of winning Federal contracts than
otherwise similar non-women-owned businesses at the 95% confidence
level. SBA has determined that the finding by OCE of a statistically
significant lower likelihood of winning contracts demonstrates that
WOSBs are substantially underrepresented in these 109 NAICS codes.
However, of these industries, 17 are in sectors 42 and 44-45, which are
not applicable to Federal contracts under SBA's regulations. 13 CFR
121.201.
Since some industry groups cannot be used to classify Federal
contracts, SBA has excluded them from the list of industries designated
as substantially underrepresented. In addition, OCE found that in 145
out of the 304 industries, the odds of women-owned businesses winning
contracts were lower than those of otherwise similar non-women- owned
businesses, but there was not a statistically significant difference
between the odds of winning for the two groups. Although there was not
a finding of statistical significance for these industries, 21 of them
were previously found by the RAND study to be industries in which WOSBs
are underrepresented or substantially underrepresented. Thus, SBA was
provided with information showing historical underrepresentation of
women-owned businesses in these 21 industries, which was consistent
with
[[Page 62006]]
the OCE finding that women-owned businesses are less likely to win
contracts. As a result, SBA found that it possessed sufficient data to
determine that WOSBs are underrepresented in these 21 industries. SBA
also believed that this decision fulfills the intent of the Small
Business Act, which demonstrates the intent that the designations of
eligible industries be based on at least five years of data. The full
OCE study is available on SBA's website at www.sba.gov/wosb.
D. Solicitation of Public Comments
As both the RAND and OCE studies indicate, there is no single
solution to determine underrepresentation, with each study methodology
choice having its own benefits and shortcomings. As discussed above,
the previous studies made choices regarding certain measures. Through
this request, SBA seeks input from stakeholders on the areas below.
1. For the past two studies SBA has looked at the value of
contracts as part of determining the utilization ratio. One issue
raised by this approach is that this may be reflecting very few
contracts awards (meaning awards to a few companies) which may not be
representative of the actual competitive balance in the industry. SBA
is seeking input on whether a hybrid approach should be used accounting
for both value of contracts and number of contracts in a given
industry. SBA is also considering using higher level NAICS (meaning
fewer digits) for low volume industries.
2. SBA is also seeking input on how best to define women-owned
businesses that are ready, willing, and able. Past studies have used
SAM registration as a measure for ready, willing, and able. However, it
may be that there are women-owned firms that are ready, willing, and
able to perform government contracts that are not registered in SAM.
Another option would be to look at women-owned small businesses in the
US generally rather than limiting it to sam.gov registered businesses.
SBA would like public comment input if it should continue to use the
ready, willing, and able that was used in the previous studies, use
general women-owned businesses in the US, or is there another method
that SBA should consider.
Another issue with the ready, willing, and able determination is
the possible overestimate of the number of WOSBs in a given NAICS
because of the ability of firms to self-select NAICS in sam.gov without
regard for capability. It may be possible to perform a sensitivity
analysis to try to identify if there is a problem with overestimates
and to correct the analysis accordingly. SBA would like public input on
whether this possible overestimate is a problem, and, if so, is SBA's
proposed solution useful.
3. SBA is seeking comments on the appropriate thresholds for
underrepresented versus substantially underrepresented. Currently, the
threshold for underrepresented is <1 and the threshold for
substantially underrepresented is <.5. Another factor SBA would like
the public to consider is what should the thresholds be if they are
changed? In addition, SBA is also considering utilizing different
thresholds for low-volume NAICS. Should it be the same for all
industries?
4. The past two studies have each had issues with low-volume
industries. This occurs when there are either low-dollar value or low
volume of contracts in a given industry. The result is that minor
changes in in either category can have extreme effects on the outcome.
SBA is considering the use of power analysis calculations to determine
which industries have a sufficient number of firms to detect a small
effect size for the difference between the use of WOSBs and that of
other businesses. SBA is also considering determining the level of
industry concentration using a Normalized Herfindahl Index. In
addition, SBA may also consider measuring disparity metrics
independently by fiscal year and using pooled data over multiple years.
This could reduce the number of low-volume NAICS, but could be
considered less reliable if there is significant variance in disparity
metrics over time. SBA would like public input on whether it should
make changes to the treatment of low-volume NAICS and whether or not
the proposed methods are a good way to taking into account low-volume
NAICS.
Barbara Carson,
Deputy Associate Administrator, Office of Government Contracting and
Business Development.
[FR Doc. 2020-21678 Filed 9-30-20; 8:45 am]
BILLING CODE 8026-03-P