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SBA's Office of Women's Business Ownership (OWBO) oversees a network of SBA-funded Women's Business Centers (WBCs) throughout the United States and its territories. WBCs provide management and technical assistance to small business concerns both nascent and established, with a focus on such businesses that are owned and controlled by women, or on women planning to start a business, especially women who are economically or socially disadvantaged. The training and counseling provided by the WBCs encompass a comprehensive array of topics, such as finance, management and marketing in various languages. This rule will codify the requirements and procedures that govern the delivery, funding and evaluation of the management and technical assistance provided under the WBC Program. The rule will address, among other things, the eligibility criteria for selection as a WBC, use of Federal funds, standards for effectively carrying out program duties and responsibilities, the requirements for reporting on financial and programmatic performance, and provisions regarding the collection and use of the individual WBC client data.

Statement of Need:

There are currently no regulations that codify the legislative authority of the Agency to administer the Women’s Business Center (WBC). The Program started as a pilot in 1988 and a regulation governing its operations was never promulgated after it became a Program in 2007. The Small Business Jobs Act of 2010 (Pub. L. 111240) amended Section 29(n) of the Small Business Act (the Act), 15 U.S.C. 656, to direct the SBA Administrator to issue regulations to establish standards for requiring disclosures during a financial audit. In order to meet this legislative requirement, SBA must issue regulations for the WBC program.

This rule finalizes proposed regulatory language that would codify this legislative authority as well as streamline the policy and procedural requirements of the Program currently included in the Program Announcement and Notice of Award (NOA). This rule also incorporates flexibilities allowable during disasters enacted under the RISE After Disaster Act. Changes made with the publication of 2 CFR part 200 and other federal grant requirements enforced over the past 28 years have been incorporated. Once final, the rule’s implementation would result in standardization and transparency to Program delivery.

Summary of the Legal Basis:

The WBC Program was created under the authority of Title II of the Women's Business Ownership Act of 1988 (Pub. L. 100-533). The WBC Program authority is now codified in section 29 of the Act. Section 29(n)(3) of the Small Business Act (the Act) directs the SBA Administrator to issue regulations to establish standards for requiring disclosures during a financial audit.  

Note, since its creation, the WBC Program has changed through a number of Pub. L.s that have turned the WBC Program from a Demonstration into a permanent program. Laws that have impacted the Program include:  The Women's Business Development Act of 1991 (Pub. L. 102-191); The Women's Business Centers Sustainability Act of 1999 (Pub. L. 106-165): U.S. Troop Readiness, Veterans' Care, Katrina Recovery, and Iraq Accountability Appropriations Act of 2007 (Pub. L. 110-28); The Small Business Jobs Act of 2010 (Pub. L. 111-240); and the RISE After Disaster Act of 2015 (Pub. L. 114-88).

Alternatives:

The alternative to not yet publish regulations, and continue to rely on grant documents to implement the WBC Program, is not one that SBA would like to exercise. Because the statute specifically requires SBA to publish regulations for the WBC Program, exercising this alternative would not be compliant. SBA believes that issuing regulations for the WBC Program would establish and ensure long-lasting consistency in Program implementation.  

Anticipated Costs and Benefits:

SBA analyzed the costs and benefits associated with both the application process to become funded as a WBC and the on-going operations for currently funded WBCs, as the populations are different for the application process and the existing WBCs.

This proposed rule could theoretically affect all nonprofit entities as the statute requires that an entity be organized as a nonprofit in order to participate. According to the IRS, for tax year 2010, there were over 269,000 entities that filed returns as a 501(c)(3). As the application process is voluntary and does not require a nonprofit entity to apply, the vast majority of nonprofits would not be affected. Over the past 5 years, there were a total of 133 new applications submitted for the WBC Program averaging 25-35 applications per year. The SF 424 (Application for Federal Assistance) on grants.gov does not include a field for revenue size. Based on the majority of the entities being small, SBA can presume that the majority of the Applicant Organizations are also small. It is projected that a grants writer would take approximately 20 hours to complete and submit the required application forms through grants.gov. For a grants writer at an average of $30 per hour, this would cost approximately $600. These estimates are based on the burden statements associated with the grants.gov application forms and anecdotal information from Applicant Organizations to the WBC Program. Therefore, the SBA has determined that the application section of the proposed rule would not have a significant impact on a substantial number of small entities.     

 There are currently 110 entities that participate in the WBC Program, all of which are small entities. However, the SBA has determined that the impact on these entities affected by the rule will not be significant. The rule codifies current policies and procedures that are already achieved through a Cooperative Agreement with the SBA. It does not include new reporting requirements. Rather it standardizes existing policies to ensure transparency and consistency which in theory will reduce the cost to both the WBC participants and SBA. A WBC participating in the WBC Program submits a Federal Financial Report and attachments twice a year. The estimated burden for these reports is 2 hours twice a year. The annual submission of a work plan is substantially less than the Application and is only to update any changes from the initial Application. The estimate for these forms on an annual basis is a total of 14 hours. For a grants writer at $30 per hour, the annual estimated cost would be $420. 

Risks:

SBA believes that this rule minimizes financial risk to the Agency and the program. The increased transparency of the program, including standard definitions and requirements, would help WBC Program participants comply with applicable laws and statutes. The regulations would codify the actions the Agency is authorized to take when a non-federal entity does not comply with the program. This in turn reduces the risk that funds allocated to the non-federal entities would be misused, and therefore minimizes a financial risk to the Agency.