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The Small Business Reserve Program requires state agencies to
reserve 10 percent of its contracting dollars for bid solely by small businesses.
For the first time, small businesses will be able to bid for state contracts
without competing with larger, more established businesses.
Frequently Asked
Questions
What
is the Small Business Reserve Program?
A law was passed October 1, 2004 establishing the Small Business Reserve Program,
and it requires that twenty-four
designated state agencies
structure their procurement processes so that at least 10 percent of their
total procurement dollars are spent with qualified small businesses.
An unofficial copy of the legislation
is available on the Maryland General Assembly website at http://mlis.state.md.us .
Scroll down the page and type SB 904 in the Bill Number box and click the
Submit Query button.
Which
twenty-four (24) State agencies are required to reserve ten (10) percent
of their total procurement dollars for qualified small businesses?
These State agencies have to abide by
the Small Business Reserve Program:
• The State Treasurer;
• The Department of Budget
and Management;
• The Department of Business
and Economic Development;
• The Department of Environment;
• The Department of General
Services;
• The Department of Health
and Mental Hygiene;
• The Department of Housing
and Community Development;
• The Department of Human
Resources;
• The Department of Information Technology;
• The Department of Juvenile
Services;
• The Department of Labor,
Licensing, and Regulation;
• The Department of Natural
Resources;
• The State Department of
Education;
• The Department of State
Police;
• The Department of Public
Safety and Correctional Services;
• The Department of Transportation;
• The University System of
Maryland ;
• The Maryland Port Commission;
• The State Retirement Agency;
• The Maryland Insurance
Administration;
• The Maryland Stadium Authority;
• The Maryland Transportation Authority;
• The State Lottery Agency;
and
• Morgan State University
.
The websites for these 24 agencies can
be accessed through www.maryland.gov using
the Agency Index drop down list.
What
is a small business in the State of Maryland ?
A small business is a business, other
than a broker, that meets the following criteria:
• The business is independently
owned and operated;
• The business is not a subsidiary
of another business;
• The business is not dominant
in its field of operation;
• The wholesale operations
of the business did not employ more than 50 persons, and the gross sales
of the business did not exceed an average of $4,000,000 in its more recently
completed 3 fiscal years;*
• The retail operations
of the business did not employ more than 25 persons, and the gross sales
of the business did not exceed an average of $3,000,000 in its most recently
completed 3 fiscal years;*
• The manufacturing operations
of the business did not employ more than 100 persons, and the gross sales
of the business did not exceed an average of $2,000,000 in its most recently
completed 3 fiscal years;*
• The service operations
of the business did not employ more than 100 persons, and the gross sales
of the business did not exceed an average of $10,000,000 in its more recently
completed 3 fiscal years;* and
• The construction operations
of the business did not employ more than 50 persons, and the gross sales
of the business did not exceed an average of $7,000,000 in its most recently
completed 3 fiscal years.*
• The architectural and engineering operations
of the business did not employ more than 100 persons, and the gross sales
of the business did not exceed an average of $4,500,000 in its most recently
completed 3 fiscal years*.
* If a business has not existed for
three years, the gross sales average is computed for the period of the business's
existence. For newly formed businesses the determination will be based upon
employment levels and projected gross sales.
What
if a business operates in more than one of the six general business classifications?
If a business operates in more than
one of the following business classifications: wholesale, retail, manufacturing,
service, construction, and architecture/engineering, its combined operation must meet the limitation
of the more liberal classifications. However, the employment limit for a retail operation is 25 persons,
versus 50 for a wholesale operation and 100 for a manufacturing operation.
Accordingly, a business with both retail and wholesale classifications can
have up to 50 employees, while a combined manufacturing and wholesale business
can have up to 100 employees.
How
are the gross sales and employment level calculated?
Gross Sales: For a business that
has been in operation long enough to file a Federal income tax statement,
the annual average Gross Sales of the business will be calculated from the
sales amounts contained on the tax form(s).
Employment: Employment
will be calculated on an employee "Full-Time Equivalent" (FTE) basis. All
full time, part time, temporary or contractual employees, including employees
of temporary help firms or subcontractors working for the business, will
be counted against the applicable employment limitation. The specific FTE
employment levels for a business at the end of each calendar quarter (March
31 st , June 30 th , September 30 th and December 31 st ) will be averaged
to determine a business most recent FTE employment level.
How
do I apply to be qualified as a small business?
The Maryland Department
of General Services (DGS) has established an online self-certification process
that began on September 15, 2004 .
How
often must a business get qualified as a small business?
A business needs to
reapply for qualification every year by the anniversary date of the initial
certification. Verification of businesses' gross sales and employment data
will occur annually. However, if a business ceases to be independently owned
and operated or becomes a subsidiary of another business, the business needs
to notify the Department of General Services immediately via email at sbadmin@dgs.state.md.us or
in writing to State of Maryland , Department of General Services, Small Business
Reserve Program, 301 West Preston Street , Room M-3, Baltimore , Maryland
21201 .
How
do I update my small business profile?
A business can change
its basic information, i.e. address and contact name, online. However, a
change to information that may alter whether or not a business remains on
the list of qualified small businesses must be requested in writing to State
of Maryland , Department of General Services, Small Business Reserve Program,
301 West Preston Street , Room M-3, Baltimore , Maryland 21201 or via e-mail
at sbadmin@dgs.state.md.us .
Will
my company receive a Small Business Qualification Number?
Yes. Once a business
completes the registration process a Small Business Qualification Number
will be assigned.
What
are the benefits of participating in the Small Business Reserve Program?
The overall goal is
to increase economic opportunities for small businesses. Only qualified small
business may participate in a Small Business Reserve Program procurement.
Once a solicitation has been designated for a small business reserve, only
bids or proposals from qualified small business will be accepted. Therefore,
a business will be in competition only with other qualified small business,
guaranteeing that the contract will be awarded to a qualified small business.
Where can I find procurement opportunities?
To receive email notifications of procurement opportunities in your area of expertise you must register on eMaryland Marketplace at www.emarylandmarketplace.com, Maryland's web-based procurement system. For registration assistance contact 410-767-1492.
How
will a business know if a solicitation is selected for a small business
reserve?
The solicitation will clearly state
that a small business reserve applies. To bid on State projects You must belong to eMaryland Marketplace. To register for, and to view solicitations on eMaryland Marketplace visit: www.emarylandmarketplace.com.
Can
a nonprofit organization qualify as a small business?
No, only for-profit
businesses can apply to be qualified as a small business.
Is
a small business the same as a minority business?
No, but a business can be both if it
has been qualified as a small business and has been certified by the Maryland
Department of Transportation's (MDOT) Minority Business Enterprise Program
as a minority business. For more information about the Minority Business
Enterprise Program visit: http://www.mdot.state.md.us/MBE_Program/index.html.
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