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Government Contracting: Socio-Economic Certifications

Allen Waldo

By Allen Waldo, 

Guest Contributing Writer

Springfield, MO—When a business is contemplating becoming a governmental contractor, the business should evaluate their eligibility for a socio-economic certification.  One positive to having a certification is that it gives the business the competitive advantage for “Set Aside” solicitations so that they may only be competing against other companies with a similar socio-economic certification.  This is important that as by regulation a certain percentage of government contracts must be “Set Aside” for those certified companies.    Different categories include minority owned, woman owned, and veteran owned businesses.  In coming months’ articles, different certifications will be discussed.

This month centers on the main requirements that the majority owner(s) must meet in order for their business to be considered for most certifications.  These requirements include the following.

• At least 51% ownership in the business by those in that socio-economic class. The owners shall be able to prove their ownership percentages for example by capital contributions.

• The majority owner(s) needs to be United States citizens.

• The business must be small as defined by the company’s NAICS codes.

• The business must be “for profit”

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• The majority owner(s) must have strategic and operational control of the business.   This statement may sound simple but if for example the company’s bylaws establish that 100% of the owners (and not all owners are women for example) must approve an action before it can occur then the business may not be eligible.

• The majority owner must be actively involved in the day to day operations of the business.   Holding another non-related full time job will normally exclude that owner and thus their business.  Additionally if this company is a professional business requiring a license such as an architectural firm, the majority owner typically must possess that applicable license.

• The owner usually must be the highest paid person in the company.

• The owner should have the highest title in the company (i.e.  President, Chair Person, etc.)

To prove the above requirements, the certifying body will audit various documents including bank signature cards, lease agreements, bid proposals, contracts, board minutes, and payroll records to be sure that the woman owner truly is involved in the business.

Confused yet?  Missouri PTAC (supported via taxpayer dollars) is here to help by offering free consultation services.  If interested, please contact Allen Waldo in the Springfield area PTAC office at (417) 837-2612 or via email at

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