You Should Get Certified!

If you’re a DMWVLGBTBE (Disadvantaged or Disabled, Minority, Women, Veteran, Lesbian, Gay, Bisexual or Transgendered Business Enterprise), particularly if you’re a small business, you’ve probably heard that advice. We’ve talked about having a strategy when it comes to selecting the certifications that are right for your business, but just jumping right into filling out a certification application can lead to delays in the process if you haven’t carefully looked at the certifier’s eligibility requirements and your supporting documentation.

Say you’re a Connecticut based business interested in getting certified by the State of New York because you’ve heard about their 30% MWBE (minority-and-women-owned enterprises) state contracting utilization goal. Before being eligible to apply for certification in New York as an out-of-state firm there are a few steps you’ll need to take:

1. Your firm must be Home-State certified; in this case a business would need to hold either an S/MBE certification from Connecticut’s Administrative Services Office of Supplier Diversity or a DBE certification from Connecticut’s DOT Unified Certification Program (UCP).
2. You must go to the New York Department of State’s web site and apply for the Authority to do Business within New York.
   1. If you do not have someone to act as your agent within the state you’ll need to engage a registered agent service to perform this function.
   2. You’ll also need to provide the New York Department of State with one of the following: Certificate of Existence, Certificate of Good Standing or Certificate of Status from your Home-State.

If you have not taken these steps before applying for certification with the State of New York they will deem you ineligible for certification.

Note: Almost all states require out-of-state firms to be Home-State certified to be eligible for certification, while there are a limited number of states that require out-of-state firms to register for the authority to transact business within them as an eligibility requirement. Registering your business with a state may make you responsible for yearly filings or paying taxes to that state.

In terms of the SBA’s HUBZone certification we’ve known a number of businesses who thought they were eligible because their business was located in a HUBZone only to go through the application process and discover that they did not factor in the 35% employee residency requirement. While 35% of business’s workforce does not need to reside in the same HUBZone area in which the business is located, they must live in another HUBZone area. With the inclusion of qualified census tracts, there is now a street by street determination for HUBZone status. Before diving headlong into the HUBZone application go to the SBA’s HUBZone Map website and enter your business’s addresses, as well as, all of your employees’ addresses – you’ll need provide copies of this with your application anyhow – to determine if you meet the 35% requirement.  If you do not meet the 35% requirement your business is not eligible for HUBZone status.

If you’re a veteran owned business seeking the VA’s Vets First Verification you’ll want to make sure your information is correct and up-to-date in BIRLS (Beneficiary Identification and Records Locator Subsystem). The VA uses this system to validate a veteran’s status and if there are any discrepancies between the system and the information provided during the application process the verification process will be delayed and the business could possibly be found ineligible.

If you’re a minority-owned business seeking certification with NMSDC (National Minority Supplier Development Council) providing proof of ethnicity can be complicated if your birth certificate does not list it. The individual(s) on whom the certification is based must be of at least 25% of their stated ethnicity (e.g. an African American candidate must have at least one grandparent who is also African American).  NMSDC has a list of acceptable supporting documentation that includes: marriage records; death record of parents or grandparents; military record; baptismal certificate; hospital record; or other legal documents from a recognized institution (school, social service agency, church, adoption records, etc.). In extremely rare cases when documentation cannot be provided because none of the official documents available list ethnicity, DNA testing results have been allowed to be submitted.

Note: We always recommend to begin by collecting the required supporting documents.  This way you will know in advance if anything is missing and can address that issue before completing the application.

Remember, before you take someone’s advice to get certified make sure you know and understand the certifier’s eligibility requirements so you haven’t wasted your time.