It gets harder every day to take advantage of disadvantage.

Uncle Sam gives the 5,775 small disadvantaged businesses it recognizes as such a break on government contract bids — their quotes are discounted by up to 10% (in other words, a $1 million bid is treated as a $900,000 bid). Now, the feds are tightening up the procedure for qualifying. After July 1, it won't be possible to certify yourself as disadvantaged — the government has appointed over 60 nongovernmental and quasi-governmental agencies to certify businesses for it.

Now you submit an SDB application to the agency nearest you with such information as net worth, the size of your stake in the company, and other financial information, as well as documentation of your disadvantage to be certified as an SDB. A company's primary owner must have experienced prolonged social or economic disadvantage. That covers nearly all ethnic and racial minorities, certain disabled business owners, and nonminorities who live in depressed regions, such as Appalachia. There were forms before to be sure, but the change adds up to more scrutiny.

You can find applications at www.sba.gov/sdb or by calling 800 558-0884.

By Dennis Berman in New York
dennis_berman@businessweek.com