Automation Consultation & Construction, No. MSB-452 (February 15, 1994)
Docket No. MSBE-93-11-15-13

                    UNITED STATES OF ANERICA
                                
                  SMALL BUSINESS ADMINISTRATION
                                
                 OFFICE OF HEARINGS AND APPEALS
                                
                        WASHINGTON, D.C.

IN THE MATTER OF:             )
                              ) Docket No. MSBE-93-11-15-13
Automation Consultation       )
& Construction                )

                           APPEARANCES

For the Petitioner:                For the Agency:

Sandra J. Kay, President           John T. Spotila, Esq.
Automation Consultation            General Counsel
  & Construction 1/                Robinson S. Nunn, Esq.
8 Pine Cone Drive                  Agency Representative
Hampton, VA 23669-2914             Small Business Administration
                                   409 Third Street, SW
                                   Washington, DC 20416

                             DIGEST

The regulations published at 54 Federal Register 34692, et seq.,
on August 21, 1989 and codified at 13 CFR Part 124 must be fol
lowed in evaluating all applications for participation in the
Agency's 8(a) Program that were pending as of August 21, 1989 or
were filed thereafter. 13 CFR 124.1(a)(2)(i).
An applicant for participation in the Agency's 8(a) Program has
the burden of proving all elements of its eligibility. 13 CFR
124.210(h)(3)(ii); 13 CFR 134.31(a).

In order to be eligible to participate in the Agency's 8(a)
Program, an applicant concern must be one which is at least 51
percent unconditionally owned by an individual who is determined
by SBA to be socially and economically disadvantaged, and the
concern must be controlled by the socially and economically
disadvantaged individual. 13 CFR 124.103.

An applicant firm whose socially-disadvantaged status is based
upon the claim of social disadvantage on the part of an individ-
ual, who is not a member of a group that has been designated by
SBA as "presumed to be socially disadvantaged," must prove that
individual's claim of social disadvantage by clear and convincing
evidence. 13 CFR 124.105(c).

Clear and convincing evidence is not unequivocal or of such
quality as to dispel all reasonable doubt; rather, it is evidence
that fairly compels the factfinder's belief, leaves little doubt
about the truth of the matter asserted, and produces an abiding
conviction that the truth of the matter is highly probable, not
merely more probable than not.

A determination by the Associate Administrator denying the
socially-disadvantaged claim of the individual upon whom a firm's
8(a) eligibility is based is not arbitrary, capricious, or con-
trary to law if there is a reasonable basis for that conclusional
finding in the record that was before the AA/MSB&COD at the time
she made the determination.

Ordinarily, evidence that was not adduced for consideration by
the AA/MSB&COD in making her determination may not be admitted in
a proceeding brought to set aside that determination. 13 CFR
124.210(h)(3)(i).

                         FINAL DECISION

                        February 15, 1994

USHER, Administrative Law Judge:

Jurisdiction

Authority for these proceedings is found in Section 409 of the
Business Opportunity Development Reform Act of 1988, Public Law
100-656 (Section 8(a)(9) of the Small Business Act of 1958, as
amended; 15 U.S.C. 637(a)(9)), hereinafter referred to as "the
Act," and in the regulations codified at 13 CFR Parts 124 and
134, which are referred to hereinafter by section numbers only.

Issues

Is there an evidential rationale for the conclusion of the Asso-
ciate Administrator in the record that was before her at the time
she made her determination, and is it clear from the record and
from the determination itself that the AA/MSB&COD considered all
of the relevant facts in making her determination? 2/

Facts

The Petitioner initially filed its application for admission to
the Section 8(a) Program on November 18, 1991. 3/ Its President,
Sandra J. Kay, upon whom eligibility was to depend, stated that
she was not claiming social disadvantage on the basis of her
identification as a Black American, Hispanic American, Native
American or other group designated in Section 124.105(b) of the
regulations. Rather, she specifically claimed that she is 
socially disadvantaged because she is "female;" that, she claimed,
has resulted in her being "personally...subjected to cultural
bias." Further, she asserted that, because of cultural bias
against her as a female, her ability to compete in the free
enterprise system has been impaired and she has suffered diminished
capital and credit opportunities as compared with others in the
same business area who are not socially disadvantaged.

Thus, she claimed economic disadvantage resulting from her
socially disadvantaged status. More specifically, with regard to
her social disadvantage and the firm's resulting economic
disadvantage, she asserted the following in her original filing:

     Our [firm's] ability to compete in the market place
     [sic] has been impaired by our inability to obtain ade-
     quate bonding as documented in our Bonding Statement.
     (See B.5.)
     
     We are restricted from growing to larger jobs because
     they are not available without bonding capability,
     because of situations such as McGee Construction who
     added a 100% mark up [sic] on work to cover their
     exposure of using a smaller company and lost the job,
     and where we believe limited bonding is now available
     through Blankenship in Richmond. We have been told to
     prepare for an additional burden of a lot more paper
     work.
     
     Our ability to compete in the market place [sic] has
     been impaired by our inability to obtain credit or
     financing. Being a smaller company with limited re
     sources and inadequate bank financing, we find our
     selves in situations such as with a current job. After
     being awarded a job under "small emerging businesses,"
     when we placed the order for a major material we unex-
     pectedly find [sic] that we're required to make a cash
     down payment and expected to pay the full balance upon
     receipt of the material. Our bank will still not 
     approve financial assistance on construction contracts.
     [Reference omitted.]
     
     In the current situation, it is a government contract
     and we are asking for assistance from the contract
     division for a progress payment. [Reference omitted.]
     However, the manufacturer may keep us from using the
     materials until it [sic] is fully paid for and the
     government, if it approves a progress payment, may take
     up to two weeks to process the paper work and issue the
     check, which will cause the contract to default because
     we are unable to meet the contract completion date. If
     we pay the full cost of the building from our limited
     resources, then our other creditors will be paid late
     and we stand to loose [sic] our credit status with
     them.

In answering the question whether she has been subjected to
"chronic, substantial discrimination that has caused her unem-
ployment, limited educational opportunities or personal depri-
vation," she stated her opinion that

     during [her] lifetime, women have not been expected to
     accomplish (or are not considered capable of) anything
     other than getting married, having children, or perhaps
     working menial jobs.

                          * * * * * * *

     However, there has been a chronic record of social
     discrimination because of my sex, female.

                          * * * * * * *

     To please my mother, I completed a two year business
     college.

                          * * * * * * *

     My father had taught me for many years about using
     electricity and mechanical apparatuses to perform a
     variety of work. However, it took nine years for me to
     land my first programming job which fully allow [sic]
     me to use this knowledge. As a female, I was always
     considered for clerical or data entry positions, but
     even with continued education females were not usually
     considered for technical positions.

     I saw many situations were [sic] men with no experience
     and no training were placed in technical positions,
     whereas a female was only considered for clerical work.
     At the time it was considered a joke that women would
     ever do more than marry and leave the job market to
     have children.

According to Kay's statements, she was denied credit by "Sears
Department Stores" so long as she identified herself as "Sandra
J. Kay," but "was immediately issued a revolving charge account
as Mr. S. J. Kay" after using only the initials "S. J." in the
application.

Kay related a similarly disturbing experience while taking a
class at Old Dominion University. An instructor admonished her:
"You are a woman with a job [and] have no business attending
college classes or trying to improve when all you will do is
marry some man to support you."

At about the same time, while Kay was working "on a programming
team with Planning Research Corporation [and] was the only person
on our team that knew how to design structured logic charts," she
was "denied credit for this work" and denied a promotion. She was
told that "as a woman I would never be considered for any
position more than a team member" because "Lead programmers and
Managers are always men."

Subsequently, because of that same attitude, according to Kay's
allegations, she has not been able to convince her bank to
"extend credit for the materials and labor to perform [her] con-
struction work...even with signed contracts in hand," because she
is a woman. She stated that she has been told that

     if I would take a (male) partner or investors to fully
     capitalize the construction venture, then they [the
     bank] would assist my business.

At one point, the bank "required a 'male' signature, even if the
'male' had no credit established," to obtain credit for her busi-
ness "solely because I am a general contractor...a designation
that 'females' are not considered capable of performing."

According to Kay's assertions, she has suffered "a chronic pat-
tern of never being fully accepted [because she has not been]
willing to accept menial or limited success," and contends that

     [g]oing from one organization to another in order to
     force my talents to be increasingly compensated has
     drained me of personal resources that could have been
     accumulated in a normal career position with only one
     or two companies.

                          * * * * * * *

     My performance has chronically not been compensated at
     the same wage as my male counterparts, and my limited
     resources depleted in pursuing a string of limited
     positions of responsibility because women are still not
     considered for permanent upward management mobility in
     most organizations.

Kay described instances of discrimination in employment to sub-
stantiate her claim of cultural bias:

At one point in 1979 she was a Marketing Representative when "a
man was hired...to be [her] assistant." He had no experience in
the field; had only a high school education; but he was paid
$3,000 more a year the she was paid. When she inquired of the
firm's Vice President, she was told, "[He] is a man; men expect
higher salaries; females do not have the same financial needs."

She described another employment situation. She was the only
female salesperson, and she was fired because the Sales Manager
resented the fact that she drove a new automobile.

In 1982, she was hired as Director of Data Processing for the
Hampton City Schools at $31,000 a year, but that resulted from
the fact that the only other qualified person, a man, refused the
job when it was offered to him at $40,000. She worked for seven
years as Director of Data Processing, and, in an attempt to 
"position [herself] for an upward move," she sought an opportunity
to attend the College of William and Mary to earn a Master's
Degree. She "was denied this educational opportunity," although
"other directors (who were males)...had been allowed time to con-
tinue their education[s]." Subsequently, when the data processing
[functions] for the City and the schools were merged, she was
denied the position of Assistant Director of Data Processing
because she was a woman. Furthermore, she was denied the highest
position offered in the merged departments by the Director of
Data Processing for the City, who was only a high school grad-
uate, presumably because he needed to "protect his own job from
competition." She was told that it was because she was "an
educated female who could find a job anywhere."

Kay wrote about her two marriages: In the first she was "physi-
cally and mentally abused...expected to work a menial job...and
turn [her] pay check [sic] over to [her] husband;" in the second,
she was "happily married...until [her] pursuit of career had
advanced [her] salary higher than [her] husband's." That fact
caused a change and a rapid deterioration in the relationship,
which ended in separation, divorce, and her "having to pay all of
[the] joint debts to keep from ruining [her] 'good credit."'

The Associate Administrator denied the firm's application in a
July 24, 1992 letter to Kay. Kay was advised that: 1) it could
not be determined that she unconditionally owned at least 51
percent of the company; 2) it could not be determined that she
was socially and economically disadvantaged; 3) it was, however,
determined that Kay did not possess the managerial or technical
expertise to control the day-to-day management of the firm; 4) it
was determined that the firm had not been in business for the
required two-year period; 5) a nondisadvantaged individual (or
individuals) was found to control the firm; and 6) it was
determined that the firm did not have the potential successfully
to meet the business development objectives of the 8(a) Program.
Kay was advised that, if she wished to have the application
reconsidered, she should furnish, among other things, "[e]vidence
to document that you are socially and economically
disadvantaged."

On behalf of the firm, Kay filed a timely request for recon-
sideration and, subsequently, supplied additional evidence and
argument in a timely fashion. With regard to the question of her
socially disadvantaged status, Kay submitted the following to the
Agency's Regional Office representative in a June 11, 1993
letter:

     I am a knowledgeable working general contractor and
     licensed electrician and would expect that I should get
     the same prices as any other contractor, but that is
     not the case. To prove my point, I documented one of
     the recurring incidents that I live with each day.
     
     Pricing on a pump to me as a general contractor, a
     female, was incomplete and 30% higher. Also, the same
     salesman responded very nonchalantly to me, a female,
     with informal prices, incomplete prices, and identified
     himself casually as "Kenny." To check out the pricing
     and Mr. Westerfield's response, I had a male employee
     call for the identical information. My male employee
     did not identify himself as a contractor and did not
     represent any specific purpose other than wanting to
     purchase a pump. His response was formal, complete, and
     30% lower in pricing.
     
     I, a female, representing myself as a licensed general
     contractor needing a pump for a job that I was working
     on got no reduction [of the] over-the-counter price and
     informal treatment. My employee, a male, achieved
     immediate formal attention and reduction in price for
     no reason other than he was a "male."
     
     This is discrimination and it occurs on a regular basis
     every day. This is one of the reasons why I feel that I
     qualify for the SBA 8(a) program. Please see my pre-
     vious documents for corresponding incidents of unequal
     pay, denial of job position, denial of education, and
     credit discrimination -- all due to me [sic] being a
     "female" working in an occupation that is traditionally
     stereotyped for "males."

Kay also furnished a copy of the following June 2, 1993 letter,
addressed to a supply firm in Chesapeake, Virginia:

     On May 24, I, a female, requested pricing from you on
     the above pump and was given the following:

          1) Motor only                 $199.00

          2) to replace the whole unit (pump &
          $234.36 motor) and you added the probable
          + 30.22 need for a nose cone at
          an additional cost            $264.58

     On May 26 I had a male employee call for pricing on
     this same unit and you supplied cost to him as follows:

          1) Motor only                 $160.89

          2) to replace the whole unit (pump,
             motor and nose cone)            $174.00
          
          3) to replace the whole unit
          including a new bladder tank       $201.35

     I clearly stated that I was a general contractor
     looking for your contractor wholesale pricing for a job
     I was working on. The male employee only said he needed
     to replace the pump and did not necessarily request
     contractor pricing. You supplied the above pricing to
     me on a cover spec sheet signed [by].... You supplied
     to my male employee a formal quotation signed [by the
     same person].

According to Kay, she was subsequently informed by this supplier
that the retail list price for a "whole new unit (pump, motor and
bladder tank) was $318.07." Copies of the different invoices from
the supplier were submitted with the June 11, 1993 letter.

After the submission of this information and a request for recon-
sideration of the denial of the application, in a letter dated
September 29, 1993, the Associate Administrator again declined to
grant the Petitioner admission to the 8(a) Program. In her re
considered determination, the AA/MSB&COD informed the Petitioner,
in pertinent part:

     You did not provide sufficient new evidence to allow us
     to conclude that you [Sandra J. Kay], the individual
     upon whom eligibility is based, are socially and
     economically disadvantaged due to your gender.
     
     As outlined in our letter of July 24, l99t2], indi-
     cating our reasons for initially declining your appli-
     cation, an individual who is not a member of one of the
     groups presumed to be socially disadvantaged must prove
     his or her social disadvantage by clear and convincing
     evidence that he/she has personally suffered chronic
     and substantial social disadvantage [sic].
     
     You make a general statement that at the time (late
     '60s and early '70s) women were only considered for
     clerical work based on a perception that they would
     leave the job market to have children. You allege that
     you were turned down for at least 100 jobs because men
     were always chosen, but you provide no specific 
     details. Your [Form] lOlOA does present several instances
     of alleged discrimination regarding credit applications
     in 1971 and 1974 as well as alleged discrimination in
     several positions you previously held. Regarding
     credit, you claim not to have received credit cards
     from two department stores approximately 20 years ago
     based on a policy not to issue credit to women. These
     two instances appear to be isolated instances which
     occurred in the distant past and are not illustrative
     of chronic and substantial discrimination. Regarding
     discrimination during your employment, you present four
     instances of claimed discrimination starting since
     1975. In one instance, you claim your superior started
     discriminating against you when he saw you driving a
     new car. (Control Data Corporation, circa 1975.) In
     another instance, a male superior denied you leave to
     pursue an Executive Master Degree because he had not
     had the opportunity to do so. These instances of
     alleged discrimination state reasons other than sexual
     discrimination as their bases. The two examples of
     discriminatory employment practices at PRC (concerning
     lead programmers and managers being men) and another
     unspecified position (concerning a male subordinate
     receiving a higher salary) may be representative of
     sexual discrimination. However, there is not sufficient
     specific details [sic] to prove social discrimination
     by the "clear and convincing" standard. Moreover, both
     of these instances occurred in the mid/late 70s. Two
     instances of discrimination, if proven, are not
     reflective of chronic and substantial discrimination.
     Regarding discrimination in education, the incident at
     Old Dominion University, if proven by clear and
     convincing evidence, is the only example given and
     occurred in 1974. You later passed this course under a
     different professor and obtained your degree. A single
     incident of possible educational discrimination in 1974
     is not indicative of chronic and substantial discrimi-
     nation related to your educational pursuits, even if
     clear and convincing evidence is provided.

     In your request for reconsideration, you submitted
     little additional information beyond that contained in
     the original application. The additional instances that
     are raised in your request do not contain sufficient
     facts to prove social disadvantage by "clear and
     convincing" evidence.

     Based on our review of your application, we cannot
     conclude that you have personally suffered chronic and
     substantial social disadvantage and that such social
     disadvantage has negatively impacted on your entry into
     and/or advancement in the business world.

     As a result of our determination that you are not
     socially disadvantaged, we are unable to conclude that
     you are economically disadvantaged.

In accordance with the regulation codified at Section 124.210,
Kay, on behalf of the firm, submitted a timely Petition for my
review on November 12, 1993. That letter was docketed on November
15, 1993, and this proceeding was commenced. Kay summarized the
evidence she contends has been adduced for the record, cited
additional instances of "social and economic discrimination" 4/
and argued, in pertinent part:

     I am filing this Petition for appeal as I feel the
     determination of 29 September is subjective. The
     documentation submitted clearly shows social and thus
     economic discrimination.

                          * * * * * * *

     Throughout the documentation submitted for consider-
     ation I have substantiated discrimination regarding
     credit, education and employment. These are all rooted
     in social discrimination, which in turn leads to
     economic discrimination.

     The SBA problem of clear and convincing evidence is
     addressed specifically in these pages and in my 8(a)
     application documents. Also, please note that some
     incidents listed in this letter were forwarded to SBA,
     but have never been acknowledged.

Counsel for the Agency filed a response to the Petition on
December 30, 1993. Counsel argued that, inasmuch as the Peti-
tioner "is a corporation that is 97.5% owned by a Caucasian 
female [and] the firm applied for admission [to] the 8(a) Program
due to the social and economic disadvantage of [its] principal
that was alleged to be based on her gender," it is the Peti-
tioner's burden to prove entitlement by clear and convincing
evidence. He further argued that "[n]o evidence is offered to
support a [decision]...that the Agency's [determination] was
arbitrary or capricious."

Discussion

Section 124.210(h)(1) of the regulations provides that, in an
appeal proceeding brought under authority of Section 124.210(a),
the AA/MSB&COD's determination shall be sustained unless I find
that it is arbitrary, capricious or contrary to the law or the
regulations. Thus, the validity of the Associate Administrator's
determination is to be measured by the provisions found elsewhere
in the regulations.

The regulation at Section 124.103 provides, in part:

     Except for concerns owned by Indian tribes, Alaska
     Native Corporations or Native Hawaiian Organizations,
     in order to be eligible to participate in the 8(a)
     program, an applicant concern must be one which is at
     least 51 percent unconditionally owned by an individual
     who is a citizen of the United States...and who is
     determined by SBA to be socially and economically
     disadvantaged.

At Section 124.105, the requirements for the establishment of
social disadvantage are discussed at length, as follows:

     (a) General. Socially disadvantaged individuals are
     those who have been subjected to racial or ethnic
     prejudice or cultural bias because of their identities
     as members of groups without regard to their individual
     qualities. The social disadvantage must stem from
     circumstances beyond their control.

                          * * * * * * *

     (b) Members of designated groups.

          (1) In the absence of evidence to the contrary,
     the following Individuals are presumed to be socially
     disadvantaged: Black Americans; Hispanic Americans;
     Native Americans (American Indians, Eskimos, Aleuts, or
     Native Hawaiians); Asian Pacific Americans...;
     Subcontinent Asian Americans...; and members of other
     groups designated from time to time by SBA according to
     procedures set forth at paragraph (d) of this section.
     
          (2) An individual seeking socially disadvantaged
     status as a member of a designated group may be
     required to demonstrate that he/she holds himself/
     herself out and is identified as a member of a
     designated group if SBA has reason to question such
     individual's status as a group member.

     (c) Individuals not members of designated groups.

          (1) An individual who is not a member of one of
     the above-named groups must establish his/her individ-
     ual social disadvantage on the basis of clear and con-
     vincing evidence. A clear and convincing case of social
     disadvantage must include the following elements:
     
     (i) The individual's social disadvantage must stem from
     his or her color, ethnic origin, gender, physical
     handicap, long-term residence in an environment iso-
     lated from the mainstream of American society, or other
     similar cause not common to small business persons who
     are not socially disadvantaged.

     (ii) The individual must demonstrate that he or she has
     personally suffered social disadvantage, not merely
     claim membership in a non-designated group which could
     be considered socially disadvantaged.

     (iii) The individual's social disadvantage must be
     rooted in treatment which he or she has experienced in
     American society, not in other countries.

     (iv) The individual's social disadvantage must be
     chronic and substantial, not fleeting or insignificant.

     (v) The individual's social disadvantage must have
     negatively impacted on his or her entry into and/or
     advancement in the business world. SBA will entertain
     any relevant evidence in assessing this element of an
     applicant's case. SBA will particularly consider and
     place emphasis on the following experiences of the
     individual, where relevant:

          (A) Education. SBA shall consider, as evidence of
     an individual's social disadvantage, denial of equal
     access to institutions of higher education; exclusion
     from social and professional association with students
     and teachers; denial of educational honors; social pat-
     terns or pressures which have discouraged the individ-
     ual from pursuing a professional or business education;
     and other similar factors.

          (B) Employment. SBA shall consider, as evidence of
     an individual's social disadvantage, discrimination in
     hiring; discrimination in promotions and other aspects
     of professional advancement; discrimination in pay and
     fringe benefits; discrimination in other terms and
     conditions of employment; retaliatory behavior by an
     employer; social patterns or pressures which have
     channelled the individual into non-professional or non-
     business fields; and other similar factors.

          (C) Business history. SBA shall consider, as
     evidence of an individual's social disadvantage,
     unequal access to credit or capital; acquisition of
     credit or capital under unfavorable circumstances;
     discrimination in receipt (award and/or bid) of
     government contracts; discrimination by potential
     clients; exclusion from business or professional
     organizations; and other similar factors which have
     impeded the individual's business development.

In order for the Petitioner to prevail in this review proceeding,
it is necessary that Kay's social disadvantage, as defined in the
regulations quoted above, be proven, by clear and convincing evi-
dence, in the record that was before the AA/MSB&COD at the time
she made her reconsidered determination. Section 124.105(c)(1).

The clear and convincing standard of evidence is discussed in
United States v. Mastrangelo, 561 F.Supp. 1114, 1120 (E.D.N.Y.
1983) as follows:

     To meet the clear and convincing standard it is not
     required that the evidence be unequivocal or of such a
     quality so as to dispel all reasonable doubt. Addington
     v. Texas, 441 U.S. at 423, 99 S.Ct. at 1807. The clear
     and convincing standard, however, does require from the
     fact-finder a distinctly higher degree of certainty
     than does the preponderance standard. Id. at 432-33, 99
     S.Ct. at 1812. It has been said that:

          [T]he term "clear and convincing" evidence means
          that the witness to a fact must be found to be
          credible, and that the facts to which they have
          testified are distinctly remembered and the
          details thereof narrated exactly and in due order,
          so as to enable the trier of the facts to come to
          a clear conviction, without hesitancy, of the
          truth of the precise facts in issue. Whether
          evidence is clear and convincing requires
          weighing, comparing, testing, and judging its
          worth when considered in connection with all the
          facts and circumstances in evidence.

     30 Am.Jur.2d Evidence  1167 (1964); Hobson v. Eaton,
     399 F.2d 781, 784 n.2 (6th Cir. 1968), cert. denied,
     394 U.S. 928, 89 S.Ct. 1189, 22 L.Ed.2d 459 (1969).

In Kaszuk v. Bakery and Confectionery Union, 638 F.Supp. 365, 374
(N.D. Illinois 1984) the court declared that:

     "[c]lear and convincing" does not mean evidence which
     unequivocally proves a point, or dispels all reasonable
     doubt. [Citing Mastrangelo.] To the extent that the
     phrase is susceptible of precise definition, we believe
     it is best described as evidence which produces in the
     mind of the trier of fact "an abiding conviction that
     the truth of [the] factual contentions are [sic]
     'highly probable.'"

Thus, if I find that the AA/MSB&COD had reason to conclude that
the evidence adduced concerning Kay's social disadvantage did not
produce an abiding conviction that the truth of the assertions
was highly probable, I must affirm the determination and deny the
relief sought by the Petitioner; if I decide that the Associate
Administrator was not able to come to a clear conviction, without
hesitancy, of the truth of the fact of Kay's social disadvantage,
I am obliged to sustain her determination.

Perhaps several of the incidents that have led Kay to presume
bias against her could be proven to have happened. For example:
the incident concerning the overpricing of the pump and motor;
the assertion that her bank "required a 'male' signature...to
obtain credit for her business;" and the incident involving her
not having been given credit for being the only person on the
team who knew how to design structured logic charts - or a pro-
motion - because "Lead programmers and Managers are always men."
Nevertheless, it is obvious that proof of a the nexus between
those and similar incidents and a resulting socially disadvan-
taged status is clearly lacking. From a review of the record, it
is apparent to me that the Petitioner has not proved that Kay's
womanhood was the cause of her alleged inability to compete in
the free enterprise system or the asserted diminished capital and
credit opportunities she has experienced. The record is replete
with Kay's assertions regarding the prejudice and bias she
perceived, but they are clearly subjective, and, while they are
self-serving - as might be expected - there are no stated
objective bases for them. Furthermore, she has provided no
evidence - let alone clear and convincing evidence - to support
these asserted facts.

I am inclined to agree with the assessment of the Associate
Administrator, as pointed out in her denial letter, that the
incidents cited by Kay to support her contention that she has
suffered cultural bias have not been proven; they are not
sufficiently detailed; they are not shown to have been recurrent;
and they happened in the too distant past to have the claimed
effect on Kay's status today.

See Section 124.105(c) of the regulations; see also Fagan v.
Small Business Administration, 783 F.Supp. 1455 (D.D.C. 1992);
Central States Construction, Inc. v. Small Business
Administration, 770 F.Supp. 1447 (D.Kan. 1991).

On this record, the AA/MSB&COD concluded that the Petitioner
failed to carry its burden of proving, by clear and convincing
evidence, that Kay, the individual upon whom eligibility rests,
is socially and economically disadvantaged. I cannot disagree.
The AA/MSB&COD's determination "was based on a consideration of
the relevant factors" and there was no "clear error of
judgment." Motor Vehicle Manufacturers Association v. State Farm
Mutual Insurance, 463 U.S. 29, 77 L.Ed.2d 443, 103 S.Ct. 2856
(1983). It is apparent that the Associate Administrator has
adequately considered all factors and has demonstrated a rational
connection between the facts found and the choice made. The
procedures employed by the Associate Administrator in reaching
her determination comply with the applicable statutory
requirements and with the regulations. United States Lines, Inc.
v. Federal Maritime Commission, 584 F.2d 519 (D.C. Cir. 1978).

Conclusion

The September 29, 1993 determination of the Associate Adminis-
trator, finding the Petitioner, Automation Consultation and
Construction to be ineligible for participation in the Agency's
Section 8(a) Program, was NOT ARBITRARY, CAPRICIOUS OR CONTRARY
TO LAW.

This is the final decision of the Small Business Administration,
and it is binding upon all parties, including those within the
employ of the Agency. See Section 124.210(i).

                              ___________________________
                              Benjamin G. Usher
                              Administrative Law Judge

1/ According to the Section 8(a) Business Eligibility Statement
(SBA Form 1010B), the firm's full name is: "Automation
Consultation by Sandra Kay & Assoc., Ltd., t/a Automation
Consultation & Construction."

2/ The Associate Administrator for the Agency's Office of
Minority Small Business and Capital Ownership Development may be
referred to herein as the "Associate Administrator" or the
"AA/MSB&COD."

3/ The Petitioner's President asserts that an "original appli-
cation was submitted August 26, 1988, [and that] by August of
1990 [the] application had reached Washington...where we were
request[ed] to submit more additional [sic] information because
by that time our business had grown, developed and changed." She
asserts further: "January 1991 we were... told that Sandra J. Kay
was eligible for the program as a 'socially disadvantaged'
individual and her ownership of the business had been
established; the two-year business requirement had been waved
[sic] due to the exceptional education and management skills of
Sandra Kay...and the business had potential for success. However,
because the business had grown and developed a revised
application was needed. Withdrawal of the original application
was made in March 1990 [and]...we began...putting the new
application together...."

4/ To the extent that additional evidence was adduced by the
Petitioner with its Petition for my review, such evidence cannot,
and does not, form any basis for this decision. Evidence that was
not adduced for consideration by the AA/MSB&COD in making her
reconsidered determination may not be admitted in a proceeding
brought to set aside that determination. Section
124.210(h)(3)(i).