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).