OSBE Preference Program

**This page is currently being updated. Please return for updates!**

In 2025, Oregon Legislature passed House Bill 2337, directing the Department of Administrative Services (DAS) to create a Small Business Procurement Program and authorizing the Certification Office for Business Inclusion and Diversity (COBID) to develop a new Oregon Small Business Enterprise (OSBE) certification.

What is Oregon Small Business Enterprise Certification?

The OSBE certification is a race and gender-neutral small business certification for Oregon-based businesses. Business Oregon began certification on April 1, 2026. There are currently over 300 OSBE certified businesses and growing. More information about OSBE certification requirements and the application process can be found on the COBID website.

Why was the OSBE Certification and Preference Program Created?

The state of Oregon spends billions of dollars on outside services every year. Small businesses make up 99.4% of Oregon's economy. Small businesses (under 500 employees) also make up 53% of all Oregon employees. Despite this, many Oregon small businesses struggle to compete for state contracts with large out-of-state businesses. The OSBE preference program aims to help Oregon businesses compete for contract opportunities and keep Oregon money in Oregon. The preference program goes into effect July 1, 2026 and is applicable to all state agencies under DAS authority.

How does the preference work?

The OSBE preference applies to small and intermediate procurements. It does not apply to procurements under ORS-279C and has exemptions for: office supplies, IT hardware/software, and vehicles.

For small procurements (under $25,000) OSBE has been added before statewide price agreements in the buy decision. This means that before an agency purchases off of a statewide price agreement, they must first check to see if there is an OSBE that can meet their need. If there are no OSBEs that provide that service or the existing OSBEs cannot meet agency need such as timeline or quantity of product, then the agency may move to statewide price agreements or the open market for their procurement.

Flow chart of the Buy Decision Priority Order with statue references

Intermediate procurements ($25,000 to $250,000) will implement the OSBE preference in the open market stage. For informal solicitations, agencies must solicit bids from three OSBEs before seeking bids from non-OSBE vendors. For formal solicitations a preference of up to 10% will be applied to OSBE bids. This may take the following forms:

Evaluation based on price: Apply the preference by reducing the OSBE's evaluated price by the selected percentage. This reduction is for the evaluation only - the contract price does not change.
Best Value Evaluation: Apply the preference by increasing the OSBE's score by the selected percentage.
Non-Scored Procurements: Agencies must consider in their decision how purchasing from an OSBE:

Strengthens Oregon's economy
Supports local jobs

The OSBE preference may be combined with other procurement preferences unless prohibited.

Resources

COBID Website

COBID Vendor Directory

COBID Procurement Guide

Common NAICS to NIGP Code Crosswalk

OSBE RAC Materials and Rule Document

Workday Trainings for Procurement Professionals:

DAS - SPS Buy Decision
DAS - SPS Oregon Small Business Enterprise (OSBE) Preference

**Frequently Asked Questions Coming Soon!**

HB 2337 Rules Advisory Committee Recording

House Bill 2337 (2025) directs the Department of Administrative Services (DAS) to establish a program granting procurement preference to certified Oregon Small Business Enterprises (OSBEs). These rules focus on small (up to $25,000) and intermediate ($25,000-$250,000) procurements. The OSBE preference is the first step in a larger rule update effort, setting the foundation for future improvements while ensuring progress on the inclusion of Oregon small businesses in procurement. The rules advisory committee (RAC) meeting was recorded and published on the DAS OPE website to facilitate an additional solicitation of public comments. Following this RAC and comment process, DAS developed a final rule for submission to the Secretary of State, in order to become effective on July 1, 2026.