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Contracting Opportunities for VOSBs and SDVOSBs
Contracting Opportunities for VOSBs and SDVOSBs
If you are a Veteran or Service Disabled Veteran entrepreneur, you’ll want to understand the programs and preferences in place to support your participation in federal government contracting. Two distinct programs – the government-wide Service Disabled Veteran-owned Small Business Concern Program (SDVOSB) and the Veteran Affairs’ Veterans First Contracting Program – have significantly different parameters and requirements.
Service Disabled Veteran-owned Small Business Concern Program
The purpose of the Service-Disabled Veteran-Owned Small Business Concern (SDVOSBC) Program is to provide agencies with the authority to set acquisitions aside for exclusive competition among SDVOSB concerns, as well as the authority to make sole source awards to SDVOSB concerns if certain conditions are met. (See Code of Federal Regulations (CFR) 13 C.F.R. § 125.8-125.10).
This program was developed to help agencies meet the government-wide goal that not less than 3% of the total value of all prime contract and subcontract awards be made to small businesses owned and controlled by service-disabled veterans stipulated by the Veterans Entrepreneurship and Small Business Development Act of 1999. It does not provide a priority or preference to SDVOSBs, it simply allows contracting officers to create SDVOSB set-asides or make sole source awards if they choose to do so in an effort to meet the 3% goal.
Veterans First Contracting Program:
Within the Department of Veterans Affairs (VA), the procurement hierarchy for open market acquisitions places the highest priority on SDVOSBs, followed by VOSBs, putting Veteran-owned businesses ahead of 8(a), HUBZone, Woman-owned and other small businesses. This is the only program that gives first priority to veterans and the only program that provides a preference for veteran business owners who are not service-disabled. The VA is one of the largest federal procurement organizations, awarding over $3 billion to Veteran-owned small businesses.
Verification: To qualify for the Veterans First Contracting Program, businesses must be found eligible through the VA’s Verification process, which is administered by the VA’s Center for Verification and Evaluation (CVE). The core requirements are as follows (per 38 CFR part 74):
- The Veteran owner(s) have direct, unconditional ownership of at least 51percent of the company and have full decision-making authority;
- The Veteran manages the company on both a strategic policy and a day-to-day basis;
- The Veteran holds the highest officer position;
- The Veteran should be the highest compensated employee unless there is a logical explanation otherwise, submitted by the Veteran as to how taking a lower salary than other employee(s) helps the business; and
To be eligible for the SDVOSBC, the following criteria must be met:
- The Service Disabled Veteran (SDV) must have a service-connected disability as determined by the VA or Department of Defense (DoD)
- The SDVOSBC must be small under the North American Industry Classification System (NAICS) code assigned to the procurement
- One or more Service Disabled Veterans must unconditionally own 51% of the business, control its management – including long-term decision making – and daily operations, AND hold the highest officer position
- Ownership by one or more service disabled veterans must be direct ownership. A concern owned principally by another business entity that is in turn owned and controlled by one or more service-disabled veterans does not meet this requirement.
The SDVOSBC program is self-certifying, meaning that no verification process is currently required. Individual Contracting Officers may require documentation of eligibility before awarding set-aside or sole source contracts under the program and awards may be subject to protest if the eligibility of the successful bidder is in question. Significant penalties, including prison sentences, have been imposed on some contractors found to have fraudulently claimed SDVOSB status.
- The Veteran has the managerial experience of the extent and complexity needed to manage the company.
- To be eligible for the SDVOSB Certification, the Veteran applicant must meet the eligibility requirements in 38 CFR § 74 and possess either a disability rating letter issued by VA establishing a service-connected rating between 0 and 100 percent or a disability determination from the Department of Defense.
Did you know that 3% of all federal contracts must be set-aside to Service Disabled Veteran Owned Small Business?Recently SDVOSB certified? Interested in Joint Venturing with another firm to capitalize on opportunities? Then let Byerly Enterprises help you with your SDVOSB Joint Ventures. As former SBA employees, we understand the regulations and processes that SBA uses to approve your Joint Ventures.
Found the perfect Mentor? Let Byerly Enterprises prepare your Mentor Protégé Package for submittal to SBA. Interested in knowing the pitfalls of the Mentor Protégé Program? Let our experts walk discuss the pros and cons of the program.
Whether you are starting or growing a business, at Byerly Enterprises we will assist you with all your business certification needs.