Despite its VA VetBiz verification, a small business was recently found ineligible for a Navy SDVOSB set-aside, in a decision issued by the SBA’s Office of Hearings and Appeals.
The SBA’s decision stands as a warning that SDVOSB verification does not guarantee SDVOSB eligibility–especially when an eligibility protest arises under a non-VA procurement.
The VA is seeking public comment on its VOSB and SDVOSB verification regulations in an effort to “improve the regulations to provide greater clarity, to streamline the program, and to encourage more VOSBs to apply for verification.”
As part of the public comment process, the VA is inviting the public to weigh in on previously-suggested changes, as well as answer specific questions about ways the VA might improve its verification rules.
The SBA refused to address a vague SDVOSB protest on its merits–even when the protester attempted to introduce new supporting evidence as part of its appeal.
In a recent decision, the SBA Office of Hearings and Appeals upheld the SBA’s decision to toss out the vague SDVOSB protest. SBA OHA held that in order for a SDVOSB protest to be viable, it must set forth information or evidence supporting the protester’s allegations.
Reacting to a February federal court decision, the VA’s Center for Veterans Enterprise has reversed its position on provisions restricting the rights of service-disabled veterans to transfer their ownership interests in their service-disabled veteran-owned small businesses.
Previously, the VA CVE had taken the position that any restriction on a service-disabled veteran’s right to transfer his or her interest in the company was improper. Because such transfer restrictions are commonplace, many otherwise-eligible SDVOSBs had their verification applications denied.
No more. In a newsletter to SDVOSBs issued yesterday, the VA CVE stated that it would no longer deny verification based on certain ownership transfer restrictions–and offered an expedited reconsideration process to companies previously denied on this basis.
The VA CVE’s position is welcome news, but doesn’t mean that most SDVOSBs should rush to include transfer restrictions in their bylaws or operating agreements, because the SBA may not agree with the VA CVE’s change of heart.
In a recent SBA Office of Hearings and Appeals size decision, a service-disabled veteran-owned small business’s operating agreement caused affiliation under the SBA’s affiliation rules, despite the fact that the majority owner was also labeled as the 51% manager.
SBA OHA’s decision in Size Appeal of Washington Patriot Construction, LLC, SBA No. SIZ-5447 (2013) shows the importance of carefully drafting a small business’s corporate operating agreements or bylaws to prevent affiliation with other companies controlled by the small business’s minority owners.
Did your company file a request for reconsideration of a VA CVE SDVOSB verification denial? If so, be prepared to wait awhile–approximately 128 days, according to a recent VA CVE email.
The email, which was sent to a number of SDVOSBs and VOSBs (and kindly shared with me) indicates that the VA CVE is currently processing approximately 300 requests for reconsideration. As a result, the VA CVE says, the time frame to process a request for reconsideration is now more than double the regulatory goal of 60 days.
After prevailing in its SBA OHA 8(a) appeal, a St. Louis-based communications and electrical construction contractor has been certified as a participant in the SBA’s 8(a) program.
The SBA’s decision to certify Innovet, Inc. shows the importance of pursuing an appeal of an unreasonable SBA 8(a) denial–and offers hope that the SBA is learning from its recent string of defeats at SBA OHA.