VetBiz verification is only required for VA SDVOSB set-aside solicitations (and FAA SDVOSB set-asides), right? Not in the eyes of one Air Force contracting officer, who apparently inserted a VetBiz verification requirement in a recent SDVOSB set-aside solicitation.
After being excluded from the competition, a contractor challenged the legality of the VetBiz requirement, and asked the SBA to declare it invalid. Unfortunately for the protester, as the SBA Office of Hearings and Appeals held, the SBA lacks authority to rule on such a protest.
SBA OHA’s decision in SDVOSB Appeal of 347 Construction Group, SBA No. VET-232 (2013) involved an Air Force solicitation for the renovation and repair of heating and air conditioning systems. The Air Force set the procurement aside for SDVOSBs. Apparently, a provision in the solicitation required SDVOSBs to be verified with the VA’s VetBiz system in order to be eligible for award.
On September 21, 2012, the Contracting Officer announced that the contract had been awarded to Total Team Construction Services. On the same day, the Contracting Officer informed 347 Construction Group that it had been excluded from the solicitation because it was not registered in the VetBiz database.
On September 27, 347 filed a protest with the Contracting Officer challenging its exclusion. 347 admitted that it was not registered in the VetBiz system, but argued that VetBiz registration was not necessary to qualify as a SDVOSB for the procurement. 347 asserted that if the Contracting Officer questioned 347’s SDVOSB status, it was required to forward the matter to the SBA for resolution.
After a “delay of several months,” the Contracting Officer forwarded 347’s protest to the SBA’s Office of Government Contracting. Two weeks later, SBA OGC dismissed the protest. SBA OGC explained that it had authority to decide a SDVOSB status protest only if the protester challenged the SDVOSB eligibility of the successful offeror. In this case, however, 347 sought a review of its own SDVOSB eligibility, not that of the awardee.
347 filed an appeal with SBA OHA. SBA OHA confirmed that 347 had filed its protest incorrectly.
347’s allegations “pertain to the Air Force’s conduct of the procurement, and therefore are in the nature of a bid protest,” SBA OHA wrote. “Bid protest allegations must be raised at the U.S. Government Accountability Office (GAO) or similar forums, not at OHA .”
SBA OHA concluded, “[a]ccordingly, insofar as  seeks to challenge the Air Force’s decision to exclude  from the competition,  is pursuing this litigation in the wrong forum.” SBA OHA denied 347’s appeal.
At its most basic, the 347 Construction Group decision stands for the principle that when a contractor challenges its own exclusion from the competition–even for reasons related to size or socioeconomic eligibility–the proper mechanism is likely a bid protest with the GAO (or Contracting Officer or Court of Federal Claims), not a protest with the SBA.
In this case, 347 not only should have filed a bid protest instead of a SBA protest, but should have filed that protest before the due date for proposals, rather than waiting until it was excluded from the competition. This is because the general rule for bid protests is that deficiencies that are evident on the face of a solicitation must be protested before the proposal due date. Because 347 waited until after award to protest, even had 347 filed in the right forum, its protest may well have been dismissed as an untimely challenge to the solicitation’s VetBiz requirement.
That brings me to the more interesting part of the 347 Construction Group case: the fact that the Air Force required VetBiz verification for SDVOSBs. Was that legal?
At the very least, the provision was highly questionable. In a SBA OHA decision issued last year, a disappointed offeror for an Army SDVOSB set-aside filed a SDVOSB eligibility protest, arguing that the successful awardee was not registered in VetBiz. SBA OHA held that SBA OGC had properly dismissed the protest, writing:
“This procurement is an Army procurement and is thus under SBA’s SDVO SBC regulations. Under SBA’s regulations there is no requirement that a firm be included in VA’s VetBiz database. A concern need not be listed in VetBiz in order to bid on procurements for Federal agencies other than the VA. 13 C.F.R. §§ 125.9, 125.10. Accordingly, an allegation that a firm is not listed on the VetBiz database is not valid grounds for a protest under SBA’s regulations.”
Was the Air Force’s insistence on VetBiz verification an outlier, or a sign of things to come? If the latter, we can certainly expect the GAO and/or the Court of Federal Claims to weigh in on the question that the SBA lacked jurisdiction to decide.