VA CVE Announces “Pre-Determination Findings” To Improve SDVOSB Verification

The VA Center for Veterans Enterprise will soon begin giving some applicants the opportunity to correct problems with their SDVOSB verification applications before denying their applications.

In a letter sent yesterday to a number of SDVOSB advocates, VA OSDBU Executive Director Thomas Leney announced that the VA CVE’s new “pre-determination findings” program will launch on May 1, 2013.  If the new program works as intended, it could significantly reduce the number of SDVOSBs requesting reconsideration, lead to quicker verifications, and reduce the backlog of verification applications.

According to Mr. Leney’s letter, the pre-determination findings program is “aimed at eliminating the large percentage of verification denials that are due to single points of failure that can be easily and quickly corrected.”  Applications with one or more of nine problems are eligible for the pre-determination findings program:

  • Quorum
  • Weighted voting
  • Serve as general partner for partnership
  • Serve as management member of limited liability company
  • Community property
  • Living trust and direct ownership
  • Highest compensation for veteran
  • Highest officer position
  • Ownership 51% unconditional

In my experience (and apparently CVE’s, as well), these nine issues are often easily correctable through changes to corporate bylaws, operating agreements and similar documents.  Issues that do not fall within this list will  not be available for the pre-determination findings program initially, although Mr. Leney indicated that the program “may be refined to reflect lessons learned.”

If a SDVOSB’s application is eligible for the pre-determination findings program, the firm will receive an email identifying those issues before the letter of eligibility is issued.  The CVE will follow up on this “preliminary findings” email with a telephone call within 24 hours to ensure receipt.

The SDVOSB has 48 hours to inform the CVE of the firm’s intent to participate in the pre-determination process.  The SDVOSB must then submit revised documentation and other information in response to the preliminary findings within five business days.

After the SDVOSB responds to the preliminary findings, the CVE will notify the SDVOSB whether the response adequately addressed the issues.  If not, the SDVOSB will be given the choice to withdraw its application, or to have a denial letter issued, which can be used as the basis of a request for reconsideration.

All in all, the pre-determination findings program sounds like a major step forward for the CVE.  For too long, qualified firms have been denied verification based on minor issues, and forced to wait months for a reconsideration decision.  The pre-determination findings program should enable those firms to become verified much more quickly, while enabling the CVE’s reconsideration team to focus its attention on applications with more difficult or significant issues.

I am curious to see how the pre-determination findings program will work in practice come May.  For now, I will say something I thought I might never say: cheers to the CVE!

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