SDVOSB Regulations Reveal Typo in Exceptions to Ownership Conditions

As we’ve written about on the blog, SDVOSB regulations were consolidated under the SBA’s rules beginning October 1, 2018, and those changes included some good and bad changes. We recently noticed a single letter in one of the changes that, while most likely a typo, could potentially affect the meaning of one part of the new regulation.

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OHA Denies First-Ever VA SDVOSB Status Protest

The Small Business Administration Office of Hearings and Appeals has denied a protest of the service-disabled veteran-owned small business status of a company seeking to perform work for the U.S. Department of Veterans Affairs.

The decision was not particularly controversial or otherwise notable in and of itself. What is notable is that this was the first VA-status SDVOSB protest decision ever issued by OHA.

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New Consolidated SDVOSB Eligibility Requirements: the Good, the Bad, and the Downright Ugly

New, consolidated SDVOSB eligibility regulations kicked in on October 1.  The new regulations replace the old VA and SBA rules, which provided separate eligibility standards for SDVOSBs.

Veterans have long been confused by the fact that the Government operated two separate SDVOSB programs, each with its own standards.  The consolidated rule will eliminate that confusion, and that’s a very good thing.  There are also several other pieces of the new SDVOSB eligibility rule that veterans should like–but also some that aren’t so great, or that require further clarification as to how they’ll be applied.

My colleague Matt Schoonover provided a broader overview of the new regulations earlier last week.  Now it’s time for me to get on my soapbox.  Without further ado, here’s my list of the good, bad, and the downright ugly from the new SDVOSB regulations.

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SDVOSB Eligibility Update: SBA Issues New Rule

Earlier this week, Steve updated SmallGovCon readers on a very important SDVOSB eligibility change: beginning October 1, the VA will begin using the SBA’s eligibility rules to verify SDVOSBs and VOSBs.

The SBA has now followed suit—in a final rule published today, the SBA has amended its eligibility rules for SDVOSBs. These rules provide important clarity into SDVOSB eligibility going forward.

Let’s take a look at some of the most important changes.

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VA Will Use SBA SDVOSB Eligibility Rules Starting October 1, 2018

The VA will begin using the SBA’s eligibility rules to verify SDVOSBs and VOSBs beginning October 1, 2018.

In a final rule published today in the Federal Register, the VA confirms that the SBA’s eligibility requirements will apply beginning next week–but in my eyes, one very important question remains unanswered.

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SBA Proposes Consolidated SDVOSB Eligibility Rules

The SBA has released its proposed consolidated rule for SDVOSB eligibility, which was published in the Federal Register today.  Once the rule becomes final, it will apply government-wide, to both VA and non-VA SDVOSB contracts.

For SDVOSBs, a uniform set of rules is a very good thing.  There has been far too much chaos and confusion under the current system, in which the SBA and VA have different SDVOSB eligibility requirements.  But how about the substance of the proposal itself?  Well, there are certainly some things to like–and some areas that could use improvement.

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VA Proposes Expanded “Good Character” SDVOSB Exclusions

The VA has proposed expanding its definition of the “good character” required to own or control an SDVOSB or VOSB.

The VA’s proposed rule would exclude many people convicted of felonies (including felonies unrelated to business integrity), which may raise questions about the rule’s fairness.  And I have to wonder–is the VA’s proposal consistent with the Congressional directive requiring the VA to use the SBA’s SDVOSB eligibility rules?

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