Government-Wide SDVOSB Certification: More Details on New Bill

I’ve long predicted that Congress would eventually adopt a formal, Government-wide SDVOSB certification program (or “verification” program, if you prefer).  Maybe my crystal ball is finally right.  As my colleague Matt Schoonover wrote last week, a new bill introduced in the House of Representatives would do just that.

The full text of the bill has now been published.  Here are some of the key details of the Government-wide SDVOSB certification proposal.

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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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VetBiz Verification Not Required For Non-VA SDVOSB Contracts, SBA OHA Reiterates

Despite a longstanding and very common misconception, the VA’s SDVOSB verification requirement doesn’t apply to non-VA SDVOSB contracts.

As the SBA Office of Hearings and Appeals recently reiterated, it was “simply not correct” to believe that a company was required to be verified in VetBiz to be awarded a non-VA SDVOSB contract.

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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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VA Proposes Elimination of SDVOSB Ownership & Control Rules

The VA has formally proposed to eliminate its SDVOSB and VOSB ownership and control regulations.

Once the proposed change is finalized, the VA will use the SBA’s regulations to evaluate SDVOSB and VOSB eligibility, as required by the 2017 National Defense Authorization Act.

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Unverified SDVOSB JV Partner Couldn’t Protest VA Set-Aside Solicitation

A non-SDVOSB company couldn’t protest the terms of a VA SDVOSB set-aside solicitation, despite entering into a joint venture agreement with an SDVOSB–because the joint venture hadn’t started the process of becoming verified by the VA.

In a recent bid protest decision, GAO held that because neither the protester nor the joint venture was included in the VIP database, or likely to be included during the protest process, the protester wasn’t an “interested party” under the GAO’s bid protest regulations.

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