Recently, SBA’s VetCert Program announced that it had gotten through its backlog, meaning that the system has returned to normal, so to speak. With this in mind, many new service-disabled veteran-owned small businesses (SDVOSBs) no doubt are looking at getting into the SDVOSB program. Indeed, some of you reading this may be the owners of some of those businesses. Considering that we just looked at an SDVOSB appeal regarding the control requirements for an SDVOSB, today, we’re going to go further and provide a general rundown of the SDVOSB Program to update our past post on this topic.
Continue readingCategory Archives: Service-Disabled Veteran-Owned Small Businesses
OHA SDVOSB Appeal: Voting Provisions Scuttle Veteran Control
In a recent decision, SBA’s Office of Hearings and Appeals (OHA) emphasized the importance of a careful reading and complete understanding of the control and ownership requirements for Service-Disabled Veteran Owned Small Businesses (SDVOSBs). This decision provides contractors with an excellent opportunity to brush up on SBA’s control rules regarding qualifying and non-qualifying owners. As the appellant found out in this case, while it may seem to some at first glance that simple majority ownership by the service-disabled veteran is enough to meet SDVOSB requirements, voting provisions matter as well. Failure to keep in mind all aspects of SDVOSB requirements could lead to a denial of SDVOSB status. Let’s take a look at the language of the regulation in question, and how this case illustrates the potential consequences of overlooking a critical item in an otherwise-compliant application for SDVOSB certification.
Continue readingHappy Veterans Day From SmallGovCon
Today, on Veterans Day, we at SmallGovCon take a moment to honor the brave men and women who’ve served our country. We salute those who’ve worn the uniform and their families who’ve stood beside them. Both today and whenever we have the chance.
Because this is a legal blog, we also want to remind you of the federal government’s program for Service-Disabled Veteran-Owned Small Businesses. Those benefits are available to those with disabled status based on their service, and those who work at their companies. It is a program that we hope to see grow even more important in the future.
For our service-disabled veteran readers and our veteran readers, we wish to say thank you. And Happy Veterans Day.
OHA: Contractor Learns from Earlier OHA Decision to Show Me the Money on Ostensible Subcontracting Issue
Compliance with the ostensible subcontractor rule is essential for companies seeking small business and socioeconomic set-asides. Yet many contractors learn the hard way that there is a difference between simply claiming compliance and proving it.
Earlier this year, we blogged on an SBA Office of Hearings and Appeals (OHA) decision (here) that examined whether a subcontractor was an ostensible subcontractor or not. Ultimately, the awardee failed to sufficiently demonstrate that its subcontractor was not performing the primary and vital parts of the contract.
In a recent OHA decision, the same parties went head-to-head again for round two, on a different procurement with a different proposal. But this time, one party brought the receipts. In reviewing the proposal, SBA found that the prime contractor had properly outlined its tasks and work in alignment with the solicitation and showed its compliance with the limitations on subcontracting. These two cases work in tandem to help show federal contractors how to demonstrate compliance with the ostensible subcontractor rule.
Continue readingSBA’s SDVOSB Warning: Spell Out Veteran Control in Business Documents and Minutes
It is quite common for businesses in the private sector to share control and duties among many executives or individuals. However, as many who have looked into SBA socioeconomic certifications have found out, to gain certification in a set-aside program, basically all control needs to reside with one individual. Recently, the SBA’s Office of Hearings and Appeals (OHA) reviewed a SDVOSB recertification denial, and provided a reminder to contractors interested in the SDVOSB and VOSB program that the veteran must be the sole individual in control.
Continue readingOHA Says: Show me the Money! (in Ostensible Subcontracting Review)
Size and status protests, which are reviewed by the SBA’s Office of Hearings and Appeals (OHA), are far less common than GAO protests which protest an evaluation aspect of a solicitation or award. But when they are used they can be a powerful tool to keep contracting dollars intended for small businesses to stay with small businesses. In the case of Winergy, LLC, OHA takes a look at an award intended for SDVOSBs, to determine if the awardee is in compliance with the ostensible subcontractor rule or if it is subcontracting out the primary and vital parts of the contract. The lesson? If you want to keep an award, be sure that you, or a similarly situated subcontractor, will be performing the primary and vital parts of the contract and that you can support that assertion with evidence.
Continue readingFully Devoted or Just Rebuttable? Qualifying Veterans Overcome Full-Time Devotion Rule
It doesn’t take too long to find a blog post where we’ve discussed SBA’s Service-Disabled Veteran-Owned Small Business (SDVOSB) full-time devotion requirement. For a service-disabled veteran (SDV) to meet the SDVOSB control requirements, the SDV must control “the management and daily business operations” of the SDVOSB. This requires the SDV to be fully devoted to the SDVOSB. As a quick refresher on the full-time devotion requirement, a qualifying veteran “may not engage in outside employment that prevents [them] from devoting the time and attention to the concern necessary to control its management and daily business operations.” Further, the veteran must be able to “devote full-time during the business’s normal hours of operation” or SBA will assume lack of control. 13 C.F.R. 128.203(i). The same rule applies for the WOSB and 8(a) programs. In past decisions, SBA was OK with a veteran juggling multiple jobs as long as the hours didn’t overlap. But a recent decision shows that it may be possible to overcome this assumption.
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