Last week, the U.S. House of Representatives passed the 2015 defense authorization bill. The House-passed version of the 2015 National Defense Authorization Act would transfer VetBiz SDVOSB verification from the VA to the SBA.
If the Senate agrees, and the President signs the bill into law, the process of transferring SDVOSB verification from the VA CVE to the SBA could begin later this year.
The definition of a “service-disabled veteran-owned small business” would be standardized under a new bill introduced by Senators Angus King and Richard Burr.
The King-Burr bill, S.2334, could resolve a serious problem: under current law, the requirements to qualify as a SDVOSB vary (in some cases, significantly) depending on whether an acquisition falls under the VA’s SDVOSB rules or the SBA’s SDVOSB rules.
The King-Burr bill also directs the GAO to study whether it is practical to implement a Government-wide SDVOSB verification system.
Moving SDVOSB verification from the VA to the SBA would save approximately $5 million annually, according to a recent cost estimate issued by the non-partisan Congressional Budget Office.
The CBO concludes that implementing the Improving Opportunities for Service-Disabled Veteran-Owned Small Business Act of 2013 would save money because the SBA would be able to take advantage of systems already in place for other certification programs. The CBO estimate may reignite debate over the potential transfer of the SDVOSB verification program from the VA to the SBA.
The SBA will “make it a priority” to adopt regulations establishing mentor-protege programs for SDVOSBs, HUBZones, and WOSBs in the next 12 months, according to the SBA’s most recent semiannual regulatory agenda.
The regulatory agenda states that the three new mentor-protege programs are expected to be “similar” to the 8(a) mentor-protege program, which suggests that the special joint venturing benefits currently available only to 8(a)s may become available to SDVOSBs, HUBZones and WOSBs, as well.
The SBA has issued a final rule eliminating the unusual megawatt hours size standard applicable to six NAICS codes in NAICS Sector 22. The SBA’s revision replaces the megawatt hours size standard with a 500-employee size standard, and eliminates the requirement that a firm must be “primarily engaged” in the generation, transmission or distribution of energy for sale.
Although the megawatt hours size standard may have made sense when it was adopted in the 1970s, the SBA appropriately recognized that the market has changed. Perhaps most important, the “primarily engaged” component of the megawatt hours size standard unfairly excluded many companies from competing as “small” in NAICS Sector 22.
The VA SDVOSB protest process has been criticized by some (including a certain Kansas-based government contracts attorney) for failing to offer a right of appeal. Under the VA’s rules, if a protested company was found to be ineligible as a SDVOSB, its only option was to sue the VA in federal court–an expensive and time-consuming proposition.
Until now.
Today, the VA published an interim final rule, under which a protested SDVOSB has the right to an appeal within the VA. The new system isn’t perfect, but it’s a step in the right direction.
Today, Congressman Mike Coffman introduced the Improving Opportunities for Service-Disabled Veteran-Owned Small Businesses Act of 2013.
The bill would standardize the requirements for SDVOSB eligibility, eliminating the current differences between the SBA’s and VA’s regulations. In addition, the bill would transfer responsibility for verifying SDVOSB status to the SBA (the VA would retain authority for determining whether an individual is a service-disabled veteran).
Hardy Stone’s website, VetLikeMe, has a more detailed summary of the bill. I will be closely tracking this legislation and will post updates if and when it moves forward.