FAA: SDVOSBs Must Be Verified in VetBiz to Receive Set-Aside Awards

Want to receive a service-disabled veteran-owned small business set-aside contract from the Federal Aviation Administration?  Get listed in the VA’s VetBiz database.  The FAA has adopted a regulation requiring VA VetBiz certification as a requirement of winning a FAA SDVOSB set-aside award.  One interesting question: will other agencies follow the FAA’s lead?

The FAA is an odd duck in the federal procurement arena: neither the FAR nor the Small Business Act apply to it.  Instead, the FAA has its own procurement guidelines, known as the Acquisition Management System, or AMS.  Recently, the AMS was revised to state that, “there is no requirement to obtain the SBA’s or Veteran Administration‘s approval to make award to the selected SDVOSB.  However, unless the firm is designated as a SDVOSB on the VA website, the CO must not make an award to the firm as a SDVOSB.”

The FAA’s regulation leaves no room for doubt: if you want to receive an FAA SDVOSB set-aside contract, you must be listed in the VA’s VetBiz database.  What happens now?  Will other agencies follow the FAA’s lead?

My guess is no.  Sections 502 and 503 of the Veterans Benefits, Health Care and Information Technology Act of 2006, the statute creating the verification system, seems to authorize the VA–and only the VA–to require verification as a precondition to award of a SDVOSB set-aside contract.  Seeming to confirm my interpretation of the statute, a few months ago, I attended a presentation given by a high-level VA contracting official, who stated that other agencies cannot precondition SDVOSB awards upon VetBiz registration, and that any agency that did so would be setting itself up for a bid protest.

Of course, as I mentioned, the FAA is an odd duck in the procurement world.  Maybe the FAA has the authority to require SDVOSB verification, even if other non-VA agencies do not.  I certainly am interested to see if any non-verified SDVOSB challenges the FAA’s new requirement.  In the meantime, SDVOSB verification is the rule–both at the VA and the FAA.  As for other agencies, I wouldn’t hold my breath.

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