As SmallGovCon readers may recall, SBA has already eliminated the ability to self-certify as a Service-Disabled Veteran-Owned Small Business (SDVOSB) for all prime contracting opportunities set aside for SDVOSBs. This change occurred January 1, 2024 and meant that self-certified SDVOSBs will no longer be eligible for set-aside and sole source contracts. We wrote about the change here. However, the rule change left in place the self-certification ability for self-certified SDVOSBS, but only for subcontracting purposes and government goaling purposes. This will be changing in December 2024.

In this direct final rule, SBA is implementing a portion of the National Defense Authorization Act for Fiscal Year 2024 (NDAA 2024) to eliminate SDVOSB self-certification for subcontracts and agency SDVOSB goals. Currently, under SBA rules firms “that meet the VetCert Program eligibility requirements may self-certify their SDVOSB status, receive prime contract or subcontract awards that are not SDVOSB set-aside or sole source contracts, and be counted toward an agency’s SDVOSB small business goals or a prime contractor’s subcontracting goal for SDVOSB awards.”

In other words, federal agencies still get credit for awards to self-certified SDVOSBs, even though SBA has not reviewed that the companies in question are proper SDVOSBs. There would be no incentive for anyone to really check on whether the claimed SDVOSB status is proper, because there is no protest process and the agency didn’t rely on the company’s SDVOSB status in making the award.

This new rule will eliminate any remaining ability to self-certify as an SDVOSB.

The rule creates a grace period so that firms that file a VetCert application by December 22, 2024 may continue to self-certify for these limited purposes, including subcontracts, until SBA makes a final decision. Firms that are not certified and do not have a pending application filed by December 22 cannot self-certify for any purpose after December 22.

Here are some of the key regulatory text changes.

• “A concern must be certified pursuant to § 128.300 to receive a prime contract that is to be counted by a Federal agency for the purposes of meeting participation goals for SDVOSBs or to receive a subcontract from a Federal prime contractor for the purpose of meeting subcontracting goals for SBVOSBs in Federal procurement contracts.” 13 CFR § 128.200. This means that large prime contractors with subcontracting plans will only be allowed to get credit for awarding subcontracts to certified SDVOSBs.
• “Any small business concern that submits a complete certification application to SBA on or before December 22, 2024, shall be eligible to self-certify for a . . . subcontract that counts towards SDVOSB goaling purposes or SDVOSB subcontracting goals” until SBA makes its decision and any “small business concern that does not submit a complete SDVOSB certification application to SBA on or before December 22, 2024, will no longer be eligible to self-certify[.]” 13 CFR § 128.200.

This updated regulation will close the last loophole allowing self-certified SDVOSB status. For those not already certified, please pay close attention to the December 22, 2024 date. After that, SDVOSB self-certification will be eliminated for good.

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