Tag Archives: SDVOSB eligibility

Bill Introduced To Transfer SDVOSB Verification To SBA

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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.

SDVOSB Joint Ventures: Supermajority Provision Defeats Eligibility, Says SBA OHA

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A SDVOSB joint venture was not eligible for award of a SDVOB set-aside contract because its joint venture agreement called for certain decisions to be made by supermajority vote.

As explained by the SBA Office of Hearings and Appeals in its decision finding the SDVOSB joint venture ineligible, the supermajority provision undermined the regulatory requirement that a SDVOSB joint venture be managed by an eligible SDVOSB.

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Verified SDVOSB Found Ineligible For Navy SDVOSB Set-Aside

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Despite its VA VetBiz verification, a small business was recently found ineligible for a Navy SDVOSB set-aside, in a decision issued by the SBA’s Office of Hearings and Appeals.

The SBA’s decision stands as a warning that SDVOSB verification does not guarantee SDVOSB eligibility–especially when an eligibility protest arises under a non-VA procurement.

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VA Seeks Public Comment on SDVOSB Verification Rules

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The VA is seeking public comment on its VOSB and SDVOSB verification regulations in an effort to “improve the regulations to provide greater clarity, to streamline the program, and to encourage more VOSBs to apply for verification.”

As part of the public comment process, the VA is inviting the public to weigh in on previously-suggested changes, as well as answer specific questions about ways the VA might improve its verification rules.

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SBA Tosses Vague SDVOSB Protest

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The SBA refused to address a vague SDVOSB protest on its merits–even when the protester attempted to introduce new supporting evidence as part of its appeal.

In a recent decision, the SBA Office of Hearings and Appeals upheld the SBA’s decision to toss out the vague SDVOSB protest.  SBA OHA held that in order for a SDVOSB protest to be viable, it must set forth information or evidence supporting the protester’s allegations.

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VA CVE Reverses Course on Ownership Transfers, Offers Expedited Reconsideration

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Reacting to a February federal court decision, the VA’s Center for Veterans Enterprise has reversed its position on provisions restricting the rights of service-disabled veterans to transfer their ownership interests in their service-disabled veteran-owned small businesses.

Previously, the VA CVE had taken the position that any restriction on a service-disabled veteran’s right to transfer his or her interest in the company was improper.  Because such transfer restrictions are commonplace, many otherwise-eligible SDVOSBs had their verification applications denied.

No more.  In a newsletter to SDVOSBs issued yesterday, the VA CVE stated that it would no longer deny verification based on certain ownership transfer restrictions–and offered an expedited reconsideration process to companies previously denied on this basis.

The VA CVE’s position is welcome news, but doesn’t mean that most SDVOSBs should rush to include transfer restrictions in their bylaws or operating agreements, because the SBA may not agree with the VA CVE’s change of heart.

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SDVOSB’s Operating Agreement Caused Affiliation

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In a recent SBA Office of Hearings and Appeals size decision, a service-disabled veteran-owned small business’s operating agreement caused affiliation under the SBA’s affiliation rules, despite the fact that the majority owner was also labeled as the 51% manager.

SBA OHA’s decision in Size Appeal of Washington Patriot Construction, LLC, SBA No. SIZ-5447 (2013) shows the importance of carefully drafting a small business’s corporate operating agreements or bylaws to prevent affiliation with other companies controlled by the small business’s minority owners.

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