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.
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.
VetBiz verification is only required for VA SDVOSB set-aside solicitations (and FAA SDVOSB set-asides), right? Not in the eyes of one Air Force contracting officer, who apparently inserted a VetBiz verification requirement in a recent SDVOSB set-aside solicitation.
After being excluded from the competition, a contractor challenged the legality of the VetBiz requirement, and asked the SBA to declare it invalid. Unfortunately for the protester, as the SBA Office of Hearings and Appeals held, the SBA lacks authority to rule on such a protest.
As many service-disabled veteran-owned small businesses have discovered, the VA CVE believes that so-called “right of first refusal” provisions prevent veterans from freely selling or transferring their ownership interests. Because such transfer restrictions are commonplace in standard corporate bylaws and operating agreements, countless SDVOSBs have been denied VA CVE verification for including them.
Those days may be over.
In a decision released to the public late last week, the U.S. Court of Federal Claims held that the VA OSDBU had erred by sustaining a SDVOSB eligibility protest on the basis of the company’s right of first refusal provision. That decision, Miles Construction, LLC v. United States, No. 12-597C (2013), also includes other important rulings on the scope of “unconditional” ownership and the VA OSDBU’s evaluation of SDVOSB eligibility protests.
In an important decision impacting many SDVOSB verification applicants, the U.S. Court of Federal Claims has held that the VA’s SDVOSB regulations did not prevent a service-disabled veteran from controlling his company remotely.
In KWV, Inc. v. United States, No. 12-882C (2013), the Court held that a veteran could control his Rhode Island-based construction company by electronic means, even though the veteran spent half of the year residing in Florida.
SDVOSB protests relating to VA set-aside procurements may only be decided by the VA Office of Small and Disadvantaged Business Utilization. In a recent decision, the SBA Office of Hearings and Appeals confirmed that the SBA currently lacks jurisdiction to decide SDVOSB protests under VA set-aside procurements.
For small government contractors, SBA size and eligibility issues are of critical importance. Recognizing this, the SBA provides an independent forum–the SBA Office of Hearings and Appeals–to review potential mistakes made by the SBA Area Offices, which decide SBA size protests.
Small government contractors must remember, however, that SBA OHA exists to evaluate the decisions made by SBA Area Offices, not to evaluate new allegations raised for the first time in the course of a SBA OHA appeal. Case in point: SBA OHA’s recent decision in Size Appeal of In & Out Valet Co., SBA No. SIZ-5354 (2012), in which the protester apparently attempted to “file” a SDVOSB protest with SBA OHA during the course of its SBA size appeal.