VA helping small biz owners avoid verification issues

The Department of Veterans Affairs says it is instituting a "quick-fix" program designed to help qualified veterans avoid time- and resource-consuming denials of their applications to compete for VA procurement contracts. Beginning May 1, VA will allow those wishing to establish a veteran-owned small business (VOSB) or service-disabled veteran-owned small business (SDVOSB) to correct what VA calls "minor deficiencies" in paperwork submissions, thus avoiding an automatic rejection of his or her application. The new procedure will apply to hopeful competitors for VA "Veterans First" contracts.

Any would-be VOSB or SDVOSB owner-operator wishing to do business with the U.S. government must undergo an extensive, document driven "verification" process to determine, to VA’s satisfaction, both the eligibility and viability of the would-be federal contractor. Currently, a significant number of verification applications are being rejected due to what VA is calling "single points of failure that can be easily and quickly corrected."

According to Davy Leghorn, assistant director of The American Legion’s Economic Division and a specialist in veteran-owned small business matters, these "single points of failure" are not merely typographical errors or neglected check boxes.

"These are about things like an incomplete set of bylaws, or an unclear establishment of a corporate management structure -- things like that," Leghorn said. "VA requires that a veteran-owned small business be, obviously, owned by a veteran, not a surrogate. That’s easy to prove. But, VA also requires a VOSB or SDVOSB to be controlled by a veteran. That means the veteran must have and be able to maintain a controlling financial interest in the company and also be shown to be in charge of day-to-day operations. That’s where it can get tricky, especially if there are non-veterans with significant roles to play in the firm.

"It is true, most of these ‘single points of failure’ can be corrected with a small modification, explanation or addendum, but it sometimes takes someone steeped in business management and corporate law to figure that out. So, we are happy that VA will now be allowing veterans to correct these errors or deficiencies before their applications for verification are denied altogether. It should help veteran-owned businesses avoid the time and money consuming delays that a verification denial can cause."

VA says that businesses whose applications would normally be rejected based on an easily corrected error will receive a notification of that error, or what VA calls a "preliminary finding." The applicant will then be given 48 hours to notify VA that the business intends to rectify the problem and submit corrected paperwork within a specified number of days. VA’s Center for Veterans Enterprise (CVE) has begun a pilot test of the new procedure. More information can be obtained by visiting CVE’s website or by calling (202) 303-3260.