SBA Proposes Rule to Take Control of All Veteran-Owned Certifications | Pillsbury Winthrop Shaw

The Small Business Administration (SBA) has proposed consolidating and making significant changes to the Veteran-Owned Small Business (VOSB) and the Service-Disabled Veteran-Owned Small Business (SDVOSB) programs, including the elimination of self-certification.

TAKEAWAYS

  • In accordance with the 2021 NDAA, the SBA will issue all SDVOSB and VOSB certifications.
  • The SBA is also proposing to amend its rules to eliminate SDVOSB self-certification.
  • Comments on this proposed rule must be submitted by August 5, 2022.

On July 6, 2022, the SBA proposed to amend its regulations to eliminate VOSB and SDVOSB self-certification and to transfer responsibility for VOSB and SDVOSB certifications from the Department of Veterans Affairs (VA) to the SBA. Currently, there is no government-wide certification program for SDVOSBs, meaning that for contracts not awarded by the VA, SDVOSBs are only required to self-certify their status for set-aside or sole-source opportunities. This proposed amendment to the SBA’s regulations implements Section 862 of the FY 2021 National Defense Authorization Act (NDAA).

The SBA proposes to create the Veterans Certification Program at 13 C.F.R. § 128, which includes consolidating existing regulations at 13 C.F.R. § 125 with the VA’s Center for Verification and Evaluation (CVE) verification guidelines at 38 C.F.R. § 74. The SBA proposes to take over responsibility for all VOSB and SDVOSB certifications on January 1, 2023. Companies certified by the VA prior to January 1, 2023, will be deemed eligible by the SBA for the remainder of their three-year term. There will be a one-year grace period for SDVOSBs to file an application for certification with the SBA to maintain their eligibility. With the exception of the grace period for SDVOSBs, after January 1, 2023, VOSBs and SDVOSBs would need to obtain the SBA’s certification to be eligible to receive sole-source or set-aside contracts for VOSBs or SDVOSBs.

These proposed rules for veteran-owned companies include ownership and control rules for certification that are similar to the rules for companies in the 8(a) and WOSB programs. The SBA is also proposing to grant reciprocity to 8(a) and WOSB companies that are owned and controlled by veterans or service-disabled veterans, and to provide an expedited process for 8(a) and WOSB companies applying for SDVOSB or VOSB status.

Comments should be submitted on or before August 5, 2022.

[View source.]