In 2011, the Senate passed the Small Business Contracting Fraud Prevention Act in response to widespread concerns on potential fraud in the government contracting industry by companies falsely claiming to be service-disabled veteran owned small businesses (SDVOSBs). This bill would require businesses to be certified as service-disabled veteran owned small businesses on the VetBiz Vendor Information Pages (VIP) maintained by the Department of Veterans Affairs’ Center for Veterans Enterprise prior to receiving awards that are set-aside by other government agencies for SDVOSBs. The SBA’s SDVOSB self-certification rules used by other government agencies differ (and are traditionally less stringent)than the VA-required application process for certification to compete for VA contracts.
Even though the bill has not become law, many agencies are using the VIP database as a reference point when considering whether companies are truly SDVOSB contractors. Although an agency could not necessarily exclude a bidder from competition due to the fact that the bidder was not certified as an SDVOSB by the VA, the SBA Office of Hearings and Appeals has held that a business’ complete absence from the VIP database provides a valid ground for an SBA eligibility protest. For these reasons, it makes sense for any service-disabled veteran owned contractor to consider obtaining the VA certification.
The VA will reject a company’s application if the company’s corporate documents do not comply with the VA certification requirements. Unfortunately, the VA process requires a mandatory six-month waiting period to reapply if a company’s initial application is rejected, so a flaw in the initial application can be costly. Potential applicants are encouraged to review their corporate documentation prior to submitting their applications to avoid delays.