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Growing Call for SBA Control Over Vets First Program

A bill brought before the House of Representatives last summer may soon bring significant changes to the Vets First Program. The 2013 Improving Opportunities for Service-Disabled Veteran-Owned Small Business Act, which was introduced in July 2013 by Rep. Mike Coffman (R-CO), calls for the Small Business Administration (“SBA”) to take over control and administration of the Vets First Program from the U.S. Department of Veterans Affairs (“VA”). This transfer of control would include the responsibility for verification of service disability.

Under the Vets First Program, the VA issues set-aside government contracts to eligible Veteran-Owned Small Businesses and Service-Disabled Veteran-Owned Small Businesses (“SDVOSB”). Obtaining service-disabled status provides veteran-owned businesses with significant contracting opportunities, as the VA annually awards over $3 billion in contracts to veteran-owned small businesses. Unlike SDVOSB set-asides from other federal agencies, disability status under the Vets First Program applies only to VA procurements.

The idea is gaining traction on the heels of a recent Congressional Budget Office report which estimated that the transfer of responsibility would save the federal government about $5 million per year, on average. The savings would come from reducing administrative inefficiencies for SDVOSB contracts across all agencies. As the process stands today, the VA is responsible for verification of SDVOSB status as it applies to only VA contracts, while the SBA has responsibility for final determination of SDVOSB status for all other agency contracts. Additionally, savings would result from efficiencies gained by using systems and processes already in place at the SBA. Currently, the SBA determines eligibility for other small business set-aside programs, including the 8(a) and HUBZone programs.

As of posting date, the bill has still not been brought to the House floor for discussion. Movement has been slow, with the bill last going through the House Small Business Committee mark-up on March 5th.

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