January 7 2011 Copyright 2011 Business Research Services Inc. 301-229-5561 All rights reserved.

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VA: Veteran-Owned Firms Must Prove Eligibility

A new law requires veteran-owned businesses to prove their eligibility to receive set-aside contracts from the Department of Veterans Affairs.

Veteran-owned and service-disabled veteran-owned companies must be listed in the Vendor Information Pages at www.vetbiz.gov in order to be eligible for set-aside contracts from VA. However, SDV-owned firms are permitted to self-certify their eligibility when seeking set-sides from other agencies, and other agencies are not required to consult the VA database before awarding SDV set-aside work.

A Government Accountability Office investigation in 2009 found self-certification was an invitation to fraud. GAO said many firms that self-certified as SDV-owned actually were not eligible or were fronts for non-veteran-owned businesses.

Congress passed a provision of the 2010 Veterans Benefits Act requiring VA to verify the eligibility of companies listed in its database and to remove companies that did not provide satisfactory documentation.

VA Secretary Eric Shinseki said, “Although the verification process may initially be a challenge to some small business owners and to VA, it’s a necessary step to eliminate misrepresentation by firms trying to receive contracts that should go to service-disabled and other veteran-owned vendors.”

VA has sent notices to more than 13,000 companies already listed in the database, telling them to provide documentation within 90 days. In a statement, the department said priority processing will be given to firms that are in line to receive a set-aside contract from VA, those that already conduct business with VA, and those that have already filed an application for verification.

The department said it will post additional information at www.vetbiz.gov in early February informing applicants how to submit their documents electronically.


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