It’s Over: GAO Waves White Flag On Aldevra SDVOSB Cases
Well, that was fast. A little more than two weeks after the U.S. Court of Federal Claims held that the VA need not consider service-disabled veteran-owned small business set-asides before procuring goods and services using the Federal Supply Schedule (FSS), the GAO has ended its long-running dispute with the VA over the same issue.
The GAO’s decision, in a case also involving Kingdomware Technologies, puts a sudden end to a series of GAO cases (known by many as the Aldevra cases) holding that the VA has been acting contrary to the law by failing to consider SDVOSB set-asides before using the FSS.
The GAO’s decision in Kingdomware Technologies–Reconsideration, B-407232.2 (Dec. 13, 2012) involved a VA task order award to LiveProcess, Inc. under that firm’s Schedule contract. The initial task order was issued in August 2011. In August 2012, the VA exercised an option, extending LiveProcess’s contract.
On August 27, 2012, Kingdomware filed a GAO bid protest. Kingdomware alleged that the initial task order award, as well as the option award, violated the Veterans Benefits, Health Care, and Information Technology Act of 2006 because the VA had not considered a SDVOSB set-aside before awarding the task order. Kingdomware pointed out that the initial task order award had not been publicly posted, preventing Kingdomware from learning about the award–and challenging it–in 2011.
At the time of Kingdomware’s August 2012 protest, the GAO was regularly sustaining protests like Kingdomware’s, under precedent first established in Aldevra, B-405271, B-405524 (Oct. 11, 2011). Nevertheless, the GAO dismissed Kingdomware’s protest, holding that because more than a year had passed since the underlying task order was issued, “no useful purpose is served by our considering a protest of the action.”
Kingdomware filed a request for reconsideration, asking the GAO to think again about its decision dismissing the protest. However, before the GAO issued its decision on reconsideration, the Court of Federal Claims had its say.
On November 27, 2012, Judge Nancy Firestone issued her ruling in Kingdomware Technologies, Inc. v. United States, No. 12-173C (Nov. 27, 2012). Judge Firestone supported the VA’s position, holding that the VA need not consider SDVOSB set-asides before using the Federal Supply Schedule.
The GAO wrote that Judge Firestone’s decision, coupled with the VA’s continued refusal to follow the GAO’s Aldevra-style recommendations, made it pointless for the GAO to continue hearing protests like the one filed by Kingdomware. The GAO wrote:
“While this Office has set forth its view of the 2006 VA Act in Aldevra and its progeny, as well as in testimony before the Congress, the VA has elected not to follow our recommendations. In addition, the court has reached a different conclusion about the meaning of the 2006 VA Act. Although our Office is not bound by the court’s decisions, its decision in Kingdomware, together with the VA’s position on the meaning of this statute, effectively means that protesters who continue to pursue these arguments will be unable to obtain meaningful relief. Consequently, under these circumstances, we will no longer consider protests based only on the argument that the VA must consider setting aside procurements for SDVOSBs (or VOSBs) before conducting an unrestricted procurement under the FSS.”
The GAO dismissed Kingdomware’s protest.
The GAO’s decision in Kingdomware Technologies marks a sudden (but, in the wake of the Court’s decision, not unexpected) end to the Aldevra line of cases. For SDVOSBs, the decision is dispiriting, but the bottom line is that the GAO is correct: without the Court on its side, the GAO has no power to make the VA abide by its rulings. Unless things change, there is no substantive purpose to be served by SDVOSBs continuing to file such GAO bid protests.
For SDVOSBs, the good news is that the GAO has not changed its position on the merits. The GAO continues to believe that the VA is acting contrary to the 2006 VA Act by failing to consider SDVOSB set-asides before using the Schedule. As the battle moves to its next stage (presumably, either an appeal to the U.S. Court of Appeals for the Federal Circuit or a request for Congressional action), SDVOSBs should not forget that the GAO may yet be an important ally in one day requiring the VA to truly put “Veterans First.”
GAO: For VA, SDVOSB Set-Asides Trump GSA Schedule Buys :
Government Contracts Attorney Services: Is it Groundhog Day? Aldevra Strikes Again : GAO Bid Protest Attorney Services : The Aldevra Saga Continues–and the GAO Throws the VA Some Lifelines : Here We Go Again: Another Aldevra-Style GAO Protest Sustained–Is a Court Resolution Looming? : GAO Confirms: AbilityOne Trumps SDVOSB for VA Set-Asides : GAO Sustains An Aldevra Protest (Again) : Another Day, Another Aldevra Victory–When Will It End? : SDVOSBs Lose Aldevra Battle With VA, Says Federal Court
How VA’s Non-Compliance With GAO
May Change Government
(SDVOSB News Services, 12/26/2012, Washington, DC) — Because the Veterans Administration (VA) refused to abide by the Government Accountability Office (GAO) recommendations for a full year, it makes sense to review the GAO’s track record as a watchdog agency for the U.S. Government. How will VA’s refusal to follow GAO’s recommendations affect other government agencies?
The following quoted information is condensed and available on GAO’s website.
“GAO heard its first protest in the 1920’s, and was significantly revamped as an independent watchdog agency in 1984 with the passage of the “Competition in Contracting Act.” According to its current statute, if GAO sustains a protest for any reason, the involved agency must issue a report to GAO within 60 days advising whether the agency has fully implemented GAO’s decision. When an agency advises GAO that it has not implemented a decision, GAO is required to prepare a report to all Congressional committees that have political leverage over the agency.”
At that point, the matter becomes a political issue between the Executive and Legislative Branches of government, which the Veterans First mandate has become. Because VA is a cabinet-level Department, only the Executive branch (Office of the President) can compel the VA to follow existing law (PL 109-461).
Two thousand seventy-five GAO protests were filed in 2012, but only 106 of these protests were sustained for the plaintiff, or .05 per cent. GAO does not sustain bid protests without rigorous proof and compelling argument.
Between 1985 and 1997, only seven government entities ignored a GAO recommendation.
Aldevra, a food equipment vendor in Portage, MI issued more than three dozen protests to GAO in the fall of 2012. GAO has sustained each one based on PL 109-461.. The ‘Veterans First’ mandate directs the VA to conduct market research to discover whether credible SDVOSBs or VOSBs in the marketplace can provide the specifics of a contract at a reasonable price. Aldevra, Kingdomware Technologies and Crosstown Courier Services, Inc. all filed GAO protests against the VA for not conducting research for a set-aside. See GAO 2012 Report to Congress:
( http://www.gao.gov/products/GAO-13-162SP )
On November 30, 2011, the House Committee on Veterans Affairs Subcommittee on Oversight and Investigations held a hearing on the VA’s refusal to comply with the Veterans First mandate. (http://tinyurl.com/7nzzhaj )
Though Subcommittee Chairman Bill Johnson and many other Subcommittee members found the VA in direct violation of PL 109-461, nothing was done. VA was NOT held accountable for violating a public law. VA Secretary Eric Shinseki said at the Detroit VOSB conference “…we put Veterans first in everything we do, including contracting…”
The Executive Branch has not forced the VA to follow GAO’s recommendations. What’s next? Can the VA operate with impunity with no oversight from Congress? With no oversight from the White House? What about other GAO recommendations? Will VA’s ‘victory’ over GAO embolden other agencies to ignore GAO? Is there a disconnect between the White House and Congress?
On the Hill
Reviewing the legislation that stalled out in the 112th Congress:
Sponsor: Bill Johnson (R-OH)
Introduced: February 16, 2012
Referred: House Committee on Veterans’ Affairs
Gov Track prediction–2%; VLM prediction–Dead.
H.R. 3850: Government Efficiency through Small Business Contracting Act of 2012
Rep. Samuel “Sam” Graves [R-MO6]
Introduced: Jan 31, 2012
House Committee on Oversight and Government Reform
House Committee on Small Business – passed
GovTrack: 29% –VLM: Better than average chance of President signing
Maybe 2013 will be a better year, it’s got a good start. PA Representative ___ Mike Fitzgerald intends to introduce “The Fairness to Veterans Act” at time very soon. We can only hope. In the meantime, lets have a look at the bills that died in Committee at the hands of the Congress during 2011.Reviewing the legislation tat stalled out in the 112th Congress:
2011 Proposed Legislation:
HR 3438: To require the Department of Defense to meet the annual goal for participation in procurement contracts by small business concerns owned and controlled by veterans with service-connected disabilities.
Sponsor: Rep. Bob Filner (D-CA)
Introduced: November 17, 2011
Referred: House Armed Services Committee, House Small Business Committee
GovTrack–4%, VLM prediction–Will not pass Committee—went nowhere
S. 1154: Honoring Promises to Service-Disabled Veterans
Act of 2011
Requires transparency for Executive departments in meeting the Government-wide goals for contracting with small business concerns owned and controlled by SDVOSB.
Introduced: June 7, 2011 by Senator Max Baucus (D-MT); co-sponsors: Harkin, Vitter
Referred: Senate Committee on Small Business and Entrepreneurship
GovTrack: 4%–VLM Dead—went nowhere
S. 1184: To amend title 38, United States Code
To revise the enforcement penalties for SDVOSB misrepresentation
Introduced: June 13, 2011 by Senator Maria Cantwell (D-WA)
Referred: Senate Committee on Veterans Affairs
Introduced in House of Representatives: April 15, 2011 by Marlin Stutzman (R-IN)
Activity: May 23, 2011: passed in the House by roll call vote
GovTrack=2% chance—VLM: Dead—went nowhere
HR 240: To amend title 38, United States Code Requires (current law authorizes) a Department of Veterans Affairs (VA) contracting officer to award contracts to small businesses owned and controlled by veterans using other than competitive procedures for contracts above the simplified acquisition threshold.
Introduced: Jan 7, 2011 by Rep. Robert Filner (D-CA)
Referred: House Veterans Affairs Committee, hearings held by Subcommittee on Economic Opportunity.
GovTrack: 2%, VLM: Dead—went nowhere
S. 633: Small Business Contracting and Fraud Prevention Act of 2011
Requires that SDVOSB/VOSB are verified by all federal agencies…ends self-certification…
Introduced: March 17, 2011 by Senator Olympia Snowe (R-ME)
Referred to House Small Business Committee.
GovTrack: 9%–VLM: Roll over, Rosie, this one is stagnating in the House Small Business Committee (Sam Graves R-Missouri, Chairman). Internal feuds in the veteran service organizations and lobby efforts make this improbable, although it was passed unanimously by the Senate.
Please go back and reread the last sentence. “…although it was passed unanimously by the Senate.” What’s happening here? Politics is happening here, my fellow veteran business owners. In Washington’s incendiary game of cat and mouse, veterans are the bait and the hostage. Sure, helping veterans is the right thing to do anytime, but we’re only a pawn in their game. A pawn without a voice. But pawns never have a voice.
It’s easy to talk a good game. It’s much harder to stand by your words regardless of what happens politically. In the situation we’re in now, the Republicans run the House of Representatives, and anything pushed by Democrats is turned away. But it also works the same way with the Democrats in charge. It’s even worse when a group supposedly operating in our interest plays a card against us. S. 633 was introduced by a Republican Senator, yet it was stalled by the House Small Business Committee.
Some in Washington said of S. 633: “It’s a bad bill that harms some veteran owned businesses.” Get the bill passed and then go back and work the details. Fraud is the chief reason that veterans get the shaft. And why do we get the shaft? Because we’re an easy target. Because we have no pressure group. That’s how VetLikeMe got its start. We’re an easy target, a target that’s not moving. Sad to say, isn’t it?~~
Welcome Chairman Sanders
Veterans will have a strong ally in Congress when Vermont Sen. Bernie Sanders takes the helm of the Senate Veterans Affairs Committee.
An independent who calls himself a democratic socialist, Sanders is in line to become the new chairman of the VA Committee in the new 113th Congress, replacing Sen. Patty Murray (D-Wash.), who’s moving on to head the Senate Budget Committee.
Sanders, 71, did not serve in the military and protested against the Vietnam War, but he’s had a seat on the committee since he came to the Senate in 2007 and gets high marks from veterans groups.
“Sen. Sanders has been a strong advocate for veterans issues,” said Tom Tarantino, legislative director for Iraq and Afghanistan Veterans of America. “He has pushed to expand veterans health care, opposed budget cuts that would trim military retirement and veterans disability cost-of-living allowances and co-sponsored the new Post-9/11 GI Bill, which dramatically expanded educational benefits for new veterans.”
“Sen. Sanders has also worked tirelessly to ensure that Iraq and Afghanistan veterans get proper care for invisible injuries that, if left untreated, can tragically lead to suicide,” Tarantino said.
Sanders also helped in the fight to get the Department of Veterans Affairs to finally include Agent Orange exposure in its disability benefits for Vietnam veterans and boosted programs for homeless veterans.
He also helped raise the travel reimbursement rates for veterans who must commute long distances to receive medical care. In 2007, the reimbursement rate was 11 cents per mile. Now, it’s 41.5 cents.
And he’s a fervent supporter of disabled veterans.
“It is morally and economically unacceptable that anyone in Congress would propose more tax breaks for millionaires, billionaires and large corporations while at the same time [propose] significant cuts for disabled veterans,” Sanders said recently. “This is not what the American people want, and it is not what must happen.”
-read full story- http://tinyurl.com/b5x5lfz
Sanders to Tackle Veterans’ Suicide
SDVOSB News Services – Washington, DC – February 1, 2913 The Senate Committee on Veterans Affairs convened today for its initial session of the 113th Congress. Senator Bernie Sanders (I-VT) opened the hearing as the incoming Chairman of the Committee, replacing Senator Patty Murray (D-WA), who will now Chair the Senate Budget Committee.
Veterans today face extraordinarily difficult situations when they return from deployment, including high unemployment, a growing number of homeless veterans and a dramatic surge in suicides by returning veterans. “What we’re seeing is an extraordinary tragedy which speaks to the horror of war and the need for us to do a much better job assisting our soldiers and their families after they return home.”
Senate Small Business Committee Set for 113th Congress
(SDVOSB News Services, January 25, 2013) Washington, DC — Senator Mary Landrieu (D-LA), Chair of the Senate Small Business and Entrepreneurship Committee, welcomed colleagues today urging a bipartisan approach to issues pertinent to small business.
The Committee begins deliberations without Ranking Member Olympia Snowe (R-ME), who retired at the close of the 112th Congress. Snowe was a strong advocate for small business for nineteen years, introducing — among many other legislative initiatives — the Small Business Fraud Prevention Act (S 633) of 2011. Though the bill did not move through Congress, it encouraged the Veteran’s Administration to revisit the efficiency of its verification program for SDVOSB and VOSB, known as the Center for Veterans Enterprise.
Senator Landrieu recognized the new Committee Ranking Member, Jim Risch (R-ID): “I look forward to working across party lines with Senator Risch to ensure small businesses thrive and create jobs….If both sides of the aisle come together to put job creators first, then the 113th Congress will see continued successes on behalf of America’s 28 million small businesses.”
Guided by Senator Landrieu, the Committee on Small Business and Entrepreneurship passed the Small Business Jobs Act of 2010, reauthorized the Small Business Innovation Research (SBIR) and the Small Business Technology Transfer (STTR) programs. In addition, the Committee provided 12 billion in tax relief to small business and ensured parity for small business surety bonds.
Democrats sitting on the Committee include Senators Carl Levin (MI), Tom Harkin (IA), Maria Cantwell (WA), Mark Pryor (AR), Ben Cardin (MD), Jeanne Shaheen (NH), Kay Hagan (NC) and Heidi Heitkamp (ND). In addition to Ranking Member Jim Risch, Republicans include Senators David Vitter (LA), Marco Rubio (FL), Rand Paul (KY), Deb Fischer (NE), Mike Enzi (WY) and Ron Johnson (WI).
VA CVE Reconsideration: A Primer for SDVOSBs
by Steven Koprince
The VA CVE reconsideration process is an important component of the VA’s SDVOSB verification program–especially in light of news earlier this year that the VA’s Center for Veterans Enterprise is rejecting 60% of new SDVOSB verification applications.
For many companies, SDVOSB verification hinges on a successful VA CVE reconsideration request, but VA CVE reconsideration is often misunderstood. After working with many SDVOSBs to successfully obtain verification through the VA CVE reconsideration process, I have compiled this list of common “Q&As” regarding SDVOSB reconsideration.
Q: What is VA CVE reconsideration?
A: A VA CVE reconsideration is a written request asking the VA CVE to reconsider its decision to deny a SDVOSB application. When timely submitted to the VA CVE, the reconsideration request gives a denied SDVOSB applicant a second opportunity to convince the VA CVE to verify it as a SDVOSB.
Q: Where can I find the regulations governing VA CVE reconsideration?
A: The primary regulation governing VA CVE reconsideration is located at 38 C.F.R. § 74.13. SDVOSBs should be aware that the regulation does not cover all of the important aspects of reconsideration (such as filing new or amended documents and the emailing of reconsideration requests) and contains an ambiguity regarding the time frame for the VA CVE to issue its decision. These matters are covered in this post.
Q: Can I file new or amended documents with my VA CVE reconsideration request?
A: Yes! SDVOSBs sometimes believe that their only option in a VA CVE reconsideration is to convince the VA CVE that it made a mistake in its original decision. Not so.
In fact, in most cases, filing new or amended documents is the best (and perhaps the only) way to successfully obtain SDVOSB verification by way of a VA CVE request for reconsideration. For example, if the VA CVE identified a defect in a SDVOSB’s bylaws, the SDVOSB may be able to successfully obtain verification by adopting amended bylaws correcting the defect and submitting those amended bylaws with its reconsideration request.
Q: When must I file a VA CVE reconsideration request?
A: According to 38 C.F.R. § 74.13, a VA CVE reconsideration request must be received by the CVE no later than 5:30 p.m. Eastern Time, 30 days after the SDVOSB receives the VA CVE’s denial decision. Note that the “received” is italicized (by me, not the VA), because it is the VA CVE’s receipt of the request within the 30-day time frame, not the SDVOSB’s sending of the request within that time frame, that counts.
Q: How should I file a VA CVE reconsideration request?
A: 38 C.F.R. § 74.13(a) states that a request for reconsideration may be filed by hand delivery, mail, commercial carrier, or facsimile. However, even though the regulation says nothing about email, recent VA CVE denial letters have asked applicants to email VA CVE reconsideration requests to [email protected] The bottom line: check the denial letter for filing instructions.
Q: When will I receive my VA CVE reconsideration decision?
A: 13 C.F.R. § 74.13(b) states that a decision will be issued within 60 days after filing “when practicable.” In other words, the VA CVE will attempt to issue a decision within 60 days, but will not necessarily do so. In fact, in recent months, the VA CVE has been informing applicants that it may take up to 90 days to receive a reconsideration decision.
Some savvy SDVOSBs have pointed out a conflict in the regulation: 13 C.F.R. §74.13(a) does not use the “when practicable” language of 13 C.F.R. § 74.13(b), but instead flatly states, “a formal decision will be issued within 60 days after receipt.” Notwithstanding this regulatory conflict, the VA CVE plainly believes that it has more than 60 days to issue reconsideration decisions, and has been doing so as of late.
Q: What if the VA CVE denies my reconsideration request?
A: If the VA CVE denies an applicant’s request for reconsideration, the applicant typically must wait six months to file a new application. There is one exception, however: if the VA CVE denies the reconsideration request based solely on issues not raised in the initial denial, the applicant may file a new VA CVE reconsideration request addressing those issues.
In Retrospect: 2012
Eugene M. Ogozalek
The year 2012 began with my architectural business SDVOSB verification being resubmitted for approval by the Center for Veterans Enterprises. The process was to have been 90 days, but the end of July approached with no re-verification in hand. Finally, on July 25th, seven months into the year, my verification reappeared on the vipvetbiz website.
I was thrilled until three months later on October 30th when I received a letter stating my verification was cancelled permanently, and that I may appeal the decision. Are you confused yet? After much consternation and to my great surprise, I managed to get the verification returned by Nov. 30, 2012. The bottom line is that I was unable to be awarded any new contracts for architectural services for seven months in 2012. The reason for cancellation was that I failed to respond to an email sent on August 15 stating that my son and my wife were directors of my company, and as such I could be outvoted in any decision. I was therefore not in control of my company and in violation of the federal acquisition regulations. I immediately had my wife and son resign as directors. I never received a notice of cancellation email in August.
During 2012 I wrote approximately 12 letters to Mr. Tom Leney, executive director of the CVE and received no response. The letters were on a number of topics suggesting ways to speed up the process. Finally, in late December, I did receive a phone call from Mr. Leney assuring me that the process was operating exactly in accordance with the federal acquisition regulations. He also stated that I had some good ideas that were being reviewed. The conversation was essentially meaningless.
It is important to document that the disruption in work due directly to the inability to secure timely contracts in 2012 caused a serious delay in cash flow. The remedy was to borrow additional cash in excess of $150,000 in early 2013. Is this how the process is to work? Take the verification from an ongoing operation, hold it for an indefinite amount of time, send a single email of cancellation which amounted to a death notice, and punish a veteran for conducting a family business?
I am glad 2012 is over. I sincerely hope that a degree of common sense prevails this year regarding the verification process. I do not have high hopes. Lip service is cheap.
Eugene M. Ogozalek: India Co. 3rd Bn / 4th Marines, 3rd MARDIV, Vietnam ’67-‘68’, Purple Heart Recipient, Combat Infantry MOS 0311
SDVOSB Business Owner
Willow Design Architects
Small Business Gets Lift for 2013
(SDVOSB News Services, Jan. 4, 2013) — President Obama signed legislation on January 1 that encourages the federal government to hire more small business in its massive procurement program. Government contract awards are mandated to go to small business, especially businesses that are recognized by the federal government as a disadvantaged business group.
For the 12th straight year, the federal government as a whole has fallen considerably short of the minimum threshold established by the Section 15(g)(1) of the Small Business Act.
Representative Sam Graves (R-MO), Chairman of the House Small Business Committee, noted in a news release after the President signed the measure. [The legislation will] “help small businesses compete in the federal marketplace, bring efficiency and cost-savings to the taxpayer, and create jobs while doing it.”
Skepticism remains, however, by many small business owners. “We’ve seen this move before,” noted Ralph Baxter, owner of BluePoint Productions, a service disabled veteran owned business out of Frederick, Maryland. “Large companies have always had the edge getting work with the federal government because the procurement system really doesn’t favor small business.” The power of mandates simply are not working within the federal government as they should.
The Small Business Act mandates that all small businesses have the maximum opportunity to participate in providing goods and services to the government. The Small Business Administration (SBA) negotiates procurement preference goals with each federal agency and annually reviews each agency’s results. SBA then publishes the results in what is known as the “SBA Scorecard.”
In theory, the statutory goals help to ensure that small businesses get their fair share. In reality, though, goals are rarely met and small business is generally sealed off from major procurements.
The SBA is responsible for ensuring that mandated government-wide goals are met in the aggregate. However, as a policing agency, the SBA shares as much – if not more – of the blame as the individual federal agencies for not meeting the procurement minimums.
The statutory minimum goals that the government procurement program include a twenty-three (23) percent minimum of prime contracts; five (5) percent of prime and subcontracts for small disadvantaged businesses; five (5) percent of prime and subcontracts for women-owned small businesses; three (3) percent of prime and subcontracts for service-disabled veteran-owned small businesses.
One provision of the new law includes a small business contracting element in the performance evaluations of senior agency executives. If the established small business goals are not met, bonus awards are withheld. In addition, the legislation cracks back on the bundling of contracts.
Contract bundling is stacking multiple contracts or segments of a contract into one large contract, making it impossible for small businesses to compete with large business.
After publishing VetLikeMe for more than three years, I decided—for my own mental health – that I needed to upgrade the news platform if VLM had a chance to run with the big dogs. Fortunately, along came Mr. David Coakley, who guided me into the digital age — with much more to offer SDVOSB. VLM’s website, ‘vetlikeme.org’ is becoming a site that is hard to beat in breaking news regarding veteran business owners.
Readers recently received a request from VLM to subscribe; I hope you will. There are more than 7000 veterans from across the nation on our mailing list. VLM will continue to be a bi-monthly email publication, but our web site will be updated continuously. I hope this helps your business, and I also hope it helps mine.
David Coakley is the owner of GovCon, a network of web sites that concentrates on government contracting. Thanks to those SDVOSB who has given their time, energy and laughs.
Fairness to Veterans Act
(Transcript from Aldevra, 2/15/13)
Hello, my name is Congressman Mike Fitzpatrick. I represent the Eighth District of Pennsylvania, home to tens of thousands of veterans in the suburban Philadelphia area.
I wanted to talk to you briefly about legislation I have been working on called the Fairness to Veterans Act and invite you to join me in Washington DC to talk about this important Veterans jobs bill.
The Fairness to Veterans Act is a simple idea: Veterans should get the same federal contracting preferences as every other group. Federal agencies that produce military veterans will give a contracting preference and priority first to veteran small businesses to exceed the annual 5% contract award goals in every industry.
This simple idea will have a dramatic impact in fueling Veteran entrepreneurship and putting our nation’s heroes to work. But, as I’m sure you are all too aware, bureaucrats in Washington are very good at turning simple ideas in practical nightmares for Veterans.
So I’ve worked closely with the American Legion Small Business Task Force to create an innovative, administratively convenient contracting tool so that doing business with Veterans is the cheapest, easiest, and fastest choice for the federal government. By streamlining the process,
we will cut costs for the government and make the Veteran small business contract the most attractive choice for the contracting community. And the bill ensures that the contract be awarded only to a qualified Veteran small businesses who has the necessary skills and commercial licenses to actually perform the work the government needs.
In short, this legislation guarantees that Veterans get their fair share of small business contracts without all the bureaucratic hoops, headaches, and hassles.
I look forward to continuing this important work and I hope you can join me in D.C. as we work towe will cut costs for the government and gether to turn Fairness to Veterans into law.
VLM has featured unvarnished national news and editorial opinion concerning the SDVOSB community since Nov. 2009. From the beginning we’ve operated in the red, but this publication will always be free.
We hope VLM keeps the SDVOSB community informed so that decision makers will provide increased federal contracting opportunities for those of us injured while serving our country.
Aldevra, Portage, MI
All Season’s Apparel, Post Falls, UT
Blackhorse Worldwide, LLC, Overland Park, KS
Heroes Villages, WestPort, CT
Petefish, Immel, Heeb & Hird, LLP, Lawrence, KS
Vetrepreneur, LLC, Reston, VA
Willow Design Architects, Scranton, PA
GovCon, For sponsorship opportunities, contact Hardy Stone 301-845-1330
Editorial opinions expressed in VetLikeMe do not necessarily reflect the views of our sponsors.
VetLikeMe is published bi-monthly by:
Editor and publisher: Hardy Stone
Contributing Writers: Steven Koprince, Maggie Bullard-Marshall, Eugene Ogozalek
Following federal court decision,
GAO will not hear some veteran protests
Published: December 30
The Government Accountability Office said earlier this month that it will no longer hear protests from veteran-owned small businesses who claim the Department of Veterans Affairs is violating the law, capping off more than a year of wrangling.
Veteran-owned small businesses have been filing protests with the GAO in connection with a piece of 2006 legislation that says the VA must give preference to veteran-owned firms when its market research shows that favoring these businesses would result in multiple competitors and a fair price.
Though the GAO upheld a protest filed on these grounds in late 2011, the VA rejected the GAO’s recommendation and maintained its original award, according to the GAO. The agency has argued that the law does not prevent it from opting to use existing federal supply schedules — rather than opening a new competition, according to court documents.
Now, the Court of Federal Claims has made its own ruling in support of the VA, denying the claims of plaintiff Kingdomware Technologies, a service-disabled, veteran-owned small business based in Waldorf.
In a late November decision, the court said it disagrees with the GAO’s interpretation of the 2006 legislation, specifically as it pertained to an emergency notification service contract.
The court “finds that VA’s decision not to set aside the … contract at issue was not arbitrary, capricious, or contrary to law,” the decision said.
In light of this ruling, the GAO announced on Dec. 13 that it will no longer hear protests argued on this basis.
“There’s no possibility of meaningful relief given the events that have transpired, and therefore we’re not going to consider these cases,” said Ralph White, managing associate general counsel for procurement law at the GAO.
Kingdomware Technologies could not be reached for comment.
Veteran-owned business advocates, however, are concerned that the court ruling and subsequent GAO decision could put small companies at a disadvantage as the contracting environment becomes increasingly competitive.
Greg McConnell, president of the Kilda Group, a service-disabled, veteran-owned government services company in Annapolis, said the latest development has him questioning whether Kilda should expand into more commercial work.
“We aren’t asking for something that’s crazy,” he said of the preference for veteran-owned businesses. “It’s really not a level playing field in federal acquisitions.”
Steven J. Koprince, a partner with Lawrence, Kan.-based Petefish, Immel, Heeb & Hird who spent many years as a government contracts lawyer locally, said the GAO and federal court decisions mark a real setback for veteran-owned small businesses.
“The VA does the best job of all the federal agencies, in terms of [service disabled, veteran-owned small business] contracting,” he said. But “I think that there’s no way around the fact that there are going to be service-disabled, veteran-owned small businesses that — had the court ruled the other way — they would have gotten contracts that now they won’t get.”
The VA declined to comment for this article, noting that it considers the matter still to be in litigation given that there is time remaining in the appeal period.
Are Bid Protest Decisions Binding?
What happens when an executive branch agency disagrees with the Government Accountability Office (GAO) regarding the interpretation of a statute governing the procurement of goods or services by that agency? Is the agency required to modify its procurement practices to conform to GAO’s opinion, or can it disregard GAO’s recommendations? What if a federal court later upholds the agency’s interpretation? Is GAO required to adopt the court’s interpretation, or could GAO adhere to its prior interpretation? These and related questions have been raised by the recent decision of the U.S. Court of Federal Claims in Kingdomware Technologies, Inc. v. United States, wherein the court adopted an interpretation contrary to that adopted in a series of 18 bid protest decisions issued by GAO in 2011 and 2012. Beginning with its October 11, 2011, decision in Aldevra, GAO has consistently construed the Veterans Benefits, Health Care, and Information Technology Act of 2006 as requiring the Department of Veterans Affairs (VA) to give set-asides for veteran-owned small businesses priority over purchases from the Federal Supply Schedules. GAO reached this conclusion, in part, because the 2006 act states that VA “shall” use set-asides for veteran-owned small businesses in certain circumstances, and GAO viewed “shall” as indicating mandatory action.
However, GAO could not compel VA to act in accordance with its interpretation since GAO and VA belong to separate branches of the federal government, and the separation of powers would be violated if one branch were to interfere impermissibly with another’s performance of its assigned functions, or assume a function more properly entrusted to another. Instead, the statute which authorizes GAO to hear bid protests calls for GAO to make “recommendations” to executive agencies whenever GAO finds that the agency has acted improperly in the award, or proposed award, of a federal contract. The statute further provides that, if the procuring agency fails to implement GAO’s recommendations within a certain time frame, it is to notify GAO. GAO, in turn, is to “report promptly” the agency’s noncompliance to several congressional committees.
FY2010 and FY2011, VA declined to do so here. VA’s decision not to adopt GAO’s recommendation that it gives set-asides for veteran-owned small businesses priority over purchases from the Federal Supply Schedules prompted one vendor-who had won at GAO, only to have VA decline to adopt GAO’s recommendations to file suit in the Court of Federal Claims. The vendor asked the court to enjoin VA to comply with the 2006 act, as it had been construed by GAO.
Hardy Stone is the editor/publisher of VetLikeMe, the nation’s only publication devoted to service disabled veteran owned business.