After months of putting the application together and waiting for the recently received letter from Benjamin Ward, Deputy Director Center for Veterans Enterprise (CVE), on behalf of the U.S. Department of Veterans Affairs (VA), have you been informed that your service-disabled veteran-owned small business (SDVOSB) has been denied for inclusion in VA's VetBiz Vendor Information Pages (VIP) Verification Program?
They typically state that your VIP profile lists your business as a SDVOSB, and VA Form 0877 Verification Application you submitted lists you, the service-disabled Veteran, as the owner of your firm. They generally continue to state the CVE has confirmed that you have valid service-disabled veteran status from VA; however, CVE is unable to conclude that your firm satisfies the requirements set forth in 38 CFR Part 74.
At this point they will list off their reasons for not granting the certification. Typical reasons include:
- That you, the veteran, does not have control of your Board of Directors and/or its decision-making processes. They then go on to complain about some language in your bylaws/articles of organization and/or your corporate minutes and then conclude that this gives the potential for negative control. The regulations state that an SDVOSB "must not be subject to conditions precedent, conditions subsequent, executory agreements, voting trusts, restrictions on assignments of voting rights or other arrangements causing or potentially causing ownership benefits to go to another (other than death or incapacity}”.
- That you, the veteran, are not acting as the top management individual in the firm or that you are not doing that in a full-time capacity. This is required by the regulations. They will search many resources for confirmation that the veteran is the individual running the firm, such as www.manta.com, your state’s SOS website, Westlaw, and others.
- That the firm is some way affiliated with another firm. This can come about in many different ways. The common ones are by having a minority owner that owns other businesses, by you and/or your spouse owning other businesses, by having an immediate family member that owns another business in a similar industry, by sharing employees with another business, by borrowing equipment or office space from another business, or by borrowing money and/or bonding support from another business. Generally, when they affiliate you with another business they will claim that you, the veteran, either do not have control of your business or that they cannot determine that you are a small business.
- That you, the veteran, did not have the technical or business background to be running the firm. This generally only happens in a scenario where the firm is very young and you are starting it even though your resumes in a different industry or in a scenario where you have recently purchased the firm from someone else, especially if that person has remained on as an employee.
You can request that the Director of the CVE reconsider the denial by filing a request for reconsideration with the CVE within 30 days of receipt of your denial email or you can wait six months and reapply.
We are experts at not only successfully helping firms initially receive their SDVOSB certification but also at the reconsideration process. We have encountered all the scenarios above and many more and have a strong understanding of the reconsideration process and requirements being implemented by the CVE. We have successfully overturned many denials and in about a 10-minute phone call can give you a good assessment of your options and probabilities of success.
SDVOSB Reconsideration: $1,000.00