Additionally, SBA received numerous comments on specific topics related to control, including comments regarding franchises, SBA's use of rebuttable presumptions, and extraordinary circumstances.. 601-612, requires an agency to consider the potential economic impact that a draft regulatory action may have on small entities. Joint ventures. means a firm applying for certification in the Veteran-Owned Small Business Contracting Program. (a) (i) Prior to being identified as an apparent successful offeror for a VOSB or SDVOSB contract, the certified VOSB or SDVOSB partner to the joint venture must submit a certification to the contracting officer and SBA, signed by an authorized official of each partner to the joint venture, stating as follows: (A) The parties have entered into a joint venture agreement that fully complies with paragraph (c) of this section; (B) The parties will perform the contract in compliance with the joint venture agreement and with the limitations on subcontracting requirements set forth in paragraph (e)(2)(i)(A) of this section. However, ownership by a trust, such as a living trust, may be considered direct ownership where the trust is revocable, and qualifying veterans are the grantors, trustees, and the current beneficiaries of the trust. While SBA acknowledges the potential issues to implement self-certification for these purposes, it believes that for the time being, applying this treatment equally to the Veteran Small Business Certification Program is appropriate. For VA procurements, a contracting officer may award a sole source contract to a VOSB or SDVOSB as set forth in the VAAR. SBA may verify that the Participant currently meets the eligibility requirements of this part and that it met such requirements at the time of its application. (c) The Participant must respond to any program examination initiated by SBA to remain a certified VOSB or SDVOSB. A major rule cannot take effect until 60 days after it is published in the This phone number may also be reached by individuals who are deaf or hard of hearing, or who have speech disabilities, through the Federal Communications Commission's TTY-Based Telecommunications Relay Service teletype service at 711. How does a VOSB obtain Federal surplus personal property? If, after certifying a Participant, SBA discovers that a firm or its representative knowingly submitted false information, SBA will initiate proceedings to decertify the Participant and remove it from the certification database pursuant to 128.310. (c) Congress Approves Government-wide SDVOSB Certification - SmallGovCon What is a program examination and what will SBA examine? (a) ; and (5) What alternatives will allow the Agency to accomplish its regulatory objectives while minimizing the impact on small businesses? The VA stopped accepting new applications for VOSB and SDVOSB certification or recertification on October 24, 2022. (j) the official SGML-based PDF version on govinfo.gov, those relying on it for 1. (f) Amend 134.201 by removing and reserving paragraph (b)(3) and revising paragraphs (b)(8) and (9). Likewise, this final rule provides a non-exhaustive list of circumstances at 128.203(h)(2) that may lead to a finding of control by a non-qualifying-veterans. (1) A Participant that qualifies as a VOSB or SDVOSB at the time of initial offer response which includes price, including a Multiple Award Contract, is generally considered to be a VOSB or SDVOSB throughout the life of that contract. SBA, hereby, certifies to the Chief Counsel of Advocacy of SBA and others that the instant final rulemaking will not have a significant economic impact on a substantial number of small entities. In the case of a limited liability company, one or more qualifying veterans must serve as managing members, with control over all decisions of the limited liability company. SBA does not review issues concerning the administration of a VOSB or SDVOSB contract. In carrying out its statutory mandate to certify VOSB and SDVOSB firms, SBA intends to collect information from VOSB and SDVOSB applicants or participants through an online application system. This approach is consistent with SBA's WOSB and 8(a) BD programs, which allow businesses to self-certify as ED/WOSBs or SDBs for awards that are made outside of those respective programs and for agencies to receive WOSB or SDB credit for such awards. (New), Subpart FPenalties and Retention of Records, Subpart GSurplus Personal Property for Veteran-Owned Small Business Programs, Section 128.700How does a VOSB obtain Federal surplus personal property? Proposed 128.408 incorporated the requirements at former 125.26, describing the procedures applicable to the Administrator's appeal authority provided in former 125.25. The proposed rule included a provision at 128.402(b)(10) providing that a VOSB or SDVOSB participant cannot be a joint venture partner on more than one joint venture that submits an offer for a specific VOSB or SDVOSB contract. An untimely protest will be dismissed. (1) The Secretary of the VA (or designee) or SBA may file a VOSB or SDVOSB status protest at any time. The decision is the final agency decision and becomes effective upon issuance. means a small business concern that meets the requirements described in 128.200(a). To be eligible for a VOSB or SDVOSB multiple award contract, a VOSB or SDVOSB must be small pursuant to the requirements of 121.404(a)(1) of this chapter. Ownership of a partnership. Proposed 128.306 included VA's three-year program eligibility term and continuing obligation requirements at 38 CFR 74.15, with a provision specifying that a business concern would receive an eligibility term of three years from the date of SBA's approval letter establishing its VOSB or SDVOSB certified status. Each document posted on the site includes a link to the 12. recommendation by SBA's Procurement Center Representative to make a requirement available for award as an SDVOSB contract, the contracting officer must notify the Procurement Center Representative as soon as practicable. This amendment included general requirements for submission to SBA rather than listing each document individually as with the current VA regulation. The certified VOSB or SDVOSB must comply with the applicable limitations on subcontracting provisions ( SBA intends to comprehensively review the use of self-certification in its socioeconomic certification programs for goaling and subcontracting purposes with federal government stakeholders and SBA contracting program participants. At the time of certification, a VOSB or SDVOSB must be a small business under the size standard corresponding to any NAICS code listed in its SAM profile. Sample templates and definitions when developing an effective capabilities statement. 5 U.S.C. With the exception of this grace period, once this rulemaking is finalized, VOSBs and SDVOSBs that are not certified by SBA's Veteran Small Business Certification Program will not be eligible to receive sole source or set-aside VOSB or SDVOSB awards across the Federal Government. The qualifying veteran need SBA received one comment stating that SBA's estimate for the time burden for applicants was lower than the actual time it would take, due to system issues and document submission requirements. (f) In addition to sharing the same small business program status as the prime contractor, a similarly situated entity must also be small for the NAICS code that the prime contractor assigned to the subcontract the subcontractor will perform. SDVOSB Certification Set Aside Requirements Bid ProtestsLawyers 2022-25508 Filed 11-28-22; 8:45 am]. With this final rule, SBA does not abandon its previous interpretation of unconditional ownership but merely adds a limited exception for a commercially reasonable right of first refusal. (b) (b) This repetition of headings to form internal navigation links System for Award Management (SAM) Can an Applicant appeal SBA's initial decision to deny an application? VA will retain its unique authority to make contract award set-asides to VOSBs and will rely on the SBA's certification beginning January 2023 to verify SDVOSB or VOSB eligibility. that consolidates various federal procurement systems ( SDVOSB firms that have self-certified on the Transfer Date, described herein, must apply within a one-year grace period after the Transfer Date for certification by SBA. (B) The contracting officer may award a contract before the Judge issues a decision only if the contracting officer determines that an award must be made to protect the public interest and notifies the Judge and D/GC in writing of such determination. Certification requirement. The disadvantaged person or persons must be socially disadvantaged and economically disadvantaged. (g) If the D/GC approves the application, the period of program eligibility will be specified in the concern's certification letter. In determining the amount of work done by a non-VOSB or SDVOSB partner, all work done by the non-VOSB or SDVOSB partner and any of its affiliates at any subcontracting tier will be counted. (4) Orders set aside for SDVOSBs against a Multiple Award Contract, which had been awarded in full and open competition or as a small business set-aside. A list of the minimum required documents that must be submitted can be found on SBA's website at Concerns acquiring surplus personal property from a SASP may be required to pay a service fee to the SASP in accordance with 41 CFR 102-37.280. Suspension or debarment. A contracting officer may award a sole source contract to an SDVOSB for non-VA procurements only when the contracting officer determines that: (a) None of the provisions of 128.403 or 128.404 apply; (b) The anticipated award price of the contract, including options, will not exceed: (1) $7,000,000 for a contract assigned a manufacturing NAICS code; or, (c) A SDVOSB is a responsible contractor able to perform the contract; and. (Former 74.20), Section 128.309What are the ways a Participant may exit the Veteran Small Business Certification Program? About the Federal Register Section 128.303 describes what an applicant must apply to be certified as a VOSB or SDVOSB. VOSB or SDVOSB prime contractor is unduly reliant on one or more small businesses that are not certified VOSBs or SDVOSBs to perform the VOSB or SDVOSB contract, the prime contractor is not eligible for award of that VOSB or SDVOSB contract. (b) SBA, in its sole discretion, may request clarification of information relating to eligibility at any time in the eligibility determination process. In terms of demonstrating that an applicant qualifies as a small business, the proposed rule provided that an applicant must demonstrate that it qualifies as small under the size standard corresponding to any NAICS code under which it currently conducts business activities. (a) Proposed 128.202(f) required participants to notify SBA of a change of ownership and attest to continued eligibility in accordance with proposed 128.307. In the case of a publicly-owned business, not less than 51 percent of the stock (not including any stock owned by an ESOP) must be unconditionally owned by one or more qualifying veterans. The joint venture partners must allow SBA's authorized representatives, including representatives authorized by the SBA Inspector General, during normal business hours, access to its files to inspect and copy all records and documents relating to the joint venture. 8127, authorize Federal contracting officers to restrict competition to eligible VOSBs and SDVOSBs for Department of Veterans Affairs (VA) contracts. SBA did not receive any comments during the public comment period disputing this certification. SBA has reviewed all input from interested stakeholders while drafting this rule. Service-Disabled Veteran-Owned Small Business Procurement Program The Service-Disabled Veteran-Owned Small Business (SDVOSB) Procurement Program is intended American National to provide SDVOSBs greater access to federal contracting opportunities. 4124 or 4125, or to Javits-Wagner-O'Day Act participating non-profit agencies for the blind and severely disabled, under 41 U.S.C. SBA previously administered only the SDVOSB self-certification program and former 125.14 did not specifically reference VOSB requirements. In connection with a VOSB or SDVOSB contract, a VOSB or SDVOSB must be small under the size standard corresponding to the NAICS code assigned to the contract at the time it submits its initial offer or response which includes price. This estimate is based on 32,284 SDVOSB firms registered in SAM and excludes 10,816 firms registered in SAM but already verified by VA as of December 2021. (f) The decision of the D/GC to approve or deny an application will be in writing. (b) A business concern seeking a VOSB or SDVOSB contract must meet the applicable limitations on subcontracting requirements set forth in 125.6 of this chapter. For purposes of architect-engineering, design-build or two-step sealed bidding procurements, a concern must be certified as a VOSB or SDVOSB as of the date that it submits its initial bid or proposal (which may or may not include price) during phase one. Document Drafting Handbook If the contractor is not a VOSB or SDVOSB, the agency can no longer count the options or orders issued pursuant to the contract from that point forward towards its VOSB or SDVOSB goals. Performance of work reports. 13. For organizational purposes, SBA moved these provisions to the section specifically addressing program examinations, 128.308(c). e.g., If the Judge determines that the protest is timely, sufficiently specific, and based upon protestable allegations, the Judge will issue a notice and order, notifying the protester, the protested concern, the Director, Office of Government Contracting (D/GC), SBA Counsel, and, if applicable, the contracting officer of the date OHA received the protest, and order a due date for responses. The firm must be small, according to SBA's size standards . Signature requirement. (iii) Where there has been a VOSB or SDVOSB status protest on the solicitation or contract, part 134 of this chapter describes the effect of the status determination on the contract award. (1) A non-qualifying-veteran must not: (i) Exercise actual control or have the power to control the concern; (ii) Have business relationships that cause such dependence that the qualifying veteran cannot exercise independent business judgment without great economic risk; (iii) Control the Applicant or Participant through loan arrangements (which does not include providing a loan guaranty on commercially reasonable terms); (iv) Provide critical financial or bonding support or a critical license to the Applicant or Participant, which directly or indirectly allows the non-qualifying-veteran significantly to influence business decisions of the qualifying veteran. What other eligibility requirements apply for certification as a VOSB or SDVOSB? The Service-Disabled Veteran-Owned Small Business (SDVOSB) Certification Program supports service-disabled military veterans who own a business and live in Kentucky. As such, SBA is implementing 128.101 as proposed to clarify the two types of assistance available to participants in the Veteran Small Business Certification Program. Finality. For VA procurements, a contracting officer may award at or below the simplified acquisition threshold as set forth in the VAAR. (iii) Non-qualifying-veterans may be found to control or have the power to control in circumstances where non-qualifying-veterans control the Board of Directors of the Applicant or Participant, either directly through majority voting membership, or indirectly, where the by-laws allow non-qualifying-veterans to prevent a quorum or block actions proposed by the qualifying veterans. Section 862 of the NDAA 2021 amended the VOSB/SDVOSB requirements to transfer the responsibility for certification of VOSBs and SDVOSBs to SBA as of January 1, 2023 (Transfer Date) and created a certification requirement at SBA for SDVOSBs seeking sole source and set-aside contracts across the Federal Government. i.e., Accordingly, SBA estimates that as many as 21,500 self-certified SDVOSBs could apply for initial certification within the first year of the program. 125.1 of this chapter); or. SBA amends the definition of similarly situated entity in 125.1 to clarify that a subcontractor must be certified as VOSB or SDVOSB in order to qualify as a similarly situated entity for purposes of complying with the limitations on subcontracting. Proposed 128.102 included definitions for the following terms, which have been removed from this final rule: eligible individual, interested party, joint venture, primary industry classification, and unconditional ownership. The final rule replaces the term eligible individual with the term qualifying veteran, as explained above. An Applicant may appeal SBA's decision to deny an application for certification as a VOSB or SDVOSB by filing an appeal with the SBA's Office of Hearings and Appeals (OHA) in accordance with part 134 of this chapter. Ownership will be determined without regard to community property laws. 1001, 18 U.S.C. 125.3(a) of this chapter) in effect at the time of contract award remain in effect throughout the life of the contract. SBA does not review issues concerning the administration of a VOSB or SDVOSB contract. As stated above, revised subpart J addresses protests of eligibility for inclusion in the Veteran Small Business Certification Program, and revised subpart K addresses appeals of denials and cancellations of certification for inclusion in the Veteran Small Business Certification Program. Start Printed Page 73407 The decision on the appeal shall be final. VOSB or SDVOSB status. (a) Any Participant seeking to remain certified must recertify its eligibility every 3 years. (6) Any protest received after the time limit is untimely, unless it is from SBA, VA, or the contracting officer. Ostensible subcontractor. ET via toll-free number: 208-391-5817; Conference ID: 278 449 067, where members of our team answer questions to help firms navigate the certification process. To qualify as a VOSB, one or more veterans must unconditionally and directly own at least 51 percent of the concern. Prohibition on combined set-asides. (f) Veteran-Owned Small Business and Service-Disabled Veteran-Owned Small Timothy Green, U.S. Small Business Administration, Office of Veterans Business Development, 409 Third Street SW, 5th Floor, Washington, DC 20416; (202) 205-6777; means a veteran upon which a VOSB's eligibility is based, or in the case of an SDVOSB, a service-disabled veteran (or in the case of a veteran with permanent and severe disability, the spouse or permanent caregiver of such veteran) (as those terms are defined in this part) upon which a SDVOSB's eligibility is based. Removing SDVO, in paragraph (f)(1)(v) and adding in its place SDVOSB, VOSB,. What are the ways a Participant may exit the Veteran Small Business Certification Program? SBA agrees but believes that for organizational purposes, these requirements are more appropriate for inclusion in the additional eligibility requirements at 128.201(b). In the proposed rule, SBA explained that it intended to prioritize those applications where the contracting officer has identified the applicant as the apparent successful offeror. Proposed 128.500 addressed status protests for VOSBs and SDVOSBs. (3) Non-voting, advisory, or honorary Directors may be appointed without affecting qualifying veterans' control of the Board of Directors. (a) The rules of practice in this subpart apply to appeals of denial of certification and decertification for inclusion in the SBA Veteran Small Business Certification Program certification database (VOSB or SDVOSB Appeals). There is no order of precedence among the 8(a) BD, HUBZone, SDVOSB, or WOSB programs. If SBA determines that the Participant is not eligible, the D/GC will issue a notice of decertification. SBA believes that participants will not incur any start-up costs, operation or maintenance costs, service costs, or require additional capital as a result of this final rule because there should be no cost in setting up or maintaining systems to collect the required information. What are a Participant's ongoing obligations to SBA? SBA received one comment on 128.309 recommending that SBA include misrepresentation and false statements as a basis for decertification from the program. legal research should verify their results against an official edition of How is a concern certified as a VOSB or SDVOSB? Service. see (a) A concern whose application for VOSB or SDVOSB certification has been denied or whose status has been decertified must file its appeal within 10 business days of receipt of the denial or decertification. SBA believes that the appeals process with SBA's Office of Hearings and Appeals (OHA) as outlined in 13 CFR part 134 serves as an adequate substitute for the process of reconsideration. Whether a firm qualifies as small under its primary industry classification is not relevant to that determination. The concern may reapply for certification ninety (90) calendar days after the date of decertification. SBA received no comment on these proposed regulations and is implementing these sections as proposed. Will the SBA make changes to the VA's CVE program when VOSB and SDVOSB become part of the SDVOSB Service Disabled Veteran Owned Business Certification to the courts under 44 U.S.C. Examiners may review any information previously provided to SBA and any additional information requested by SBA at the time of program examination. Participant informational resource until the Administrative Committee of the Federal 4. If such an oral hearing is ordered, the proceeding shall be conducted in accordance with those rules of subpart B of this part as the Judge deems appropriate. SBA received 13 comments related to the rebuttable presumptions at proposed 128.203(i). SBA received 1 comment on proposed 128.204(a), which established size at the time of contract offer, noting that this was inconsistent with SBA's size requirements at 121.404(a), which provide that SBA determines the size of a concern as of the date the concern submits a written self-certification that it is small to the procuring activity as part of its initial offer or response which includes price. In response to this comment, SBA has amended 128.204 to be consistent with 121.404. CVE's SDVOSB and VOSB Verification to Transfer to SBA January 1, 2023 To be considered direct ownership, the qualifying veteran must own 51 percent of the concern directly, and not through another business entity or trust (including an ESOP). Start Printed Page 73402 SBA did not receive any comments on this section and is implementing 128.700 as proposed. Reservists or members of the National Guard disabled from a disease or injury incurred or aggravated in line of duty or while in training status also qualify. Proposed 128.204 included SBA's size requirements at former 125.15 and revised the section to incorporate VOSBs. They believed that one firm having access to pricing information for several quotes could skew the pricing received for the order. The Participant must submit a written response to the notice of proposed decertification within the timeframe specified in the notice. see For VA procurements, a contracting officer may award a VOSB or SDVOSB contract as set forth in the VAAR. Amend 125.1 by revising the definition of Similarly situated entity to read as follows: Similarly situated entity You can find the full qualification criteria in this Code issued by SBA. (a) Timing. Financial obligations. A: Yes. After comprehensive review of the use of self-certification in socioeconomic certification programs for goaling and subcontracting purposes with federal government stakeholders and SBA contracting program participants, SBA anticipates sunsetting these forms of self-certification after five years, through a separate rulemaking. As proposed, SBA did not require SDVOSB joint ventures to be certified to be eligible for non-VA contracts. The proposed regulations described a number of rebuttable presumptions of control by a non-qualifying-veteran, including circumstances where the non-veteran: is a former employer; receives the highest compensation; provides critical bonding or financial support; co-locates with another firm in a similar line of business; shares services and resources; and holds required licenses. If those rights are exercised by the non-qualifying-veteran, a Participant must notify SBA in accordance with 128.307. 2. 681 In response to this statement, one commenter strongly urged SBA to include amendments to part 134 in the final rule to clarify OHA's role in deciding all VOSB and SDVOSB status protests per NDAA 2021. To qualify as a SDVOSB, one or more service-disabled veterans must unconditionally and directly own at least 51 percent of the concern. In the proposed rule, SBA stated that revisions to part 134 would likely occur through a separate direct final rule. (8) For protests of eligibility for inclusion in the Veteran Small Business Certification Program, in subpart J of this part; (9) For appeals of denials of certification and decertification in the Veteran Small Business Certification Program, in subpart K of this part; and. In addition, VA's existing regulations require offerors to be certified at the time of offer. Generally, an agency's certification must include a statement providing the factual basis for this determination, such as a description of the affected entities and an estimate of the cost of the impacts that justify the no impact certification. Moreover, applicants must already provide this information to VA's CVE for verification. et seq. What are SBA's description and estimate of the number of small businesses to which the rule will apply? For the initial application, SBA estimates that applicants will complete the application process in 1 hour, a program examination in 1 hour, and recertification in 1 hour. The procedures set forth in 41 CFR part 102-37 and this section will be used to transfer surplus personal property to such concerns. (1) the SDVOSB/VOSB Certification Trademark Fact Sheet Summary Service-Disabled Veteran-Owned Small Businesses (SDVOSBs) and Veteran-Owned Small Businesses (VOSBs) not currently verified, as demonstrated by being listed on the VetBiz Vendor Information Pages/VIP, are prohibited from using the SDVOSB or VOSB certification trademarks. A certified VOSB or SDVOSB that is a non-manufacturer may submit an offer on a VOSB or SDVOSB contract for supplies if it meets the requirements of the non-manufacturer rule set forth at 121.406(b)(1) of this chapter.
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