The VOSB/SDVOSB Program and Upcoming Changes

According to the most recent U.S. Census data, 9.1% of all businesses are majority-owned by veterans. However, not all these businesses are certified with the federal government. For a veteran-owned business (VOB) to qualify for certification with the federal government, it must be:

  • More than majority (51%) owned by a veteran,
  • The veteran owner must have been honorably discharged from service,
  • And the veteran owner must be involved in the management and daily business operations of the company.

For service-disabled veteran-owned businesses (SDVOBs), owners must be able to prove a service-connected disability, which should be included in their discharge paperwork.

Benefits of Certifying

There are several benefits to certifying your veteran-owned or service-disabled veteran-owned business. One of the greatest benefits is that it can help your company win more business from both government agencies and corporations. The government has many contracts that are set aside specifically for VOB/SDVOBs, and certification can be an excellent marketing tool and differentiator from the competition.

Upcoming Certification Changes

While the intent behind certification has always been good, the actual process can be daunting and time-consuming for many businesses. However, with the approval of the National Defense Authorization Act (NDAA) for Fiscal Year 2021, the certification process is going to change.

Section 831 of the bill transfers the verification process for all veteran-owned and service-disabled veteran-owned business designations from the U.S. Department of Veterans Affairs to the U. S. Small Business Administration. This bill is a major step in eliminating inconsistent regulatory requirements and duplication efforts for these agencies.

However, this change will not have an immediate transfer of responsibilities. The bill states that this transformation will not officially begin until two years after the official enactment of the new law.

What Does This Mean for Your Company?

So, what does this information mean for you and your business?

  1. The FY 2021 NDAA changes should help reduce the amount challenges for businesses to be certified as a VOB, VOSB, SDVOB, or SDVOSB as businesses will only be dealing with one agency.
  2. This transfer of the verification process to the U.S. Small Business Administration (SBA) will eliminate the ability for veteran-owned businesses to self-certify their VOSB or SDVOSB status. There will be a one-year grace period where a self-certified VOSB or SDVOSB can apply for certification with SBA. Self-certifications that fail to apply within that one-year grace period will lose their VOSB or SDVOSB certifications.
  3. Once the grace period ends, self-certified VOSBs or SDVOSBs will no longer be eligible for any VOSB or SDVOSB set-aside and sole-source contracts.

While these changes are meant to simplify the certification process, it can still be difficult to navigate for those who are new to the process. If you have any questions or would like to discuss how JetCo Solutions can help you navigate the certification process, contact our team. We would be happy to discuss the options for you and your veteran-owned business.

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