by Sarah Schauerte
What’s the point in a victory if the other party refuses to admit they’re beat?
Recently, service-disabled veteran-owned small businesses (“SDVOSBs”) across the country are asking themselves that same question. Even though Kingdomware Technologies, Inc, a small business located in Waldorf, Maryland, spent years bravely acting as the representative of SDOVSBs in challenging the VA’s refusal to put veterans first in its issuance of set-aside contracts off the Federal Supply Schedule – sparring with the VA at the Government Accountability Office, the U.S. Court of Federal Claims, a U.S. District Court, and finally the U.S. Supreme Court – the VA has been attempting to find ways to wriggle out of its mandate ever since the Supreme Court handed down its unanimous decision last summer.
In a nutshell, the Supreme Court held that the VA is mandated to set aside certain contracts for veteran-owned small businesses (“VOSBs”) when “procuring goods and services pursuant to a contracting preference under [Title 38] or any other provision of law.” Known as the “Rule of Two,” this mandatory preference applies if the solicitation’s contracting officer has a reasonable expectation that two or more small business concerns owned and controlled by veterans will submit offers and that the award can be made at a fair and reasonable price that offers the best value to the U.S. (38 U.S.C. § 8127(d)).
Since this ruling, I have not heard from veteran owners who have been leveraging the opportunities landed by this development. Instead, I have heard from veteran owners who have experienced the VA not following it. Veteran business organizations maintain that the VA policy memorandum ( http://www.legalmeetspractical.com/wp-content/uploads/2017/04/Memo-1.pdf ) issued to implement Kingdomware misinterprets the Supreme Court’s decision. They also report many instances of the VA attempting to skirt the decision’s requirements. This includes by:
- Procuring open market medical surgical items and industrial supplies from large business prime contractors without regard to VETS First.
- Contracting using strategic sourcing, to the detriment of veterans in the office products industry.
- Placing Ability One vendors above veteran-owned small businesses (In fact, there is a U.S. Court of Federal Claims pending with this accusation).
- Sending requirements to other agencies to contract for VA.
The VA’s mission is “to fulfill President Lincoln’s promise: To care for him who shall have borne the battle, and for his widow, and his orphan ‘by serving and honoring the men and women who are America’s Veterans.'” The VA’s Office of Small and Disadvantaged Business Utilization’s (OSDBU) mission is to: “enable Veterans to gain access to economic opportunity by leveraging the federal procurement system and expanding participation of procurement-ready small businesses.”
If you are a veteran business owner competing in the federal marketplace, what do you think? Have you encountered issues with the VA circumventing Kingdomware? (Any comment made can be made anonymously, or with a handle – merely request it when you submit your comment). Also, if you’re interested in joining the D.C.-based National Veteran Small Business Coalition’s fight to shame the VA into following the Kingdomware mandate, you can access more information here.
As a procurement attorney and SDVOSB advocate, I find it necessary to note this: while I have heard many complaints about violations of Kingdomware, I have not heard from one business that is willing to stamp its name on a public declaration of the VA’s dereliction of duty. I understand – you fear retaliation, you fear the cost, and you don’t want to be “that guy.” But if everyone takes that stance, doesn’t that mean the VA will get its way?
We can’t let the Kingdomware ruling mean nothing. It’s too important for our nation’s veteran business owners.
*Did you find this article informative? If so, sign up for Sarah Schauerte’s legal blog on veteran business news at: http://www.legalmeetspractical.com.