In the latest Weekly Wright Report:
- New Rules Become Effective January 1, 2023 for VOSB and SDVOSB Certification
New Rules Become Effective January 1, 2023 for VOSB and SDVOSB Certification
On November 29, 2022, the Small Business Administration (SBA) issued its final rule to implement a requirement in section 862 of the National Defense Authorization Act for Fiscal Year 2021, Public Law 116-283, 128 Stat. 3292 (January 1, 2021) (NDAA 2021) to certify Veteran-Owned Small Business Concerns (VOSB) and Service-Disabled Veteran-Owned Small Business Concerns (SDVOSB) participating in the Veteran Small Business Certification Program. The final rule becomes effective on January 1, 2023.
Previously, there was no government-wide SDVOSB certification program, and firms seeking to be awarded SDVOSB sole source or set-aside contracts with Federal agencies other than the VA only needed to self-certify their status. However, to be eligible for VA contracts, VOSBs and SDVOSBs had to be verified by VA’s Center for Verification and Evaluation. The NDAA 2021 amended the VOSB/SDVOSB requirements to transfer the responsibility for certification of VOSBs and SDVOSBs to the SBA as of January 1, 2023 and created a certification requirement at SBA for SDVOSBs seeking sole source and set-aside contracts across the entire Federal Government. NDAA 2021 also created a one-year grace period after the January 1, 2023 start date for businesses to file an application for SDVOSB certification with SBA and to continue to self-certify. Self-certified SDVOSBs that apply within the one-year grace period will maintain eligibility until SBA makes a final eligibility decision. With the exception of this grace period, once the final rule takes effect, 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 SBA estimates that as many as 21,468 self-certified SDVOSBs could apply for initial certification within the first year of the program.
Firms currently verified by the VA’s Center for Verification and Evaluation prior to January 1, 2023 will be deemed certified by SBA during the time that remains in the firm’s three-year term of eligibility. To be recertified by SBA after January 1, 2023, those VA verified firms will be required to meet all conditions of eligibility as described in SBA’s final rule. The final rule makes a number of changes to the definitions, eligibility and terms applicable to the Veteran Small Business programs. If you have questions regarding this matter, please contact a member of our Government Contracts Practice Group.