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Hon. Bill Johnson, Chairman, Subcommittee on Oversight and Investigations

Good morning.  This hearing will come to order.

I want to welcome everyone to today’s hearing on Evaluating the VA’s Service Disabled Veteran Owned Small Businesses certification process.

I would like to ask unanimous consent of the Subcommittee that Chairman Stutzman and Ranking Member Braley of the Economic Opportunity Subcommittee be allowed to join us today in our meeting.  Hearing no objection, so ordered. 

In any process, we must be willing to be critical in search of new possibilities and positive implications.  This process requires a keen eye, and an analytical mind, but most importantly it requires action based on willing participants in order to identify and correct weaknesses and shortcomings.

As many of you know, including today’s witnesses, this Subcommittee has partnered with the Subcommittee on Economic Opportunity, Government Accountability Office, the Veterans Affair Office of Inspector General and others in conducting an investigation into the certification process for Service Disabled Veteran Owned Small Businesses, or “SDVOSBs.”

Months of investigation have revealed many deeply troubling issues, many of which we will discuss today.  For instance, businesses such as TeamUS, an organization identified by GAO in November 2009 as ineligible to participate in the SDVOSB program at the VA, continued to perform millions of dollars in contracting work for the VA after being found ineligible. 

Our investigation into a specific group of companies, along with investigation by OIG and GAO, also identified that fraud was common among not just companies but also individuals.  This fraud was not limited to those outside the VA- in some cases, the VA’s own Contracting Officers and key decision makers were at fault.  That fault was occasionally due to carelessness, sometimes due to lack of training, but in some instances it was also due to a VA employee’s own ego or greed.

As Tertullian noted, “Truth engenders hatred of truth.  As soon as it appears, it is the enemy.”

Despite multiple discoveries of fraud in our investigation, it is important to note that there are many dedicated professionals in the VA who seek to do the right thing.  In some cases they have been threatened into silence, they have been circumvented by their own chain of command, they have been ignored, or even fired. 

In such cases, this subcommittee can and will be their voice, and we will present the evidence they have attempted to bring to light.  Truth cannot be suppressed - it will always find a way to be heard.

Veterans seek accountability.  They want a process that excludes fraudulence and encourages legitimacy.  They want inclusion with integrity.  They want opportunity.  The current program needs to be emancipated from an ineffective culture that will otherwise destroy it.  These good employees expect leadership that allows both the individual and the organization to flourish through the utilization of their creativity, knowledge, and dedication. 

This positive growth requires new methods of communicating and new voices with which to communicate.  It requires a leader who will engage the issues at all levels, and who will lead by example.  The knowledge we share here must be linked to values and interests that benefit the integrity of the SDVOSB community.

We will hear on our second panel from a new leader with direct oversight of this very issue.  Mr. Tom Leney has been the Executive Director of Small and Veteran Business Programs at VA for just over three months.  It is my sincere wish that he shares with this Subcommittee what actions he has already taken, and what actions he plans on taking in the future to get this program on the solid footing it requires. 

As we will hear from the GAO and OIG on the first panel, we are all well aware that problems exist and to a significant degree.  There is no denial of these facts.  And this hearing provides a positive step forward in addressing and resolving these issues. 

I appreciate everyone’s attendance at this hearing and I now yield the Ranking Member for an opening statement.