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Mr. Richard F. Weidman

Mr. Richard F. Weidman, Vietnam Veterans of America, Executive Director for Policy and Government Affairs

"The willingness with which our young people are likely to serve in any war, no matter how justified, shall be directly proportional as to how they perceive the Veterans of earlier wars were treated and appreciated by their Nation."   -George Washington

Good afternoon, Madam Chairwoman, Ranking Member Boozman and distinguished Members of the Subcommittee. Thank you for giving Vietnam Veterans of America (VVA) the opportunity to offer our comments for the record regarding veteran owned small business and service disabled veteran owned small businesses and procurement by the Federal government.

Madam Chairwoman, overall the executive branch has done a very uneven job thus far of carrying out their responsibilities under Public Law 106-50 in regard to all of the efforts they are supposed to be making under all three laws enacted since this time in 1999. SBA also can and must do a better job of meeting their responsibilities pursuant to the terms of Executive Order (E.O.) 13-360 (issued in October or 2004). 

While the situation is somewhat better today than a year ago despite some recent gestures made by the current SBA Administrator, and his apparently more open attitude toward proper treatment of veterans on the part of the Honorable Steve Preston. In my statement to you on May 17th, almost two months ago, I set forth a number of recommendations. Those recommendations were:

  1. Create a dedicated section in the contracts office with at least the same number of contract specialists devoted to 8(a) contracting. (It is worthy noting that there are 12,700 service disabled veteran owned businesses listed on the VIP at VA, while there are less than 7,400 certified 8(a) businesses. Since there are many more SDVOSB than 8(a), having the same number of contract specialists does not seem to be too much to ask.)
  2. The Administrator should take steps to create a capital formation program specifically for VOB, with an emphasis on SDVOSB. This should not be just for “start up capital” but also for so-called “mezzanine funding” to help businesses expand to a sustainable phase beyond the first few years of the small start phase.
  3. As noted below, the $25 million dollars that The Veterans’ Corporation people have been running all over Capitol Hill seeking should be added to the budget of the Veterans Business Development Office for use primarily as grants to localities to operate projects and expand existing services to better reach veteran entrepreneurs and would-be entrepreneurs. These grants should go to expand services of particularly effective Small Business Development Centers, to ensure that there is continued funding for such efforts as the fine project in St. Louis operated by Pat Heavey, and for special projects reaching out to wounded service members or to veterans for purposes of helping them become self-employed or to start micro businesses.
  4. The Administrator should issue a long overdue Administrator’s Order implementing all of the statues that have been enacted in the past eight years, plus putting more teeth into Executive Order 13-360 in regard to services delivered by SBA or funded through SBA.
  5. The Administrator should undertake a review of all SBA programs to ensure that veterans, particularly disabled veterans, are receiving full and proper access and maximum services from each of the SBA services and programs for which those individuals would otherwise be eligible. In other words, for example, this internal review, and appropriate corrective action as needed, would determine if women veterans were being properly reached in numbers commensurate with their incidence in the population and given the full range of services available to the maximum extent legally permitted.
  6. The Administrator should specifically review all that is being done for those citizens serving in the National Guard or Reserves who activated, and determine what more can be done under existing law to better assist these individuals, and work with the Congress and The White House to determine what else can and should be done by changing the law or by Executive Order.
  7. Closely related to the above point, but slightly different, is that we as a nation have to figure out how we can better support those businesses who have National Guard and Reserves members as employees who are now subject to frequent deployments for longer periods of time. This is a matter of national defense, but it is also a veterans re-employment and employment issue because the negative side of hiring and employing those who serve in the National Guard and Reserves is being disproportionately borne by a relatively small segment of the employer community. It is also having a negative impact on veterans’ employment and on the advancement of those who are employed within their company. This is the real world, where the bottom line must be addressed, and not the ideal world of what is fair, so we must find practical ways to solve this problem.
  8. The Associate Administrator for Veterans Business Development and all other officials of the SBA (and other agencies for that matter) should by this point know better than to keep saying in public and in private that “there are not enough service disabled veterans to do the 3% contracting, they are not sophisticated enough to do the work, and we have to teach these poor old veterans how to compete” before we can move forward on contracting and sub-contracting goals, or with other programs that would better enable veterans to have access to capital or international markets. Frankly, none of this is true, and these negative stereotype “straw men” set up by those who continue to say these things are a manifestation of “VETism” or an ugly set of prejudices and stereotypes that is every bit as ugly and inappropriate as sexism or racism.

To the credit of Administrator Preston, he has moved to create a capital formation program for veterans and their spouses, as recommended, albeit only a pilot program at this point. The mere fact that he has created the “Patriot Express” loans speaks well of his sincerity and intent to do a better job for veterans. However, he must not stop there, but undertake, a review of all SBA programs to see how SBA can do a better job for veterans, and issue an Administrator’s order that will implement many of the things that will help which can be accomplished under existing law. Further, issuing an Administrator’s order that implements all aspects of P.L. 106-50, P.L. 108-183, and P.L. 109-461 that either fall under SBA purview or in which SBA can assist, and which incorporates other worthwhile changes as well as meets his responsibilities more fully under the Executive Order 13-360 is very much needed.

Of all of the things that need to be done, for the purposes here today there are two things that can and must be accomplished soon if we are to make real progress toward stepping up the pace of achieving a government wide “floor” of 3% or all contracts and 3% of all subcontracts going to SDVOSB. The first is that either SBA should do the thorough analysis need of the procurement plans submitted as required by the Executive Order and see that said plans are complete, viable, and publicly available as required or seek assistance from the Center for Veterans Enterprise at VA to do the analysis for them. The plans were due in February and it is now July and they still are not available to the public. It is time for SBA either lead, follow VA, or get out of the way and seek changes with the Office of Federal Procurement Policy give the whole responsibility over to VA to get it done.  The second thing that must be done is, as was promised many months ago by the SBA, the information contained in the SF 294s and SF 295s pertaining to subcontracting plans and actual results of said subcontracting by major prime contractors needs to be available to the public. This involves where public taxpayer dollars are spent, and it must be made public now. There is no longer any excuse for delay.

The simple and clear conclusion of any observer is that the law which states that 3% of all contracts and 3% of all subcontracts issued by the Federal government are intended to go to service disabled veteran owned small businesses (SDVOSBs) has thus far not proven to be effective as originally envisioned.

 I refer you to the fine statement of my fine colleague, Joe Wynn of the VETS Group here today for many of the details of the analysis and hard work of the participants in the Veterans Entrepreneurship Task Force regarding the 3% procurement requirement and actual performance of the Federal agencies. You will note that there has been much work on the part of many determined advocates to work cooperatively with the governmental entities.

Centralized Source and Certification

VVA strongly recommends that there be one centralized data base that is THE place to go for Federal contract officers and other Federal decision-makers to find qualified Veteran Owned businesses and SDVOSBs that are owned and operated by veterans or service disabled veterans respectively. We urge that this one place be the Vendor Information pages (VIP) at at the Center for Veterans Enterprise (CVE) at the VA.

There is need for this to be a strong, well run, and easily accessible site so that not only Federal officials can access it, but also that large prime contractors can find SDVOSBs and that VOBs and SDVOSBs can find each other to do business where appropriate. This site is also needed so that private sector corporations can also both easily access it, and rely on the certification of authenticity. Many would use SDVOSB if they knew where to find such companies.

We urge that this be the one place and the only place for such certification in the Federal government. It is puzzling that SBA does not even have a link to VIP on their web site, which causes us to think that there may be some at SBA who are still more interested in “turf” issues than in getting the job done. We urge Administrator Preston to correct this problem immediately.

It would also be helpful if VA were authorized to allow VOBs and SDVOSBs who list on the VIP to also list the profile of their employment practices. In other words, how many service disabled veterans they have as employees, how many veterans, how many VOB or SDVOSB or active duty spouse, etc. out of their total workforce. If a VOB or SDVOSB wants to list this information, then CVE should be authorized to verify this data, just as they verify veteran status and ownership and control of the business.

It is, by the way, imperative that VA acts quickly to issue complete and strong regulations to implement all aspects of P.L. 109-461. While we have great confidence in the intent and determination of Secretary R. James Nicholson, and Deputy Secretary Mansfield, VA is a large and complex organization. Therefore the regulations must be strong, complete, and have accountability measures built into them that holds all within that VA structure accountable for meeting or exceeding the intent of the law, as well as the letter of the law. Perhaps either a bi-partisan letter toward that end or even a meeting would be in order to help move along this process. 

Additional Tools

Government wide adoption of legislation analogous to the VOB and SDVOSB procurement provisions of PL.109-461 are needed through every authorizing committee in the congress. The Veterans Entrepreneurship Task Force has made this a major goal, and will be concentrating on this, beginning with the Department of Defense, to accomplish this for each aspect of the Federal government before the end of the 110th Congress.

This would get rid of the rule of two, give officials the tools they need to achieve results, and give veterans our level playing field we have been seeking.  Of course, we probably won't get the pecking order that VA has established but we will have a real sole source program and a better chance of penetrating these agencies.

Department of Defense

The Department of Defense controls more than half of all Federal procurement, and until this year has not been as determined as was needed to meet the requirements of the law and of the president’s Executive Order. To be fair, they have had many conferences, workshops, and provided tools such as mentoring for some that have been useful, but until now did not really seem to be serious about this issue.

The Deputy Undersecretary of Acquisition & Technology, the Honorable James Finley, has now taken the lead, and with the apparent full support of Secretary Gates, is moving ahead with a seven plus one plan to move DOD into compliance with the 3% minimum. (See attached) Both VVA and the VET-Force salute Mr. Finley for stepping up to the plate and providing the sorely needed strong leadership needed to get DOD moving in the right direction. The recent DOD-VA Veterans Small Business Conference in Las Vegas was a sold out and very successful conference run by Ms. Tracey Pinson of the United States Army and Mr. Scott Denniston of the VA. Mr. Finley’s address there signaled that it is a new day at DOD, and one that is heading in the right direction. Although all of us will certainly keep up the pressure, hopefully we can now spend more time working cooperatively with all officials on how best to achieve earliest results as opposed to whether to move forward.

Many thanks for allowing us to share our views for the record, and for the strong bi-partisan leadership that this subcommittee continues to exert.

[The attached report addressed to Members of Congress from the Small Business Administration's Advisory Committee on Veterans Business Affairs, is being retained in the Committee files.]

Association for Service
Disabled Veterans

Association of Small Business
Development Centers

American G.I. Forum of the United States

AMVETS (American Veterans)

Black Veterans for Social Justice, Inc.

Blinded Veterans

Center for
Veterans Issues

Enlisted Association of the
National Guard

HI Tech Services

Jewish War Veterans of the USA

Korean War Veterans Association

Military Officers Association of America

National Association for Black Veterans

National Association for Uniformed Services

National Coalition for Homeless Veterans

National Gulf War Resource Center

Non Commissioned Officers
Association of the United States of America

Paralyzed Veterans
of America

Quality Support, Inc.

Reserve Officers Association
of the United States

Rolling Thunder, Inc.

Veterans’ Entrepreneurship Task Force
8605 Cameron Street, Suite 400, Silver Spring, MD 20910
Tel: 301.585.4000 Fax: 301.585.0519

May 11, 2007

The following information is provided as the VET-Force list of suggested remedies that can improve the presently perceived lack of interest by DoD toward the 3% procurement requirement for SDVOBs,

  1. Affirmation that the goal for all DoD procurements, both prime and sub is 3%.  The affirmation will be by DoD Directive with reliable reporting and oversight directions issued NLT May 25th.
  2. Affirmation that the DoD Strategic Plan required by EO 13-360 will be modified to ensure the plan is compliant with the intent of EO 13-360.  This should be accomplished by June 8, 2007.
  3. Commitment that a DoD Directive will be promulgated and issued directing the Armed Forces Secretariats to complete comprehensive and compliant Strategic Plans per EO 13-360 by June 8, 2007.
  4. A standing committee be created to advise DoD on the effect of DoD directives and actions in meeting the SDVOB 3% goal.  The standing committee will include (less OSDBUs): 
    1. four SDVOB business owners (2 IT, 1 non-IT, and 1 construction),
    2. three veteran organizations chosen by the VET-Force,
    3. at least enough DoD appointees to include 1 each from DoD and each of the Armed Forces Secretariats. 

The monthly meeting will be co-chaired by one government member and one non-government member. 

  1. The Deputy Under Secretary of Defense for A & T will meet with the Chief Acquisition Officer for each of the Armed Forces Secretariats.  These meetings should be at least quarterly for the purpose of identifying delays in meeting the 3% goals, their cause, and suggested remedies to move the procurement goals toward successful completion.  Actions found to be forwarding success will be evaluated to determine if they can be used elsewhere.  Results will be provided to the Standing Committee formed under paragraph 4 above.
  2. Put achievement of the 3% contracting and 3% subcontracting goals into each and every manger’s performance evaluations.
  3. Create a set of awards for SDVOSB commensurate with other categories of procurement awards.

Key Question: Will the DoD support the VET-Force in an endeavor to have legislation passed to include the same requirements for the DOD that the VA has accepted in Public Law 109-461?

The Keefe Group

The Retired Enlisted Association

The Veterans Advocacy Foundation

Veterans Benefits Clearinghouse

Veterans Business Network

Veterans Enterprise, Training, & Services Group

Veterans of Foreign Wars

Veterans of Modern Warfare

Vietnam Veterans of America

Vietnam Veterans of California