National Veterans Small Business

Engagement

Verification Program Overview

Update to Current Process

MyVA Verification Transformation

What is Verification

Verification is the process whereby Veteran Small-business owners submit an application for their firm to be designated a Department of Veterans Affairs (VA) verified Veteran-owned, or Service Disabled Veteran-owned Small-business (VOSB/SDVOSB). If approved, the firm is listed in the Vendor Information Pages (VIP) immediately.

Verification is a comprehensive, document-based process. Evaluation of an application is primarily based on the requirements found in 38 Code of Federal Regulations (CFR) § 74

What is Verification

In normal circumstances, firm approved for VA SDVOSB or VOSB designation retain their verification status for 2-years.

By attaining verification, a Veteran Small-business postures itself for entry into the VA small business procurement life-cycle. The VA procurement life-cycle includes competing for Veteran set-aside contracts with the VA.

Although the VA places emphasis on doing business with verified firms, please remember we are Veterans first, not Veterans only. Procurement opportunities for non-verified firms do exist.

What is Verification

The Vendor Information Pages (VIP) Database is the only federally controlled database in which a legal verification process is used to determine service disabled or veteran status of a small business

Verification is Not

• A means unto itself

• A self-certification process

• Automatic merely by the fact of an applicant being a Veteran and owning a small business

• An off-shoot of the SBA, 8A, HubZone, SAM, etc. databases

• Synchronized with other Veteran small business designation programs maintained by states or other federal organizations

Why Get Verified

• Subcontracts with VA’s large prime contractors in acquisitions

• VA is one of the largest Federal Government procurement organizations – over $3 Billion to Veteran-Owned Small Businesses

• Potential procurement opportunities with other federal agencies

The Right Fit for Verification• There are currently six (6) business types that are eligible

to apply for verification • Sole Proprietorship• C Corporation (Inc. or Ltd.)• Limited Liability Company (LLC)• Sub Chapter S Corporation (Inc. or Ltd.)• General Partnership• Limited Liability Partnership (LLP)• Visit our website to see the list of documents required by

business type:– https://www.vip.vetbiz.gov/Public/Register/Document

List.aspx

Not the Right Fit for Verification

• Ineligible Business Models

– Not for profit organizations

• Ineligible Businesses and Owners

– EPLS – Excluded Party Listing System

– Questionable Character. In order to be in compliance with 38 CFR § 74, Veterans must be of GOOD CHARACTER in order to be eligible for VIP

– Debarred/Suspended

– Unresolved Federal Financial Obligations (e.g. not paying federal taxes; no payment plan)

Franchises

• Franchises are not automatically disqualified from the program. Our experience has been that business documents for franchises typically include language which impedes an applicant from meeting the ownership and/or control aspects of 38 CFR, Part 74. For this reason, a franchise may not be approved. All applications are reviewed holistically.

The Principal Tenets of Verification

The verification application process focuses on three aspects of an applicant.

• Eligibility

• Ownership

• Control

The Principal Tenets of Verification

• Eligibility

– Beneficiary Identification Records Location Subsystem (BIRLS) preferred

– DD 214 accepted

– Includes Reserve/Guard on Federal active duty

– For SDVOSB: VA or DoD disability rating between 0 and 100 percent.

– Did not receive a discharge of Dishonorable.

The Principal Tenets of Verification

• Ownership

– 51% ownership

– Multiple Vets ownership equals 51%

– Veteran owner(s) have direct and unconditional ownership of at least 51% of the business

– Community Property detracts from direct and unconditional ownership, however, it can be overcome.

The Principal Tenets of Verification• The Relationship Between Community Property and Ownership

– SDVOSBs and VOSBs that reside in community property states may have to take special measures in meeting the 51% ownership stipulation. However, it is can be an EASILY CORRECTIBLE ISSUE that may be resolved before applying.

– In a community property jurisdiction, most property acquired during the marriage (except for gifts or inheritances) – is owned jointly by both spouses and is divided upon divorce, annulment, or death. Community Property States include Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin. Puerto Rico and Guam are Community Property Territories.

– Joint ownership is automatically presumed by law in the absence of specific evidence that would point to the contrary.

– In the instance of a business located in a community property state, unless otherwise indicated, the business would automatically be ONLY 50% owned by the Veteran – DOES NOT MEET ELIGIBILITY REQUIREMENTS.

The Principal Tenets of Verification

• Control

– Total unconditional control (full decision-making authority)

– Both a strategic policy and lead day-to-day decision making

– Managerial experience to the extent and complexity needed to manage the company.

– Highest compensated

– Highest officer position

What Does “Control” Mean?

• As guided by 38 CFR, Part 74, CVE evaluates “control” based on the following stipulations:

– The Veteran owner has FULL DECISION-MAKING AUTHORITY. CVE will investigate further if any management, operating and/or shareholding agreements and/or bylaws of the organization that state the Veteran does not have full decision-making power or does not lead in making strategic day-to-day decisions.

– The Veteran owner has MANAGERIAL EXPERIENCE to the extent and complexity that they can manage the business. CVE will investigate further if the Veteran owner does not supply evidence to support training, education or experience in the field of work done by the business.

Changes to the Current Process

• Responding to Veterans’ requests for a streamlined process, CVE has changed the timing when business documents will be uploaded to a firm’s Vendor Information Pages (VIP) Profile.

• “Core Business Documents” will be uploaded immediately after the business owner(s) electronically sign the 0877

Changes to the Current Process

• Within 10 calendar days of the submitting the application, the CVE staff will contact the Veteran to conduct a “Pre-Qualification” discussion.

• The Veteran will be requested to provide the remaining business documents within 10-days after the discussion.

Changes to the Current Process

Benefits of the streamlined document submission approach

“Just in time” business document upload

Earlier identification of a firm’s potential to receive an approval. Note: If the remaining business documents contradict information provided in the Pre-Qualification Discussion, a firm may not be approved. The CVE Staff will coordinate and communicate with the Veteran on areas/items of concern.

The opportunity to have a “discussion” with the CVE Staff

A more personalized approach to Verification

Pre-Qualification DocumentsAll BusinessModels(See note 1)

LLC Sole Prop. Corporation Partnership Joint Venture Franchise

Resumes (Allowners must provide this)

X X X X X X

Articles of Organization/Formation

X

Articles of Incorporation

X

By-Laws X

Shareholder Agreement

X (See Note 2)

Partnership Agreement X

JV Agreement X

Franchise Agreement(Note 3)

X X

Note: 1) Tax and other business documents will be required after the initial conversation with the Assessor

2) Only those Corporations that have created a Shareholder Agreement.

3) If applicable

MyVA Verification Transformation Trial

As of November 1, 2015

MyVA Verification Transformation Goal

The MyVA transformation goal is to improve services to Veterans. As part of this transformation, CVE is streamlining the Verification Application Process to make it a predictable and consistent Veteran-centric process.

Feedback provided from Veterans combined with CVE Staff analyzing trends led to creating a transformed verification process. CVE is currently conducting trails to test our vision of the new process. The trails take into consideration the “human element” of verification; rethinking every layer of the process; and re-evaluating the when business documents are submitted.

MyVA Verification Transformation Highlights

• The MyVA Verification process will include these facets:

Individualized and Direct Customer Service

Improved acknowledgment a verification application was received

Eliminating the requirement to provide all documents earlier than needed

Individualized and Direct Customer Service

• When an application is submitted, processing will be completed by a smaller team. We have not finalized the optimal size needed in order to maximize the best Veteran-centric customer service. However, we speculate the staff size will be 3-6 individuals.

• Throughout the application, the Veteran will have two points of contact; a Case Manager and Assessor.

Improved Acknowledgment Your Verification Application Was Received

In addition to the automated system notice the application was submitted, the Veteran will be called and provided an acknowledgement by the Case Manager. During this contact, the Veteran is told if any of the basic required documents (a.k.a. Pre-Qualification Documents) were not uploaded.

Eliminating the Requirement to Provide All Documents Earlier than Needed

A minimal number of documents will be required at the outset when submitting an application. After the first conversation with the Assessor, the remaining required documents, and any clarifying information will be submitted. Note, the initial conversation with the Assessorwill result with the Veteran making an informed decision about proceeding with the remaining stages of the verification process.

MyVA Transformed Verification Process Stages

Intake Pre-Qualification Assessment Decision

MyVA Transformed Verification Process Stages

Intake Pre-Qualification Assessment Decision

During this stage, the Veteran submits the verification

application. The application is assigned to a team and its

respective Case Manager for processing. The Case

Manager is one of two primary points of contact on the

team the application is assigned to, who will communicate

with the Veteran throughout the verification process.

MyVA Transformed Verification Process Stages

Intake Pre-Qualification Assessment Decision

During this stage, a search regarding the owner(s) and applicant firm is conducted

using BIRLS, EPLS, and the Internet. The verification team confirms that the Veteran

has provided the needed Pre-Qualification documents. The verification team also

conducts the first telephone conversation with the Veteran owner during this stage. At

this point the Case Manager assigns an Assessor. The Case Manager coordinates a

date for the Assessor and the applicant to have a Pre-Qualification Interview, about the

application. This interview is intended to ask questions to assess the firm’s likelihood of

being approved. If the review results in findings that prevent the firm becoming verified,

those finding are conveyed in a report provided to the Veteran. If no clarifying

responses and/or documents are needed, the Assessor will Email the report conveying

the results of the review to the Veteran. Also during this time CVE requests that the

Veteran provide any Pre-Qualification documents that need correction are uploaded to

the firm’s profile, and remaining documents to complete the application.

MyVA Transformed Verification Process Stages

Intake Pre-Qualification Assessment Decision

During this stage, the Assessor reviews the business documents provided by

the Veteran. Also, it is during this phase that the Veteran has a conversation

with the Assessor about the Pre-Qualification documents provided. Based

on this review and only if needed, the Assessor compiles a list of clarifying

questions and/or documents the Veteran needs to provide to CVE. Any

information or documents requested by CVE during this phase are needed by

the suspense date stated in CVE’s correspondence. Failure to provide

required information by the suspense date could lead to an applicant being

offered the choice to withdraw from consideration or to accept a denial from

entry into the VETBIZ program. Once the Veteran has provided the requested

information or documents, or returns a response to include negative findings

outlined by CVE, the Assessor sends the application to the Federal Review

phase with a recommendation to approve or deny the application.

MyVA Transformed Verification Process Stages

Intake Pre-Qualification Assessment Decision

During this stage, a federal employee reviews the Assessor’s

recommendation. The review by the federal employee includes comparing

the application against the tenets outlined in 38 CFR Part 74. Those tenets

comprise eligibility, ownership, and control. The Federal Reviewer sends a

recommendation combined with that of the Assessor, to the appropriate CVE

approval authority for a decision. The CVE approval authority signs and

Emails the decision letter to the Veteran. If approved, the letter will include

the hyperlink guiding the Veteran to a location to download the appropriate

SDVOSB or VOSB logo. Additionally during this phase, the Veteran’s firm is

immediately listed in the Vendor Information Pages as approved.

Pre-Qualification DocumentsAll BusinessModels(See note 1)

LLC Sole Prop. Corporation Partnership Joint Venture Franchise

Resumes (Allowners must provide this)

X X X X X X

Articles of Organization/Formation

X

Articles of Incorporation

X

By-Laws X

Shareholder Agreement

X (See Note 2)

Partnership Agreement X

JV Agreement X

Franchise Agreement(Note 3)

X X

Note: 1) Tax and other business documents will be required after the initial conversation with the Assessor

2) Only those Corporations that have created a Shareholder Agreement.

3) If applicable

Examples of Question Themes Possibly Posed by the Assessor

• Veteran reside? Is this a community property state?

• DBA?

• The location of applicant work (e.g. work from a commercial or home office space)?

• Who is the highest officer?

• Experience to manage the applicant?

• Additional employment other than the applicant firm?

CONNECT WITH CVE ONLINE!

facebook.com/CVEVetbiz

Center of Verification

and Evaluation

(OSDBU)

@CVEVetBiz_OSDBU

www.vetbiz.gov

(866) 584-2344

vip@va.gov

Questions?

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