"The Department of Veterans Affairs (VA) conducts its contracting with small businesses in good faith and in the spirit of the "Veterans First" legislation that gives preference to eligible Veteran-owned small businesses (VOSBs) and service-disabled Veteran-owned small businesses (SDVOSBs). This law gave VA new authority "for purposes of meeting [its] goals" for contracting with these firms, and VA is complying by exceeding those goals. VA will continue to strongly support eligible Veteran-owned small businesses who seek to do business with the federal government.
It is VA's position that procurement professionals should continue to use the Federal Supply Schedules Program as one of the many contracting vehicles available to meet the needs of the Department. The GAO recommendation does not change how VA will acquire goods and services in support of its mission. VA expects this issue ultimately will be decided by the courts. Since the June 2007 effective date, VA has consistently interpreted the law as a small business set aside program with Veteran small businesses having priority over any other class of small business when conducting full and open competition contracts.
VA again specifically explained that "this rule does not apply to Federal Supply Schedule task or delivery orders' when promulgating the final rule (74 Federal Register 64619 (December 8, 2009)), implementing the portions of the Veterans Benefits, Healthcare, and Information Technology Act of 2006 (Public Law 106-491) providing opportunities for SDVOSBs and VOSBs to increase their contracting and subcontracting with VA. "
On October 11, 2011, the U.S. Government Accountability Office (GAO) issued a decision upholding a bid protest by an SDVOSB on two solicitations for the purchase of food-preparation equipment. VA has 65 days in which to formally respond to GAO's recommendations, which are currently under review.
VA leads the federal government in contracting with SDVOSBs. In fiscal year (FY) 2010, VA awarded $3.5 billion to VOSBs, of which $3.1 billion went to SDVOSBs, out of a contracting base of $15.4 billion. These awards represent 23% to VOSBs and 20% to SDVOSBs, and greatly exceed VA's goals of 12% and 10%, respectively. This performance also exceeds the government-wide SDVOSB goal of 3%. When VA buyers make purchases through the FSS program, awards to SDVOSBs and VOSBs also count toward these goals--not just awards made through formal set-asides. In FY2010, approximately 12% of VA's total VOSB/SDVOSB spending included firms holding FSS contracts.
VA, in conjunction with the General Services Administration (GSA), encourages VOSBs and SDVOSBs to consider participating in the FSS Program. The FSS Program is the primary vehicle the Federal Government uses in making purchases for commercially available products and services: medically related products and services at VA, and other products and services through GSA. Both agencies' FSS Programs are multiple award contracting programs that are open for potential new contractors on a continuing basis. The VA and GSA FSS web portals which can assist potential contractors in determining if this program is right for them can be found at http://www.fss.va.gov/ and http://www.gsa.gov/portal/category/100611 respectively.