Defining Disability

Some veterans question giving the edge to service-disabled contractor bids.

For most people, the word "disabled" conjures up images of wheelchairs, guide dogs or paralysis. For some government contractors, it means money-at least in theory.

Ever since the 1999 Veterans Entrepreneurship and Small Business Development Act was passed, agencies have faced a 3 percent target for contract awards to service-disabled veterans. The 2003 Veterans Benefits Act allowed agencies to award sole-source contracts and restrict competition to small businesses owned by service-disabled veterans. President Bush further upped the ante when he issued an executive order in October 2004 requiring agencies to "more effectively implement" the two laws.

The focus on the service-disabled has led some veterans to ask, "What about me?"

"One of the unintended results of the mandate [is that] it diminishes the role of the veteran-owned business," says Sherry Vance, vice president of business development for LSI, a small, veteran-owned business in Washington that provides information technology training. "Anyone who volunteers and puts their life on the line should receive special treatment." Vance would like to see set-asides for all veteran-owned businesses, not just service-disabled.

"There's no help for a company like ours," says Beth Miller-Herholtz, vice president of corporate development at SNVC in Fairfax, Va. Agencies are not required to give veteran-owned businesses contracting preferences. She'd like a law change that would allow veteran-owned businesses to compete on the same set-asides for the service-disabled. If price and all else were equal, she says, the contract should go to a service-disabled veteran-owned company. But, she adds, if the veteran-owned company offers a better price, it should win.

Part of the problem lies with the definition of disabled. According to Veterans Affairs, a minor scar classifies someone as "zero percent" disabled, which qualifies them for the contracting preference, but not monetary compensation. There are 2.3 million veterans classified as zero percent disabled and 2.6 million veterans whose disabilities are serious enough to grant them monthly compensation checks. The entire veteran population is 24 million.

Of course, no one wants to appear unappreciative of what service-disabled vets have sacrificed. They were injured as a result of service to their country, and many aren't shy about standing up for their special privileges. "If [people] have any heartburn about it, they should be grateful that they didn't get hurt," says Tom Flannery, co-owner of Veteran Enterprise Technology Services, a Reston, Va., service-disabled veteran-owned business. Flannery, who served in the Air Force in Vietnam, has a noncombat spinal injury.

Meanwhile, even service-disabled businesses say they don't have enough help winning contracts. Despite the 3 percent target, agencies awarded only 0.61 percent of federal contracting dollars to them in 2005. There is no penalty for failing to meet requirements. "Our biggest problem is ambivalence. The government really doesn't give a damn," says Jack O'Brien, president of Go-Vets Inc. in Fairfax Station, Va., whose Web site (www.govetsusa.com) connects contractors with agencies and each other.

"It's only been in place for two years, so a lot of government officials are not familiar with it," says William "Bud" Almas, owner of B3 Solutions LLC in Jacksonville, Fla. The logistics company is classified as a service-disabled business be-cause Almas, an Army veteran, has a back injury. He and his partner, Brenda Bearden, say they often find themselves teaching contracting officers about the service-disabled target because they aren't familiar with it. Some vet activists are lobbying Congress for changes to the law that would force agencies to take the target more seriously. The House passed legislation in July that would prohibit bonuses for VA procurement officials who do not meet the 3 percent target. At press time, the bill was being reviewed by the Senate Committee on Veterans Affairs.

Agencies say they're doing what they can, but implementing preference programs takes time. "We're talking about changing culture," says Scott F. Denniston, director of Veterans Affairs' Office of Small and Disadvantaged Business Utilization and the Center for Veterans Enterprise. The center's Web site (www.vetbiz.gov), which promotes awards to veteran-owned businesses, hosts an online searchable database of 6,000 businesses. In October, the center is launching a series of regional conferences on contracting opportunities for veteran-owned businesses.

Another quandary is that some eligible businesses have not registered as service-disabled veteran-owned. Ray Bjorklund, chief knowledge officer at Federal Sources Inc., a consultancy in McLean, Va., says he knows service-disabled veterans contracting with the government who have opted not to use their military history to give them a leg up over competitors. He attributes this decision to modesty or humility.

William Elmore, the Small Business Administration's associate administrator for veterans' business development, says many veteran-owned businesses tend to be smaller operations and might be unprepared to compete for federal contracts. Elmore plans to host booths at conferences hosted by veterans organizations and to reach out to recently retired service members through the Defense Department.

The General Services Administration announced in June a new training course for contracting personnel on how to apply the preferences for service-disabled veteran-owned businesses. In October, GSA expects to make awards for a governmentwide acquisition contract that will be open only to service-disabled veteran-owned businesses offering information technology services to federal agencies.

The Army awarded $1.6 billion in contracts to veteran-owned businesses and $500 million to service-disabled businesses, which add up to almost 3 percent of total contracting dollars in 2005. In June, the service released a solicitation for a contract to analyze why Defense has not yet reached its 3 percent target for awards to service-disabled veteran-owned businesses.

Lt. Col. James Blanco, assistant to the director of the Army's small business programs, says the Army is in year three of its five-year plan to reach the target. He says the goal is to help veteran-owned small businesses build their core capabilities so they can win contracts awarded through full and open competition, not just through set-asides.

That's why Carl Campbell, chief executive of the Data Research Group in Alexandria, Va., says service-disabled veteran-owned companies like his need to work hard and be competitive without relying on their special status. Campbell, who served in the Army during the first Persian Gulf War, was diagnosed with back problems as a result of his military service. He says his status gets him meetings, but doesn't guarantee him contracts.

Tony Coombs, a former Marine paratrooper, hurt his ankles while jumping. As the chief executive of TCAssociates, a telecommunications and logistics company in Springfield, Va., Coombs has the extra benefit of being in the SBA's 8(a) program for small and disadvantaged businesses. The company qualified because he is black. Still, he says, "We don't say, 'Give me this work because I'm a service-disabled veteran.' It's just one more box they can check off," which helps everyone involved meet their goals.

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