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Denied for Inclusion in Vetbiz database-Request for Reconsideration

Posted by Joseph Whitcomb on Nov 25, 2013 11:35:12 PM
Joseph Whitcomb

Were you denied inclusion in the Vetbiz Database? Try a "Request for reconsideration"

38 CFR 74.13 asks "Can an applicant ask CVE [Center for Verification and Eligibility] to reconsider its initial decision to deny an application?" The answer is yes.  If CVE denies your firm's inclusion in the Vetbiz database, submitting "request for reconsideration" to the director of the  Center for Verification and Evaluation is the next step.  Many times the reasons for your firm was denied inclusion in the Vetbiz database may not  make sense.  You have operated in good faith and gone to great pains to make sure your company satisfies the CVE's posted requirements.  However, quorum language in your bylaws or the fact that you live in a community property state and are married can lead to your applications denial.  Many people have argued in vain that the application process is unnecessarily complicated and does more to hurt deserving veterans than prevent fraudulent certifications, but for now, this is the system we are stuck with.

So, what should you do if you are denied inclusion in the Vetbiz database by the CVE. The first thing to remember is that you have 30 days from the date of the CVE denial letter to file your "request for reconsideration."  This can be completed with a letter detailing the reasons you disagree with the CVE denial.  It may be a good idea to solicit the help of a trained attorney at this point as this is not an altogether intuitive process.  Something that makes sense to the average business owner, like partnering with another experienced business person could be the very reason for your denial.

Also, it may not matter that your state requires certain language in your bylaws or operating agreements.  It also important to remember that no one with a legal degree or necessarily any business experience will review your application before an initial denial.  As September 30, 2013, the VA created another layer of appeal for status whereby "VA’s Director of CVE  shall initially adjudicate SDVOSB and VOSB status protests and to provide that either the protesting party or the protested business may appeal the Director of CVE decision to the Executive Director of OSDBU."  Since beginning this practice area, I have personally seen Veteran applicants denied inclusion in the Vetbiz database for every imaginable reason.  One recent example included a Veteran business owner who was denied inclusion, because the reviewer at the CVE did not think applicant had the necessary specialized experience to sell flowers.

The CVE frequently denies applications for inclusion because the company's corporate governance documents, like bylaws or operating agreements, contain offending language.  The problem is often that State LLC Acts or Corporation Laws require certain language or limitations in those documents.  However, when we have submitted letters of explanation to the CVE about those requirements, we have been told that federal law trumps state law.  The flaw in that logic is that corporations and LLCs are strictly inventions of State law.  There is essentially no such thing as a federal corporation.  Many companies operate all over the U.S. and internationally, but they are still creatures of their State of organization.

The main point of this article is that you as a business owner should not assume that the reasons the CVE is offering for denying your company's inclusion in Vetbiz are legitimate.  If you read something from them that does not make sense or that you cannot fix and still run your business, then don't take the denial lying down.  Rather, file your request for reconsideration.  If you feel like you need help, find a lawyer that practices in this area and has a good track record.


Topics: Government Contracting