[Federal Register Volume 80, Number 46 (Tuesday, March 10, 2015)]
[Rules and Regulations]
[Pages 12564-12566]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-05505]



48 CFR Part 819

RIN 2900-AM92

Department of Veterans Affairs Acquisition Regulation: Service-
Disabled Veteran-Owned and Veteran-Owned Small Business Status Protests

AGENCY: Department of Veterans Affairs.

ACTION: Final rule.


SUMMARY: This document adopts as a final rule, without change, the 
interim final rule published in the Federal Register on September 30, 
2013. This document implements a portion of the Veterans Benefits, 
Health Care, and Information Technology Act of 2006, which requires the 
Department of Veterans Affairs (VA) to verify ownership and control of 
Veteran-owned small businesses (VOSBs), including service-disabled 
Veteran-owned small businesses (SDVOSBs), in order for these firms to 
participate in

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VA acquisitions set asides for SDVOSB/VOSBs. Specifically, VA amends 
its adjudication procedures for SDVOSB and VOSB status protests, to 
provide that VA's Director, Center for Verification and Evaluation 
(CVE), shall initially adjudicate SDVOSB and VOSB status protests, and 
to provide that protested businesses, if they are denied status, may 
appeal to VA's Executive Director, Office of Small and Disadvantaged 
Business Utilization (OSDBU). SDVOSB/VOSB status protests occur when 
during a particular SDVOSB/VOSB set aside acquisition, a competing 
vendor in acquisition challenges the status of the putative awardee as 
an actual SDVOSB or VOSB, as applicable. Additionally, VA amends the 
title of CVE from the Center for Veterans Enterprise to the Center for 
Verification and Evaluation, to more appropriately represent the 
function of this office.

DATES: Effective Date: This final rule is effective March 10, 2015.

Procurement Analysis (003A2A), Department of Veterans Affairs, 425 I 
ST. NW., Washington, DC 20001, (202) 632-5319. (This is not a toll free 

SUPPLEMENTARY INFORMATION: On September 30, 2013, VA published in the 
Federal Register (78 FR 59861) an interim final rule that revised the 
interim adjudication procedures for SDVOSB and VOSB status protests to 
provide that 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's decision to the 
Executive Director of OSDBU. In addition, the interim final rule 
described procedures used by both VA's Director of CVE and the 
Executive Director of OSDBU to use in status protest and appeals of 
status protests. As noted in the preamble to the interim final rule, VA 
has concluded that it will not utilize the U.S. Small Business 
Administration (SBA) to consider and decide VA SDVOSB and VOSB status 
protests on behalf of VA because this program is founded in Title 38 of 
the U.S. Code, solely applicable to VA acquisitions, and VA has 
developed appropriate internal expertise in adjudicating SDVOSB/VOSB 
status protests.
    We provided a 60-day comment period that ended on November 29, 
2013. We received one comment. The commenter discussed the SBA's view 
expressed in the Government Accountability Office (GAO) bid protest 
case Latvian Connection LLC, (GAO Case Number B-408633) that under 15 
U.S.C. 644(j)(1) and 13 CFR 125.2(f)(1) there is an automatic small 
business set-aside requirement imposed even where the competition takes 
place outside of the United States. This comment addressed an issue 
that is beyond the scope of the request for comments. Therefore, we 
make no changes based on this comment. Based on the rationale set forth 
in the interim final rule, we adopt the interim final rule as a final 
rule without change.

Administrative Procedure Act

    This document affirms the amendments in the interim final rule that 
is already in effect. In accordance with 5 U.S.C. 553(b)(B) and (d)(3), 
the Secretary of VA concluded that there was good cause to dispense 
with advance public notice and the opportunity to comment on this rule, 
and also good cause to publish this rule with an immediate effective 
date. VA provided that the Executive Director, OSDBU, shall consider 
and decide SDVOSB and VOSB status protests until VA and SBA executed an 
interagency agreement for SBA to consider and decide SDVOSB and VOSB 
status protests. For the reasons stated in 78 FR 59861, that VA has 
developed the necessary expertise to administer a SDVOSB/VOSB set aside 
program, including associated status protests, enacted in statute 
solely applicable to VA, we have determined that adjudication of SDVOSB 
and VOSB status protests shall remain within VA. Therefore, we are 
adopting as final the interim provision to provide that the Director, 
CVE, shall initially adjudicate SDVOSB and VOSB status protests and to 
provide that either the protester or the protested business may appeal 
the Director, CVE, decision to the Executive Director, OSDBU. Thus, the 
final rule continues to authorize an administrative appeal at the 
agency level, where the lack thereof had been criticized in Miles 
Construction, LLC v. United States, 108 Fed. Cl. 792 (2013), as not 
providing a party adequate due process and the opportunity to be heard 
at a meaningful time in a meaningful manner.

Regulatory Flexibility Act

    The Secretary hereby certifies that this final rule will not have a 
significant economic impact on a substantial number of small entities 
as they are defined in the Regulatory Flexibility Act, 5 U.S.C. 601-
612. The final arbiter of VA SDVOSB and VOSB status protests remains 
the Executive Director, OSDBU, as previously promulgated. The main 
change is that the Secretary has determined that SBA should not be 
involved in VA SDVOSB or VOSB status protests because these status 
protests are solely associated with title 38 SDVOSB and VOSB set-aside 
acquisitions where SDVOSB or VOSB status is to be determined by the 
Secretary pursuant to 38 U.S.C. 8127(f). On this basis, the Secretary 
certifies that the adoption of this final rule will not have a 
significant economic impact on a substantial number of small entities 
as they are defined in the Regulatory Flexibility Act, 5 U.S.C. 601-
612. Therefore, under 5 U.S.C. 605(b), this rulemaking is exempt from 
the initial and final regulatory flexibility analysis requirements of 
sections 603 and 604.

Unfunded Mandates

    The Unfunded Mandates Reform Act of 1995, at 2 U.S.C. 1532, 
requires that agencies prepare an assessment of anticipated costs and 
benefits before issuing any rule that may result in an expenditure by 
State, local, and tribal governments, in the aggregate, or by the 
private sector, of $100 million or more (adjusted annually for 
inflation) in any one year. This final rule will have no such effect on 
State, local, and tribal governments, or on the private sector.

Paperwork Reduction Act

    This final rule contains no collections of information under the 
Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3521).

Executive Orders 12866 and 13563

    Executive Orders 12866 and 13563 direct agencies to assess the 
costs and benefits of available regulatory alternatives and, when 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, and other advantages; distributive impacts; 
and equity). Executive Order 13563 (Improving Regulation and Regulatory 
Review) emphasizes the importance of quantifying both costs and 
benefits, reducing costs, harmonizing rules, and promoting flexibility. 
Executive Order 12866 (Regulatory Planning and Review) defines a 
``significant regulatory action'' requiring review by the Office of 
Management and Budget (OMB), unless OMB waives such review, as ``any 
regulatory action that is likely to result in a rule that may: (1) Have 
an annual effect on the economy of $100 million or more or adversely 
affect in a material way the economy, a sector of the economy, 
productivity, competition, jobs, the environment, public health or 
safety, or State, local,

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or tribal governments or communities; (2) Create a serious 
inconsistency or otherwise interfere with an action taken or planned by 
another agency; (3) Materially alter the budgetary impact of 
entitlements, grants, user fees, or loan programs or the rights and 
obligations of recipients thereof; or (4) Raise novel legal or policy 
issues arising out of legal mandates, the President's priorities, or 
the principles set forth in this Executive Order.''
    The economic, interagency, budgetary, legal, and policy 
implications of this regulatory action have been examined, and it has 
been determined not to be a significant regulatory action under 
Executive Order 12866. VA's impact analysis can be found as a 
supporting document at http://www.regulations.gov, usually within 48 
hours after the rulemaking document is published. Additionally, a copy 
of the rulemaking and its impact analysis are available on VA's Web 
site at http://www.va.gov/orpm/, by following the link for VA 
Regulations Published from FY 2004 to FYTD.

Catalog of Federal Domestic Assistance

    There is no Catalog of Federal Domestic Assistance number or title 
for this program.

Signing Authority

    The Secretary of Veterans Affairs, or designee, approved this 
document and authorized the undersigned to sign and submit the document 
to the Office of the Federal Register for publication electronically as 
an official document of the Department of Veterans Affairs. Jose D. 
Riojas, Chief of Staff, Department of Veterans Affairs, approved this 
document on March 2, 2015, for publication.

List of Subjects in 48 CFR Part 819

    Administrative practice and procedure, Government procurement, 
Reporting and recordkeeping requirements, Small businesses, Veterans.

    Dated: March 5, 2015.
Michael P. Shores,
Chief, Impact Analyst, Office of Regulation Policy & Management, Office 
of the General Counsel, U.S. Department of Veterans Affairs.

    Accordingly, VA adopts the interim final rule amending 48 CFR part 
819, which was published in the Federal Register at 78 FR 59861 on 
September 30, 2013, as a final rule without change.

[FR Doc. 2015-05505 Filed 3-9-15; 8:45 am]