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GAO to VA: There’s No Loophole to Avoid Your Obligation to Vets

Yesterday, the Government Accountability Office (GAO) confirmed that the U.S. Department of Veterans’ Affairs (VA) cannot circumvent its statutory mandate to set aside contract work for veteran-owned small businesses by sneaking the opportunity through the Government Publishing Office (GPO). Veterans4You, Inc., B-417340.1, B-417340.2.

That’s the “legal” way of putting what just happened. The narrative way of explaining it is far more interesting, and as the attorney who handled this case, this was one of the most colorful and frustrating issues I’ve handled. As such, I’m taking to my blog, while noting that my client, Veterans4You, Inc. gave me complete liberty in presenting this tale.

First off, does a suicide gunlock for veterans sound like “printing” to you? No? What if the gunlock also includes an imprint of the Veterans Crisis Line Logo? Still no? Okay, just checking.

When Mr. Tim Farrell, the owner of Veterans4You, contacted me in mid-February and explained his issue with a solicitation issued by the GPO, I had trouble following the details because they simply didn’t make sense. The VA was procuring suicide gunlocks for veterans, yet running the contract through the GPO because it claimed that slapping a logo on the gunlocks qualified the procurement as involving “printing.” (Under a “printing mandate,” executive agencies have to obtain things like handbooks, pamphlets and flyers through the GPO. As such, the VA/GPO was/were arguing that the VA had to use the GPO to meet this need. Then, because it was no longer a VA solicitation, Kingdomware didn’t apply).

The opportunity was issued as an Invitation for Bids with a very quick turnaround (approximately a week), and the bids were due the next day at 10:00 AM. I told Tim that if he wanted to protest, we had to do it now, or otherwise we’d lose the opportunity. (If you’re protesting the terms of a solicitation, violation of a federal regulation, or other irregularities in conducting a procurement, you have to do it before bids are due). He said “sure,” noting this wasn’t the first time the VA had used the GPO for questionable “printing” requirements.

One basis of our protest was violation of the Kingdomware mandate, which is that, when a contracting officer has a reasonable expectation that two or more responsible veteran-owned small businesses (or service-disabled veteran-owned) will make an offer, and that the contract can be awarded at a fair and reasonable price that offers the best value to the government, the agency has to set aside the work for these veteran companies. 38 U.S.C. 8127(d). This is also known as the Rule of Two under the Veterans Benefits Act (VBA); this mandate was solidified at the U.S. Supreme Court in 2016 after a long and protracted battle in lower courts and forums.

Here, though, I wondered how the GAO (the forum where we were protesting) would address this argument, considering that this was not a “VA” procurement. It had been issued by the GPO. There are plenty of cases out there that say that Kingdomware and this “Rule of Two” does not apply to a non-VA procurement.

However, this effectively was a VA procurement. The VA was acquiring the supplies. And they were suicide gunlocks for veterans, work which the VA incomprehensibly wanted to take away from veteran business owners.

After our protest was filed, I thought the VA (through the GPO) would take corrective action. Again, suicide gunlocks for veterans.

It didn’t. We went through several rounds of briefing, during which I argued that even though Kingdowmare applies only to VA procurements, this was in fact a VA procurement and the VA shouldn’t have run the work through the GPO in the first place because a suicide gunlock that happens to have a logo is a far cry from “printing.” (And what next? If the VA is allowed to call a gunlock “printing” just because it bears a logo, imagine what else it can squeeze through the GPO).

Yesterday, or June 3, the GAO confirmed that the VA cannot use other agencies to circumvent its mandate to set aside work for veteran-owned small businesses. The decision, which addressed only the Kingdomware issue, found that even if the VA is using another agency to acquire services or supplies, it must adhere to the Rule of Two (which will trump other statutes or provisions). Accordingly, even if the printing mandate did apply and this was a GPO procurement, Kingdomware still applied.

Also, under 38 U.S.C. 8127(i) (another part of the VBA), if the VA enters into an agreement to obtain services via another governmental entity, it is required to include “a requirement that the entity will comply to the maximum extent feasible, with the [Rule of Two] to the maximum extent possible in acquiring such goods or services].” There was no evidence in the record that the VA did anything of the sort.

The decision did not address whether this requirement should have even gone through the GPO as “printing work,” noting that because Veterans4You won on the Kingdomware issue, this analysis was not necessary. Because the GPO is subject (or not subject) to certain requirements, this therefore leaves the door open for the VA to continue to procure items dubiously labeled as “printwork” through the GPO for reasons other than circumventing Kingdomware.

As a veteran attorney and advocate, this case baffled me. The VA not only has a statutory duty to award to veteran-owned businesses, but this is the Department of Veterans Affairs. It should want to provide work to capable veteran business owners, and especially given the procurement at issue, it makes no sense that it took such strenuous efforts to avoid following its mandate. (And it didn’t even have to do it! It just had to do the work to see if the Rule of Two applied! If it couldn’t make the award at a fair and reasonable price, it wouldn’t have to set the contract aside for veterans). Every day, I expected a notice that the VA would take corrective action and comply with Kingdomware, and it never came.

And then, the decision did. So now, it is publicly affirmed that the VA cannot use the GPO (or another agency) to avoid the Rule of Two by taking a procurement out of its own hands. Another veteran victory in the Kingdomware war.

Access the full decision HERE.

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