Service Disabled Veteran Owned Small Business Relief Act

Floor Speech

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Mr. McNERNEY. Mr. Speaker, first, I want to thank Chairman Wenstrup and Ranking Member Takano for their continued work on behalf of our Nation's veterans and for bringing these commonsense bills to the floor today.

Small businesses are the economic drivers in our communities, and we must give them opportunities they need to grow and prosper. Veteran entrepreneurs, in particular, are some of the most apt at starting, managing, and growing small businesses.

In the United States, there are about 5 million veteran-owned businesses and an estimated 500,000 service-disabled veteran-owned small businesses. A service-disabled veteran-owned small business is one that must be at least 51 percent directly owned and controlled by one or more service-disabled veterans.

The Federal Government established procurement contracting goals for small businesses in 1978 and set aside 3 percent of the total value of all Federal contracts for veteran-owned small businesses. Although some Federal agencies meet these goals, there are no penalties for not meeting the 3 percent small business procurement goal. The VA is diligent, on the other hand, in meeting this goal.

Under current law, if a veteran who was rated 100 percent disabled and owned a service-disabled veteran-owned small business passes away, the surviving spouse has 10 years to transition the business away from service-disabled veteran-owned small business status for contracts that the company has with the VA.

However, if the veteran businessowner was rated at less than 100 percent disabled or dies of a nonservice-connected injury, the surviving spouse has only 1 year to transition the business for contracts with the VA.

Unfortunately, this is not enough transition time for service-disabled veteran-owned small businesses whose owner passes away and was rated at less than 100 percent disabled to reposition the business, putting many service-disabled veteran-owned small businesses at a disadvantage. We need to correct this deficiency in the law.

That is why I introduced H.R. 1313, the Service Disabled Veteran Owned Small Business Relief Act. My bill allows the service-disabled veteran-owned small business, whose principal owner passes away and was rated at less than 100 percent disabled at the time of death, with a reasonable 3-year transition period from service-disabled veteran-owned small business status with the VA.

It is only right that we provide our heroes and their families and the employees with flexibility and certainty to ensure their businesses continue to thrive. The loss of a veteran businessowner is already tragic enough for their families and can put service-disabled veteran-owned small businesses at severe risk of closing or downsizing because of the loss of Federal contracts.

H.R. 1313 is supported by the Paralyzed Veterans of America, AMVETS, Veterans of Foreign Wars of the United States, The American Legion, and Iraq and Afghanistan Veterans of America. In addition, the VA said, at a subcommittee hearing on March 24 of this year, that the bill is a reasonable approach.

I hope that my colleagues will join me in passing this commonsense bill and support veteran-owned small businesses across the country.

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