PREPARED REMARKS OF MR. SCOTT F. DENNISTON
DIRECTOR SADBU
DEPARTMENT OF VETERANS AFFAIRS
BEFORE THE HOUSE COMMITTEE ON SMALL BUSINESS

February 17, 2004

It is a pleasure to be here today on behalf of the Secretary of Veteran Affairs (VA), the Honorable Anthony J. Principi. VA has a long history of supporting small business and particularly minority-owned small businesses in our acquisition program. We will continue to do so consistently with the equal protection guarantees of the Constitution. We will consistently exceed the legislative goals for awards to small business and small disadvantaged businesses including 8(a) businesses. We achieve the 3 percent HUBZone goal. Secretary Principi is personally committed to achieving all of VA’s small business goals and understands the importance of small businesses to this nation’s economy. He began working in his father’s small business at an early age. The challenge for VA is one of supporting all small business programs, providing the American public the best government possible for their tax dollars, while most importantly provide veterans with the best healthcare, benefits, and dignified burials we possibly can with the resources available.

The Office of Small and Disadvantaged Business Utilization (OSDBU) was created by Public Law 95-507. The primary purpose of the office is to promote maximum practicable opportunities for small businesses to participate in the Department’s purchases at both the prime and subcontract levels. To accomplish this, OSDBU is responsible for the development of Department-wide policies, programs, and practices relating to small business concerns. This includes educating and training VA staff, negotiating prime and subcontracting goals with contracting activities, monitoring achievements, and managing information system reports to VA executives. OSDBU advises contracting officials on procurement strategies to ensure equitable opportunities for small business concerns, conducts market research to identify small business sources for competitive actions, and reviews and approves procurements to assist concerns in the Small Business Administration’s business development programs.

You asked that VA address two areas this morning: access to capital for small businesses, especially the need of African-American and other minority-owned small businesses in the Chicago area, and efforts to assist small businesses in finding real federal procurement opportunities, and recommendations for improvement. I will address my comments to federal procurement opportunities. We hear from small businesses, particularly veteran small businesses constantly about the difficulties in accessing capital but as you know this is not our field of expertise. VA does not have statutory authority to make small business loans.

Although we are pleased with our support of the small business community we know that obstacles still exist and we work hard to help make small businesses successful in VA acquisition. We know we cannot be successful without effective partnering with small business.

Understanding how to gain access to information is critical to small business success. Each month we hold vendor counseling sessions which include contracting and program officials to provide small businesses access to information. We have a robust web site at www.va.gov/osdbu/ which contains points of contact for small business at each VA facility, a subcontracting directory of prime contractors with subcontracting opportunities, an extensive Forecast of Contracting Opportunities which can be updated throughout the year, and links to other web sites which can assist small businesses. We are active in outreach events participating in over 100 small business conferences around the country each year.

The very best resource available to small businesses interested in doing business with the Federal government are the Procurement and Technical Assistance Centers (PTACs). PTACs are non profit organizations that are partially funded by the Department of Defense with the balance of their funding coming from various resources such as state, county and local governments as well as colleges and universities. There are 93 PTACs around the country. Their sole purpose is to teach the local businesses ( mostly small businesses, including minority small businesses) how to do business with the federal, state and local governments, but particularly the Department of Defense. VA works very closely with the PTACs so that small businesses working with VA are aware of these resources.

We also work closely with the Small Business Development Centers to ensure that small businesses know of the resources available to train them in business development issues such as marketing, financial planning and management growth. Small businesses do not take advantage of these services to the maximum extent possible.

VA is committed to supporting the Administration’s antibundling initiatives. Bundling has impeded small business ability to compete. We expect to have implementing instructions to field facilities by March, 2004.

Since the passage of Public Law 106-50, the Veteran Entrepreneurship and Small Business Development Act of 1999 and the establishment of 3 percent government-wide goal for participation by small businesses owned and controlled by service-disabled veterans in federal contracting and subcontracting. VA has worked hard to assist those firms navigate the federal market place. In 2000 we established the Center for Veteran Enterprise (CVE) for this purpose. The CVE touches approximately 8000 veterans a month with information on starting and financing a small business, and breaking into the federal market place. We do an annual mailing to approximately 50,000 veteran-owned small businesses telling them of services available through VA, the Small Business Administration, Department of Labor and the Veterans Business Development Corporation. We have established a data base of veteran-owned small

businesses to assist Federal agencies and prime contractors meet their veteran small business goals. We have sponsored outreach conferences around the country with several agencies, including GSA, DOT and SBA, large businesses prime contractors, Small Business Development Centers and Procurement and Technical Assistance Centers. We have also established private sector initiatives to assist veterans with the International Franchise Association and Operation Hope.

With the recent passage of Public Law 108-183, the Veterans Benefits Act of 2003, providing set-aside and sole source authority for service disabled veteran-owned businesses we are confident this well deserved group of small businesses will also be successful in Federal procurements.

I will be happy to answer any questions.