Issue: What type of managerial experience does a Veteran need to have? How is the “extent and complexity” of managerial experience determined?
(b) “…An applicant or participant’s management and daily business operations must be conducted by one or more Veterans or service-disabled Veterans. Individuals managing the concern must have managerial experience of the extent and complexity needed to run the concern. A Veteran need not have the technical expertise or possess a required license to be found to control an applicant or participant if he or she can demonstrate that he or she has ultimate managerial and supervisory control over those who possess the required licenses or technical expertise. However, where a critical license is held by a non-Veteran having an equity interest in the applicant or participant firm, the non-Veteran may be found to control the firm.
“…for a concern to qualify as an SDVOSB, “…Individuals managing the concern must have managerial experience of the extent and complexity needed to run the concern. A Veteran need not have the technical expertise…if he or she can demonstrate that he or she has ultimate managerial and supervisory control over those who possess the…technical expertise…” 38 CFR § 74.4(b). The LLC’s website states that, “[o]ur primary expertise is the supply of clothing and textile products to the federal government as well as the private sector on an international scale.” According to the service-disabled Veteran’s résumé, he has experience as an education benefits counselor with the Department of Veteran Affairs and as a Sales Representative at a car dealership. His military service is unrelated to the clothing industry. However, the résumés for the two non-Veteran owners indicate that they each have substantial years of experience in the clothing industry. Based upon the documentation submitted, CVE cannot reasonably conclude that the service-disabled Veteran has the ultimate managerial and supervisory control over the much more experienced non-Veteran owners as is required by 38 CFR § 74.4(b).
“…according to 38 CFR § 74.4(b), “[i]ndividuals managing the concern must have managerial experience of the extent and complexity needed to run the concern.” The applicant business is a newly formed construction business. The résumé for the service-disabled Veteran shows he is the current Owner/CEO of the applicant and that he was previously an elementary school teacher from 2006-2012. From 2009-2011, the service-disabled Veteran owned and operated his own catering business and was enlisted in the U.S. Air Force from 1998-2003 as a Fire Protection Crew Chief. The service-disabled Veteran holds a Bachelors Degree in Education. The Veteran has not provided adequate explanation as to how his prior work experience and educational background would prepare him to manage a construction business on a day-to-day basis. Therefore, the application provided by the service-disabled Veteran does not reflect the necessary experience needed to satisfy the control requirement of 38 CFR § 74.4(b).
This information has been provided by CVE for general informational purposes and should not be construed as providing legal advice. You should contact your attorney to obtain advice with respect to any particular issue or problem. In addition, CVE makes no representation as to the accuracy or whether the above information is currently up-to-date. All applicants must read the applicable regulations and determine how best to meet these requirements. The Verification Assistance Briefs do not constitute legal notice or replace the regulations.