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Acquisition Policy Flash! 16-20

What's Changed?

Implementation of the Veterans First Contracting Program as a Result of the U.S. Supreme Court Decision

Purpose:  This Acquisition Policy Flash notifies the acquisition workforce of revised policy and procedures to fully implement the Supreme Court decision in Kingdomware v. United States decided June 16, 2016.  Acquisition Policy Flashes 16-15 and 16-16 provided transition guidance and are incorporated in the revised policy and procedures and therefore rescinded.

This Acquisition Policy Flash distributes a Class Deviation with Attachments 1-11 and a Procurement Policy Memorandum (PPM) both titled—Implementation of the Veterans First Contracting Program as a Result of the U. S. Supreme Court Decision.  The class deviation and the PPM with attachments revise the Veterans Affairs Acquisition Regulation (VAAR) and procedures and guidance for the acquisition workforce to fully implement the Veterans First Contracting Program granting preference to verified Service-Disabled Veteran-Owned Small Businesses (SDVOSBs) and Veteran-Owned Small Businesses (VOSBs).

Effective Date:  Immediately

Expiration Date:  In effect until incorporated into the Veterans Affairs Acquisition Regulation (VAAR) or Veterans Affairs Acquisition Manual (VAAM) or otherwise rescinded.

Background:  On June 16, 2016, the U.S. Supreme Court reversed a lower court decision on the VA Veteran-owned small business contracting program.  Generally, the Court ruled that consistent with Public Law 109-461 (38 U.S.C. 8127 and 8128), the VA shall award contracts based upon competition restricted to SDVOSBs or VOSBs when a contracting officer has a reasonable expectation, based on market research, that two or more firms listed as verified in Vendor Information Pages database are likely to submit offers and an award can be made at a fair and reasonable price that offers best value to the United States.  This is known as the “Rule of Two.”  The Supreme Court’s major holdings were:

  • “…the Rule of Two contracting procedures in [38 U.S.C.] §8127(d) are not limited to those contracts necessary to fulfill the Secretary’s goals under §8127(a).”
  • “We also hold that [38 U.S.C.] §8127(d) applies to orders placed under the [Federal Supply Schedules] FSS.”

VA seeks to ensure the Department can effectively procure goods and services for Veterans in a timely manner while being good stewards of taxpayer dollars and meeting legal requirements.

Action Required:

To implement the policy, procedures and guidance in Class Deviation and PPM both titled—Implementation of the Veterans First Contracting Program as a Result of the U. S. Supreme Court Decision, Heads of Contracting Activities, contracting officers, and other members of the acquisition workforce will comply with the attached PPM and Class Deviation.

Additional Information:  HCA’s shall review and revise internal or local policy and/or procedures that may not be consistent with the PPM and the Class Deviation.

Please ensure all members of the VA Acquisition Workforce are provided copies of this Acquisition Flash and the attached PPM, Class Deviation, and Decision Tree Tool.

Direct questions or concerns to the Procurement Policy and Warrant Management Service via email at or telephone at (202) 632-5288.