Office of Public and Intergovernmental Affairs

Remarks by Secretary Eric K. Shinseki

National Veterans Small Business Training Symposium and Exhibition
St. Louis, MO
August 8, 2013

Tom, thank you for that kind introduction and, more importantly, thanks for your leadership of our veteran-owned small business initiatives, including this one.

My thanks, as well, to:

• Rhett Jeppson—Associate Administrator for Veterans Business Development at the Small Business Administration;
• All the procurement officials who joined us this week—49 of them from 25 non-VA federal agencies;
• The VSO's—American Legion, AMVETS, Disabled American Veterans, Paralyzed Veterans of America, Veterans of Foreign Wars, and Vietnam Veterans of America;
• IVMF—the Institute for Veterans and Military Families at Syracuse University;
• The Bob Woodruff Foundation—the grants enabling 100 Veteran-entrepreneurs to be here to train and to network this week were magnificently generous;
• VA colleagues; fellow Veterans; distinguished guests; ladies and gentlemen.

This week's annual training symposium and exposition was designed to do one thing—help you succeed in business by providing you access; by creating a dynamic, learning laboratory; and by enabling you to network, real-time, with key decision makers.

First, access: You were provided unprecedented access to key government and commercial procurement decision makers. More than 400 federal procurement officials from across government—through whom goods and services are acquired—and more than 30 large, commercial firms that came here seeking to do business with Veteran-owned companies.

Access also meant providing you the latest information, policies, and procedures for doing business in the federal and commercial marketplaces. In short, this was intended to be a venue unlike any other, a truly unique opportunity for establishing your stance in the buyer-supplier arena. Handshakes are important, and this was your opportunity to engage decision makers.

Our second objective was to design this training symposium as a learning laboratory for teaching the fundamentals of:

• Navigating the federal and commercial acquisitions processes;
• Building a start-up;
• Surviving the critical first years;
• Expanding your business;
• Writing proposals that bring in contracts;
• Managing growth, and increasing your competitive edge.

Third, and most importantly, this symposium was designed as a premier networking experience. More than just establishing business contacts, it was an opportunity to work at creating those high-payoff collaborations that win contracts. "Teaming" to pool expertise and experience has been the more powerful contracting strategy, but it takes effort to find the right partners who have talent and are willing to invest in a partnership. Well, this was your week for courting likely collaborators—and getting a look at the competition.

More than just an "observe and advise" exercise, we wanted to get you to the graduate level in business entrepreneurship. We push you to be at your best because we have a vital interest in your business and financial successes.

Small businesses are crucial to our economy—they represent over 99% of all employer firms in the country. Success of Veteran-owned small businesses means employment for others, especially other Veterans. Why? Because Veterans hire Veterans. They know what they are getting: mission focus, discipline, experienced team players, a strong work ethic, and tough, "can-do" attitudes.

The other reality is that, today, less than 1% of our population serves in uniform. Veteran employment rates for younger Veterans are headed up; that's a very good thing. But there are still simply not enough Veteran small business owners to hire Veterans who need jobs, and mentor others, like yourselves, who dream of owning their own businesses.

You have no greater champion in realizing that dream than the President and the First Lady. President Obama has said many times: "Veterans who fought our wars should not have to fight for jobs." His goals are repeatedly reflected in his State of the Union addresses, in the tax incentives he has made available to businesses that hire unemployed Veterans, and in allowing us to conduct training symposiums, like this one, which are designed to hone your competitive skills, knowledge, and attributes.

For more than four years, I have witnessed, firsthand, his staunch and unwavering advocacy for our Nation's service members, Veterans, and their family members. The President knows that Veterans, including those dealing with issues like PTS, PTS-D, TBI, and even depression, are not damaged goods. He knows that what Veterans need are jobs, education, and quality healthcare—the things which give them a legitimate shot at joining the middle class so they can help rebuild our economy. You can help us here with jobs.

Let me touch on the healthcare law that's about to go into effect. Veterans have put their lives on the line for this country, and deserve to know and understand what this law means and what choices they have. Six key points:

1. The law was designed to provide healthcare for as many Americans as possible;
2. VA wants all Veterans to receive quality care that improves their health and well-being—they earned it;
3. All Veterans currently enrolled in VA healthcare do not have to take any additional steps. VA care meets the new law's standard;
4. Veterans not currently enrolled in VA healthcare can apply at any time. I encourage you to give us a good look. You won't be disappointed;
5. Veterans and family members who are not eligible for VA healthcare, and who do not have health insurance through their employers, should use the new Marketplace to get coverage under the law;
6. Ensuring that Veterans receive quality healthcare is a fundamental obligation for VA, and we intend to help Veterans understand their options as the new healthcare law is implemented later this year.

All of us here this week have a contribution to make in helping rebuild a vibrant middle class for our country, with Veteran-entrepreneurship as the centerpiece of our efforts. We are vitally interested in helping you compete in business, in general, and for federal contracts, in particular, because as you "grow" your businesses, you become a catalyst for creating jobs, enabling other Veterans to support their families, buy homes, and invest in the future of our country.

The customers you've met this week, both federal and commercial, simply want to obtain the best value and quality for their purchases, and to buy those goods and services with little bureaucratic overhead—time is money. One-in-four attendees, responding to our survey, reported they had won a contract award as a direct result of last year's symposium. Our goal is to up that number this year, so my staff will be scheduling a follow-up meeting with each of the businesses they've made contact with this week. We're ready to do business. I'm sure you are, as well.

As the 4th largest contracting agency in government—after Defense, Energy, and Health and Human Services—VA purchased over $17.5 billion in services, materiel, and supplies in FY 2012—everything from medical and IT equipment to construction services and grave markers. Thirty-five percent, or $6.1 billion, went to small businesses—and more than $3.8 billion specifically to Veteran-owned small businesses. Of that amount, $3.8 billion, $3.4 billion went to service-disabled Veteran-owned small businesses. For the past five years, VA has spent more through service-disabled, Veteran-owned small businesses than all other federal civilian agencies combined. This improved performance results from:

• Expanding of our Office of Small & Disadvantaged Business Utilization;
• A results-oriented programming strategy;
• Beefed-up partnerships;
• Networking events like this one, and;
• Leader responsibility for specific small business goals. Every VA senior executive's performance evaluation includes a small business metric.

Our Veterans First program demonstrates VA's commitment to Veteran-owned small businesses. Since 2008, this program has given you contract priority over any other class of small business, and we are committed to protecting this Veterans' advantage.

In 2007, only 10% of VA's procurement dollars went to Veteran-owned small businesses. By FY 2012, that figure had more than doubled, to 21.8%--well beyond the federal goal of 3%, and even beyond our own stretch-goal of 12%. We are on track to exceed our goals, once again, in FY 2013. We are now beginning our discussions with the Small Business Administration regarding FY 2014 goals, and we intend to keep VA at the forefront in Veteran contracting.

Verification is our most important tool for safeguarding the Veterans First program for eligible Veteran-owned small businesses. As many here know, this has been a bit of a forced march to implement Congress' mandate and best serve our eligible Veterans. We have resolved most of our start-up challenges by fielding over the last 18 months:

• A verification education program;
• An on-line application system;
• A simplified renewal process;
• An expanded help desk, and;
• Web-based guides, information, and assistance.

Today, we offer counseling on verification and renewal processes in partnership with the VSOs and the procurement technical assistance centers—more than 100 counselors in all. And we continue to make the process more agile and user-friendly.

In May, we launched our new Pre-determination Findings program, designed to reduce denials by identifying and giving companies the opportunity to correct easy-fix findings on their applications prior to receiving a final determination letter. This initiative significantly increases your chances for approval to participate in the Veterans First program.

In the past year-and-a-half, the average processing time for an initial verification application dropped from 130 days to 30 days, while the approval rate rose from 58% in 2012 to 84% today. More than four-out-of-five businesses that use the Verification Assistance program, receive approval on their first submission. Similarly, the processing time for requests for reconsideration decreased from more than 140 days to less than 60 days last month—and the approval rate increased from 49% to 62%.

We recognize that the regulation itself poses challenges for Veteran-owned small businesses. So, we've harmonized our regulation with SBA's Service-Disabled Veteran-Owned Small Business regulation, and are looking at ways to improve it.

In May we published an advance notice of proposed rulemaking to solicit your recommendations to further streamline the Verification program; improve regulation clarity; and, encourage more businesses to apply for verification.

We received a number of comments that will influence the draft of the Proposed Rule, which is now underway in consultation with SBA. We intend to publish it for comment by May 2014. That will be your opportunity to help us design what works best for you.

Verification protects Veteran business owners. Every contract going to a company that is not verifiable means lost business and lost revenue for legitimate Veteran business owners. We will continue to aggressively pursue those who falsely claim Veteran-owned business status or use their Veterans' status to front for non-Veteran-owned businesses. As I've said before, "For those who choose to ignore the rules, there will be consequences." Our Center for Veterans Enterprise will be conducting more than 1,000 post-verification audits in 2014, in the effort to protect the preferential procurement opportunities for legitimate Veteran-owned businesses.

In the same vein, our Subcontracting Compliance Review Program was established two years ago to review the performance of prime contractors in meeting their subcontracting targets for Veteran- and service-disabled Veteran-owned small businesses. Our compliance reviews, so far, show that the majority of VA contractors are taking meaningful steps to comply with our standards. Our review program will continue to ensure that prime contractors provide meaningful opportunities for subcontractors—and investigate when they do not. For VA, the "bottom line" in serving Veteran-entrepreneurs is maintaining the integrity of our contracts with them.

For the past several years, I've highlighted VA's IT strategic sourcing initiative and how Veteran-owned businesses can compete as part of VA's T-4 program—Transformation Twenty-one Total Technology, T-4 This past year, more than 60% of the awards under this contract went to Veteran-owned small businesses.

At VA, rapid advances in technology—and our increasing reliance on it—have been dramatic. President Obama's 2014 budget request includes a record-breaking $3.68 billion for our IT requirements, reflecting its vital role in our daily work. For those of you in technology services, this is an opportunity to explore.

Entrepreneurs like you have historically formed the bedrock of our economy. America's stories are written by the do-ers—those innovators and risk-takers who see possibility, seek opportunity, resist handwringing, remain fixed on their goals, and overcome the barriers to progress by working long and hard to achieve their dreams. You are the next chapter in that ongoing story. Dream big dreams for all of us.

We wish you success in your businesses. It is not a matter of "if" you succeed, but "when" you succeed, hire Veterans. That's the return on investment for our having underwritten this training symposium and exposition. Like you, other Veterans are looking to make a contribution. They, too, deserve that chance to join the middle class and achieve their dreams. That's my ask of you today. Help us rebuild the middle class—with Veteran-entrepreneurs as its centerpiece.

God bless the men and women who serve, and have served our Nation in uniform. May God continue to bless this wonderful country of ours. See you all next year! Thank you.

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