Casey: Defense Department Missing Contracting Goals for Veteran-Owned Small Businesses; Immediate Reform Needed

Casey Calls On Defense Secretary to Immediately Reform DOD Contracting Procedures So More Veteran- Owned Businesses Can Compete for Defense Projects

WASHINGTON, DC – U.S. Senator Bob Casey (D-PA) has called on Defense Secretary Leon Panetta to immediately reform a program that was designed to award 3% of all Department of Defense contracts to small businesses owned by disabled veterans, but is falling well short of its goals.

An executive order created the Service Disabled Veteran Owned Small Businesses program (SDVOSB), which directed federal agencies to award 3% of all contracts to small businesses that are owned by disabled veterans. Over the last decade federal agencies across the government have made progress toward the goal, yet the Department of Defense is still awarding only 1.82% of all contracts to such businesses.

“All across the country and in Pennsylvania, businesses owned by our wounded warriors are open for business, so it’s time for the Defense Department to open its doors to them,” Senator Casey said. “Awarding more defense contracts to small businesses owned by our disabled veterans will boost Pennsylvania’s economy and help our nation’s heroes adjust to life at home.”

In 2004, Executive Order 13360 directed that at least 3 percent of the federal government’s contracting dollars go to businesses owned by service-disabled veterans. Nearly a decade later the Department of Defense is falling well short of the executive order’s goal. In fact, only 1.82% of Defense Department contracts are awarded to small businesses that are owned by disabled veterans. In his letter, Senator Casey called upon Secretary Panetta to immediately reform the program so that more of our wounded warriors can successfully compete for Defense Department projects.

The full text of Senator Casey’s letter to Secretary Panetta can be seen below:

Dear Mr. Secretary,

I write to urge the Department of Defense (DOD) to take all necessary steps to fulfilling its Service Disabled Veteran Owned Small Businesses (SDVOSB) contracting goals.  It has come to my attention that the DOD failed to reach its goal of awarding 3 percent of all contracts to service disabled veterans in 2010.   Our veterans who have served and protected our Nation deserve to have equitable participation in the federal procurement process. 

The 2010 scorecard issued by the Small Business Administration that grades each agency on its contracting record revealed that the DOD failed to achieve its 3 percent goal for contracts awarded to SDVOSB.  While I recognize that the 1.82 percent achieved by the DOD for SDVOSB contracting is higher than previous years, not meeting the 3 percent goal represents a loss of over $3 billion in contracts that were not awarded to service disabled veterans.  Furthermore, I have been informed that 2010 marks the tenth consecutive year that the DOD has failed to achieve its 3 percent goal.  

It is disheartening that the DOD continues to fall short of its contracting goals for service disabled veterans.  If the DOD does not make doing business with veterans a top priority, it sends a signal to other government agencies that it is acceptable to not meets its contracting goals with SDVOSB. 

I respectfully request information regarding steps the Department is taking to meet its SDVOSB contracting goals.  Thank you for your attention to this important matter.


Robert P. Casey, Jr.

United States Senator