1. Problem:
Paragraph 1896.81 (a) (1), Eligibility for DVBE Certification reads as follows:
(a) The DVBE applicant shall, pursuant to the requirements of Military and Veterans Code 999 and 9992., meet all the following qualifying criteria: (1) DVs shall have at least a 10 percent service-connected disability and domiciled in California.
This current wording of Paragraph 1896.81, Section (a) (1) above actually restricts and therefore hurts the ability of a California Disabled Veteran Business Enterprise (DBVE) to grow, expand, generate revenues, etc. For example, if a disabled vet wants to own part of the 51% of a DVBE company that gives that company its DVBE status and that disabled vet is ready, willing, and able to infuse substantial capital into the company or bring in substantial business, that disabled vet is unable to do so if he/she is not domiciled in California. Other states, copying California in putting a DVBE special category into place, have realized that this domicile requirement is a mistake and have not made this restriction part of their DVBE regulation when copying or emulating California’s DVBE regulation (Thirty (30) states now have regulations for DVBE owned and operated companies). For example, states like New York and Illinois only require that the DVBE company maintain a “business presence” in the state, e.g., an office, as a requirement for DVBE certification. A requirement such as this contributes to the state economy without restricting the ability of the DVBE company to bring in additional capital, expand business, grow the company, etc., by having the restriction that all disabled vet owners be domiciled in the state.
2. Solution proposed by the USVBA Legislative Committee
The proposed solution is to add seventeen (17) more words to Paragraph 1896.81, Eligibility for DVBE Certification, Section (a) (1) so that it reads as follows: “DVs shall have at least 10 percent service-connected disability and domiciled in California or maintain a business presence in California that can provide evidence of financially supporting the California economy.”
a. This would bring the California DVBE regulation into line with the DVBE regulations of most of the states that designate DVBEs as a special category.
b. The Certification Unit, Office of Small Business & DVBE Services, Department of General Services, could create the criteria to provide proof of a business presence in California that can provide evidence of financially supporting the California economy (e.g., office lease, rent payment receipts, business license, etc. The USVBA Legislative Committee could work with the Certification Unit to establish the criteria.).
3. Help needed from the USVBA members and Instructions:
The USVBA Legislative Committee has decided that the best way to submit this proposed change is to present it to a California legislator who is vet business friendly along with USVBA Petition asking for the change in the regulation that is supported by at least one hundred (100) USVBA members who have electronically signed their names in support of the USVBA Petition asking for the proposed change.
FOR A USVBA MEMBER TO ELECTRONICALLY SIGN HIS/HER NAME IN SUPPORT OF THE USVBA PETITION ASKING FOR THE PROPOSED CHANGE, ALL THAT IS REQUIRED IS THAT THE USVBA MEMBER COMPLETELY FILL OUT THE BLANKS IN THIS SECTION AND THEN PRESS THE SUBMIT TAB. THIS WILL AUTOMATICALLY ADD YOUR NAME TO THE USVBA PETITION.
4. Feedback
Since feedback, questions, comments, etc., are always welcomed from USVBA members, to do so, just email these to Elton Johnson, USVBA Legislative Committee, email is [email protected] If we can post some of these along with responses, we will do so. This will serve as sort of a FAQ Section for this particular proposal.
5. Pertinent Contacts
Elton Johnson is ISVBA Legislative Committee member in charge of state matters. His email address is [email protected]
6. Current Status
We are now at the point where we need support from the USVBA membership in the form of electronic signatures submitted to be added to the USVBA petition requesting this change in the California DVBE regulation.
We need at least ONE HUNDRED (100) signatures to be taken seriously. We also need any advice or suggestion on which California legislator is very vet business friendly so that we can approach him/her to request help in getting this regulation changed.
Elton Johnson, Jr., currently serves as a USVBA Director. He is on the USVBA Legislative Committee serving as the Head of the State Legislation Section. His civilian job is Chief Executive Officer for AmeriVet Securities, Inc., one of the few broker-dealers that is certified as both a Service-Disabled Veteran Owned Business (SDVOB) and a Minority Business Enterprise (MBE). He is a disabled combat veteran and a decorated Lieutenant Colonel in the US Army Retired Reserves having received the Bronze Star Medal, the Defense Meritorious Service Medal, and the US Army Combat Action Badge for combat service in Iraq and Afghanistan.