Wisconsin Lt. Governor Barbara Lawton

Veteran businesses threatened

The American Legion criticized a recent shift in federal insourcing policy at its small business development conference during the 92nd National Convention in Milwaukee.

Joe Sharpe, director of the Legion's Economic Division, said the federal government is taking contracting jobs out of the private sector and making them government jobs, claiming that such a move will save money.

"We have yet to see a study that actually proves insourcing will save the federal government a significant amount of money," Sharpe said. "But what we are seeing is an immediate negative impact on the veteran-owned small business community."

By law, the federal government is required to provide 3 percent of its contracting dollars to businesses owned by service-disabled veterans. The standard set by the law, which has been on the books for a decade, has never been met.

"They're taking away the people with contracting and procurement skills, hiring them as federal employees, and leaving the smaller companies to go bankrupt," he said. "Basically, federal agencies are saying, ‘Come work for us. We'll make you a G-11 for doing the same job.'"

"When you take 30 or 40 positions away from a small business, you're essentially crippling their ability to succeed in the private sector," said Mark Walker, deputy director of the Legion's Economic Division. He cited one situation in Arizona where new federal insourcing policy is endangering five small businesses. One of them, Oak Grove Technologies, is owned by Mark Gross, a member of The American Legion Small Business Task Force.

According to Sharpe, three of the Arizona small businesses will probably shut down, and two others will be severely affected. "They'll probably close up shop and go somewhere else." Meanwhile, Sharpe says large defense contractors in the area such as Raytheon are hardly affected by insourcing policy because they have far more employees.

Several congressional staffers attended the Legion's two-day small business conference at the Hilton Milwaukee Center, Aug. 31-Sept. 1, including representatives from the House Veterans' Affairs Committee, and the offices of Sen. Mary Landrieu, D-La., and Rep. Nydia Velazquez, D-N.Y.

Walker said that while several members of Congress on both sides of the aisle have shown concern over the damaging effects of federal insourcing practices on small businesses, Velazquez is the only one taking lead in the matter. She is currently investigating the Arizona case, where five service-disabled, veteran-owned small businesses are threatened.

"The American Legion has been on Capitol Hill, trying to save these five particular veteran-owned companies," Walker said. "We want Congress to re-evaluate this particular contract and whether insourcing really needs to be done."

If insourcing has to be done, Sharpe said The American Legion wants to make sure it is done equitably and "not on the backs of small businesses.

"We're trying to generate interest from local representatives in Arizona to participate in a congressional review of the policy and its effects," Sharpe said. "But so far, Congresswoman Velazquez is the only member of Congress who is trying to do something about it at this point."

About 75 people attended the Legion's small business conference and listened to several speakers, including John Barry from the federal Office of Personnel Management, Wisconsin Lt. Gov. Barbara Lawton, Wes Stith of Clark Construction, and representatives from the Defense Logistics Agency, the General Services Administration and the Department of Veterans Affairs.


  1. Apparently Mr Guthrie feels that an organization is not doing anything unless they are doing the exact thing he wants then to do. This month a local post in my state is helping with a stand-down for homeless and underprivileged veterans, while at least two other posts are involved with yellow ribbon events for deploying troops headed for Afghanistan. The local posts are assisting the United Veterans Council with a remembrance ceremony for the victims of 911. National Headquarters of The American Legion has been active in support of Job Fairs, and the Legion Riders has raised over half a million dollars for the Legacy Scholarship Program for the children of Fallen Warriors. The American Legion is 2.5 Million members. What they do is what the legion does. Mr Guthrie should become more active. Elmer Palmer USMC 1962-1988
  2. There is no organization that has done more to promote the interests of SDVOB's. I would suggest,before you make a blanket statement, that you look at the facts. Many Congressional reps that tout their "support the troops" have been reticent to change the system that favors their core constituent groups ...and they are not Veterans. Moses came down from the Mountain with the TEN Commandments and not the TEN suggestions. Until there is a real MANDATE...not a goal...not a target objective....or some other self serving innocuous meaningless obfuscating bureaucratic catch phrase for not insuring that 3% of these contracts go to SDVOB's, then Veterans business interests will continue to be threatened and eroded. "You will" expects results.In the military when a commander fails to meet his assigned objectives he is replaced. Until those responsible for meeting these objectives are accountable and held to be responsible this will be an exercise in futility. Ask your Congress Rep WHY?
  3. I have requested numerous times that the American Legion help getting Veteran owned businesses included in the governments Affirmative Action 8a program which gives preferential treatment to certain groups of people such as North Vietnamese, North Korean, Cubans, etc. To date I have not received a reply. Therefore I will not renew my membership in the A.L. I am not going to donate any money to any veterans organizations that do not actually support veterans. If and when you ever decide to get your lazy butts off the barstool and actually do something to help veterans, I may again consider financially supporting the American Legion. Larry Guthrie USN 1971-1975
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