Veteran Entrepreneurs Reveal How VA Funding Cuts Have Devastated Their Businesses

Robert Betters, a former Air Force logistician, recently faced a tough blow when the Department of Veterans Affairs (VA) canceled several of his contracts. This sudden decision cost his company, RB Consulting, Inc., a staggering 50% of its revenue and led to the layoff of 45 employees, many of whom are veterans themselves.

For over 20 years, Betters has been using his logistics expertise to help the VA and other agencies manage their supply chains and IT needs. Just last week, seven of his contracts were wiped out as part of a $2 billion budget cut ordered by the new VA Secretary, Doug Collins. Despite this setback, Betters expressed understanding towards the government’s shifting priorities, stating that he doesn’t blame them for the cuts. However, his main worry now lies with his employees and their future job prospects.

Collins noted that the funds from these canceled contracts would be redirected toward improving veterans’ health care and benefits, but specific plans on how this would be implemented haven’t been shared yet. Betters feels that his company was already working towards the same goal, as some of their projects aimed at enhancing VA services for veterans. For instance, one canceled project focused on creating surveys to streamline the disability evaluation claims process, while another aimed to improve supply chains for medications in VA hospitals.

Scott Jensen, who leads the National Veteran Small Business Coalition, criticized the decision-making behind the cuts, emphasizing that it overlooks the human impact on veteran business owners. He highlighted that these entrepreneurs followed the proper channels to secure contracts and shouldn’t be blamed for having their missions cut short.

In a video announcement, Collins expressed disdain for certain types of contracts, indicating that money was being wasted on tasks like creating presentation slides. He encouraged employees to learn basic skills rather than rely on consultants. However, professionals like Betters argue that many government projects require specialized skills that aren’t easily filled by existing staff.

Last year, Betters’s firm landed a $22 million VA contract aimed at improving customer service feedback from veterans undergoing disability evaluations. This effort aimed to ensure veterans were getting the care they deserved. Betters has spent three decades in medical logistics, bringing valuable experience to the table. He recalled working with the same community in the 90s and emphasized that his goal is always to support veterans in receiving proper treatment.

One of the projects that was recently cut was meant to create a comprehensive catalog for the supply chains of 172 VA hospitals, which would compile crucial data about medications and supplies. Betters explained that without it, hospitals face inefficiencies and could overspend on critical resources, ultimately impacting patient care.

Veteran-owned businesses often have an advantage in securing federal contracts, but many find themselves reliant on the VA due to policies set in place. Jensen pointed out that roughly 74% of the revenue for veteran-owned companies comes from VA contracts. This reliance can be risky, especially when sudden budget cuts occur, as seen with Betters’s company. Other veteran businesses have reported losses and layoffs following the announcements of major contract cancellations.

As concern grows among veteran entrepreneurs, especially with more cuts on the horizon, the National Veteran Small Business Coalition is advocating for clearer communication from the VA. Jensen highlighted the uncertainty facing small business owners in light of recent developments, emphasizing the need for engagement between contractors and government leaders about future priorities.

The VA has signaled plans to review approximately 90,000 contracts worth over $67 billion, raising questions about further cuts that might come. Jensen remarked that many in the veteran business community are left wondering what might happen next, urging for better dialogue to reduce the shock of such announcements in the future.

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