VIP VetBiz – Our Three Year Quest To Be Recognized as VETERAN-OWNED

Jim Wallace, the president of Electro Soft, Incorporated not only served his country in the Vietnam War.  He spent an additional 38-years as an Air Force Reservist.  Upon retirement, he was the highest ranking officer at the Willow Grove Air Force Reserves Base.  To have spent such a large portion of his life serving the country, you would think that he would have had an easier journey obtaining the Veteran-owned certification for his own business.



In a letter dated December 10, 2010, Wallace received a letter from the Department of Veteran Affairs making him aware of the Veterans Small Business Verification Act signed into law by President Obama in 2010.  The law requires the VA to verify that ESI is in fact owned by a Veteran.  The process seemed easy, simply log on to, review the profile, apply and you are done.  We were given 90-days to complete it.  Here is the list of what we needed:


  • Business License
  • Resumes for all key personnel
  • Tax – 1040, W-2, K1, Schedule C submitted to IRS for past two years
  • Tax – 1120S
  • Payroll Distribution Ledger Summary and W-2s for preceding year and year to date
  • Signature cards from the bank
  • Copies of the last 5 contracts
  • Copy of building lease agreement and cancelled checks
  • Stockholder agreement
  • Official Certificate of Formation and Operating Agreement with all amendments
  • Minutes of first and most recent stockholder and Board of Director meetings
  • All Corporate bylaws and amendments
  • Articles of Incorporation filed with the Secretary of State
  • Stock registers and ledgers
  • Lastly, he had to submit a VA Form 0877, which verifies his name against the Beneficiary Identification Records Locator Subsystem (BIRLS) database.  More on the BIRLS system later.



Because Electro Soft, Incorporated is in fact a legitimate company, all of the paperwork was in line and took 2 weeks to align readily available.  We followed all of the steps and blacked out all private information such as:  social security number, home addresses and phone numbers.  Each document was scanned and uploaded to the site for the Center for Veteran Enterprise (CVE) could review.  Then we waited.

Problem #1

July 6, 2011 – We received a letter from Chuck Southern, the verification program manager, which stated that they could not verify Mr. Wallace’s Veteran status because there was no BIRLS record.

We contacted the Veterans Benefits Administration in Philadelphia and were told that Mr. Wallace had to bring in his discharge paper (from the early 70s).  So Mr. Wallace did just that.  You see, in order to be included in the BIRLS system, you have to apply for benefits.  Because Mr. Wallace is a fully capable, working individual, he didn’t require benefits over the past 45 years.  He was advised to just file a claim stating that he wanted them, so that he will be entered into the BIRLS system.  He was also told that he would be denied, but it would cost tons of man hours rejecting healthy Veterans, keeping those in need waiting do no harm.

So we updated the paperwork and resubmitted.

Problem #2

August 2, 2011 – We received a letter from Tyrone Brown, Verification Program Manager (what happened to Chuck?).  Again, we were told “no BIRLS record”.  Really?  Because Mr. Wallace’s VBA Office paperwork was sitting on my desk, along with a faded discharge form proving that this man served his country.  So we call the VBA and find out that Mr. Wallace was entered into the BIRLS system under his claim/file number as opposed to his social security number.  So we resubmitted the forms using his claim number as his social security number.  That didn’t work.  So we got on the phone and email and had to work on pushing it through.

Problem #3

November 9, 2011 – We received a letter from Thomas J. Leney, Executive Director of Small and Veteran Business Programs.  It basically said, that upon review of the board minutes, they found that two of three members are not Veterans, so based upon this they denied the application. Our solution, we removed the person from the board.  While we know that direction of the company is determine by Mr. Wallace, the paperwork obviously has to reflect this.

January 17, 2012 – I wrote a email requesting status on our application and was referred to the November letter.  I stated that we resubmitted the paperwork and heard nothing in response.  So we put this project on the back burner for a while to focus on other things.

May 11, 2012 – Mr. Wallace sends an automated email that says that we can resubmit all of our documents for review.  Wait, what?

December 19, 2012 – We decide to forge ahead once again into this battle and find that there is now a new system.  We are hoping that this one is more effective.

June 7, 2013 – We start emailing and requesting assistance.  We see all of the forms in this new system that were originally uploaded, along with some additional forms that were needed, yet no determination was made.

June 12, 2013 – We receive a response that says that we are in the “initiation stage”.  Back to the beginning.

July 10, 2013 – We received an email requesting additional documentation:


  • 2012 Federal Personal Income Tax – all schedules, W2s (including spouse), K-1s
  • All 1040s for Mr. and Mrs. Wallace
  • ESI’s 2012 Income Tax forms
  • 2012 payroll distribution ledger and current year to date payroll distribution ledger, including hours and dollars for all employees
  • 2012 W2s for All employees
  • last 5 contracts
  • most recent 3 rent checks with the business owner and business address on them

It was all completed and submitted


August 5, 2013 – We receive and email stating that additional documentation is needed:


  • Copies of “not more than 20 cancelled checks that have been written, cashed and cleared the business account”
  • 2013 payroll distribution ledger, year to date, including hours and dollars for ALL employees as well as their W2s
  • Mr. Wallace had to answer 9 detailed questions about his function, his ownership, etc

We submitted all documentation

August 27, 2013 – we were asked to submit Mr. Wallace’s current home address so that they could calculate his commute.

Where We Are Now

We think that we are in the final days.  I called today to see how long the wait will be, I was told, “I cannot say because if the day comes and it doesn’t happen, you will be upset”.  After three years, I think we will be fine.  In fact, if the day ever happens, we will be in disbelief.

We Understand

We completely understand why the Department of Veteran Affairs has created this monster obstacle course.  Unsavory business people were cheating Service Disabled Veterans and regular Veterans out of their set aside.  We get it.  But many Veterans are getting flat out annoyed and burned out by this experience.  Many of whom do not have the staff support to continue this horrible journey.  Unfortunately, the few bad folks in the world have made it horribly worse for everyone.  But is it worth it?


If you can relate to this story or have an equally bad story to tell, let us know.  We would love to commiserate.  Perhaps you were thinking about heading down the road to verification, yet paused because of the horror stories.  Let us know in the comment section below.



September 6, 2013 – TODAY, we were verified.



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