Dozens of disabled workers face layoffs after Huntsville flag manufacturer’s federal contract ends

Published: Jun. 28, 2019 at 10:57 PM CDT|Updated: Jun. 28, 2019 at 10:58 PM CDT
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HUNTSVILLE, Ala. (WAFF) - A federal court ruling ends a 25-year flag contract for a Huntsville-based company. The court upheld the U.S. Veteran Administration’s Rule of Two, meaning that veteran-owned companies will be given priority over AbilityOne nonprofits as bids are awarded.

Phoenix in south Huntsville has been producing interment flags for Veterans Administration since 1994. The company primarily employs disabled or veteran flag-makers.

“The contract was cancelled and the final shipment will be made in about 10 days," said Wes Tyler, Phoenix’s VP of Manufacturing & Business Development.

The AbilityOne Program has its beginnings in a 1938 law that allows nonprofits to be awarded certain federal contracts as long as they meet quality and pricing requirements, and 75 percent of the employees are people with disabilities. Through its AbilityOne contracts, Phoenix employs 791 people, 75 of which are veterans.

Nearly two dozen people work on Phoenix’s contract with the VA to manufacture interment flags, 95 percent of whom have a significant disability. Phoenix has produced more than 2.1 million flags since beginning the contract.

“People have come and gone but we still have a lot of folks like myself that have been here 24 years," said Wanda Duboise.

Duboise is worried about her professional and financial future. “I’m still trying to be optimistic that someway or another it can turn around for us," said Duboise.

Nationwide, more than 100 nonprofits have AbilityOne contracts with the VA. More than 1,000 persons who have at least one disability or are veterans are employed on these contracts. The collective value of these contracts is $53 million, according to officials with Phoenix.

Some of the Phoenix employees making the flags have severe disabilities, a demographic with one of the highest unemployment rates of any group seeking employment.

Phoenix is asking Congress to step in. The House and Senate Veterans Affairs Committees need to enact legislation clarifying the intent of the Veterans Benefits, Health Care and Information Technology Act of 2006 (VBA) to maximize contracting awards to veteran-owned small businesses without eliminating or reducing AbilityOne jobs for veterans and people with significant disabilities. Also, the VA needs to suspend implementing guidance related to the Rule of Two until ongoing litigation is resolved.

“We’re for employment of all persons," said Tyler. “We want to make sure people with a disability have a seat at the table.”

Phoenix also provides custodial and ground maintenance work for Redstone Arsenal, manufactures forestry service backpacks, parachute harness and sandbags for flood control.

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