16.1 Self-Employment Program Considerations

Self-employment includes all employment in which the individual or the entity owned by the individual is responsible for paying for the employer and employee portion of their own social security taxes, insurance, licenses, and other employee benefits and may be a sole proprietorship, partnership, or corporation. DVR defines persons desiring self-employment as entrepreneurs and adopts the Small Business Administration (SBA) entrepreneur definition: one who assumes the financial risk of the initiation, operation, and management of a given business or undertaking.

Individuals involved in the self-employment program are subject to all relevant parameters of vocational rehabilitation discussed elsewhere throughout this Service Delivery Policy Manual.

Self-employment may be considered viable when the individual possesses the skills and experience pertinent to the business concept. Training within a self-employment plan is considered on a case-by-case basis based on industry standards within the chosen field. Training may be necessary within a self-employment plan:

● To develop skills specific to business operations (e.g., basic bookkeeping or marketing).

● To obtain necessary certifications or licensures.

● To obtain a necessary academic degree or vocational credential when the industry standard is self-employment (e.g., cosmetology, real estate agent, etc.).

Self-employment is typically not considered when the individual is entering a field in which they do not have previous experience and wage employment is a feasible option to gain experience and build expertise in the field. Exceptions may be considered when self-employment is the most appropriate option to accommodate disability-related concerns.

The individual shall maintain majority ownership and substantial participation in core business functions to be considered for self-employment. In the case of a partnership or corporation, the individual receiving DVR services shall be the controlling partner or shareholder at 51 percent or better. The case file shall clearly demonstrate the individual’s ownership and substantial participation in core business functions.

Business ventures shall be for-profit and comply with all relevant state, federal, and local laws and regulations. Bankruptcy or other legal proceedings that directly impact business planning shall be resolved by the individual prior to engaging in self-employment. The DVR self-employment program excludes:

● Passive activity in which the business owner does not materially or physically participate.

● Highly speculative businesses, such as those requiring a patent that has not yet been obtained.

● Illicit or sexually explicit businesses.

● Multi-level marketing or pyramid models.

● Hobby businesses.

● Businesses engaged in any aspect of the marijuana or psilocybin industry.

● Non-profit organizations.

● Other businesses determined by the Director to be inconsistent with the values and sensibilities of the state.

For the purposes of owning and operating a business, DVR does not:

● Purchase real estate or land.

● Erect or modify the structure of buildings, including homes.

● Purchase motorized vehicles licensed to operate on public thoroughfares.

● Pay for normal living expenses.

● Pay wages for permanent full-time or part-time employees of the business.

● Purchase firearms or ammunition.

Individuals wishing to explore non-profit development may receive services to achieve an employment goal within a non-profit setting, though not as part of the DVR self-employment program. As part of vocational goal planning, individuals may be assisted with referral to non-profit resources such as the Colorado Nonprofit Association (CANPO) and, when appropriate, training services such as grant writing courses or education in non-profit management.

Hobby businesses are those which do not substantially contribute to the individual’s personal income. Income which is sufficient to meet the needs of the individual, such as adequately supplementing disability benefits, may be considered work activity. To consider whether a business concept reflects a hobby business or work activity explore: a) whether there is an intention to generate profit or income; b) the continuity or regularity of the activity or transactions; c) whether the activities are a regular occupation or profession; and d) whether the individual presents themselves to others as selling the goods or services.

Supported self-employment provides the opportunity for individuals with most significant disabilities to own a business with appropriate resources and supports. For those who need ongoing support to perform the functions and operation of their businesses, supported self-employment may be a viable option to meet the individual’s employment needs. An individual may be considered for supported self-employment services when:

● The DVR Counselor and the individual have identified supported self-employment as the appropriate employment outcome.

● Considerable assistance is needed to develop an individualized, profitable, and sustainable microenterprise.

● The individual will perform the essential tasks of the business concept, with or without accommodations.

● A self-employment outcome can be maintained with necessary ongoing and extended supports in place.

● Another individual, organization, or resource has been identified to provide extended services after DVR funded services are complete.

Extended services are not time limited and may be needed for the life of the business. DVR may only fund extended services for youth aged 24 or younger when no other funding source is available. In these cases, DVR funding of extended services shall be limited to a period of four years and not extend beyond the youth’s 25th birthday. Extended services may include:

● On-the-job support.

● Ongoing case management.

● Peer support.

● Natural support.

● Ongoing paid professional services for the business.

Necessary extended services shall be identified using the agency approved form and updated as needed throughout the VR case.

Supported self-employment requires a team approach for planning and ongoing support. The business or support team shall explore and determine the feasibility of the proposed business and assist the individual to develop their business plan, launch the business, and address the individual’s extended support needs. The business team membership is based on the support needs of the individual and consideration should be given to include:

● Informal supports, such as family members and/or friends.

● Formal supports, such as legal guardians, provider agencies, Community Work Incentives Coordinator, and other appropriate state agencies.

● Community-Centered Board staff (if applicable).

● Community Mental Health Center staff (if applicable).

● Community experts relevant to the business, such as an accountant or attorney.

● Community business mentor(s) operating similar business concepts.