Competition

Army Lawyer, Jan, 2007 by Ralph J. Tremaglio, III

The Reverse Sole-Source Bid Protest

In Metro Home Medical Supply, Inc., (32) the contractor protested a request for proposals (RFP) for home oxygen supplies and services for patients of seven Veterans Affairs (VA) Hospitals claiming that the agency should have sole-sourced the requirement to Metro, a certified Historically Underutilized Business Zone (HUBZone). (33) The RFP provided for a cascading set-aside award process. (34) For the facility in Detroit and three other locations, if two or more responsible HUBZone small businesses responded and award would be at a fair market price, the VA would award to a HUBZone small business. (35) For the remaining three locations and any of the previously mentioned facilities not resulting in award to a HUBZone small business, if technically acceptable competitive offers were received from two or more responsible small businesses, the VA would award to a small business. (36) If award was not made to either HUBZone or small businesses under the conditions previously described, then award would be made on the basis of full and open competition, regardless of that contractor's size or socio-economic status. (37)

Metro protested to the GAO three days prior to bid closing, claiming that the Detroit location should be removed from the cascading set-aside process and awarded to Metro on a sole source basis. (38) Metro claimed that the VA failed to comply with the goals for HUBZone small businesses that it had set out for itself and, therefore, the agency should sole-source the procurement to remedy their noncompliance. (39)

The agency stated that it could not award the Detroit contract sole-source because the requirements of FAR part 19.1306 were not satisfied. Neither the requirement for only one HUBZone business capable of satisfying the requirement nor the contract price limitation of $3 million could be met. (40) The Small Business Administration also pointed out that the language at FAR part 19.1306 is discretionary, not mandatory. (41) In the end, the GAO denied the protest. (42)

Requirement to Adequately Disclose the Desired Services?

In M.D. Thompson Consulting, LLC; PM Tech, Inc., (43) the GAO sustained a protest where an agency failed to adequately disclose the services required and then awarded a sole source bridge contract. (44) It makes it hard to compete for a procurement, or even to know whether to compete, when the synopsis does not accurately reflect what the agency seeks. In a protest of the Department of Energy's (DOE) nine-month extension of a sole-source "bridge contract," two firms alleged that they had been excluded for failing to provide a requirement that was not in the synopsis. (45) Two small businesses, M.D. Thompson Consulting, LLC, and PMTech, Inc., argued that the DOE failed to properly synopsize its requirement to allow for meaningful responses from prospective bidders, thereby making DOE's sole-source contract improper. (46)

The DOE published a pre-synopsis notice on FedBizOpps stating its intent to extend the contract with CSC Systems & Solutions LLC for "unspecified services" for up to nine months. (47) Both M.D. Thompson and PMTech submitted capability statements, (48) The agency rejected both in part because the firms did not propose personnel experienced in "isotope separation technology," although such a requirement was not apparent from the synopsis. (49)