ASBCA 63794

ARMED SERVICES BOARD OF CONTRACT APPEALS Appeal of - ) ) HD Inc. ) ASBCA No. 63794 ) Under Contract No. FA4830-20-C-0010 ) APPEARANCE FOR THE APPELLANT: John R. Tolle, Esq. Baker, Cronogue, Tolle & Werfel, LLP McLean, VA APPEARANCES FOR THE GOVERNMENT: Caryl A. Potter, III, Esq. Air Force Deputy Chief Trial Attorney Kelsi J. Pilcher, Esq. Trial Attorney OPINION BY ADMINISTRATIVE JUDGE WITWER ON THE PARTIES’ CROSS-MOTIONS FOR SUMMARY JUDGMENT Appellant HD Inc. (HDI) seeks $174,874.08 for increased costs resulting from the incorporation of a revised Collective Bargaining Agreement (CBA). Respondent, the Department of the Air Force, concedes that HDI is entitled to an equitable adjustment but disputes the amount and method of calculation. Both parties have moved for summary judgment. For the reasons set forth below, we deny HDI’s motion and grant summary judgment in favor of the Air Force. We remand the matter to the parties to determine quantum. STATEMENT OF FACTS FOR PURPOSES OF THE MOTIONS The following facts are undisputed, unless stated otherwise. On August 4, 2020, the Air Force awarded Contract No. FA4830-20-C-0010 to HDI for grounds maintenance services at Moody Air Force Base, Georgia (ASUMF ¶ 1; gov’t resp. to ASUMF ¶ 1; R4, tab 1 at 1, 12). The contract required HDI to provide personnel, equipment, tools, supervision, and other resources necessary to maintain the base’s landscaping (R4, tab 1 at 12). Services were to be performed under fixed-price contract line item numbers (CLINs) (id. at 3-11). The period of performance included a 12-month base period and four option years (ASUMF ¶ 4; gov’t resp. to ASUMF ¶ 4; R4, tab 1 at 4-11). The subject dispute concerns Option Year Two (compl. at 6), which ran from October 2022 through September 2023 (ASUMF ¶ 31; gov’t resp. to ASUMF ¶ 31; R4, tab 22 at 2). Solicitation The solicitation included two key attachments: a Department of Labor (DOL) wage determination specifying locally prevailing wages and benefits and a Collective Bargaining Agreement (CBA) executed between the predecessor contractor, ProDyn, LLC, and its service employees (R4, tab 41 at 88, 107). For clarity, we refer to the former as the “DOL locality wage determination” and the latter as the “predecessor contractor’s CBA.” The DOL locality wage determination was No. 2015-4494 dated December 2019 (app. reply, ex. 1, DOL Wage Determination No. 2015-4494). For the covered positions employed by HDI, the predecessor contractor’s CBA set higher wages than the DOL locality wage determination (app. resp. dtd. Jan. 8, 2025, to Bd. Order, Excel spreadsheet, tab “Paul’s Allocation”). The predecessor contractor’s CBA provided in pertinent part: NOTE: The successor contractor’s obligation is to ensure that all service employees are paid no less than the wages and fringe benefits to which the employees would have been entitled, including prospective increases, if employed under the predecessor’s collective bargaining agreement for the first year of the contract[.] (R4, tab 41 at 88, 107) HDI was bound by this CBA during the base year of the contract (ASUMF ¶¶ 6-7; gov’t resp. to ASUMF ¶¶ 6-7; app. supp. R4, tab 2 at 2; app. supp. R4, tab 1, RFI No. 1). After the base year, HDI was free to negotiate a new CBA for the option years (id.). The solicitation stated that, if a new CBA were negotiated, the awardee could file a Request for an Equitable Adjustment (REA) to recover any increase in wages and benefits mandated under the new CBA (ASUMF ¶ 9; gov’t resp. to ASUMF ¶ 9; app. supp. R4, tab 4, RFI No. 47; app. supp. R4, tab 5). The solicitation incorporated by reference two key Federal Acquisition Regulation (FAR) clauses: FAR 52.222-41, SERVICE CONTRACT LABOR STANDARDS (AUG 2018), and FAR 52.222-43, FAIR LABOR STANDARDS ACT AND SERVICE CONTRACT LABOR STANDARDS—PRICE ADJUSTMENT (MULTIPLE YEAR AND OPTION CONTRACTS) (AUG 2018) (app. reply at 3; GSUMF ¶¶ 1-2; R4, tab 41 at 73, 78). For ease of reference, we refer to these as the SCA Clause and the Price Adjustment Clause. With respect to offerors’ price proposals, the solicitation specified that the Air Force would evaluate offerors’ total evaluated prices for reasonableness (R4, 2 tab 41 at 104).