S&K Electronics, B-282167, June 10, 1999

B-282167 Jun 10, 1999 Jump To VIEW DECISION RELATED PAGES GAO CONTACTS Highlights Decision whether to place procurement under 8(a) program is not subject to General Accounting Office review where there is no showing of possible bad faith on the part of government officials or that regulations may have been violated. 2. Protest by 8(a) firm alleging improper bundling of desktop computing requirements under General Services Administration's Seat Management Services Program is denied where record shows Seat Management contracts reflect qualitatively different approach from earlier acquisitions and agency reasonably anticipated substantial technical benefits from use of Seat Management contract to acquire broad range of computing requirements under one contract. The Government will acquire integrated services and the required components to include: (1) general purpose desktop computers. View Decision Matter of: S&K Electronics File: B-282167 Date: June 10, 1999 DIGEST Attorneys DECISION S&K Electronics (SKE) protests the Department of the Treasury's determination to acquire information technology (IT) technical support services--previously furnished by a section 8(a) contractor--as part of a package of IT services, hardware and software under the General Services Administration's (GSA) Seat Management Services Program. SKE asserts that this approach violates Treasury's procurement regulations with respect to section 8(a) contracts and constitutes improper contract bundling. We deny the protest. BACKGROUND On October 4, 1997, GSA issued solicitation No. TFF-97-014, which provided for multiple-award, non-mandatory indefinite-delivery/indefinite-quantity task order contracts, for a period not to exceed 120 months, to furnish Seat Management services. The statement of work (SOW) provided as follows: Under the Seat Management concept, the Government will acquire integrated services and the required components to include: (1) general purpose desktop computers, servers and associated peripherals; (2) high performance computational systems and associated peripherals; (3) local area and wide area network capabilities; (4) commercial off-the-shelf (COTS) software; (5) help desk services; (6) maintenance; (7) design and installation; and (8) training. The Contractor will provide the assets needed to provide Seat Management Services and will hold title directly or indirectly to all assets provided. . . . The Government intends to acquire desktop computing services and support as a utility and pay for them on a per 'seat' basis. So that the Government may benefit from the total cost savings, these services must be acquired in an integrated fashion from a single source. TFF-97-014, SOW Sec. C1, at 1; see Commerce Business Daily, Sept. 30, 1997 (posted Sept. 24, 1997). The SOW emphasized that the services to be furnished under the contracts will include "all the essential components and resources to service and maintain the desktop computing environment," and that "[c]omponents of Seat Management Services may not be purchased independently." TFF-97-014, SOW Secs. C3, C4, at 2-3. The Seat Management contracts were to include fixed ceiling prices, with the ordering agencies free to negotiate lower prices for each task order. On June 30, 1998, GSA awarded eight Seat Management contracts. Treasury historically has acquired desktop computer supplies and services from multiple vendors. In particular, desktop computer support services for its departmental offices have been furnished for approximately 10 years by 8(a) firms--most recently by Uniband, Inc.--under the Small Business Administration's (SBA) 8(a) program. Uniband's contract covered fiscal year 1994, contained options for fiscal years 1995-98, and was extended until March 1999. On September 28, SKE wrote to the SBA's Helena, Montana office to request that Treasury's computer support services requirements be reserved for SKE under the 8(a) program; that office, in turn, requested Treasury to consider awarding an 8(a) contract for these services, to be performed by SKE. SKE subsequently met with Treasury representatives on several occasions to discuss the agency's intended procurement approach. Apparently dissatisfied with the response received from Treasury, on December 21 SKE wrote to both the SBA and Treasury to question the agency's intended approach to meeting the requirement. SKE asserted that Treasury's intent to remove the requirement from the 8(a) program, and to compete the effort among the GSA Seat Management contractors, violated agency regulations. Agency Report, Tab 20, Letter from SKE to SBA (Dec. 21, 1998), and Tab 21, Letter from SKE to Treasury (Dec. 21, 1998). By letter of February 9, 1999, Treasury responded to SKE: This is in response to your December 21, 1998 letter regarding an expiring technical support contract within Departmental Offices.