Champion Business Services, Inc., B-283927, January 24, 2000

B-283927 Jan 24, 2000 Jump To VIEW DECISION DOWNLOADS RELATED PAGES GAO CONTACTS Highlights A firm protested several General Services Administration (GSA) contract awards and a GSA sole-source solicitation for security services, contending that: (1) GSA's award of the contracts violated the time constraints cited in federal procurement regulations concerning recurring service requirements; and (2) GSA failed to include four 1-year options in its solicitation in order to keep the contract's price below the monetary threshold that would require it to compete the contract. GAO held that GSA: (1) properly awarded the contracts in accordance with relevant procurement regulations; and (2) was not required to include four 1-year options in its solicitation. Accordingly, the protest was denied. View Decision Matter of: Champion Business Services, Inc. File: B-283927 Date: January 24, 2000 DIGEST Attorneys DECISION Champion Business Services, Inc. protests the sole-source award by the General Services Administration (GSA) of a number of indefinite-quantity contracts with 1-month periods, as well as GSA's issuance of a solicitation on a sole-source basis with a 1-year performance period, through the Small Business Administration (SBA) under the section 8(a) program to Gonzales Consulting Services, Inc. for dispatch and security system monitoring services. We deny the protest. In November 1996, GSA awarded a contract for the dispatch, security and monitoring services to RMES Communications, Inc. Agency Report at 1. Although the contract provided for a base period of 1 year with four 1-year options, GSA determined during the first option year that its requirements were no longer being met by the RMES contract and decided not to exercise the second option. Id. GSA contacted SBA at that time and requested that SBA identify a contractor participating in the section 8(a) program "that could perform on a month-to-month basis, pending [GSA's] development of appropriate specifications." Contracting Officer's Statement at 1. SBA responded by identifying Gonzales as an eligible potential contractor and informing GSA that it "need not submit anything further." Id. at 2. GSA subsequently entered into the first of a series of indefinite-delivery contracts, each with a performance period of 1 month, with Gonzales for the services. Id. at 1-2. Since December 1, 1998, the monthly sole-source contracts have been awarded to, and performed by, Gonzales through SBA's section 8(a) program. Id.; Agency Report, exhs. 4-15 (GSA month-to-month solicitation/contract/order for commercial items issued to Gonzales Consulting Services, Inc.). GSA explains that it has been developing adequate technical specifications for a solicitation to be issued on a sole-source basis under the section 8(a) program for a 1-year contract, and has now issued such a solicitation and offered the procurement to the section 8(a) program with an "offering letter listing all parties that have expressed an interest in the procurement." /1/ Contracting Officer's Statement at 2; Supplemental Agency Report at 1. The protester argues that, in awarding the 1-month contracts to Gonzales, the agency has improperly exceeded "the six (6) month limit" imposed on such awards by Federal Acquisition Regulation (FAR) Sec. 37.111. Protest; Protester's Comments, Nov. 24, 1999, at 4. FAR Sec. 37.111 states that "[a]ward[s] of contracts for recurring and continuing service requirements are often delayed due to circumstances beyond the control of contracting officers," provides that contracting officers "may include an option clause . . . in solicitations and contracts which will enable the Government to require continued performance of any services within the limits and at the rates specified in the contract," and states that extensions under such an option clause "shall not exceed 6 months." Because FAR Sec. 37.111 only applies to a contracting agency's extension of performance under an existing service contract, whereas the record here evidences that GSA has issued and awarded a series of contracts to Gonzales on a month-to-month basis rather than extending performance under an existing contract, this protest basis has no merit. The protester also complains that GSA has continued to issue and award 1-month contracts in order to "dodge and circumvent" the requirement in FAR Sec. 19.805-1(a)(2) and 13 C.F.R. Sec. 124.506(a)(1)(ii) that acquisitions for services offered to SBA under the section 8(a) program be awarded on the basis of competition if the anticipated contract price exceeds $3 million. As pointed out by GSA, each monthly contract awarded to Gonzales had an estimated value of approximately $93,000, such that even if the requirements had been contracted for a full year, the approximate total price of $1,116,000 would be less than the $3 million price at which competition is required. Agency Report at 3.