Apex Support Services, Inc., B-288936; B-288936.2, December 12, 2001

Apex Support Services, Inc., B-288936; B-288936.2, December 12, 2001 TITLE: Apex Support Services, Inc., B-288936; B-288936.2, December 12, 2001 BNUMBER: B-288936; B-288936.2 DATE: December 12, 2001 ********************************************************************** Decision Matter of: Apex Support Services, Inc. File: B-288936; B-288936.2 Date: December 12, 2001 Timothy P. Healy for the protester. Sherri Snowden for Zeta Construction Corporation, an intervenor. Gay F. Chase, Esq., General Services Administration, for the agency. Jennifer D. Westfall-McGrail, Esq., and Christine S. Melody, Esq., Office of the General Counsel, GAO, participated in the preparation of the decision. DIGEST Protest against performance bond and bid guarantee requirements is sustained where agency fails to demonstrate that it reasonably determined that bonding requirements were necessary to protect the government's interest. DECISION Apex Support Services, Inc., a very small business concern, protests the bonding requirements in request for proposals (RFP) No. GS05P01GAC0168, issued by the General Services Administration (GSA) for planning and estimating services. Apex contends that the bonding requirements unduly restricted competition. We sustain the protest. The RFP requested the services of two planner/estimators, one to work at a GSA office in Cleveland and the other to work at a GSA office in Cincinnati, for a base period of 1 year and two option periods of 1 year each. The two individuals are to be responsible for requesting, inspecting, and accepting construction work on behalf of the government. Tasks which they will perform include developing specifications, finalizing scopes of work, scheduling work, performing cost estimation, and preparing procurement documents. The solicitation included requirements for a bid guarantee (in an amount equal to 20 percent of the bid amount for the base period of performance) and a performance bond (in an amount equal to 20 percent of the contract price for the initial 12-month period). The protester argues that the bonding requirements would effectively bar it and other similarly situated small and very small businesses from submitting offers and that there are less restrictive ways to protect the government's interests. [1] As a preliminary matter, GSA argues that the protester is not an interested party to protest the terms of this solicitation because it did not submit a proposal in response to the RFP and thus would not be in line for award if its protest were sustained. We disagree. Whether a protester is an interested party is determined by the nature of the issues raised and the direct or indirect benefit or relief sought. Courtney Contracting Corp., B-242945, June 24, 1991, 91-1 CPD para. 593 at 4. Where, as here, the protester challenges the terms of a solicitation that allegedly deterred it from competing, and the remedy sought is the opportunity to compete under a revised solicitation, it is an interested party to protest the terms of the solicitation even if it did not submit a bid or offer under the challenged solicitation. Id. at 4-5. Regarding the merits of Apex's protest, the Federal Acquisition Regulation (FAR) instructs that agencies generally should not require performance bonds for other than construction contracts. [2] FAR sect. 28.103-1. The FAR goes on to recognize, however, as an exception to this general rule, that performance bonds may be required for contracts exceeding the simplified acquisition threshold when necessary to protect the government's interest. FAR sect. 28.103-2. The FAR gives four examples of such situations (where government property or funds are to be provided to the contractor for its use or as partial compensation; where the government wants assurance that a contractor's successor-in-interest is financially capable; where substantial progress payments are to be made before delivery begins; and where the contract is for dismantling, demolition, or removal of improvements, id.), but we have recognized that this list is not exhaustive and that there may be other circumstances where a bond is required to protect the government's interest. RCI Mgmt., Inc., B-228225, Dec. 30, 1987, 87-2 CPD para. 642 at 2. In reviewing a challenge to the imposition of a bonding requirement, we consider whether the requirement is reasonable. E.D.P. Enters., Inc., B-282232, June 17, 1999, 99-2 CPD para.