Department of the Army--Request for Modification of Recommendation, B-290682.2, January 9, 2003

B-290682.2 Jan 09, 2003 Jump To VIEW DECISION RELATED PAGES GAO CONTACTS Highlights To recognize that the agency may limit the competition to small business holders of indefinite-delivery/indefinite-quantity contracts in conducting a small business set-aside required by Federal Acquisition Regulation Sec. 19.502-2(b) is denied because the Competition in Contracting Act of 1984 provides for full and open competition among eligible small business concerns for acquisitions required to be set aside for small businesses. Which requires an agency to set aside acquisitions for small businesses where there is a reasonable expectation of receiving fair market price offers from at least two responsible small business concerns. That is. LOGJAMSS are multiple-award. No specific projects at particular locations were identified in the LOGJAMSS solicitation or contracts. View Decision Department of the Army--Request for Modification of Recommendation, B-290682.2, January 9, 2003 DIGEST Attorneys DECISION The Department of the Army requests that we modify the recommendation we made in our decision in LBM, Inc., B-290682, Sept. 18, 2002, 2002, CPD Para. 157, in which we sustained LBM's protest of the Army's decision to acquire transportation motor pool services at Fort Polk, Louisiana, under the Logistical Joint Administrative Management Support Services (LOGJAMSS) contracts. We found that the Army's failure to consider whether this requirement should be set aside for exclusive small business participation violated Federal Acquisition Regulation (FAR) Sec. 19.502-2(b) (the so-called "rule of two"), which requires an agency to set aside acquisitions for small businesses where there is a reasonable expectation of receiving fair market price offers from at least two responsible small business concerns. We recommended that the Army consider whether, in accordance with FAR Sec. 19.502-2(b), the transportation motor pool services at Fort Polk should be set aside exclusively for small business participation. The Army requests that we modify our recommendation "to allow the Army to implement the 'rule of two' among the small business concerns that currently hold LOGJAMSS contracts." Army Request for Modification of Recommendation at 1. That is, the Army proposes to acquire these motor pool services exclusively from small businesses but would limit the competition for these services to the small businesses that hold LOGJAMSS contracts. We deny the Army's request for modification of our recommendation because limiting the small business competition as proposed by the Army would violate the competition requirements of the Competition in Contracting Act of 1984 (CICA). Background 1n 1996, the Army instituted a "regionalization" contracting approach to "achieve savings resulting from improved processes and economies of scale." In implementing the Army's contract regionalization plan, the agency developed LOGJAMSS with a broad scope of work encompassing a wide range of logistical functions and supporting tasks. LOGJAMSS are multiple-award, indefinite-delivery/indefinite-quantity (ID/IQ) task order contracts. In 1998 and 1999, the agency awarded nine contracts under LOGJAMSS, five to large businesses, two to small businesses, and two to small disadvantaged businesses. No specific projects at particular locations were identified in the LOGJAMSS solicitation or contracts. Transportation motor pool services at Fort Polk had been performed exclusively by small businesses, including LBM, under small business set-asides over the last 10 years. In May 2002, the Army decided to instead acquire the Fort Polk's motor pool services using the LOGJAMSS contracts. It solicited proposals from the LOGJAMSS contractors for the award of a fixed-price task order for a base year with 4 option years to perform motor pools services at Fort Polk. /1/ The Army did not coordinate with, or notify, the Small Business Administration (SBA) of its intent to withdraw the Fort Polk motor pool services from exclusive small business competition and to transfer these services to LOGJAMSS contracts. After learning that the Army would not be setting aside the Fort Polk motor pool services for small business competition but would instead acquire the services under the LOGJAMSS contracts, LBM protested to our Office. The Army requested that we dismiss LBM's protest as a challenge to the proposed award of a task order under an ID/IQ contract, for which a protest is not permitted under 10 U.S.C. Sec. 2304c(d) (2000). /2/ The Army also argued that, to the extent we viewed LBM's protest as a challenge to the terms of the solicitation for the award of the LOGJAMSS contracts, the protest was untimely.