C. Martin Company, Inc., B-292662, November 6, 2003

B-292662 Nov 06, 2003 Jump To VIEW DECISION RELATED PAGES GAO CONTACTS Highlights Are denied where the record shows that despite inadequacies in the contracting agency's initial offering letter to SBA. Followed its regulatory guidelines in deciding that the offered work was a "new" requirement under the terms of the regulations. CMC also argues that the Navy was motivated by bad faith when it offered CMC's previous contract to SBA's 8(a) program. CMC was awarded contract No. Was awarded for a base year with up to four 1-year options. CMC was awarded two additional options to continue performance. Both options were for periods less than the full year anticipated in the contract. CMC was awarded an option for 6 months of continued performance in July 2002. An option for an additional 9 months was awarded in January 2003. View Decision C. Martin Company, Inc., B-292662, November 6, 2003 DIGEST Attorneys DECISION C. Martin Company, Inc. (CMC) protests a decision by the Department of the Navy and the Small Business Administration (SBA) to place work currently performed by CMC under SBA's 8(a) Business Development (BD) program, for award on a sole-source basis to another contractor. CMC argues that both agencies violated applicable regulations in shifting this work to SBA's 8(a) BD program, and in selecting Field Support Services, Inc. (FSSI), an Alaska Native Corporation participating in that program, for award of the contract. CMC also argues that the Navy was motivated by bad faith when it offered CMC's previous contract to SBA's 8(a) program. We deny the protest. BACKGROUND In June 2000, CMC was awarded contract No. N68711-99-D-3135, for maintenance and repair of military housing at the Marine Corps Air Ground Combat Center, in Twentynine Palms, California, pursuant to a competitive small business set-aside procurement conducted by the Naval Facilities Engineering Command. The contract included a mixture of fixed-price and indefinite-quantity work, and was awarded for a base year with up to four 1-year options. The fixed-price portion of the effort required CMC to provide change of occupancy maintenance services, various types of family housing service calls, preventative maintenance inspection and repair, grounds maintenance, and street sweeping. The indefinite-quantity work included unscheduled maintenance and repair services, painting, installation and removal of flooring, carpet, and appliances, as well as certain general labor services. Upon completion of the base period and first option year, CMC was awarded two additional options to continue performance, but both options were for periods less than the full year anticipated in the contract. In the first instance, CMC was awarded an option for 6 months of continued performance in July 2002; in the second, an option for an additional 9 months was awarded in January 2003. These limited extensions of CMC's contract were apparently related to Navy concerns about the adequacy of CMC's performance. In a letter dated May 21, 2002, the contracting officer (CO) advised CMC of several areas of ongoing concern about the company's performance; on April 7, 2003, the CO made a written determination not to exercise CMC's fourth option; by letter dated May 28, this decision was communicated to CMC. Unbeknownst to CMC, the Navy was approached by another business seeking to perform these services in March 2003. Specifically, the other business, FSSI, advised the agency that: it had the capability to perform housing maintenance; it was a participant in SBA's 8(a) BD program; and, as an Alaska Native Corporation, it could be awarded the contract directly, without competition. /1/ Concurrently, by letter dated March 5, SBA's Anchorage, Alaska regional office marketed FSSI's capabilities to the Navy as a possible source for the Twentynine Palms housing maintenance contract. By letter dated May 28--the same date as the CO's letter to CMC advising the company there would be no exercise of its fourth contract option--the CO offered to place the Twentynine Palms housing maintenance contract under SBA's 8(a) BD program. The Navy's offering letter was provided to SBA's Anchorage, Alaska regional office, and identified FSSI as its preferred recipient of the contract. By e-mail also dated May 28, an SBA representative in Fresno, California, contacted the Anchorage regional office to advise that one of its constituent small businesses, CMC, had just learned it would not be receiving an option for continued performance of its existing contract. In addition, the e-mail advised that the Navy had instead selected an 8(a) contractor sponsored by the Anchorage regional office for performance of this effort.