Designer Associates, Inc., B-293226, February 12, 2004

B-293226 Feb 12, 2004 Jump To VIEW DECISION DOWNLOADS RELATED PAGES GAO CONTACTS Highlights Designer Associates, Inc. protests the decision of the Department of the Air Force and the Small Business Administration (SBA) to place the Air Force requirement for maintenance and repairs services for military family housing at Hill Air Force Base (AFB), Utah, under SBA's section 8(a) business development program for award of a sole-source contract to Creative Times, Inc. Designer Associates contends that the Air Force's decision to offer these requirements to SBA, and SBA's resulting acceptance, were improper. We deny the protest. View Decision B-293226, Designer Associates, Inc., February 12, 2004 Decision Matter of: Designer Associates, Inc. File: B-293226 Date: February 12, 2004 Rulon W. Waite for the protester. Eric Kattner and James B. Howarth, Esq., Department of the Air Force, and John W. Klein, Esq., Small Business Administration, for the agencies. Louis A. Chiarella, Esq., and Christine S. Melody, Esq., Office of the General Counsel, GAO, participated in the preparation of the decision. DIGEST 1. Protest that the contracting agency's letter offering requirement to Small Business Administration (SBA) for acceptance into 8(a) program failed to provide SBA with complete and accurate information regarding the proposed offering is denied where the record shows that despite inadequacies in the contracting agency's initial offering letter to SBA, SBA ultimately obtained all of the information required by its regulations and the protester was not prejudiced by the contracting agency's error. 2. Protest that the contracting agency's decision to alter the traditional duration of its service contract, in order to make a noncompetitive award under the SBA 8(a) program, was made in bad faith is denied where there is no evidence of such bad faith and where the record shows that the agency had a valid reason for its action. DECISION Designer Associates, Inc. protests the decision of the Department of the Air Force and the Small Business Administration (SBA) to place the Air Force requirement for maintenance and repairs services for military family housing at Hill Air Force Base (AFB), Utah, under SBA's section 8(a) business development program for award of a sole-source contract to Creative Times, Inc. Designer Associates contends that the Air Force's decision to offer these requirements to SBA, and SBA's resulting acceptance, were improper. We deny the protest. The requirement here is for maintenance and repair services for approximately 1,140 military family housing units at Hill AFB, and involves interior and exterior painting, refinishing and replacement of floors, repair and replacement of appliances, and change of occupancy maintenance. Designer Associates, a small business concern, competed unsuccessfully for the prior housing maintenance contract awarded by the Air Force in 1998, the result of a small business set-aside procurement.[1] Consisting of a base year and four 1-year options, the prior housing maintenance contract had an expiration date of December 31, 2003. The Air Force is now participating in the Department of Defense (DOD) Military Housing Privatization Initiative. Authorized by Congress as a pilot program, the Military Housing Privatization Initiative has the goal of improving DOD military family housing more economically and more quickly than if the traditional military construction approach were used. This initiative allows private sector financing, ownership, operation, and maintenance of military housing.[2] National Defense Authorization Act for Fiscal Year 1996, Pub. L. No. 104-06, 2801 et seq., 110 Stat. 186 et seq., codified at 10 U.S.C. 2871-2885 (2000), amended by the National Defense Authorization Act for Fiscal Year 2001, Pub L. No. 106-398, 2806. Additionally, relevant to this protest, after housing privatization, the military service involved no longer has a requirement for housing maintenance services, as the rights and responsibilities of property ownership then rest with the private-sector developer. One of the bases at which the Air Force is now in the process of privatizing military housing is Hill AFB, with an expected contract award in mid-to-late 2004. By letter to SBA dated August 29, 2003, the Air Force offered to contract with Creative Times for the Hill AFB military family housing maintenance services under the section 8(a) program. The letter advised SBA that the agency anticipated awarding a fixed-price contract for a base year with one 1-year option at an estimated total value of $1,537,899.[3] The Air Force also represented to SBA as follows: Public solicitation for the specific procurement has not already been issued under a small business set-aside. It would normally be expected that this program would be awarded to a disadvantaged firm under conventional procedures.