B-299037, Margni, Inc., January 26, 2007

B-299037 Jan 26, 2007 Jump To VIEW DECISION DOWNLOADS RELATED PAGES GAO CONTACTS Highlights Margni, Inc. protests the award of a sole-source contract to Native Contractors, Inc. under request for proposals (RFP) No. VA-786-06-RP-0148 under the Small Business Administration's (SBA) section 8(a) program, for cemetery maintenance services for the Department of Veterans Affairs (VA) at the Georgian National Cemetery, Canton, Georgia. We deny the protest. View Decision B-299037, Margni, Inc., January 26, 2007 Decision Matter of: Margni, Inc. File: B-299037 Date: January 26, 2007 Thomas J. Kelleher, Jr., Esq., Smith, Currie & Hancock, for the protester. Phillipa L. Anderson, Esq., and Dennis J. Foley, Esq., Department of Veterans Affairs, and John W. Klein, Esq., and Laura Mann Eyester, Esq., U.S. Small Business Administration, for the agencies. Charles W. Morrow, Esq., and James A. Spangenberg, Esq., Office of the General Counsel, GAO, participated in the preparation of the decision. DIGEST Small Business Administration's (SBA) determination that placing a cemetery maintenance requirement into SBA's section 8(a) program would not have an adverse impact on an individual small business, a group of small businesses located in a specific geographical location, or other small business programs was reasonable, where the record shows that the SBA made requisite findings concerning the lack of adverse impact. DECISION Margni, Inc. protests the award of a sole-source contract to Native Contractors, Inc. under request for proposals (RFP) No. VA-786-06-RP-0148 under the Small Business Administration's (SBA) section 8(a) program, for cemetery maintenance services for the Department of Veterans Affairs (VA) at the GeorgianNationalCemetery, Canton, Georgia. We deny the protest. On March 29, 2006, under request for proposals (RFP) No. VA-786-06-RP-0050, the VA solicited the predecessor to this requirement as a service disabled veteran owned (SDVO) small business set-aside. Five SDVO small businesses, including Margni, submitted acceptable proposals by the April 28 closing date. On May 25, the VA awarded the contract to Benchmark Headstones LLC based on its low $2,437,704.57 price. The requirements contract awarded was for a base period from date of contract award through September 30, 2006, with four 1-year option periods. During performance of the base period, the VA encountered several problems with Benchmark's performance, which caused the VA not to exercise the first option year under the contract. The VA then decided to obtain these cemetery maintenance services under a sole-source contract under the SBA's 8(a) program from Native Contractors, an 8(a) SDVO small business, which was successfully performing similar services at a nearby cemetery. The VA determined that because of the non'exercise of the option, this course of action was in the agency's best interests due to –the urgent nature of the Government's needs.— See VA Report, Tab G.1, Justification for Use of SDVOSB 8(a) Contractor. On September 14, the VA notified the SBA of its desire to negotiate an 8(a) contract with Native Contractors. Included in the letter was the estimated cost of the contract ($2,400,000), the period of performance, which was for 1 year longer than the prior contract, the acquisition history, and other pertinent information. The only acquisition history provided the SBA by the VA was information relating to the Benchmark contract. See VA Report, Tab G.3, at 1-2. On September 19, the SBA, accepted the offering on behalf of Native Landscaping and stated that –[a] determination has been made that acceptance of this procurement will cause no adverse impact on another small business concern.— VA Report, Tab G.3, at 1. A sole-source contract was awarded to Native Contractors under the 8(a) program on September 29. Under section 8(a) of the Small Business Act, the SBA is authorized to enter into contracts with government agencies and to arrange for performance of such contracts by awarding subcontracts to socially and economically disadvantaged small businesses. 15 U.S.C. sect. 637(a) (2000). The Act affords the SBA and contracting agencies broad discretion in selecting procurements for the 8(a) program; we will not consider a protest challenging a decision to procure under the 8(a) program absent a showing of possible bad faith on the part of government officials or that regulations may have been violated. 4 C.F.R. sect. 21.5(b)(3) (2006); Designer Assocs., Inc., B-293226, Feb. 12, 2004, 2004 CPD para. 114 at 4. Under the Act's implementing regulations, the SBA may not accept any procurement for award as an 8(a) contract if doing so would have an adverse impact on an individual small business, a group of small businesses located within a specific geographical location, or other small business programs. 13 C.F.R. sect. 124.504(c) (2006).