B-299108, SEI Group, Inc., February 6, 2007

B-299108 Feb 06, 2007 Jump To VIEW DECISION DOWNLOADS RELATED PAGES GAO CONTACTS Highlights SEI Group, Inc. protests the Federal Emergency Management Agency's (FEMA) decision to cancel request for proposals (RFP) No. HSFEEM-06-R-0020 for base camp services. SEI asserts that the agency should have amended rather than canceled the solicitation because the contemplated changes to the solicitation are not significant and the agency's requirements have not changed. SEI also challenges the timing of the cancellation. We deny the protest. View Decision B-299108, SEI Group, Inc., February 6, 2007 Decision Matter of: SEI Group, Inc. File: B-299108 Date: February 6, 2007 Eloy J. Torrez for the protester. Audrey H. Liebross, Esq., Federal Emergency Management Agency, for the agency. Kenneth Kilgour, Esq., and Christine S. Melody, Esq., Office of the General Counsel, GAO, participated in the preparation of the decision. DIGEST Protest challenging cancellation of solicitation is denied where the record supports the agency's assertion that by canceling the solicitation the agency could save money, enhance competition, and increase its purchasing flexibility. DECISION SEI Group, Inc. protests the Federal Emergency Management Agency's (FEMA) decision to cancel request for proposals (RFP) No. HSFEEM-06-R-0020 for base camp services. SEI asserts that the agency should have amended rather than canceled the solicitation because the contemplated changes to the solicitation are not significant and the agency's requirements have not changed. SEI also challenges the timing of the cancellation. We deny the protest. On April 30, 2006, FEMA issued the solicitation as a small business set-aside contemplating award of multiple indefinite-delivery/indefinite-quantity contracts for setting up and operating base camps to house personnel deployed in anticipation of domestic disasters. The solicitation divided the service area into four geographic regions covering the entire country. Prior to the proposal due date of May 4, 2006, the agency amended the solicitation to add line items for phase-in and readiness costs. In mid-July, the source evaluation board (SEB) completed review of the 46 proposals received in response to the RFP and also decided to reexamine its requirements; the hurricane season had already begun and FEMA had concerns about the costs that would be incurred for readiness and phase-in activities. Discussions between the head of the SEB and agency management produced a number of options, one of which was to make award for geographic area 3 only, which was continuing to recover from Hurricanes Katrina and Rita. The SEB reconvened, adopted the option of making award for area 3 only, and recommended awards to the protester and one other offeror. On August 24, the agency referred the two offerors to the Small Business Administration (SBA) for review under the certificate of competency (COC) procedures. On August 29, the SBA in the course of its COC review notified the agency that the second offeror was not eligible for award as a small business and therefore not eligible for a COC, leaving only SEI in the competition. The agency ultimately concluded that the solicitation no longer accurately reflected its needs in that it could not justify incurring phase-in and readiness costs as the end of the hurricane season neared. The agency also expressed concern that because the protester was the only remaining offeror, it would be required to provide services to all five base camps. On September 14, the agency canceled the solicitation. SEI asserts that FEMA should have amended rather then canceled the solicitation. The protester contends that, because the agency added the line items for phase-in and readiness by amending the solicitation, an amendment to remove those same provisions would not be a significant enough change to warrant canceling the solicitation. Further, SEI argues that the agency's requirements in fact have not changed and that the agency will issue another solicitation to construct, operate, and maintain base camps. Even if the agency had proper grounds to cancel the solicitation, SEI contends, the agency should have canceled the solicitation after receiving the initial proposals and before asking for additional information from offerors. As explained below, we find the agency's decision to cancel the solicitation was proper. In a negotiated procurement, where one or more of the offerors' prices have been revealed, an agency may properly cancel a solicitation where the record contains plausible evidence or reflects a reasonable possibility that a decision not to cancel would be prejudicial to the government or the integrity of the procurement system. Noelke GmbH, B-278324.2, Feb. 9, 1998, 98-1 CPD para. 46 at 3-4. Here, we conclude that the agency's decision to cancel the solicitation was proper.