, B-302499, July 21, 2004

B-302499 Jul 21, 2004 Jump To VIEW DECISION DOWNLOADS RELATED PAGES GAO CONTACTS Highlights This correspondence responds to a request by the Senate Committee on Finance for our review of the Internal Revenue Service's (IRS) issuance of certain task orders under its Treasury Information Processing Support Services (TIPSS-2) multiple award task order contract. Specifically, the Committee asked whether the issuance of task orders for organizational modernization services placed under the TIPSS-2 contract complies with the "fair opportunity" requirement of the Federal Acquisition Streamlining Act (FASA) of 1994. FASA requires that all multiple award contractors must be provided a fair opportunity to be considered "for each task or delivery order" over $2,500 issued under a contract unless one of four statutory exceptions applies. View Decision The Federal Acquisition Streamlining Act of 1994 - Fair opportunity procedures under multiple award task order contracts, B-302499, July 21, 2004 B-302499 July 21, 2004 MACROBUTTON The Honorable Charles E. Grassley Chairman The Honorable Max Baucus Ranking Minority Member Committee on Finance United States Senate Subject: The Federal Acquisition Streamlining Act of 1994 Fair opportunity procedures under multiple award task order contracts This responds to your request for our review of the Internal Revenue Services (IRS) issuance of certain task orders under its Treasury Information Processing Support Services (TIPSS-2) multiple award task order contract. [1] Specifically, you asked whether the issuance of task orders for organizational modernization services placed under the TIPSS-2 contract complies with the fair opportunity requirement of the Federal Acquisition Streamlining Act (FASA) of 1994. [2] FASA requires that all multiple award contractors must be provided a fair opportunity to be considered for each task or delivery order over2,500 issued under a contract unless one of four statutory exceptions applies. [3] As discussed in detail in the enclosure to this letter, we conclude that IRSs selection of certain TIPPS-2 contractors to perform all task orders for organizational modification services, without giving other contractors a fair opportunity to be considered for the individual task orders, violates FASA. A summary of the relevant facts and our legal analysis follows. Since 1998, IRS has been engaged in efforts to reorganize its structure and modernize its technology. A key part of these efforts is organizational modernization (OrgMod), which includes changes to IRSs organizational structure, management roles and responsibilities, business practices, performance measures, and supporting technology. IRS obtains services for the OrgMod program through its TIPPS-2 contract. The TIPPS-2 contract is a multiple award task order contract that encompasses not only the OrgMod program, but also a variety of other services. There are 18 multiple award contractors eligible to receive individual task order awards in some or all of the TIPSS-2 service areas. In July 2002, IRS conducted a competitive procedure among the TIPPS-2 contractors to perform OrgMod services. It issued a master Request for Information (RFI) to all 18 TIPSS-2 contractors, inviting them to compete for four task areas of the OrgMod work. The master RFI stated that IRS would select a contractor to perform the services described within each task area, and that [w]inning the competition will result in the award of any task order designated for that particular task area. IRS selected Booz, Allen & Hamilton (BAH) as the contractor for two of the task areas, and two other firms (TRW, Inc. and Pragmatics Corp.) for the other two task areas. The July 2002 RFI has resulted in the issuance of 37 task orders in the OrgMod task areas (36 task orders were issued in the two areas awarded to BAH, and one was issued in TRWs task area). The relevant provision in FASA states: When multiple [task or delivery order] contracts are awarded . . .all contractors awarded such contracts shall be provided a fair opportunity to be considered, pursuant to procedures set forth in the contracts, for each task or delivery order in excess of2,500 that is to be issued under any of the contracts. Here, there is no evidence that IRS gave any meaningful consideration to other contractors before issuing every one of the 37 OrgMod task orders to the pre-selected contractors. The fact that IRS gave all TIPPS-2 contractors an opportunity to be considered for the four OrgMod task areas does not satisfy FASAs fair opportunity requirement, which applies to individual task orders and which IRS disregarded with respect to the 37 OrgMod task orders resulting from the master RFI.