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United States Government Accountability Office
Washington, DC 20548 of the United States
Decision
File:
Date: December 11, 2008
Frank Guthart for the protester.
e Logistics Agency, for the agency. Eric M. Ransom, Esq., and Christine S. Melody, Esq., Office of the General Counsel, GAO, participated in the preparation of the decision.
DIGEST
Agency reasonably determined to solicit only two of five firms listed on the qualified
DECISION
Derm-Buro, Inc., of Plainview, New York, protests the failure of the Defense ply Center Philadelphia (DSCP) to solicit it in
We deny the protest.
ired to be worn by all Navy, Marine, and Air Force jet pilots and is designed to prevent the pilot from losing consciousness during high-
The challenged solicitation is a reprocurement for anti-gravity suits that were to be delivered under a prior contract that was terminated for default.1 With regard to this reprocurement, the agency specifically solicited two of five firms listed on the QPL, Switlik Parachute Company and Mustang Survival Manufacturing, to compete for the defaulted requirement. Derm-Buro, also a manufacturer of anti-gravity suits listed on the QPL, was not aware that Switlik and Mustang had been solicited in connection with the defaulted requirement until each was awarded a contract, at which point Derm-Buro filed this protest. Derm-Buro asserts that as a firm listed on the QPL it was entitled to receive a copy of the solicitation, and that DSCP, by withholding the solicitation, improperly denied it the opportunity to submit an offer.
Citing our decision in Montage Inc.
, B-277923, B-277923.2, Dec. 29, 1997, 97-2 CPD
¶ 176, the agency first argues that we should dismiss the protest. In Montage
, we reexamined our previous view that a defaulted contractor may not be automatically excluded from a competition for the defaulted requirement because such an exclusion would constitute an improper premature determination of nonresponsibility. In recognition of the broad authorit
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y to reprocure accorded the contracting
y to reprocure accorded the contracting officer by Federal Acquisition Regulation (FAR) § 49.402-6, we adopted the position that we would decline to review an agencys decision not to solicit a defaulted contractor in the reprocurement of work remaining under the defaulted contract. The agency argues that the Montage
decision should control here because Derm-Buro, although not the defaulted contractor in connection with the anti-gravity suits being reprocured, was recently terminated for default for failure to timely present first article test (FAT) samples and make deliveries under other contracts for anti-gravity suits.
We decline to extend the decision in Montage
beyond the situation presented in that case, and again more recently in Essan Metallix Corp.
, B-310357, Dec. 7, 2007, 2008 CPD ¶ 5, wherein a contractor protests its exclusion from a reprocurement necessitated by the termination of its own contract. As that is not the situation presented here, we will review whether the agencys decision to exclude Derm-Buro was reasonable.
Generally, the statutes and regulations governing federal procurements are not strictly applicable to reprocurements of defaulted requirements. Essan Metallix
Corp.
, supra
, at 2. Rather, under FAR §§ 49.402-6(a), (b), and 52.249-8, an agency may use any terms and acquisition method deemed appropriate for repurchase of not more than the undelivered quantity for which the contract was terminated, although an agency must obtain competition to the maximum extent practicable and as
1 The defaulted contractor under the prior contract is not a party to this protest.
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reasonable a price as practicable.2 Id.
These FAR provisions allow the agency to purchase the needed supplies as expeditiously as possible while preserving the governments right to seek excess reprocurement costs from the defaulted contractor. Id.
The agency argues that it was not required to solicit Derm-Buro in connection w
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ith the reprocurement, and properly made
ith the reprocurement, and properly made awards to Switlik and Mustang in accordance with FAR § 49.402-6(a), (b). The agency states that it elected to limit competition to Switlik and Mustang on the basis that the two firms were the only firms that were currently, or had recently, delivered the required suits successfully. AR, Contracting Officers Report, at 5. Of the five firms whose products were listed on the QPL at the time the solicitation was issued, one was the contractor terminated for default under the prior contract and two, including Derm-Buro, had not delivered anti-gravity suits recently enough to be eligible for a waiver of FAT requirements. Id.
at 5-6. Thus, the agency determined that Switlik and Mustang were the only firms that could be practicably included in the competition in order to ensure continuous deliveries without a break in production and thereby secure the expeditious replacement of the quantity of anti-gravity suits remaining undelivered from the terminated contract.
Derm-Buro counters that the agencys rationale does not hold because the delivery schedule under the reprocurement contracts will allow sufficient time for all contractors on the QPL to compete, including Derm-Buro, and that by not soliciting all contractors on the QPL the agency failed to obtain competition to the maximum extent practicable and repurchase at as reasonable a price as practicable.3 Derm-Buro insists that it is fully capable of producing the required anti-gravity suits, has successfully delivered approximately 65,000-70,000 units in the past and, as it has argued before the Armed Services Board of Contract Appeals, was improperly terminated under its prior contracts.4
2 The reprocurement here is for the exact number of anti-gravity suits that remain undelivered from the terminated contract.
3 Derm-Buro, as a veteran-owned small business, also requested that the matter of its qualifications be referred to the Small Business Administration under FAR
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§ 19.6. FAR § 19.6 applies when an ap
§ 19.6. FAR § 19.6 applies when an apparent successful small business offeror is determined by the contracting officer to be nonresponsible. FAR § 19.6 does not apply here, as Derm-Buro is not an apparent successful offeror and, in any event, as addressed in our discussion of Montage
, our Office no longer considers an agencys determination to exclude a firm from a reprocurement to involve a determination of nonresponsibility.
4 The propriety of the terminations for default on its prior contracts is a matter of contract administration not for review by our Office. Bid Protest Regulations, 4 C.F.R. § 21.5(a) (2008).
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The agencys decision to limit competition for the reprocurement to the two firms currently producing anti-gravity suits, and the only firms on the QPL not subject to FAT requirements, was reasonable. With respect to not soliciting Derm-Buro, the firms last successful delivery of anti-gravity suits was in November 2006. Therefore, as stated by the agency, Derm-Buro would be required to submit FAT samples and pass a FAT before it could begin production. Given that the recent terminations for default on Derm-Buros contracts were a result of its failure to provide FAT samples in a timely manner and failure to make deliveries within the timeframe established in its contract, the agency had a reasonable concern that soliciting Derm-Buro (or any other firm subject to FAT requirements) could have an adverse effect on the agencys ability to expeditiously reprocure the critically needed suits. In light of the agencys critical need and the broad discretion granted the agency in determining how to conduct a reprocurement, we conclude that the agency obtained maximum practicable competition by soliciting the two firms on the QPL that were not subject to FAT requirements, and could therefore ensure continuous deliveries of anti-gravity suits with no breaks in production.
The protest is denied.
Gary L. Kepplinger General Counsel
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brPage 1br United States Government Accountability Office Washington DC 20548 brPage 2br brPage 3br brPage 4br brPage 5br brPage 6br brPage 7br brPage 8
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Co mp tr o lle r Ge ne l Washington, DC 20548 of the United States Decision File: Date: December 11, 2008 Frank Guthart for the protester. e Logistics Agency, for the agency. Eric M. Ransom, Esq.
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