Link: GAO Opinion
Agencies: Department of Energy
Disposition: Protest dismissed.
Keywords: Subcontract protest
General Counsel, P.C. Highlight: GAO has no jurisdiction to consider a protest of a subcontract award, even if the Agency approves the award, unless the Agency largely conducts the evaluation of the subcontractor proposal and directs the prime’s award decision.
Baron Services, Inc. protested the decision of Battelle Memorial Institute, a prime contractor for the Department of Energy (DOE), not to award it a subcontract for radars to support DOE’s Pacific Northwest National Laboratory (PNNL). PNNL is a Federally Funded Research and Development Center that is Government-owned but managed and operated by Battelle under a prime contract with the DOE pursuant to Federal Acquisition Regulation (FAR) subpart 17.6. When Baron was not awarded the subcontract for the radars it protested to the GAO. DOE then moved to dismiss the protest because the award of a subcontract by Battelle on behalf of the DOE was not a procurement conducted by “a Federal Agency,” which would have evoked GAO’s bid protest jurisdiction.
Under the Competition in Contracting Act (CICA), the GAO has jurisdiction to resolve bid protests concerning solicitations and contract awards that are issued “by a Federal agency.” Formerly, GAO would consider prime contract awards of a subcontract if conducted “by and for the government.” Following a series of court decisions, the GAO concluded that its jurisdiction did not generally extend to awards made by prime contractors acting “by and for” the government. However, the GAO continues to take jurisdiction where it finds that a subcontract essentially was awarded “by” the government with prime contractor assistance. This determination is based on an assessment of the totality of the circumstances, including what party was responsible for the preparation of the solicitation, the receipt and evaluations of proposals, the conduct of discussions, the selection of a prospective awardee, and the conduct of responsibility determinations. Instances in which the agency effectively “took over” the procurement, leaving to the prime contractor only the procedural aspects of the procurement are typically found to be procurements “by” the government.
Here, the protester argued that DOE actually conducted the procurement with Battelle’s assistance. Based on the facts, GAO concluded that Battelle, not the DOE, handled all the meaningful aspects of the procurement, including the preparation of the solicitation and evaluation criteria, the evaluation of offers and the selection of the awardee. The DOE’s approval of the issuance of the RFP does not demonstrate that the DOE took over the procurement. Thus, the GAO dismissed Baron’s protest because this procurement was not conducted by the government.