Link: GAO Decision
Protestor: Camden Shipping Corporation
Agency: Department of the Navy
Disposition: Protests Denied.
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GAO Digest:
- Agency reasonably awarded a bridge contract on a sole-source basis for the operation and maintenance of a vessel, where the agency reasonably determined that only the incumbent contractor/awardee could ensure the critically needed uninterrupted operation of the vessel, and the sole-source award did not result from a lack of advance procurement planning.
- Agency had a reasonable basis to cancel a solicitation for the operation and maintenance of a vessel that was set-aside for small businesses, and reissue the solicitation for the same services on an unrestricted basis, where the record supports the agency’s determination that prices offered by the small businesses in response to the solicitation set aside for small businesses were unreasonable
General Counsel P.C. Highlight:
Camden Shipping Corporation protested the sole-source award to Seaward Services, Inc. of a bridge contract for the operation and maintenance of the ocean survey vessel (OSV) BOLD; it also contends that an RFP issued for the same services should have issued as a total small business set-aside. In response to the award to Seaward under the RFP, Camden and another offeror made a timely size protest to the SBA. Pending the SBA’s size determination, Seaward was awarded a bridge contract to continue the uninterrupted operation of the OSV BOLD. Seaward was ultimately determined to be other than small, but it appealed this determination to the SBA, and was awarded another bridge contract. The agency engaged in several rounds of discussions with the remaining offerors and requested several rounds of revised proposals, but ultimately reached the conclusion that none of the remaining offerors’ prices were fair and reasonable. It cancelled the RFP and issued a new solicitation on an unrestricted basis.
The GAO found the Justification and Approval (J&A) supporting the sole-source bridge award to Seaward to be reasonable, finding no basis to question the agency’s assertion that there was a critical and immediate need for the OSV BOLD to continue operations uninterrupted. It also disagreed with Camden that the urgency of the requirement resulting in the sole-source award of the bridge contract was the result of a lack of advanced procurement planning. Finally, it rejected Camden’s argument that the determination not to set the procurement aside for small businesses was unreasonable, finding that the agency conducted adequate market research to gain information on which to base a determination of price reasonableness, and gave small business offerors multiple opportunities to lower their prices.
An agency is permitted to limit the number of sources from which it solicits proposals in situations of unusual and compelling urgency. While it should still solicit offers from as many sources as practicable, it is permitted to sole-source the award if it reasonably believes that only one firm can properly perform the work in the time available. It is particularly difficult for non-incumbent firms to successfully protest the sole-source award of an emergency bridge contract to an incumbent contractor where award of the contract to any other firm would require some period of transition. Where the agency is facing an interruption of vital services, a temporary sole-source award to the incumbent may be its only viable option. Potential protestors should be aware that agencies may drag their feet in approaching requirements so they can justify a bridge to the incumbent. Be prepared to protest a sole source award where the cause is lack of advanced planning.