Link: GAO Opinion
Agency: Department of the Army
Disposition: Protest denied.
Keywords: Set-aside; Status of Forces Agreement (SOFA); invited contractor
General Counsel P.C. Highlight: An agency must comply with the terms international agreements in its acquisition.
GAO denied the protest of J&J Maintenance, Inc., (J&J) based on the terms of a request for proposals (RFP), issued by the Department of the Army, for operation and maintenance (O&M) services for Medical Command-Korea (MEDDAC-K) facilities in the Republic of Korea.
J&J complains that setting aside the RFP for local sources under the Status of Forces Agreement (SOFA) (and not granting invited contractor status to non-local offerors) unnecessarily restricts competition. GAO states that a contracting agency has the discretion to determine its needs and the best method to accommodate them. However, those needs must be specified in a manner designed to achieve full and open competition. Solicitations may include restrictive requirements only to the extent they are necessary to satisfy the agency’s legitimate needs. Where a protester challenges a specification or requirement as unduly restrictive of competition, the procuring agency has the responsibility of establishing that the specification or requirement is reasonably necessary to meet the agency’s needs. GAO will examine the adequacy of the agency’s justification for a restrictive solicitation provision to ensure that it is rational and can withstand logical scrutiny. A protester’s mere disagreement with the agency’s judgment concerning the agency’s needs and how to accommodate them does not show that the agency’s judgment is unreasonable.
The record here establishes that the agency reasonably found from its market research that there were a number of local firms that could perform the operation and maintenance (O&M) services at TJC standards. Specifically, in response to the Army’s sources sought notice, five Korean firms expressed interest in providing the hospital O&M services to the agency, including the protester’s subcontractor on the incumbent contract. The agency also searched the central contractor registration (CCR) and found that there were 24 active Korean firms available to perform hospital O&M services. Prior to conducting its market research, the agency’s MEDDAC-K facilities director began investigating O&M practices of hospitals across South Korea and toured several Korean hospitals to determine the level of service that their O&M staff was providing. The facilities director found that there were number of Korean hospitals that had been accredited by the Joint Commission International (JCI). In this regard, the Army states that, since the requirement for these services was last competed in 2006 (when the protester was granted invited contractor status), ten Korean hospitals have been accredited by the JCI. The Army found that, although there were some differences between the TJC and JCI standards, the two accreditation standards had substantial similarities and, in some regards, were almost identical. Moreover, the agency found that, to the extent that JCI and TJC accreditation standards differed, the agency’s requirements would be satisfied by requiring the contractor to provide experienced key personnel with the specific, working knowledge of TJC standards. In sum, GAO finds that the agency’s decision not to grant invited contractor status to non-local offerors under SOFA is reasonable and that the record adequately justifies the RFP’s restriction to local sources. The protest is denied.