Agency: General Services Administration (GSA)
Disposition: Protest Sustained
Keywords: Javits-Wagner-O’Day Act
Decided: November 29, 2017
Released: December 6, 2017
General Counsel P.C. Highlight:
The Javits-Wagner-O’Day Act requiring the use of a mandatory source for services cannot be overcome by including such services in a “full service” lease to another.
Summary of Facts
The GSA has leased a building housing the Charlottesville courthouse from VVP, LLC for several years. This lease of office and related space was set to expire in January of 2018. Separately, GSA contracted with Goodwill Industries of the Valleys (Goodwill) to provide custodial services for the Charlottesville courthouse. This contract was set to expire at the end of January, 2018.
In October of 2016, VVP contacted Goodwill, indicating they were negotiating a new lease with
GSA. The email contact stated, in relevant part, “It appears we [VVP] will be taking over the cleaning contract.” The email requested Goodwill provide information about the scope of work and a quote for the work. Goodwill sent a proposal for custodial services. Included in the email were various assumptions, including that the proposal contemplated an award of a contract between Goodwill and VVP, pursuant to the anticipated GSA lease. Goodwill noted they were the mandatory designated source for custodial services, pursuant to the Javits-Wagner-O’Day Act (JWOD Act).
In May of 2017, the GSA informed Goodwill they would not be renewing Goodwill’s contract for custodial services for the Charlottesville courthouse. Goodwill reached out to GSA to confirm VVP would be required to procure custodial services from Goodwill, pursuant to the JWOD Act. GSA responded they had no authority to direct VVP to use a particular contractor to perform the custodial services.
Goodwill’s protest followed.
Basis for Protest
The JWOD Act is designed to increase both training and employment opportunities for blind and severely disabled people. It authorizes noncompetitive acquisition of certain, specified products and services from nonprofit agencies. The Act states the Federal Government shall procure certain products and services from identified nonprofit agencies. When a contracting activity includes as one of many requirements a service on the list, the procurement shall require their contractors procure the identified services from designated nonprofit agencies.
Goodwill previously held the contract independent of VVP, under a federal regulation designating Goodwill as the provider of custodial services at the Charlottesville Courthouse. This federal regulation was developed and enacted in 2004. Goodwill’s protest argues while the GAO combined the leasing contract previously held by VVP and the custodial contract held by Goodwill, VVP had the obligation to contract custodial services to Goodwill under the Act.
- The General Accounting Office (GAO) does not have jurisdiction about protests relating to the JWOD Act;
- The protest was not timely;
- The protesters are not qualified interested parties;
- The violation is related to contract administration; and/or
- The protest involves a subcontract.
Any one of these, the GSA argues, should result in dismissal of the protest. The GAO rejects these arguments entirely, and proceeds to the merits of the protest.
In support of their position denying the award of the custodial services contract to Goodwill, either directly, or as a condition of a leasing contract with VVP, the GSA argues the JWOD Act does not apply to leasing contracts. However, they cite no caselaw or statutory provision, nor any other authority for this position.
In reviewing the plain language of the Act, the GAO finds no basis for GSA’s assertion. They find GSA bundled custodial services in with a building lease without regard to the JWOD Act, and without instruction their contracted lessor to comply with the JWOD Act.
In light of the finding, the GAO recommends GSA either contract with Goodwill separately or require VVP to contract with Goodwill for custodial services, consistent with the mandates of the JWOD Act.