Link: GAO Opinion
Agency: Department of Veterans Affairs
Disposition: Protests sustained.
Keywords: SDVO set aside requirements
General Counsel P.C. Highlight: Procurements for Architect-Engineering (A/E) services are not exempt from the Veteran’s Administration requirement for setting aside contracts for veteran-owned companies.
Powerhouse Design Architects & Engineers, Ltd. protests the terms of eight Sources Sought Notices (SSN) issued by the Department of Veterans Affairs (VA) for architect-engineering (A/E) services.
The procurements were conducted pursuant to the Brooks Act and its implementing regulations, set forth at Federal Acquisition Regulation (FAR) subpart 36.6. In accordance with those regulations, the agency issued SSNs on the FedBizOpps website publicizing its need for A/E services. Powerhouse timely challenged the terms of the SSNs, which were issued on an unrestricted basis.
The sole protest issue is whether the agency was required to set aside these A/E procurements for service-disabled veteran-owned small business (SDVOSB) concerns. The protester asserts that the agency’s failure to do so violated the Veterans Benefits, Health Care, and Information Technology Act of 2006, 38 U.S.C. sections 8127-8128 (Supp. III 2006) (VA Act). In relevant part, 38 U.S.C. sect. 8127(d), captioned “use of restricted competition,” provides as follows:
“. . . a contracting officer of [the VA] shall award contracts on the basis of competition restricted to small business concerns owned and controlled by veterans if the contracting officer has a reasonable expectation that two or more small business concerns owned and controlled by veterans will submit offers and that the award can be made at a fair and reasonable price that offers best value to the United States.”
The statute also sets out an order of priority for the contracting preferences it establishes, providing that the first priority for contracts awarded pursuant to 38 U.S.C. sect. 8127(d) shall be given to SDVOSB concerns.
The VA issued regulations implementing the Act which, as relevant here, state that with exceptions, “the contracting officer shall set aside an acquisition for competition restricted to SDVOSB concerns upon a reasonable expectation that (1) Offers will be received from two or more eligible SDVOSB concerns and; (2) Award will be made at a reasonable price.”
The VA argued that the Brooks Act requirement that Federal agencies negotiate contracts for A/E services on the basis of demonstrated competence and qualifications for the type of professional services required makes A/E services exempt from SDVO set-aside requirements. GAO sees nothing in the VA Act or the VA regulations that exempts A/E procurements from the set-aside requirement. The GAO notes that the Brooks Act, which prescribes procedures for conducting A/E procurements with a particular focus on how price is to be considered, is silent with respect to set-asides; nothing contained in it or its implementing suggests a reasonable basis for asserting that A/E procurements are exempt set-aside requirements. The protests are sustained.