Link: GAO Decision
Protestor: Walden Security
Agency: Department of Health and Human Services, Centers for Disease Control and Prevention
Disposition: Protest Denied.
Protest challenging an agency’s decision to set aside a procurement for small businesses is denied where the record shows that the contracting officer reasonably expected that at least two responsible small business concerns would compete for the award and that award would be made at a fair market price.
General Counsel PC:
Metropolitan Security Services, Inc. d/b/a Walden Security protested the decision to issue an RFQ for security guard services at various locations in the metropolitan Atlanta, Georgia area as a small business set-aside. Walden, a large business, was the incumbent contractor, and objected to the setting aside of the follow-on contract for small businesses. Walden argued that no small business could meet the requirement because the 120 day transition period does not allow enough time to certify a sufficient number of guards to perform the requirement. Walden also asserted that the agency failed to conduct and document a contemporaneous analysis of its decision to issue the solicitation as a small business set-aside.
The GAO agreed with the agency that the email proffered by Walden as evidence that it will take 5-7 months to obtain licenses was at best the CO’s estimate, and the agency reasonably relied on statements by the licensing office that it takes 25-30 days to obtain licenses. The GAO found that Walden’s argument that small businesses would not be able to offer fair market prices was merely speculation. It pointed out that the FAR provides that adequate price competition exists where two or more responsible offerors submit proposals, and the agency had identified four small businesses capable and interested in performing.
Agencies are required to set aside solicitations for small businesses where there is a reasonable expectation that offers will be received from at least two responsible small offerors, and that award will be made at a fair market price. So long as the agency conducted reasonable market research to reach its decision to set aside the requirement, the GAO will defer to the agency’s determination. If a company believes that a requirement should not have been set aside because there are not small businesses capable of performing, it must protest the set aside decision prior to the time set for the receipt of proposals.