Matter of: Information Handling Services

John F. McIver, Jr., for the protester.

Richard T. Holland for Dataware Technologies, Inc., an interested party.

Roy E. Potter, Esq., United States Government Printing Office, for the agency.

Guy R. Pietrovito, Esq., and James A. Spangenberg, Esq., Office of the General Counsel, GAO, participated in the preparation of the decision.

Information Handling Services protests the Government Printing Office's (GPO) determination that the Service Contract Act of 1965, 41 U.S.C. § 351 et seq. (1988), was not applicable to GPO's request for proposals (RFP) for Program 900-S, "Federal Logistics Data on Compact Disc-Read Only Memory," to support the Defense Logistics Agency's (DLA) modernization of the Federal Catalog System (FCS).

We sustain the protest.

The FCS is a single catalog system for supply data, operated by the Department of Defense (DOD), pursuant to the Defense Cataloging and Standardization Act, 10 U.S.C. § 2451 et seq. (1988). DLA has been delegated the responsibility for collecting and disseminating FCS logistics data. DOD and civilian agencies use FCS to obtain logistics information (such as stock numbers and reference numbers, item names and control numbers, and interchangeability/substitutability data) to identify, describe, cross-reference, maintain, and requisition supplies. DLA currently distributes this information on microfiche. As part of its modernization efforts, DLA seeks to substitute compact disc technology for microfiche. The authority to conduct this procurement was delegated to GPO by DLA. The RFP, issued November 3, 1989, contemplated the award of a fixed-price contract to convert the FCS from microfiche to compact disc. The RFP as originally issued provided that the Service Contract Act of 1965, 41 U.S.C. § 351 et seq., was applicable. Amendment No. 3 deleted the statement that the contract would be subject to the Service Contract Act and incorporated by reference the standard clause contained at Federal Acquisition Regulation (FAR) § 52.222-20, "Walsh-Healey Public Contracts Act," which provides that any contract for materials or supplies, exceeding $10,000, is subject to the requirements of the Walsh-Healey Act. See 41 U.S.C. § 35 et seq. (1988).1

On May 4, 1990, the protester, along with the National Standards Association and USA Information Services, Inc., requested that the Department of Labor de

1 The Service Contract Act, 41 U.S.C. §§ 351-358, requires contractors performing service contracts with the government to pay minimum wages and fringe benefits, as determined by the Secretary of Labor, while the WalshHealey Act, 41 U.S.C. §§ 35-45, provides for payment of minimum wages to employees performing federal contracts for the manufacture or furnishing of materials, supplies, articles, and equipment.

termine the applicability of the Service Contract Act to the RFP.2 On May 10, Labor determined, from its review of the RFP statement of work, that the Service Contract Act was applicable to the solicitation and requested that GPO submit to Labor an SF-98, "Notice of Intention to Make a Service Contract." GPO did not respond to Labor or to the protester or amend the RFP to incorporate the Service Contract Act, and Information Handling protested to our Office on June 12, before the closing date for receipt of proposals.3 On June 14, GPO received initial proposals, including a proposal from Information Handling, and, on July 18,4 requested that Labor reconsider its determination that the Service Contract Act was applicable. Labor is presently reconsidering the applicability of the Service Contract Act to this solicitation but has not issued its determination as of the time of this decision.

GPO requests that we dismiss Information Handling's protest because Labor, which has the authority to administer and enforce the Service Contract Act, is considering the applicability of the Service Contract Act to this procurement, and GPO states that it will abide by Labor's final decision in this regard. Labor is vested with primary responsibility for interpreting and administering the Service Contract Act, see 41 U.S.C. § 353, and we will defer to Labor's judgment as to the applicability of the Service Contract Act, unless Labor's position is clearly contrary to law. B.B. Saxon Co., Inc., 57 Comp. Gen. 501 (1978), 78-1 CPD 410. Information Handling does not request that we determine the applicability of the Service Contract Act to this procurement; rather, its protest concerns GPO's unreasonable disregard of Labor's determination that the Service Contract Act was applicable and its decision to proceed to receive proposals in the face of Labor's determination.

The regulations implementing the Service Contract Act and Walsh-Healey Act contemplate an initial determination by the procuring agency as to which statute applies to a particular procurement. If the agency believes that a proposed contract "may be subject to" the Service Contract Act, it is required to notify Labor of the agency's intent to make a service contract so that Labor can provide the appropriate wage determination. 29 C.F.R. § 4.4 (1990). If the agency reasonably determines that a contract is not subject to the Service Contract Act, then there is no duty on its part to notify Labor or include Service Contract Act provisions in the solicitation. Tenavision, Inc., B-231453, Aug. 4, 1988, 88-2 CPD 114. On the other hand, if there exists any question or doubt as to the possible application of the Service Contract Act to a particular procurement, the agency is required to obtain Labor's views. 29 C.F.R. § 4.4(a)(1); FAR § 22.1003-7 (FAC 84-56); Hewes Eng'g Co., Inc., B-179501, Feb. 28, 1974, 74-1 CPD ¶ 112.

The record here shows that GPO knew on May 10, more than a month prior to the closing date for receipt of proposals, that Labor was of the view that the

'Labor has primary responsibility for interpreting and administering the Service Contract Act. See 41 U.S.C. § 353. "No award has been made.

This was the same date on which GPO submitted a request for dismissal and report on the protest to our Office.

Service Contract Act was applicable to this procurement. Despite notice of Labor's views, GPO proceeded to receive initial proposals on June 14 and continued with its procurement. On July 18, the date its report on the protest was due, GPO requested that Labor reconsider its determination.

We find that GPO's failure to adhere to Labor's views as to the applicability of the Service Contract Act to this procurement was unreasonable and in violation of applicable regulations. See 29 C.F.R. § 4.4(a)(1); FAR § 22.1003–7. While GPO disagrees with Labor's views as to the applicability of the Service Contract Act, GPO does not contend that Labor's determination was clearly contrary to law, and Labor's views must prevail.

If an agency is on notice of the possible application of the Service Contract Act to a procurement, the agency should suspend the date for receipt of proposals while the matter is pending before Labor for its determination. See Hewes Eng'g Co., Inc., B-179501, supra. Here, GPO requested reconsideration of Labor's determination of the applicability of the Service Contract Act more than 3 months after Labor's determination and only after proposals were received and this protest was filed. It was unreasonable and in violation of applicable regulations for GPO to have continued the procurement, without submitting an SF-98, in the face of Labor's determination. Id.

We recommend that GPO either (1) suspend all further contracting action on this procurement until Labor issues its determination on GPO's request for reconsideration of the applicability of the Service Contract Act, or (2) submit an SF-98 to Labor in accordance with Labor's determination. GPO should include in the RFP any minimum wage rate determination Labor finds applicable to the contract and solicit revised proposals from all offerors. Under the circumstances, the protester is entitled to recover its costs of filing and pursuing the protest, including reasonable attorneys' fees. 4 C.F.R. § 21.6(d)(1) (1990). Information Handling should submit its claim for its protest costs directly to the agency. 4 C.F.R. § 21.6(e).

The protest is sustained.

B-240980.2, October 17, 1990

Procurement

Bid Protests

■GAO procedures

Protest timeliness

Significant issue exemptions

☐☐☐☐ Applicability

Untimely protest of a solicitation's evaluation scheme will not be considered under the significant issue exception to the General Accounting Office (GAO) timeliness requirements where the issue raised in the protest has been considered on the merits by GAO in prior decisions and resolution of the issue would not be of widespread interest to the procurement community but only to the protester in this procurement. GAO will no longer invoke the significant issue exception solely because

the record shows a violation of statute or regulation. 68 Comp. Gen. 473 (1989), 66 Comp. Gen. 367 (1987), and 66 Comp. Gen. 31 (1986) will no longer be followed.

Matter of: DynCorp

Ruth Yudenfriend Morrel, Esq., for the protester.

Jeffrey I. Kessler, Esq., and Susan Leigh Mahone, Esq., Department of the Army, for the agency.

Guy R. Pietrovito, Esq., and James A. Spangenberg, Esq., Office of the General Counsel, GAO, participated in the preparation of the decision.

DynCorp protests the award of a contract to Southern Aero Corporation under request for proposals (RFP) No. DAAJ09-89-R-0585, issued by the U.S. Army Aviation Systems Command, Department of the Army, for the maintenance, overhaul, and storage of UH-1H aircraft. DynCorp contends that the RFP evaluation scheme is defective, and that it would have received an award under a proper scheme.

We dismiss the protest as untimely.

The RFP contemplated the award of a fixed-price requirements contract for the maintenance, overhaul, and storage of UH-1H aircraft for a base year and 4 option years. The RFP stated that award would be made to the responsible offeror submitting the lowest priced, technically acceptable proposal and provided that the evaluated price would be determined by adding together the offeror's prices for all the contract line items. Southern Aero's evaluated price was $25,364,342 and DynCorp's was $25,649,490. The Army awarded a contract to Southern Aero on August 27, 1990.1

DynCorp protests that award to Southern Aero will not result in the lowest "actual" cost to the government because the RFP evaluation scheme is defective. Specifically, DynCorp contends that the RFP provided in one line item for the transportation of 250 aircraft by truck to a government C-5 airfield and also provided in another line item for the transportation of the same 250 aircraft to a government C-141 airfield.2 DynCorp argues that the aircraft will only be delivered to one of the airfields, not both, and that if the proposals were realistically evaluated, its evaluated price would be lower than Southern Aero's. 3

1 COSTAR, a joint venture of JL Associates, Inc. and Tero Tek International, Inc., submitted the lowest evaluated price proposal but was determined to be nonresponsible, and the Small Business Administration denied COSTAR's request for a certificate of competency (COC). COSTAR has protested the nonresponsibility determination and denial of a COC to our Office (B-240980).

2 The RFP also provided that where the aircraft could be flown away by the government there would be no transportation costs for those aircraft.

'It appears from the material submitted by the protester that DynCorp's evaluated price might be lower than Southern Aero's if only one of the transportation line items, or neither of the items, was included in the total evaluated price.

The Army contends that DynCorp's protest of the RFP evaluation scheme, filed after the closing date for receipt of proposals, concerns an apparent solicitation impropriety, which was required to be filed before the closing date for receipt of proposals under our Bid Protest Regulations, 4 C.F.R. § 21.2(a) (1990). The Army requests that we dismiss DynCorp's protest as untimely.

DynCorp states that the RFP evaluation scheme "is a clear error evident on the face of the solicitation" which can be easily remedied, and will result in significant costs to the government if not corrected. DynCorp argues that we should consider the protest under the significant issue exception to our timeliness rules. See 4 C.F.R. § 21.2(b).

Our timeliness rules reflect the dual requirements of giving parties a fair opportunity to present their cases and resolving protests expeditiously without unduly disrupting or delaying the procurement process. Lucas Place, Ltd.Recon., B-238008.3, Sept. 4, 1990, 90-2 CPD ¶ 180. We may, in a given case, invoke the significant issue exception to our timeliness rules when, in our judgment, the circumstances of the case are such that our consideration of the protest would be in the interest of the procurement system. Golden North Van Lines, Inc., B-238874, July 17, 1990, 69 Comp. Gen. 610, 90-2 CPD ¶ 44. In order to prevent the timeliness requirements from becoming meaningless, we will strictly construe and seldom use the significant issue exception, limiting it to protests that raise issues of widespread interest to the procurement community, see, e.g., Golden North Van Lines, Inc., B-238874, supra, and which have not been considered on the merits in a previous decision. Keco Indus., Inc., B-238301, May 21, 1990, 90-1 CPD 1490. The resolution of issues that only relate to the requirements and evaluation procedures of a single solicitation do not generally fall within the exception. See NFI Management Co., B-238522; B-238522.2, June 12, 1990, 69 Comp. Gen. 515, 90–1 CPD ¶| 548.

In our view, the issue of whether the evaluation scheme is defective and would result in the lowest overall cost to the government is not of sufficient interest to the procurement community to invoke the exception. We have numerous decisions which discuss the government's obligation to evaluate proposals under an evaluation scheme which would permit the accurate assessment of the probable cost of award and which provides for the lowest ultimate cost to the government. See Environmental Technologies Group, Inc., B-236813.2, Dec. 20, 1989, 89-2 CPD ¶ 573. Thus, while we recognize the importance of the matter to the protester, we do not regard DynCorp's protest, concerning the allegedly defective evaluation scheme in this single procurement, to be a significant issue under our Regulations.

DynCorp contends that several cases indicate that if the record establishes a clear violation of statute or regulation, we will invoke the significant issue exception. Reliable Trash Service Co. of MD, Inc., 68 Comp. Gen. 473 (1989), 89-1 CPD 535; Adrian Supply Co.-Recon., 66 Comp. Gen. 367 (1987), 87-1 CPD 1357; and R.P. Densen Contractors, Inc., 66 Comp. Gen. 31 (1986), 86-2 CPD 401. In those cases, at the time it became evident to us that the protester was untimely, the record clearly reflected a material error by the agency in the con