Allegation That Awardee Is Not Minority Firm

A company protested the award of a subcontract by the Small Business Administration (SBA) to a competitor under a request for proposals issued by the Wright-Patterson Air Force Base. The solicitation was set aside by the Air Force for minority business enterprises pursuant to the Small Business Act. The protester contended that the awardee did not qualify as a minority business enterprise. In support of this contention, the protester alleged that the principals of the awarded firm were not economically and socially deprived and that they were aliens, being citizens of India. In addition, the protester contended that the awardee had become a self-sustaining, competitive entity and, therefore, did not need procurement assistance from the Government. The question of whether a firm is eligible as a minority business enterprise is basically a matter for SBA. Furthermore, the question of how much aid a minority business needs to become self-sustaining is also a judgmental one for SBA. GAO review of SBA action is limited to determining whether SBA has followed it regulations, There was no indication that SBA failed to follow its regulations in determining the firm's eligibility as a concern. GAO recommended the SBA review the awardee's eligibility based on social disadvantage alone to determine if it should be allowed to continue as a minority business set aside in view of present law or if its participation should be terminated in accordance with the law. The protest was denied in part and dismissed in part.