B-219151, AUG 21, 1985, OFFICE OF GENERAL COUNSEL

B-219151: Aug 21, 1985

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SMALL BUSINESS ADMINISTRATION - CONTRACTS - CONTRACTING WITH OTHER GOVERNMENT AGENCIES - PROCUREMENT UNDER 8(A) PROGRAM - REVIEW BY GAO DIGEST: PROTEST OF SECTION 8(A) PROCUREMENT IS DISMISSED WHERE PROTESTER HAS NOT PROVIDED EVIDENCE WHICH SHOWS FRAUD OR BAD FAITH ON THE PART OF GOVERNMENT OFFICIALS. YOU OBJECT TO AWARD TO DIVERSIFIED ON THE BASIS THAT IT IS NOT A CONCERN WHICH IS ELIGIBLE FOR RECEIPT OF AWARDS UNDER THE SECTION 8(A) PROGRAM. HAVE SHOWN A PREFERENCE FOR DIVERSIFIED WHICH HAS RESULTED IN DIVERSIFIED HAVING RECEIVED OVER $5.5 MILLION IN AWARDS UNDER THE 8(A) PROGRAM IN LESS THAN 1 YEAR FOR PROCUREMENTS AT PORT BLISS. YOU STATE THAT THESE SAME SBA OFFICIALS HAVE INDICATED AN UNWILLINGNESS TO ASSIST YOUR FIRM IN OBTAINING SUBCONTRACTS UNDER THE 8(A) PROGRAM.

B-219151, AUG 21, 1985, OFFICE OF GENERAL COUNSEL

SMALL BUSINESS ADMINISTRATION - CONTRACTS - CONTRACTING WITH OTHER GOVERNMENT AGENCIES - PROCUREMENT UNDER 8(A) PROGRAM - REVIEW BY GAO DIGEST: PROTEST OF SECTION 8(A) PROCUREMENT IS DISMISSED WHERE PROTESTER HAS NOT PROVIDED EVIDENCE WHICH SHOWS FRAUD OR BAD FAITH ON THE PART OF GOVERNMENT OFFICIALS.

RESTREPO ENTERPRISES, INC.: POST OFFICE BOX 12066 EL PASO, TEXAS 79912 ATTENTION: DR. CARLOS C. RESTREPO, PH.D. PRESIDENT

ON JULY 1, 1985, THIS OFFICE RECEIVED YOUR SECOND SUBMISSION OF A PROTEST CONCERNING THE AWARD OF A SUBCONTRACT BY THE SMALL BUSINESS ADMINISTRATION (SBA) PURSUANT TO SECTION 8(A) OF THE SMALL BUSINESS ACT, 15 U.S.C. SEC. 637(A) (1982), TO DIVERSIFIED TECHNICAL SERVICES, INC. (DIVERSIFIED), UNDER SOLICITATION NO. DABT60-85-R-0170 ISSUED BY THE UNITED STATES ARMY. ON JUNE 19, 1985, WE DISMISSED YOUR PRIOR PROTEST WHICH HAD BEEN RECEIVED ON JUNE 14, 1985, ON THE BASIS THAT YOUR FIRM HAD NOT TIMELY FILED A COPY OF THE PROTEST WITH THE AGENCY CONTRACTING OFFICER AS REQUIRED BY OUR BID PROTEST REGULATIONS. 4 C.F.R. SEC. 21.3 (A) (1985).

YOU OBJECT TO AWARD TO DIVERSIFIED ON THE BASIS THAT IT IS NOT A CONCERN WHICH IS ELIGIBLE FOR RECEIPT OF AWARDS UNDER THE SECTION 8(A) PROGRAM. IN ADDITION, YOU ASSERT THAT THERE HAS BEEN AN ABSENCE OF GOOD FAITH BY OFFICIALS IN THE EL PASO DISTRICT OFFICE OF THE SBA WHO, YOU ASSERT, HAVE SHOWN A PREFERENCE FOR DIVERSIFIED WHICH HAS RESULTED IN DIVERSIFIED HAVING RECEIVED OVER $5.5 MILLION IN AWARDS UNDER THE 8(A) PROGRAM IN LESS THAN 1 YEAR FOR PROCUREMENTS AT PORT BLISS, TEXAS. YOU STATE THAT THESE SAME SBA OFFICIALS HAVE INDICATED AN UNWILLINGNESS TO ASSIST YOUR FIRM IN OBTAINING SUBCONTRACTS UNDER THE 8(A) PROGRAM. YOU ALSO CONTEND THAT THE AWARDS TO DIVERSIFIED HAVE BEEN IN VIOLATION OF THOSE PART OF THE SBA'S STANDARD OPERATING PROCEDURE (SOP) WHICH REQUIRE THE PREPARATION OF "IMPACT" STATEMENTS PRIOR TO AWARD AND WHICH PLACE A LIMITATION ON AWARDS. IN ADDITION TO YOUR PROTEST OF THE CURRENT AWARD TO DIVERSIFIED YOU HAVE REQUESTED THAT OUR OFFICE CONDUCT AN AUDIT OF THE AWARD OF CONTRACTS DABT60-83-C 0115, DABT60-84-C-0145 AND DABT60-84-C-0156 TO DIVERSIFIED UNDER

YOUR PROTESTS OR AWARDS UNDER PRIOR PROCUREMENTS ARE UNTIMELY FILED AND AND NOT FOR CONSIDERATION UNDER OUR BID PROTEST REGULATIONS, 4 C.F.R. PARA. 21.(2)(A) (1985), AND INFORMATION MARKETING INC., B-205903, MAY 25, 1982 , 82-1 CPD PARA. 497. FURTHERMORE, IT IS NOT WITHIN THE SCOPE OF OUR BID PROTEST FUNCTION TO CONDUCT INVESTIGATIONS OR AUDITS FOR THE PURPOSE OF ESTABLISHING A PROTESTER'S ASSERTIONS. SEE A-1 PURE ICE COMPANY, B-215215, SEPT. 25, 1984, 84-2 CPD PARA. 357.

OUR BID PROTEST REGULATIONS PROVIDE THAT AMONG THE PROTESTS WHICH MAY BE DISMISSED WITHOUT CONSIDERATION OF THE MERITS ARE THOSE CONCERNING PROCUREMENTS UNDER SECTION 8(A) OF THE SMALL BUSINESS ACT. SINCE SUCH CONTRACTS ARE LET UNDER SECTION 8(A) AT THE CONTRACTING OFFICER'S DISCRETION AND ON SUCH TERMS AS ARE AGREED UPON BY THE PROCURING AGENCY AND THE SBA, AWARDS OF 8(A) SUBCONTRACTS ARE NOT SUBJECT TO REVIEW ABSENT A SHOWING OF POSSIBLE FRAUD OR BAD FAITH ON THE PART OF GOVERNMENT OFFICIALS OR THAT REGULATIONS MAY HAVE BEEN VIOLATED. SEE 4 C.F.R. SEC. 21.3(F)(4) (1985).

WE HAVE HELD THAT WE WILL NOT CONSIDER ALLEGATIONS THAT A FIRM IS INELIGIBLE FOR THE 8(A) PROGRAM ABSENT A SHOWING OF POSSIBLE FRAUD OR BAD FAITH ON THE PART OF AGENCY OFFICIALS OR A POSSIBLE VIOLATION OF APPLICABLE REGULATIONS. RILEY-BEAIRD, B-214515, NOV. 15, 1984, 84-1 CPD PARA. 313. WE HAVE ALSO HELD THAT SINCE THE SBA'S STANDARD OPERATING PROCEDURE MERELY PROVIDES INTERNAL SBA POLICIES AND GUIDELINES THAT COMPLEMENT THE SBA'S REGULATIONS IMPLEMENTING THE 8(A) PROGRAM, WE WILL NOT REVIEW THE SBA'S COMPLIANCE WITH THOSE INTERNAL PROCEDURES ABSENT A SHOWING OF POSSIBLE FRAUD OR BAD FAITH. JANKE AND COMPANY, INC., B-216152, AUG. 30, 1984, 84-2 CPD PARA. 242. WHILE YOU ALLEGE AN ABSENCE OF GOOD FAITH ON THE PART OF AGENCY OFFICIALS AT THE SBA, YOUR LETTER DOES NOT PROVIDE ANY SUBSTANTIATING EVIDENCE. A SHOWING OF BAD FAITH BY GOVERNMENT OFFICIALS INVOLVED IN A PROCUREMENT REQUIRES THAT THE PROTESTERS SUBMIT VIRTUALLY IRREFUTABLE PROOF THAT THE OFFICIALS HAD A MALICIOUS AND SPECIFIC INTENT TO HARM THE PROTESTER. SEE CENTRO MANAGEMENT, INC., B-215295, JUNE 20, 1984, 84-1 CPD PARA. 651. THE GENERAL INFORMATION WHICH YOU HAVE PROVIDED IN YOUR JULY 1 SUBMISSION DOES NOT MEET THE HEAVY BURDEN OF PROOF REQUIRED TO SHOW BAD FAITH.

YOU ALSO STATE THAT THERE IS REASON TO BELIEVE THAT A POTENTIAL CONFLICT OF INTEREST SITUATION MAY HAVE ARISEN AS YOU ADVISE THAT DIVERSIFIED HAS OFFERED EMPLOYMENT OPPORTUNITIES TO FEDERAL EMPLOYEES DIRECTLY INVOLVED IN THE PREPARATION OF THE STATEMENT OF WORK FOR SOLICITATION NO. DABT60-85-R- 0170. YOU HAVE NOT PRESENTED IN YOUR PROTEST ANY EVIDENCE WHICH WOULD ESTABLISH THE ALLEGED EMPLOYMENT OFFER OR WHICH WOULD SHOW HOW SUCH OFFERS INFLUENCED THE AWARD OF THE PROCUREMENT. ACCORDINGLY, YOU HAVE NOT PROVIDED FACTS SUFFICIENT TO SHOW A CONFLICT OF INTEREST WHICH INFLUENCED THE PROCUREMENT. SEE VIGILANTES, INC., B-213010, FEB. 8, 1984, 84-1.CPD PARA. 158.

IN VIEW OF THE ABOVE, THE MATTERS RAISED IN YOUR JULY 1 SUBMISSION DO NOT WARRANT CONSIDERATION BY THIS OFFICE.

FINALLY, WE WISH TO NOTE THAT EVEN IF YOUR PROTEST OTHERWISE MERITED CONSIDERATION IT IS NOT CLEAR FROM THE RECORD BEFORE US WHETHER YOUR JULY 1 PROTEST WOULD HAVE BEEN TIMELY SO AS TO PERMIT CONSIDERATION OF THE PROTEST. SEE C.F.R. SEC. 21.2(A)(2) WHICH PROVIDES THAT PROTESTS MUST BE FILED WITH OUR OFFICE NOT LATER THAN 10 DAYS AFTER THE BASIS OF PROTEST IS KNOWN OR SHOULD HAVE BEEN KNOWN WHICHEVER IS EARLIER.