B-22257.2, JUN 19, 1986

B-22257.2, JUN 19, 1986

CONTRACTS - PROTESTS - GENERAL ACCOUNTING OFFICE PROCEDURES - TIMELINESS OF PROTEST - DATE BASIS OF PROTEST MADE KNOWN TO PROTESTER DIGEST: 1. THE PERIOD WITHIN WHICH A PROTEST OF THE CANCELLATION OF A SOLICITATION MUST BE FILED IS NOT EXTENDED BY THE AGENCY'S ISSUANCE OF A NEW SOLICITATION FOR THE SAME REQUIREMENT. CONTRACTS - PROTESTS - GENERAL ACCOUNTING OFFICE PROCEDURES - TIMELINESS OF PROTEST - SIGNIFICANT ISSUE EXCEPTION - NOT FOR APPLICATION 2. CONCERNS OF THE LOW BIDDER UNDER A CANCELED SOLICITATION OVER THE INEFFICIENCY AND BASIC UNFAIRNESS OF THE AGENCY'S FAILURE TO AWARD IT A CONTRACT HAVE BEEN CONSIDERED IN PREVIOUS DECISIONS AND THEREFORE DO NOT CONSTITUTE SIGNIFICANT ISSUES WARRANTING CONSIDERATION OF AN UNTIMELY PROTEST.

EMPIRE REALTY CO., INC.:

EMPIRE REALTY COMPANY, INC. REQUESTS RECONSIDERATION OF OUR DECISION, EMPIRE REALTY CO., INC., B-222572, MAY 22, 1986, 86-1 CPD PARA. ***. IN THAT CASE, WE DISMISSED AS UNTIMELY A PROTEST INITIALLY FILED BY EMPIRE WITH THE DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT BOARD OF CONTRACT APPEALS OBJECTING TO THE CANCELLATION OF SOLICITATION NO. 5-86-075 FOR PROPERTY MANAGEMENT SERVICES. THE PROTEST HAD BEEN REFERRED TO THIS OFFICE PURSUANT TO AN ORDER OF THE BOARD. /1/ WE AFFIRM OUR PRIOR DECISION.

IN ITS PROTEST TO THE BOARD, EMPIRE ALLEGED THAT ALTHOUGH IT WAS THE LOW, RESPONSIVE, RESPONSIBLE BIDDER UNDER THE SOLICITATION, THE AGENCY IMPROPERLY CANCELED THE SOLICITATION BASED ON A FINDING OF INADEQUATE COMPETITION. ONLY TWO BIDS HAD BEEN RECEIVED. WE DISMISSED THE PROTEST BECAUSE IT HAD BEEN FILED AT THE BOARD MORE THAN 10 WORKING DAYS AFTER EMPIRE HAD LEARNED OF THE CANCELLATION, AND THEREFORE WAS UNTIMELY UNDER THE RULES OF THE BOARD, 24 C.F.R. SEC. 20.18(B)(2) (1985).

IN REQUESTING RECONSIDERATION, EMPIRE CONTENDS FIRST THAT ITS PROTEST TO THE BOARD SHOULD BE CONSIDERED TIMELY BECAUSE IT WAS FILED BEFORE THE AGENCY HAD TAKEN FINAL ACTION WITH RESPECT TO ITS REQUIREMENT. IN THIS CONNECTION, EMPIRE NOTES THAT THE AGENCY HAD ISSUED A SECOND SOLICITATION FOR THE REQUIRED SERVICES AND THAT THE PROTEST WAS FILED ON THE SAME DAY THAT BIDS UNDER THE SECOND SOLICITATION WERE TO BE OPENED. EMPIRE ARGUES THAT ITS PROTEST WAS TIMELY BECAUSE THE TWO SOLICITATIONS WERE "INEXORABLY CONNECTED." ALTERNATIVELY, EMPIRE CONTENDS THAT EVEN IF ITS PROTEST TO THE BOARD WAS UNTIMELY, THIS OFFICE SHOULD CONSIDER IT NEVERTHELESS UNDER EITHER OR BOTH OF THE EXCEPTIONS TO THE BOARD'S TIMELINESS RULES FOUND AT 24 C.F.R. SEC. 20.18(C). THAT SECTION, WHICH IS VIRTUALLY OUR BID PROTEST REGULATIONS, IDENTICAL TO THE TIMELINESS EXCEPTIONS CONTAINED IN 4 C.F.R. SEC. 21.2(C) (1986), PROVIDES THAT A PROTEST MAY BE CONSIDERED EVEN THOUGH IT WAS NOT FILED TIMELY AT THE BOARD EITHER WHEN IT IS DETERMINED THAT THE PROTEST RAISES SIGNIFICANT PROCUREMENT ISSUES OR WHEN GOOD CAUSES IS SHOWN.

WE FIND EMPIRE'S ARGUMENTS TO BE WITHOUT MERIT. EMPIRE'S PROTEST TO THE BOARD RAISED ONLY THE ISSUE OF WHETHER THE AGENCY HAD ACTED PROPERLY IN CANCELING THE FIRST SOLICITATION. ALTHOUGH EMPIRE'S PROTEST MENTIONED THE REISSUED SOLICITATION, AND NOTED THAT IT NOW CONTAINED AN UNDESIRABLE PROVISION PROHIBITING THE CONTRACTOR FROM BEING INVOLVED IN SALES OF THE MANAGED PROPERTIES, THERE WAS NO INDICATION THAT EMPIRE WAS INTENDING TO PROTEST THE REISSUED SOLICITATION. WE AGREE WITH EMPIRE THAT THE FIRST AND SECOND SOLICITATIONS ARE RELATED. WE DO NOT AGREE, HOWEVER, THAT THE AGENCY'S ISSUANCE OF THE SECOND SOLICITATION REASONABLY CAN BE VIEWED AS EXTENDING THE PERIOD WITHIN WHICH A PROTEST OF THE CANCELLATION COULD BE FILED. THE VERY PURPOSE OF REQUIRING A PROTEST TO BE FILED WITHIN 10 DAYS OF WHEN THE BASIS FOR THE PROTEST IS FIRST DISCOVERED IS TO PROMOTE THE EARLY RESOLUTION OF THE PROTEST SO THE AGENCY MAY PROCEED WITH THE PROCUREMENT WITHOUT FEAR OF HAVING THAT PROCESS DISRUPTED BY CLAIMS BASED ON EARLIER EVENTS. SEE INTERNATIONAL DEVELOPMENT INSTITUTE, 64 COMP.GEN. 259 (1985), 85-1 CPD PARA. 179.

WE ALSO DO NOT AGREE WITH EMPIRE THAT ITS PROTEST SHOULD BE CONSIDERED UNDER EITHER OF THE EXCEPTIONS TO THE TIMELINESS RULES. /2/ TO PREVENT THE TIMELINESS RULES FROM BECOMING MEANINGLESS, THE SIGNIFICANT ISSUE EXCEPTION IS STRICTLY CONSTRUED, AND SELDOM USED. ITT TELECOM PRODUCTS CORP., B-221325, ET AL., MAR. 21, 1986, 86-1 CPD PARA. 283. ITS USE IS LIMITED TO ISSUES OF WIDESPREAD INTEREST TO THE PROCUREMENT COMMUNITY THAT HAVE NOT BEEN CONSIDERED PREVIOUSLY ON THE MERITS. ID. IN THIS CASE, EMPIRE'S SIGNIFICANT ISSUE ARGUMENTS, IN ESSENCE, ALL CONCERN THE INEFFICIENCY AND BASIC UNFAIRNESS INVOLVED IN AN AGENCY'S FAILURE TO AWARD A CONTRACT TO THE LOWEST BIDDER. OUR NUMEROUS PRIOR DECISIONS ON THE PROPRIETY OF AN AGENCY'S DETERMINATION TO CANCEL A SOLICITATION HAVE CONSIDERED THESE ISSUES. SEE, E.G., DESIGNWARE, INC., B-221085, JAN. 28, 1986, 86-1 CPD PARA. 101.

WITH REGARD TO THE GOOD CAUSE EXCEPTION, EMPIRE CONTENDS THAT IT HAD GOOD CAUSE FOR THE UNTIMELY FILING OF ITS PROTEST BASED ON ITS BELIEF THAT THE SECOND SOLICITATION WAS LINKED TO THE FIRST. EMPIRE ALSO SUGGESTS THAT IT WAS ENTITLED TO REFRAIN FROM PROTESTING THE CANCELLATION OF THE FIRST SOLICITATION UNTIL IT BECAME AWARE THAT THE SECOND SOLICITATION CONTAINED AN UNFAVORABLE PROVISION. AS DISCUSSED ABOVE, HOWEVER, THE ACTION ABOUT WHICH EMPIRE COMPLAINED IN ITS PROTEST TO THE BOARD WAS THE CANCELLATION OF THE FIRST SOLICITATION, AND THE AGENCY'S SUBSEQUENT EFFORT TO OBTAIN THE REQUIRED SERVICES THROUGH A SEPARATE SOLICITATION DID NOT EXCUSE EMPIRE FROM FILING ITS PROTEST WITHIN 10 DAYS OF WHEN IT LEARNED OF THE CANCELLATION.

OUR PRIOR DECISION IS AFFIRMED.

/1/ IN ORDERING REFERRAL, THE BOARD CITED THE POLICY OF THIS OFFICE TO CONSIDER PROTESTS REFERRED BY THE BOARD, PROVIDED THEIR FILING AT THE BOARD WAS TIMELY UNDER ITS RULES.

/2/ WHEN WE CONCLUDED IN OUR PRIOR DECISION THAT EMPIRE'S PROTEST TO THE BOARD WAS UNTIMELY, WE APPLIED THE BOARD'S TIMELINESS RULES. RECONSIDERATION, HOWEVER, EMPIRE HAD INVOKED THE EXCEPTIONS TO THE TIMELINESS RULES, THE GRANTING OF WHICH IS WITHIN THE DISCRETION OF THE PARTICULAR FORUM BEFORE WHICH SUCH REQUEST FOR A WAIVER IS MADE. CANNOT DECIDE FOR THE BOARD WHETHER ITS TIMELINESS EXCEPTIONS SHOULD APPLY, BUT RATHER WILL CONSIDER EMPIRE'S REQUEST UNDER THE VIRTUALLY IDENTICAL PROVISIONS OF OUR OWN REGULATIONS. 4 C.F.R. SEC. 21.2(C).