B-236969, Oct 12, 1989, 89-2 CPD 346

B-236969: Oct 12, 1989

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PROCUREMENT - Socio-Economic Policies - Small business set-asides - Use - Administrative discretion DIGEST: Protest challenging agency decision to set aside procurement under section 8(a) of the Small Business Act on the basis that it violated the general requirement for full and open competition in the Competition in Contracting Act (CICA) is dismissed because awards under the 8(a) program are exempted from CICA's competition requirement. By the Defense Construction Supply Center (DCSC). /1/ The proposed contract is for custodial services and refuse removal at the Defense Logistics Agency Finance Center. The solicitation was initially issued in July 1989 and was subsequently canceled. The requirement was then set aside under the 8(a) program.

B-236969, Oct 12, 1989, 89-2 CPD 346

PROCUREMENT - Socio-Economic Policies - Small business set-asides - Use - Administrative discretion DIGEST: Protest challenging agency decision to set aside procurement under section 8(a) of the Small Business Act on the basis that it violated the general requirement for full and open competition in the Competition in Contracting Act (CICA) is dismissed because awards under the 8(a) program are exempted from CICA's competition requirement.

Bosco Contracting Incorporated:

Bosco Contracting Incorporated protests that it has been improperly excluded from competing for the award of a contract set aside under section 8(a) of the Small Business Act, 15 U.S.C. Sec. 637(a)(1988), by the Defense Construction Supply Center (DCSC). /1/ The proposed contract is for custodial services and refuse removal at the Defense Logistics Agency Finance Center, Columbus, Ohio. Bosco alleges that by reserving the procurement for minority-controlled small businesses the agency has failed to comply with the requirements of the Competition in Contracting Act (CICA), 10 U.S.C. Sec. 2305(a)(1)(A)(i) and (ii) (1988), for full and open competition.

We dismiss the protest.

The solicitation was initially issued in July 1989 and was subsequently canceled. The requirement was then set aside under the 8(a) program. Bosco, a minority-owned small business, contacted the local SBA representative at DCSC in September 1989, to ascertain whether it could compete for the procurement. The firm was told that the agency had already selected the minority business that would participate under the set aside. The protester then contacted the main SBA office and requested that Bosco be qualified under the 8(a) program and be allowed to compete for this award, or in the alternative, that the 8(a) set-aside be converted to a small disadvantaged business (SDB) set-aside. The SBA refused these requests. This protest followed.

Bosco protests that the agency violated the requirements for full and open competition under CICA by failing to give all offerors notice of its intention to set the procurement aside for small businesses, arguing that early notice would either have given Bosco time to become qualified as an 8(a) business concern or would have allowed the agency to set the procurement aside for SDB's.

Under CICA, agencies are generally required to obtain full and open competition and to use the competitive procedure best suited to the circumstances of the procurement. 10 U.S.C. Sec. 2304(a)(1)(B). However, under 10 U.S.C. Sec. 2304(c)(5) an agency may use other than competitive procedures when "a statute expressly authorizes or requires that the procurement be made through another agency." Since this procurement is being conducted as an 8(a) set-aside under 15 U.S.C. Sec. 637(a), CICA's overall mandate for full and open competition does not apply. Moreover, an agency properly may cancel a solicitation for the purpose of setting aside a procurement for award under the section 8(a) program. See Moore's Cafeteria Services, Inc., B-234063.4, June 29, 1989, 89-2 CPD Para. 11. determination to cancel a competitive procurement to initiate a section 8(a) procurement is within the broad discretion of the contracting agency and the SBA under the applicable statute and regulations, and we will not review such a determination absent a showing of possible fraud or bad faith on the part of government officials. Id. Here, there is no allegation of fraud or bad faith.

Bosco also protests that the agency should have converted the 8(a) set- aside to an SDB set-aside, arguing that this would have increased competition. However, the Department of Defense Federal Acquisition Regulation Supplement (DFARS) provides that SDB set-asides shall not be conducted where the acquisition has been reserved for the 8(a) program. DFARS Sec. 219.502-72(b)(4)(1988 ed.).

Finally, Bosco also alleges that the agency was required under CICA to use advance planning and market research in order to achieve full and open competition. As discussed above, the procedure leading to an 8(a) award is not encompassed by the competitive procurement statutes. We therefore will not consider this argument further.

The protest is dismissed.

/1/ Section 8(a) authorizes the Small Business Administration (SBA) to contract with government agencies and to arrange for performance of the contract by awarding a subcontract to a socially and economically disadvantaged small business.