B-242118, Jan 8, 1991, 90-2 CPD 19

B-242118: Jan 8, 1991

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PROCUREMENT - Socio-Economic Policies - Small business set-asides Cancellation - Unrestricted resolicitation - Propriety DIGEST: Where no small business offers are received under a small business set- aside. So that all eligible firms may have an opportunity to compete. The Small Business Administration found that CompuMed is other than small. Resolicitation is unnecessary and the agency should proceed with award to it. CompuMed argues in essence that a contracting agency may make award under a small business set-aside to a business that is other than small without resoliciting the requirement. Offers received from concerns that are other than small must be considered nonresponsive and rejected under procurements restricted to small business concerns.

B-242118, Jan 8, 1991, 90-2 CPD 19

PROCUREMENT - Socio-Economic Policies - Small business set-asides Cancellation - Unrestricted resolicitation - Propriety DIGEST: Where no small business offers are received under a small business set- aside, contracting agency properly decided to withdraw the set aside and resolicit on an unrestricted basis rather than award to a large business offeror, so that all eligible firms may have an opportunity to compete.

Attorneys

CompuMed:

CompuMed protests any cancellation of request for proposals (RFP) No. HRSA-240-BHCDA-6(1), issued as a total small business set-aside by the Department of Health and Human Services (HHS), Health Resources and Services Administration, for electrocardiogram services for federal health units. In response to a timely size status protest from another offeror, the Small Business Administration found that CompuMed is other than small. Because no other small businesses submitted offers, the agency intends to cancel the RFP and resolicit the services on an unrestricted basis. CompuMed contends that since more than one large business responded to the RFP, adequate competition has already been attained; thus, according to the protester, resolicitation is unnecessary and the agency should proceed with award to it.

We deny the protest.

CompuMed argues in essence that a contracting agency may make award under a small business set-aside to a business that is other than small without resoliciting the requirement, so long as an "adequate" number of large businesses submitted offers. /1/

Generally, offers received from concerns that are other than small must be considered nonresponsive and rejected under procurements restricted to small business concerns. Federal Acquisition Regulation (FAR) Sec. 19.502 -4(b). Where no small business bids or proposals are received in response to a set-aside procurement, the proper procedure is for the agency to withdraw the set-aside and resolicit, so that all eligible firms-- including any large businesses which elected not to submit offers in response to the original RFP on the assumption that they would be ineligible for award-- may have an opportunity to compete. Ideal Serv., Inc.; JL Assoc., Inc., B-238927.2 et al., Oct. 26, 1990, 90-2 CPD Para. 335. This is precisely the course of action that HHS intends to pursue here. While more than one offer was received from a large business, there is no indication in the record and we see no basis to assume that other large businesses, which were discouraged from competing because of the small business restriction, would not participate in the resolicitation. Further, we see no evidence that resolicitation would place CompuMed at a competitive disadvantage since its price has not been disclosed to its competitors.

CompuMed argues that it will suffer financially if it is not permitted to proceed with performance since it entered into commitments (which it will now have to cancel) to purchase certain items to be used in contract performance after the agency informed it that it was the apparent successful offeror. To the extent that the protester entered into any commitments prior to contract award, it did so at its own risk. At a minimum, CompuMed should have been aware of the possibility that another offeror might challenge its size status given that the contracting officer is required to inform each unsuccessful offeror in a small business set- aside of the name and location of the apparent successful offeror so as to permit challenges to the successful offeror's small business size status. See FAR Sec. 15.1001(b)(2); United Power Corp., B-239330, May 22, 1990, 69 Comp.Gen. ***, 90-1 CPD Para. 494.

The protest is denied.

/1/ CompuMed indicates that it is its understanding that 5 offerors responded to the RFP. The agency reports that this figure is incorrect, and in fact fewer offers were received.