Complaint Against Procurement Guidance Furnished to Grantee by the Department of Health, Education, and Welfare

A company requested review of a contract awarded by a Department of Health, Education, and Welfare (HEW) grantee, complaining about HEW procurement guidance. The complaint was denied because: the Federal Government has the right to impose conditions on grants and to monitor grantee awards for compliance; review of the grantee's procurement did not establish additional standards or violate the grantee's authority to use its own procurement policies; a provision permitting the grantee to reject all bids was not strictly applicable to the negotiated procurement, but the provision permitted rather than required rejection; HEW was reasonable in attempting to prevent restrictions on competition which it felt would result from resolicitation using a stringent certification requirement; and the grantee properly permitted a competitor to propose a less stringent requirement than initially proposed by the grantee, and this did not prejudice the complainant. A claim for proposal preparation costs was not considered since procurement procedures were proper.