Protest Alleging Awardee's Bid Was Nonresponsive

B-195197: Mar 31, 1980

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A firm protested the award of a contract issued under a small business set-aside on the grounds that the awardee would not perform at least 40 percent of the work with equipment owned by the awardee or another small business firm as required by the applicable small business size standard. The awardee posessed an option to purchase machinery with which to perform the work and indicated in its bid that it would exercise the option as a prerequisite for performing the contract. An initial protest was filed with the Small Business Administration (SBA) challenging the awardee's size status. SBA decided against the protester. While the initial protest was pending, the procuring agency determined that it urgently required performance of the project and made the award. The awardee subsequently exercised its option to purchase the equipment and began performance under the contract. The protester then filed a protest with GAO alleging that the arrangement violated the spirit of the set-aside by allowing the awardee to take affirmative steps to establish its eligibility after bid opening. There was nothing in the awardee's bid to indicate that the awardee was not responsive to the small business requirements of the procurement. With respect to the protester's concern that the awardee was permitted to take affirmative steps to establish its eligibility after bid opening, it was held that the fact that the awardee's bid was responsive on its face was sufficient to qualify it for award. If the awardee had not exercised its option to purchase the equipment, it would have been in default. Accordingly, the protest was denied.