Protest of Noncompetitive Contract Award

B-195559: Apr 9, 1980

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A firm protested the award of a noncompetitive contract for scanning services to the Georgetown University Hospital by the Veterans Administration (VA). The firm's unsolicited "informal" cost and technical proposal had been rejected, and a sole-source award made to Georgetown. The protester maintained that a sole-source contract was not justified, that VA should have issued a competitive solicitation, and that it was as capable of performing the contract as Georgetown. VA contended that the contract was properly negotiated and that the sole-source procurement was warranted since only Georgetown could meet the minimum needs of VA. On the record, however, GAO did not believe that VA had shown that only Georgetown could meet its minimum needs or that the sole-source award was justified. At most, the record indicated that there was a "close relationship" between VA and Georgetown. Therefore, in the absence of convincing evidence to support the VA position, GAO could not conclude that the sole-source contract was warranted. The protest was sustained; and it was recommended that VA clearly define its minimum needs and, if appropriate, hold a competitive procurement for the services, with the existing contract being terminated upon award.