Protest of Agency Refusal To Amend Solicitation

B-200989: Aug 19, 1981

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A firm protested the refusal of the Social Security Administration (SSA) to amend a solicitation to permit tariffed carriers, whose rates are subject to change by the filing of a revised tariff with the Federal Communications Commission (FCC), to compete for award of a contract for equipment to be used in connection with the SSA nationwide telecommunications system. The protester alleged that the equipment in question was wrongly classified as automatic data processing (ADP) equipment which must be procured on a fixed-price basis. The protester argued that it should be procured according to the regulations covering telecommunications which require that both tariffed and nontariffed carriers be given an opportunity to compete. GAO determined that the protest was untimely; however, because it raised issues which GAO had not previously considered regarding which regulations apply to equipment being procured and whether tariffed carriers may be excluded from competition for this type of equipment, GAO reviewed the matter pursuant to the significant issue exception to its bid protest procedures. GAO determined that, under the Brooks Act, the General Services Administration (GSA) has discretion to define the type of equipment to be considered ADP equipment, and GSA agreed with the SSA determination of its equipment type. Therefore, since the protester disagreed with the classification of the equipment, the protester should seek a change through GSA, not the GAO bid protest process. In view of the need to avoid buy-ins to evaluate life cycle costs accurately, thereby insuring that the Government obtains ADP equipment at the lowest overall cost, the requirement for fixed or finitely determinable prices does not unduly restrict competition. A tariffed carrier, whose existing rates are subject to change and which by law must treat all classes of customers receiving similar services in the same manner, cannot be considered for award of a fixed price contract. Accordingly, the protest was denied.