[Protest of HHS Contract Award for Support Services]

B-231885: Nov 10, 1988

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A firm protested a Department of Health and Human Services (HHS) contract award for support services, contending that: (1) the awardee was not a small business; and (2) HHS failed to provide preaward notification. HHS contended that: (1) it awarded the contract before the Small Business Administration (SBA) ruled on a protest regarding the awardee's size; (2) it properly waived preaward notice requirements, since urgent and compelling circumstances necessitated the award; and (3) contract termination would seriously harm the program, since some tasks were not readily transferable to another contractor. GAO held that HHS failed to: (1) provide preaward notification; and (2) make a written determination of urgency prior to making the award. GAO also held that, since SBA determined that the awardee was not a small business, continued contract performance was detrimental to the competitive procurement process. Accordingly, the protest was sustained, and GAO recommended that HHS: (1) phase out contract performance; (2) concurrently prepare a revised solicitation for those tasks that it can transfer to another contractor, and obtain bids; (3) terminate the instant contract upon selection of a new awardee; and (4) reimburse the protester for its protest preparation costs.

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