Protest of Department of Interior Contract Award

A firm protested the award of contracts by the Bureau of Indian Affairs (BIA). The record showed that the protester had supplied dairy products for the BIA school food program for the 10 years preceding this procurement under contracts negotiated under the Buy Indian Act. The Act permits the negotiation of contracts with Indians to the exclusion of non-Indians. The Department of the Interior's policy provided for contracting with qualified Indian firms to the maximum extent practicable; non-Indian firms are to be contacted only after it has been determined that there are no qualified Indian contractors within the normal competitive area that can meet the Government's requirement and that are interested in doing so. On the basis of a BIA review and complaints from school officials about the high price and poor quality of the dairy products furnished by the protester, the Commissioner of BIA formally waived the Act preference for the 1981 procurement and authorized the purchase of the dairy products on the open market. BIA had not advised the protester that the 1981 requirement was going to be competed without the Act preference, and the protester assumed that, as the only Indian-owned firm in the area, it was going to receive the 1981 contract. The protester contended that: (1) BIA never published in the Federal Register the criteria that it used to decide whether to waive the Buy Indian Act's preference, and this violated the Administrative Procedure Act; (2) it was not appropriate for BIA to award contracts under a solicitation that stated that it was for information purposes only; and (3) the awardee lacked the facilities to properly perform the contract. GAO held that: (1) the protester's argument was without merit since the Buy Indian Act exempts contract matters from the requirement in the Administrative Procedure Act that agencies publish various procedural and substantive rules and policies in the Federal Register; (2) BIA properly could award contracts under the solicitation despite the notice that it was for information purposes only since the notice also cautioned firms to submit best bids and since the Government reserved the right to make the award to the low bidder; and (3) the final contention involved the firm's responsibility which did not involve the issue of fraud, and therefore was not for GAO review. Accordingly, the protest was denied in part and dismissed in part.