[Request for Review of Government of Guam Contract Award]

A firm requested review of a contract award to an incumbent under an invitation for bids (IFB) issued by the Government of Guam's Department of Education for milk. The contract was funded by a Department of Agriculture (USDA) grant. The firm contended that the solicitation's 50-percent fresh milk requirement: (1) amounted to a sole-source selection of the incumbent, the only firm claiming it could fulfill the requirement; (2) was not fulfilled by the incumbent in the previous contract; (3) could not be met by any firm and should be reduced significantly or eliminated. Guam stated that the IFB was structured to obtain the greatest percentage of fresh milk for the schoolchildren and to conform to USDA regulations. GAO stated that: (1) the awardee had the low, responsive bid and that the complainant's bid was rejected as nonresponsive because its milk was not pasteurized; (2) since GAO reviews of grant complaints do not deal with contract performance or administration issues, the allegations concerning the awardee's previous contract performance were not for consideration, but were being considered by the contracting agency; (3) regulations governing USDA grants prohibit competition restriction but, once a grantee establishes that the restriction is related to its minimum needs, GAO will not question the determination criteria; and (4) since regulations governing the school lunch program require that fresh milk be provided if available, GAO had no basis to object to the inclusion of the requirement in the solicitation. Accordingly, the complaint was denied.