ABCD GRANTED: July 15, 1992 GSBCA 11883-P ELECTRONIC SYSTEMS & ASSOCIATES, INC., Protester, v. DEPARTMENT OF THE AIR FORCE, Respondent. SMALL BUSINESS ADMINISTRATION, Intervenor. Lemuel Kinney, President and CEO, Electronic Systems & Associates, Inc., St. Petersburg, FL, appearing for Protester. James C. Dever, III, and Joseph M. Goldstein, Office of General Counsel, Department of the Air Force, Washington, DC, counsel for Respondent. John W. Klein, Small Business Administration, Washington, DC, counsel for Intervenor. Before Board Judges DEVINE, HENDLEY, and DANIELS. DANIELS, Board Judge. Electronic Systems & Associates, Inc. (ESA) is currently maintaining microcomputers and peripheral equipment at the Department of the Air Force's (Air Force's) Wright-Patterson Air Force Base in Ohio. ESA is performing this work as a subcontractor to the Small Business Administration (SBA), which in turn has a contract with the Air Force under the program authorized by section 8(a) of the Small Business Act, 15 U.S.C.A. 637(a) (West Supp. 1992). This contract will expire in September. On June 15, 1992, ESA filed a protest alleging that the Air Force, in taking actions which will lead to the issuance of a request for a proposal under the 8(a) program to perform similar work at this base in the future, has violated various statutes and regulations. The protest maintains that the agency's requirements should be filled through a competitive, rather than sole-source, 8(a) procurement, and that ESA should be permitted to participate in the competition. In addition, the protest contends that the Air Force does not have a delegation of authority to procure the services through the 8(a) program; that agency employees have made false statements to the SBA regarding ESA, and have improperly diverted work from ESA on the existing contract; and that the agency's purported attempt to evaluate ESA before deciding to award a sole-source contract was a sham. The Air Force has filed a motion to dismiss the protest, or in the alternative, to deny it summarily. ESA has filed motions for summary relief as to two counts. Each of these parties has opposed the other's motions. The SBA has intervened in the case and has filed a statement which comments on several matters, including one of ESA's motions. We must address a part of the Air Force's motion -- a suggestion that we dismiss the entire case for lack of jurisdiction -- in order to proceed further. We deny that part of the motion. As to the agency's having a delegation of authority to conduct an 8(a) procurement, we grant the Air Force's motion for summary relief and deny ESA's. As to the requirement for competition, however, we grant ESA's motion for summary relief. We direct the agency to open the procurement to all eligible 8(a) firms, in accordance with the dictates of regulation. Background On March 20, 1992, the small business specialist at the Wright-Patterson Contracting Center (WPCC) proposed to the SBA's Chicago office that fulfillment of maintenance requirements currently being performed by ESA and another vendor at the base be continued under a new 8(a) contract. The estimated value of the contract was stated to be $10 million over five years (a base year and four option years); the work is to be ordered on an indefinite delivery/indefinite quantity basis, however, and the guaranteed minimum award value was stated to be only $50,000. Attached to the letter was a list of companies that apparently had been approved by the SBA to perform computer maintenance and repair under 8(a) contracts in the SBA's region V. The Air Force suggested that it be permitted to receive technical presentations from these firms on April 2 and 3, and then to negotiate directly with one of them. Protest File, Exhibit 1C. The SBA's Assistant Region V Administrator, Gary P. Peele, accepted this offer on March 26. Id., Exhibit 1D. By letter dated April 3, WPCC informed ESA of the foregoing actions. The Center told ESA that it could not be considered for award because "[t]he definitions in FAR [Federal Acquisition Regulation] 19.801 place this requirement as a 'local buy requirement' since the services meet only the needs of Wright- Patterson AFB" and ESA (which is headquartered in St. Petersburg, Florida) is not in the same SBA region as the base. Protest File, Exhibit 1E. The cited FAR provision defines two types of requirements for purposes of the 8(a) program. A "local buy requirement" is "a supply or service purchased to meet the specific needs of one user in one location." A "national buy requirement" is "a supply or service purchased to meet the needs of one or more users in two or more locations where supply control, inventory management, or acquisition responsibility have been assigned to a central contracting activity." 48 CFR 19.801 (1991) (FAR 19.801); see also 13 CFR 124.100 (1991). Local buys are to be considered by the appropriate SBA regional office; national buys are under the jurisdiction of the SBA central office. FAR 19.804-2, 19.804-3(a). Local buys may be awarded only to 8(a) firms which are located in the relevant SBA district(s) or region; national buys may be awarded to any eligible 8(a) firm. 13 CFR 124.308(f)(1), (2), 124.311(h)(3), (4) (1991). Meanwhile, WPCC received technical presentations from six interested 8(a) firms and evaluated those presentations. Protest File, Exhibits 1H, 3A-7F. A "criteria checklist" included by the Air Force in the protest file was apparently used in the evaluation. Id., Exhibits 1C.1, 4A-7F. The checklist makes numerous references to compliance of firms with various requirements of a statement of work (SOW), which is also included in the file. Id., Exhibits 1C.1, 1C.2. The written presentations of at least two of the companies make clear that the firms had seen the statement of work and were responding to its requirements. Id., Exhibits 3B, 3D. The Air Force "concedes that the SOW was provided to the participating 8(a) firms in the local buy." Respondent's Reply to ESA's Second Motion for Summary Relief (Respondent's Reply) at 2. On April 7, WPCC asked the SBA's Chicago office to authorize negotiations with one of the three top-rated firms. Protest File, Exhibit 1H.1. Mr. Peele responded on April 24 by determining that Global Information Systems Technology, Inc. (Global) "is the firm that is most eligible to receive the award of a contract on this project." Id., Exhibit 1J. By separate letter also dated April 24, however, Mr. Peele also told WPCC: After further discussions with our SBA Central Office and their evaluation of the project Statement of Work, they have determined that with the multiple users involved at WPAFB, this project must be classified as a national buy. We are, therefore, requesting that your local buy offering letter as well as our acceptance letter, be rescinded. Protest File, Exhibit 1K. Mr. Peele asked that WPCC make an offering to the SBA central office for a national buy. Id. The Air Force states, in an answer to an interrogatory, that upon learning that the procurement had been reclassified as a national buy, it evaluated ESA's capabilities on the basis of the firm's performance under the current contract. The agency further states, in that answer, that it concluded that ESA "had not displaced the top three 8(a) firms that had previously been forwarded to the SBA for consideration as potential sole-source awardees." Protest File, Exhibit 1Y (interrogatory 3). ESA maintains that it -- was never afforded the opportunity to respond to the new reprocurement requirements (including SOW) which clearly identified a major change . . . which eliminates the chronic spare parts issue on the existing contract. . . . ESA was never requested or permitted to propose a management plan for the new requirements. Protester's Response to Respondent's Motion to Dismiss at 2. On April 29, WPCC followed Mr. Peele's advice by making an offering to the SBA central office for a national buy. Protest File, Exhibit 1L. SBA's central office made a preliminary acceptance of the offer on May 14; it told Mr. Peele that final acceptance and authority to negotiate with the designated firm would be "communicated by the appropriate SBA field office." Id., Exhibits 1M, 1N. On May 20, SBA's Chicago district office told WPCC that its offering had been accepted on behalf of Global. WPCC was authorized to negotiate directly with that firm. Protest File, Exhibit 1Q. On May 30, ESA filed an agency protest with WPCC, alleging counts 1-7 of the thirteen-count Board protest. Protest File, Exhibits 1U, 1V. On June 1, ESA's president sent a letter to the General Accounting Office's (GAO's) office in Cincinnati, Ohio, stating: This is a copy of a protest filed with Wright-Patterson Contracting Center. We have forwarded the protest to you for your attention and investigation to ensure that the Air Force does not attend [sic] to sweep these problems under the rug. The agency protest was attached. Letter from Air Force counsel to the Board, June 17, 1992, Exhibit 1. GAO construed this letter to be a protest to GAO; it dismissed the protest quickly "because our Office generally has no jurisdiction to review the Small Business Administration's (SBA) stewardship of the small disadvantaged business contracting program." Id., Exhibit 2. The Air Force first asked the General Services Administration (GSA) for a delegation of authority to procure the services in question (DPA) on November 8, 1991. At that time, the Air Force envisioned filling its requirements through full and open competition. Protest File, Exhibit 2A. GSA granted a DPA on January 10, 1992. Id., Exhibit 2B. On June 12, the Air Force told GSA that it intended to fill the requirements through award of an 8(a) contract; it asked that an amended DPA be granted, authorizing this change. The request states, "The minimum guarantee for the contract will be $2M." Id., Exhibit 2H. An amended DPA was granted by GSA on June 30. Respondent's Reply to ESA's Motion for Summary Relief, Exhibit 1. Discussion Jurisdiction The Air Force first urges us to dismiss the entire protest for lack of jurisdiction, on the ground that ESA has already filed a protest involving the subject procurement at the GAO. The Brooks Act, which authorizes us to hear challenges to agency actions taken in the course of a procurement, provides that an interested party which has filed a protest with the GAO "with respect to a procurement or proposed procurement may not file a protest with respect to that procurement or proposed procurement under this [statute]." 40 U.S.C. 759(f)(1) (1988). The Board has followed this injunction by dismissing protests which previously had been filed at GAO, even when GAO had summarily dismissed the complaints. See, e.g., Southern CAD/CAM, GSBCA 11034-P, 91-2 BCA 23,735, 1991 BPD 24; Product Research Inc., GSBCA 10339-P, 90-1 BCA 22,458, 1989 BPD 356. The question now before us is whether ESA filed such a protest. The Air Force directs us to the statute's definition of "protest" -- "a written objection by an interested party to a solicitation by a Federal agency for bids or proposals for a proposed contract for the procurement of property or services or a written objection to a proposed award or the award of such a contract." 40 U.S.C. 759(f)(9)(A) (1988). According to the agency, ESA's request that GAO accept the agency protest "for your attention and investigation" is such a written objection, and is therefore a protest. ESA contends to the contrary that the letter to GAO is not identified as a protest (as the complaints filed with WPCC and this Board are); that the firm's request was for an oversight investigation, not a legal conclusion; and that GAO's misunderstanding of the nature of the letter should not be deemed to preclude ESA from having its case heard by us. The determination of whether a particular document constitutes a protest is for the Board to make. WordTech Systems, Inc., GSBCA 11006-P, 91-1 BCA 23,614, 1990 BPD 435; Digital Equipment Corp., GSBCA 9131-P, 87-3 BCA 20,210, at 102,374-75, 1987 BPD 158, at 5. We agree with ESA's contentions with regard to the characterization of the firm's letter to GAO. The Comptroller General, who heads the GAO, has numerous functions. Among them are investigating all matters related to the receipt, disbursement, and use of public money and evaluating the results of Government programs and activities, as well as deciding protests. 31 U.S.C. 712(1), 717(b), 3551-56 (1988). A company that wishes to sell goods and/or services to the United States and is dissatisfied with the way in which an agency is conducting a procurement may ask the Comptroller to look into the matter by exercising either of the first two of these authorities, rather than by exercising the last of them. ESA was thus not restricted, in communicating with GAO regarding the instant matter, to the filing of a protest. We conclude that by asking GAO to investigate the Air Force's actions, rather than specifying that it was protesting them, and by sending the letter to a local office rather than GAO's bid protest section, ESA was not filing a protest with GAO. ESA was taking a chance that GAO might choose not to conduct an investigation, or that any investigation might be concluded too late to permit ESA to get the contract in question; the provisions of law restricting award pending GAO action, 31 U.S.C. 3553(c) (1988), were not applicable. Nevertheless, this is what ESA wanted, and GAO's faulty construction of the letter does not alter our finding that no protest was ever filed with that Office. Merits ESA maintains that the Administrator of General Services, who is vested by the Brooks Act with authority to provide for the federal agencies' acquisition of automatic data processing resources, has not granted the Air Force a valid delegation of procurement authority (DPA) for this procurement. See 40 U.S.C. 759(a)(1), (b)(2) (1988). Whatever the merits of this allegation might have been prior to June 30 -- the date on which ESA filed its motion for summary relief -- there are none now. A DPA for an 8(a) contract was obtained on that date. We see no significance to the fact that the guaranteed minimum purchase is anticipated to be only $50,000 under the contract which will result from the procurement, but GSA approved a request for authority to award a contract with a guaranteed minimum of $2 million. If anything, this demonstrates that were the Air Force to award a contract larger than the one it contemplates, GSA would have no objection. Nor are we troubled by the fact that the Air Force received the DPA after the Board had issued an order suspending the agency's authority to conduct the procurement. The lack of a proper DPA "is a deficiency which is within the power of the Government to cure." An agency may, while procurement action is otherwise suspended, "explore with GSA officials a course of action which might cure deficiencies in the procurement which stem from the [agency's] initial error" of not obtaining a DPA. Computervision Corp., GSBCA 8709-P, 87-1 BCA 19,518, at 98,652, 1986 BPD 217, at 14. We grant the Air Force's motion for summary relief, and deny ESA's, as to the DPA issue. ESA maintains that for three separate reasons, the procurement should be competitive and the Air Force should be barred from making a sole-source award to Global. We decide the case on the basis of one of these counts. An SBA regulation governing the 8(a) program, 13 CFR 124.308(g) (1991), states: SBA will not authorize formal technical evaluations for sole source 8(a) contracts. If a procuring agency requires the performance of a formal technical evaluation among more than one 8(a) concern, the procuring agency must request that the requirement be a competitive 8(a) award. . . . Agencies may, however, conduct informal assessments of several 8(a) firms' capabilities to perform a specific requirement, provided that the statement of work for the requirement is not released to any of the participating 8(a) firms. This regulation prohibits an 8(a) award without competition if one of two circumstances occurs -- either the procuring agency conducts a "formal technical evaluation" of more than one firm, or the agency conducts an "informal assessment" of firms' capabilities after having released the relevant statement of work to at least one of the companies. The record, as submitted by the Air Force, makes clear that some sort of technical review of firms' capabilities to perform the required maintenance services did occur. The record also makes clear, and the Air Force admits, that several firms had seen the statement of work before they made the presentations on the basis of which capabilities were evaluated. Whether the Air Force's review was considered to be either formal or informal, the procurement must be competed because the statement of work had been given to vendors prior to the time that the review occurred. Both the Air Force and the SBA attempt to evade this straightforward conclusion on the ground that the release of the SOW occurred while the procurement was considered a local buy. The Air Force says that since ESA was not eligible to receive a local buy contract, "ESA would not have benefitted if the Air Force had provided it a copy of the SOW." Thus, according to the Air Force, the violation of the regulation was technical in nature and not prejudicial to ESA. Respondent's Reply at 3-4. The SBA acknowledges a technical violation as well, and explains that the purpose of the regulation is to ensure that all 8(a) competition is formal so that procuring activities cannot "manipulate sole source procurements through the use of technical evaluations." SBA's Response to Protest at 15-16. SBA insists, however, that the local buy and national buy are separate procurements, so the disclosure of the SOW in the local buy has no effect on the Air Force's actions in the national buy. Id. at 16. Nevertheless, SBA says (doing its best to be on both sides of the issue), the Air Force should as a matter of discretion make the procurement competitive. Id. at 17. We find these arguments unconvincing. The procurement constitutes a single "acquisition," as that term is used in the FAR. ("Acquisition begins at the point when agency needs are established and includes the description of requirements to satisfy agency needs, solicitation and selection of sources, award of contracts, . . ." FAR 2.101.) When the Air Force disclosed the SOW to several firms, it was required to permit competition to fill its needs. Because the procurement is now a national buy, ESA is no longer impeded by its location outside the relevant SBA region from participating in the competition. We consequently grant ESA's motion for summary relief as to this count. Having given ESA the relief it sought in filing the protest, we need not examine the remaining allegations. All other counts are dismissed as moot, as is the remainder of the Air Force's motion to dismiss the protest, which alleges that most of those counts do not have valid bases. Before concluding, however, we note that among the other reasons that ESA has suggested for mandating competition is that the award of a sole-source contract is not permissible because the expected value of the award is greater than $3 million. The Small Business Act requires that an 8(a) contract be awarded after competition among eligible firms if two conditions are met: first, that "there is a reasonable expectation that at least two [such companies] will submit offers and that award can be made at a fair market price;" and second, that "the anticipated award price of the contract . . . will exceed . . . $3,000,000 (including options) in the case of [a contract opportunity assigned a standard industrial classification code which is not for manufacturing]." 15 U.S.C.A. 637(a)(1)(D)(i) (West Supp. 1992). An SBA regulation provides, with regard to this provision, "For purposes of indefinite quantity/delivery contracts, the thresholds will be applied to the guaranteed minimum value of the contract." 13 CFR 124.311(a)(2) (1991). A panel of this Board has already held, in a markedly similar case involving this protester, that the regulation is valid and must be given effect because it is not "arbitrary, capricious, or manifestly contrary to the statute." Electronic Systems & Associates, Inc., GSBCA 11291-P, 91-3 BCA 24,254, at 121,261-62, 1991 BPD 175, at 7-8 (citing Chevron U.S.A., Inc. v. Natural Resources Defense Council, 467 U.S. 837, 843-44 (1984)). According to that decision, because the contract to be awarded is of the indefinite delivery/indefinite quantity variety and the guaranteed minimum purchase is well below $3 million, competition is not mandated. This panel does not agree that the regulation is valid. In our view, by making the threshold an anticipated price that includes options, the statute clearly envisions that a decision regarding competition will be made on the basis of total estimated value. The guaranteed minimum value of an indefinite delivery/ indefinite quantity contract bears no necessary relationship to total estimated value; procuring activities retain the discretion to set the minimum low, and frequently exercise that discretion to diminish the Government's potential liability. We consequently believe that the regulation, which ties the competition decision to the guaranteed minimum, is "manifestly contrary to the statute." Had the validity of the regulation been pivotal to the outcome of this case, this panel would have urged that the full Board consider the matter and reject the Electronic Systems panel's conclusion. Decision The Air Force's motion to dismiss the protest for lack of jurisdiction is DENIED. The agency's motion for summary relief on the delegation of procurement authority issue is GRANTED, and ESA's motion for summary relief on the same issue is DENIED. On ESA's motion for summary relief as to the requirement for competition in this procurement, the protest is GRANTED. The Air Force shall conduct a competitive procurement, subject to the constraints of section 8(a) of the Small Business Act, to fill the requirements at issue. 13 CFR 124.311(f) (1991). The Board's order suspending the Air Force's authority to proceed with this procurement while the protest is pending lapses with the issuance of this decision. _________________________ STEPHEN M. DANIELS Board Judge We concur: _________________________ _________________________ DONALD W. DEVINE JAMES W. HENDLEY Board Judge Board Judge