__________________________________________ AGENCY MOTION TO DISMISS VEDA AS PROTESTER DENIED: July 7, 1995 __________________________________________ GSBCA 13312-P ADVANCED TECHNOLOGY SYSTEMS, INC./VEDA INCORPORATED, Protester, v. GENERAL SERVICES ADMINISTRATION, Respondent. Donald W. Fowler, William J. Cople, III, and Robert J. Symon of Spriggs & Hollingsworth, Washington, DC; and Daniel B. Abrahams of Epstein Becker & Green, Washington, DC, counsel for Protester. Seth Binstock and Jody Burton, Office of General Counsel, General Services Administration, Washington, DC, counsel for Respondent. Before Board Judges PARKER, BORWICK, and VERGILIO. VERGILIO, Board Judge. Advanced Technology Systems, Inc. and Veda Incorporated filed this protest with the Board challenging actions of the respondent, the General Services Administration, in its conduct of the underlying procurement. The agency moves to strike Veda from this protest. It contends that Veda is not an interested party because it did not submit a proposal, and therefore lacks the requisite direct economic interest to maintain the protest. Advanced Technology submitted a proposal and identified Veda as its subcontractor. The solicitation defines the term "offeror" to include the prime contractor and any subcontractors explicitly proposed to meet the requirements of this solicitation. Advanced and Veda are explicitly proposed to meet the requirements of the solicitation. Advanced, as the proposed prime, is a protester. The Board need not here decide if Veda could maintain this protest independent of Advanced; but, as an offeror, with a direct economic interest at this time to be included within the competitive range, Veda is a proper party in this protest. Accordingly, the Board denies the agency's motion. Findings of Fact 1. The time for submitting an initial proposal has expired. Veda did not submit a proposal as a potential prime contractor. However, Advanced Technology explicitly proposed Veda as a subcontractor to meet the requirements of this solicitation. The agency has deemed the proposal to be outside of the competitive range. 2. In the instructions for proposal preparation, under the heading Technical Proposal Format and Content, the solicitation states in paragraphs under the caption "Tab A - Performance Capability": For evaluation purposes, Offerors should assume that typical DOs [delivery orders] issued in each of the functional areas listed in Section C will be in the dollar ranges highlighted in Exhibit L-1. When this Section L calls for providing experience or other information relative to projects similar to typical FEDSIM [the agency's Federal Systems Integration and Management Center] projects, this means DOs in the functional areas and dollar ranges shown in Exhibit L- 1. (Note: These ranges are for evaluation purposes only. FEDSIM will not be constrained to issuing DOs in only these ranges in each functional area.) The term "Offeror", in this solicitation, is defined as including the Prime Contractor and any Subcontractors or teaming partners explicitly proposed to meet the requirements of this solicitation. Solicitation at L-10 to L-11 ( L.6.1). 3. The agency-chosen, broad definition of offeror affects rights and obligations under the solicitation and resulting contract. For example, the solicitation contains "pre-award audit requirements": In accordance with Sub-part 15.805-5 of the Federal Acquisition Regulation, Offerors are advised that an audit review by the cognizant contract audit activity may be conducted on price proposals submitted in response to this solicitation. Offerors shall make available to the auditor(s) all books and financial records considered by the auditor(s) to be essential in the discharge of their duties under Part 15.8 of the Federal Acquisition Regulation whenever such audit is conducted. Solicitation at L-2 ( L.1.4). 4. Within section M, the solicitation describes the "method of award": The Government anticipates awarding up to seven contracts to those responsible Offerors whose proposals are the most advantageous to the Government, price and other factors considered. . . . Award may be made to other than the lowest priced technically acceptable proposals if another proposal's technical merit justifies the additional cost. Solicitation at M-1 ( M.1). As to the "preparation of offers," "A Standard Form 33, 'Solicitation, Offer, and Award', completed and signed by the Offeror, constitutes the offeror's acceptance of the terms and conditions of this proposed contract. Therefore, the form shall be executed by a representative of the Offeror authorized to commit the Offeror to contractual obligations." Solicitation at L-3 ( L.2.5.a). 5. The notion of endowing identified subcontractors with obligations and benefits is further expressed in the solicitation, in the agency's response to an inquiry ("We recommend that FEDSIM separate the functional areas and award multiple contracts in each area"): FEDSIM is departing from past procedures but we are doing so in an attempt to improve client service. As we have stated many times, this [solicitation] encourages teaming arrangements. FEDSIM believes that, with the cooperation of the successful Contractors, we are developing a contracting methodology that will enable us to provide clients with high quality service quickly and efficiently. Solicitation, General Questions and Answers (# 7). In another agency response, the solicitation states: "As you are aware, we are encouraging teaming arrangements . . . ." Solicitation, General Questions and Answers (# 9). Discussion Upon the request of an "interested party" in connection with a procurement that is subject to the Brooks Automatic Data Processing Act, the Board is to review an action of the contracting officer which is alleged to violate a statute, regulation, or condition of a delegation of procurement authority. 40 U.S.C. 759(f)(1) (West Supp. 1995). The statute defines "interested party" to mean "with respect to a contract or proposed contract . . ., an actual or prospective offeror whose direct economic interest would be affected by the award of the contract or by failure to award the contract." Id. 759(f)(9)(B). The agency contends that Veda lacks a direct economic interest in this procurement because it did not submit a proposal itself. In large part, the agency relies upon language in the decision of MCI Telecommunications Corp. v. United States, 878 F.2d 362, 364 (Fed. Cir. 1989): It is undisputed that [the "protester"] did not submit a proposal in response to the . . . solicitation anytime during the proposal period and, therefore, is not an actual bidder or offeror "with respect to [the] contract" under 40 U.S.C. 759(f)(9)(B), as these words are plainly understood. Advanced and Veda are objecting to the exclusion of their proposal from the competitive range. Veda is an offeror under the terms of the solicitation. It has a direct interest in remaining an offeror in the competition. Thus, unlike the situation described in MCI, Veda is an actual offeror and has a direct economic interest in remaining in the competition. Neither the definition of offeror, nor the context in which it arises, supports the agency's interpretation which would restrict the definition to evaluation purposes. Rather, the solicitation itself equates explicitly proposed teaming partners and subcontractors with prime contractors for purposes of the procurement. The agency elected to use the definition of offeror. The definition affects the rights and obligations of the agency and proposed subcontractors; e.g., the offeror (which here includes Veda) is subject to pre-award audit, and would be bound by contractual obligations. Permitting Veda to participate in this protest as a protester is a consequence of the definition. Decision The Board DENIES the agency's motion to dismiss Veda Incorporated as a protester. ____________________________ JOSEPH A. VERGILIO Board Judge We concur: ____________________________ ___________________________ ROBERT W. PARKER ANTHONY S. BORWICK Board Judge Board Judge