New Alleged Violation of 13 C.F.R. § 124.506(b)

GOV Services first argues that the award to ASO violates 13 C.F.R. § 124.506(b), which provides in relevant part:

(b) Exemption from competitive thresholds for Participants owned by Indian Tribes, ANCs and [Native Hawaiian Organizations (NHOs)]. (1) A Participant concern owned and controlled by an Indian Tribe or an ANC may be awarded a sole source 8(a) contract where the anticipated value of the procurement exceeds the applicable competitive threshold if SBA has not accepted the requirement into the 8(a) [business development] program as a competitive procurement.

* * *

(3) There is no requirement that a procurement must be competed whenever possible before it can be accepted on a sole source basis for a Tribally-owned or ANC-owned concern, or a concern owned by an NHO for [Department of Defense] contracts, but a procurement may not be removed from competition to award it to a Tribally-owned, ANC-owned or NHO-owned concern on a sole source basis.

* * *

(5) An agency may not award an 8(a) sole source contract for an amount exceeding $22,000,000 unless the contracting officer justifies the use of a sole source contract in writing and has obtained the necessary approval under the Federal Acquisition Regulation.

13 C.F.R. § 124.506(b).

GOV Services contends that the requirement here was submitted previously to the SBA for competition within the section 8(a) program and, therefore, subsection 124.506(b) precludes the NIH from awarding the contract to ASO on a sole-source basis.[8] Objection to Corrective Action (B‑414226) at 2-3; Opp’n to Req. For Dismiss (B-414374) at 1. As support for its contention, GOV Services points to an offer letter dated March 22, 2016, from the NIH to the SBA for similar janitorial services. Objection to Corrective Action (B‑414226) at 2; Opp’n to Req. For Dismiss (B-414374) at 2.

The record reflects that, on March 22, 2016, the agency offered a requirement for a 1‑year janitorial services contract with a 1-year option to the SBA’s Washington, D.C. District Office for competition in the section 8(a) program. NIH Offer Letter, Mar. 22, 2016, at 1. In the offer letter, the NIH valued the requirement at $10 million. Id. GOV Services contends that the requirement offered to the SBA in March 2016 and the sole-source contract offered to the SBA in February 2017 are the same requirement. Opp’n to Req. For Dismiss (B‑414374) at 2. The NIH disagrees, arguing that the sole‑source contract constitutes a “new requirement” pursuant to 13 C.F.R. § 124.504(c)(1)(ii)(C). NIH Req. For Dismissal at 2; NIH Response to SBA, Apr. 19, 2017, at 1.

At our Office’s invitation, the SBA provided its views on this protest. As a general matter, we accord great weight to the SBA’s interpretations of regulations it promulgates, such as those regarding the section 8(a) program. Agency Mgmt. Concepts, Inc., B‑411206, B‑411206.2, Apr. 21, 2015, 2015 CPD ¶ 133 at 4. With regard to the provision at issue here, the SBA takes the position that “the terms of 13 C.F.R. § 124.506(b) are intended to limit SBA’s acceptance where the current solicitation at issue was previously offered to and accepted by SBA as a competitive 8(a) requirement.” SBA Comments, Apr. 14, 2017, at 4. According to the SBA, the “relevant inquiry is whether the specific requirement was previously offered to and accepted by the SBA as a competitive 8(a) procurement.” Id. The SBA explains that, “[i]f so, [the] solicitation cannot be converted to a sole source award.” Id.

In reviewing the requirement here, the SBA explains that, “[g]enerally, a bridge contract does not encompass the total requirement that was previously fulfilled through the 8(a) [business development] program.” Id. The SBA explains that, for this reason, “SBA would usually consider a bridge contract to be a new requirement.”[9] Id. In determining whether a requirement constitutes a new requirement, the SBA states that it employs the analysis set forth in 13 C.F.R. § 124.504(c)(1)(ii)(C), SBA Comments at 4 n. 2, which provides as follows:

The expansion or modification of an existing requirement will be considered a new requirement where the magnitude of change is significant enough to cause a price adjustment of at least 25 percent (adjusted for inflation) or to require significant additional or different types of capabilities or work.

13 C.F.R. § 124.504(c)(1)(ii)(C).[10] Thus, per the SBA, the test is straightforward: “If the price of the bridge contract is at least 25 percent less than the price of the underlying full requirement, the bridge contract would constitute a new requirement.” SBA Comments at 4. Furthermore, “any previous acquisition history for the same services with a larger scope would be irrelevant to the analysis of whether” an agency could properly sole source a bridge contract to an Alaska Native Corporation.[11] Id.

We find the SBA’s interpretation of its regulations to be reasonable. In this regard, we find that the SBA’s section 8(a) program regulations are reasonably interpreted to permit the award of a sole-source contract to an Alaska Native Corporation provided that a competition among section 8(a) participants has not been initiated for the same requirement. See Agency Mgmt. Concepts, Inc., supra, at 5‑6. Thus, the central question posed by the protest is whether the requirement offered to the SBA in March 2016 for competition in the section 8(a) program is the same as the requirement offered to the SBA in February 2017 for award of a section 8(a) sole-source contract to ASO. For the reasons below, we conclude that the requirements are not the same, and therefore, find no merit to the protester’s challenge.

The record reflects that the sole-source contract awarded to ASO has a significantly shorter period of performance. The sole-source contract consists of a 6-month base period and two 3-month options compared to the requirement offered to the SBA in March 2016, which contemplated a 1‑year base period and a 1-year option. Compare NIH Offer Letter, Feb. 1, 2017, at 1 with NIH Offer Letter, Mar. 22, 2016, at 1. See also NIH Req. For Dismissal, Attach. 2, Sole-Source Contract. More importantly, however, the value of the sole-source contract awarded to ASO is more than 25 percent less than the estimated value of the requirement offered to the SBA in March 2016.

At first glance, the record does not appear to support this conclusion because the offer letters themselves do not evidence a 25 percent difference. In the offer letters, the NIH estimated the value of the sole-source contract awarded to ASO to be $10,921,838 and the value of the requirement offered to the SBA in March 2016 to be $10 million. Compare NIH Offer Letter, Feb. 1, 2017, at 1 with NIH Offer Letter, Mar. 22, 2016, at 1. During the pendency of the protest, however, the agency explained that the March 2016 offer letter contained a flaw in the estimated value of the requirement.[12] NIH Response to SBA at 2. The NIH erroneously included the value of the base year only and neglected to include the value of the option year. Id. Had the option year been included, the NIH represents that the total value of the contract would have been $20,001,713--almost double the amount of the sole-source contract awarded to ASO.[13] Id.

In response, GOV Services argues that the agency cannot “simply chose to include or exclude options years” in order to avoid the regulatory requirements. GOV Services’ Final Comments, Apr. 28, 2017, at 1. GOV Services suggests, instead, that the “annual value” of the requirements is the proper basis for comparison. Id. When the annual value is compared, GOV Services notes that both requirements have “annual value of between $10 [million] and $11 [million].” Id. We find the protester’s argument to be unavailing.

The record does not demonstrate that the NIH arbitrarily included or excluded option years in order to avoid the requirements of the SBA’s regulations. Rather, we find the NIH’s revised calculations to reflect an attempt to provide a reasonable basis for comparison. If the option periods of both requirements are included in the estimated value of the requirement, the estimated value of the sole-source contract is more than 25 percent less than the requirement offered to the SBA in March 2016.[14] If the option periods are excluded, the result is the same.[15] In this respect, the NIH provides an “apples to apples” comparison of the two requirements.

Although the protester argues that the “annual value” of the two requirements should be compared, GOV Services’ Final Comments at 1, we fail to see how this would provide a reasonable basis for comparison. A comparison of the annual value of the two requirements would result in the inclusion of the option periods in the sole-source contract awarded to ASO and the exclusion of the option period in the requirement offered to the SBA in March 2016. Accordingly, a comparison on the basis suggested by the protester would not result in an “apples to apples” comparison.

The SBA offered its conclusion on the central question presented in this protest, i.e., whether the sole-source contract to ASO represents a “new requirement.” Based solely on the offer letters, the SBA initially indicated that its regulations prohibit the NIH’s award of the sole-source contract to ASO. SBA Comments at 5. In this respect, the SBA stated that “[b]ased on the information available to the SBA on April 14, 2017, it appeared that the requirement offered to and accepted by SBA in March 2016 was the same requirement as the sole source bridge contract at issue.” SBA Revised Comments, Apr. 26, 2017, at 1.[16]

After the NIH clarified on April 19 that the March 2016 offer letter contained an error, the SBA amended its comments to provide as follows:

Information submitted by NIH in the agency’s April 19, 2017 response indicates that the value of the March 2016 competitive requirement was in fact $20,001,713.62. Accordingly, it appears that the sole source bridge contract as issue constitutes a new requirement. As such, NIH does not appear to have violated SBA’s regulations in offering the subject requirement as a sole source on behalf of a specific ANC-owned concern.

SBA Revised Comments at 1. We think the SBA’s interpretation of its applicable regulations and its revised conclusion that the sole-source contract to ASO is a “new requirement” is reasonable. In this regard, the SBA’s interpretation is consistent with the above-quoted relevant provisions of its regulations providing that a requirement will be considered “new” if the value of the work changes by at least 25 percent. See 13 C.F.R. § 124.504(c)(1)(ii)(C).

Alleged Violation of 13 C.F.R. § 124.504(b)

Finally, the protester also argues that the agency violated 13 C.F.R. § 124.504(b), which GOV Services contends “clearly prohibits” the sole-source contract awarded here. Objection to Corrective Action (B‑414226) at 2. See also Opp’n to Req. for Dismissal (B‑414374) at 1. This provision provides in relevant part:

SBA will not accept a procurement for award as an 8(a) contract if the circumstances identified in paragraphs (a) through (d) of this section exist.

* * *

(b) Competition prior to offer and acceptance. The procuring activity competed a requirement among Participants prior to offering the requirement to SBA and receiving SBA’s formal acceptance of the requirement.

(1) Any competition conducted without first obtaining SBA’s formal acceptance of the procurement for the 8(a) [business development] program will not be considered an 8(a) competitive requirement.

(2) SBA may accept the requirement for the 8(a) [business development] program as a competitive 8(a) requirement, but only if the procuring activity agrees to resolicit the requirement using appropriate competitive 8(a) procedures.

13 C.F.R. § 124.504(b).

The protester offers no evidence to support the proposition that the agency held a competition among small business concerns for this requirement prior to offering the requirement to the SBA. To the contrary, the protester alleges that “[t]his procurement has not been announced, proposals for this contract action have not been solicited by the Agency, and GOV Services has not been given a chance to compete for that work.” Comments & Supp. Protest (B‑414226) at 5. Accordingly, we find no merit to the protester’s contention that the award of the sole-source contract here violates this provision of the SBA’s regulations.

The protest is denied.  (GOV Services, Inc. B-414374: May 11, 2017)

As described above, AMC alleges DOS’s decision to award an 8(a) contract on a sole-source basis instead of competing it among eligible 8(a) program participants is improper. Protest at 4-6. In support of this allegation, AMC cites 13 C.F.R. § 124.506(a)(2), which provides as follows:

A procurement offered and accepted for the 8(a) BD [business development] program must be competed among eligible Participants if:

(i) There is a reasonable expectation that at least two eligible Participants will submit offers at a fair market price;

(ii) The anticipated award price of the contract, including options, will exceed $6,500,000 for contracts assigned manufacturing NAICS codes and $4,000,000 for all other contracts; and

(iii) The requirement has not been accepted by SBA for award as a sole source 8(a) procurement on behalf of a tribally-owned or ANC [Alaska Native Corporation]-owned concern.

Thus, under this regulation, a procurement “offered and accepted for” the 8(a) program must be competed among eligible 8(a) program participants if the three conditions described in subsections (i) through (iii) are met. AMC argues each of the three conditions has been met in this instance and, therefore, the regulation requires DOS to compete the requirement among eligible 8(a) program participants. Protest at 4-6.

In response to the protest, DOS reiterates the contracting officer’s statement that the agency intends to award a sole-source 8(a) contract to a tribally-owned concern. Request for Dismissal at 1. Based on this, DOS argues the “exception” in subsection (iii) of the regulation applies and, therefore, DOS’s actions are permissible under SBA’s 8(a) program regulations. Id. at 1. DOS further argues that since SBA’s regulations permit the intended award, AMC’s protest should be dismissed. Id. at 2.

AMC acknowledges DOS’s reliance on subsection (iii) of the regulation. Protest at 5. AMC, however, argues such reliance is misplaced based on two provisions within 13 C.F.R. § 124.506(b).

First, AMC cites 13 C.F.R. § 124.506(b)(1), which provides as follows:

A Participant concern owned and controlled by an Indian Tribe or an ANC may be awarded a sole source 8(a) contract where the anticipated value of the procurement exceeds the applicable competitive threshold if SBA has not accepted the requirement into the 8(a) BD program as a competitive procurement.

(Emphasis added.) AMC alleges the requirement previously was competed among 8(a) program participants and, therefore, this regulation prohibits DOS from conducting the follow-on procurement as a sole-source 8(a) award to a tribally-owned concern. Protest at 5-6.

Second, AMC cites 13 C.F.R. § 124.506(b)(3), which provides as follows:

There is no requirement that a procurement must be competed whenever possible before it can be accepted on a sole source basis for a tribally-owned or ANC-owned concern, but a procurement may not be removed from competition to award it to a tribally-owned or ANC-owned concern on a sole source basis.

(Emphasis added.) Again, AMC alleges the requirement previously was competed among 8(a) program participants and, therefore, this regulation prohibits DOS from conducting the procurement as sole-source 8(a) award to a tribally-owned concern. Protest at 5-6.

The Small Business Act affords SBA and contracting agencies broad discretion in selecting procurements for the 8(a) program; we will not consider a protest challenging a decision to procure under the 8(a) program absent a showing of possible bad faith on the part of government officials or that regulations may have been violated. 4 C.F.R. § 21.5(b)(3) (2014); Rothe Computer Solutions, LLC d/b/a Rohmann Joint Venture, B-299452, May 9, 2007, 2007 CPD ¶ 92 at 3. At our Office’s invitation, SBA provided its views on this protest. As a general matter, we accord SBA’s interpretations of regulations it promulgates, such as those regarding the 8(a) program, great weight. Singleton Enters.-GMT Mech., A Joint Venture, B‑310552, Jan. 10, 2008, 2008 CPD ¶ 16 at 3.

Here, SBA takes the position DOS has done nothing improper. SBA Comments on Request for Dismissal at 2, 4-5. In this regard, SBA states “the fact that a recurring requirement was previously offered to and accepted by SBA as a competitive 8(a) procurement has no bearing on whether it can be offered and accepted on a sole source basis when it is reprocured.” Id. at 4. In support of this position, SBA points to the same provisions of 13 C.F.R. § 124.506(b) as those relied on by AMC. For ease of reference, these provisions are provided again below:

(1) A Participant concern owned and controlled by an Indian Tribe or an ANC may be awarded a sole source 8(a) contract where the anticipated value of the procurement exceeds the applicable competitive threshold if SBA has not accepted the requirement into the 8(a) BD program as a competitive procurement.

* * * * *

(3) There is no requirement that a procurement must be competed whenever possible before it can be accepted on a sole source basis for a tribally-owned or ANC-owned concern, but a procurement may not be removed from competition to award it to a tribally-owned or ANC-owned concern on a sole source basis.

13 C.F.R. § 124.506(b) (emphasis added).

With regard to the provision at subsection (1), SBA interprets the phrase “SBA has not accepted the requirement into the 8(a) BD program as a competitive procurement” to mean a “specific solicitation was . . . accepted by the SBA as a competitive 8(a) procurement.” See SBA Comments on Request for Dismissal at 4. SBA contrasts the issuance of a “specific solicitation” with the circumstance where, as here, performance of an 8(a) contract has been completed and an agency is faced with the decision of whether to procure a follow-on requirement through issuance of another competitive 8(a) solicitation or award it on a sole-source basis to a tribally- or ANC-owned concern. See id. In other words, SBA interprets the phrase “competitive 8(a) procurement” in the regulation to mean a solicitation has been issued and there is an active competition among 8(a) program participants.

With regard to the provision at section (3) of the regulation, SBA similarly interprets the phrase “a procurement may not be removed from competition to award it to a tribally-owned or ANC-owned concern on a sole-source basis” to refer to instances where a “specific solicitation” has been offered to SBA for acceptance into the 8(a) program; i.e., instances where an active competition exists by virtue of issuance of a solicitation. See SBA Comments on Request for Dismissal at 4.

In support of these interpretations, SBA points to the following text from the preamble to the final rule that implemented the regulation at issue:

[SBA] has amended this paragraph to preclude SBA from awarding a requirement above the threshold amounts on a sole source basis to a tribally-owned 8(a) concern once it has been accepted for competition and prospective offerors have been notified. However, if a requirement is offered to the 8(a) program again (after the concern which was awarded such contract pursuant to competition has completed performance), the requirement must then be separately accepted for the 8(a) program and could be offered to a tribally-owned concern.

54 Fed. Reg. 34,692, 34,704-05 (Aug. 21, 1989). As reflected in the emphasized text, the preamble to the final rule is entirely consistent with the interpretation SBA offers here. SBA summarizes its position by explaining that “the question of whether the [agency] previously awarded a contract for this requirement on a competitive or sole source basis is immaterial to the analysis of whether the instant procurement may properly be sole sourced to a tribally-owned concern.” SBA Comments on Request for Dismissal at 4.

We find SBA’s interpretation of the regulation reasonable. As stated at the outset, AMC alleges DOS’s prior award of contracts under the 8(a) program precludes award of a sole-source 8(a) contract to a tribally-owned concern for the follow-on requirement. See Protest at 4-6. However, as demonstrated above, SBA’s 8(a) program regulations are reasonably interpreted to permit the award of a sole-source 8(a) contract to a tribally-owned concern regardless of whether the requirement previously was procured through competitive or sole-source 8(a) contracts, so long as a competition among 8(a) participants has not been initiated through issuance of a solicitation. AMC has not alleged, and there is nothing to suggest, that a competition among 8(a) participants was initiated here. Rather, the record reflects DOS offered the requirement to SBA as a sole-source 8(a) award, and SBA accepted the offer. See Request for Dismissal, exh. 1, SBA Acceptance Ltr., at 1; SBA Comments on Request for Dismissal at 4. Accordingly, AMC’s allegations fail to show regulations may have been violated, and we will not further consider them. 4 C.F.R. § 21.5(b)(3).

As a supplemental basis of protest, AMC claims DOS’s decision to award a sole-source 8(a) contract is improper because DOS allegedly provided incomplete information to SBA when it offered the requirement as a sole-source 8(a) procurement. AMC Response to Request for Dismissal at 3. More particularly, AMC claims DOS “misled SBA by failing to provide a complete acquisition history of the requirement” and “SBA would not have accepted this requirement into the 8(a) BD program if it had received the complete acquisition history.” Id.

As described above, SBA has advised that based on the 8(a) program regulations, “the question of whether the [agency] previously awarded a contract for this requirement on a competitive or sole source basis is immaterial to the analysis of whether the . . . procurement may properly be sole sourced to a tribally-owned concern.” SBA Comments on Request for Dismissal at 4. Hence, SBA in essence has advised that under its regulations, a requirement’s “acquisition history” has no bearing on the determination of whether to accept a procurement as a sole-source 8(a) award to a tribally-owned concern.

The protest is dismissed.  (Agency Management Concepts, Inc., B-411206, B-411206.2: Apr 21, 2015)  (pdf)

HRCI/MPSC alleges that the procurement of the professional administrative support services through a sole source 8(a) award is precluded by 13 C.F.R. § 124.506(b) (2013), which, according to the protester, prohibits accepting a requirement for a sole-source 8(a) award where the requirement had previously been accepted for a competitive 8(a) award. HRCI/MPSC argues that this work has been performed by 8(a) contractors since at least 2009, and was most recently competed as an 8(a) set-aside under solicitation No. W912JB-R-4001.

Section 8(a) of the Small Business Act authorizes the Small Business Administration (SBA) to contract with other government agencies and to arrange for the performance of those contracts via subcontracts awarded to socially and economically disadvantaged small businesses. 15 U.S.C. § 637(a) (2006). The Act affords the SBA and contracting agencies broad discretion in selecting procurements for the 8(a) program; we will not consider a protest challenging a decision to procure under the 8(a) program absent a showing of possible bad faith on the part of government officials or that regulations may have been violated. 4 C.F.R. § 21.5(b)(3) (2010); Rothe Computer Solutions, LLC d/b/a Rohmann Joint Venture, B-299452, May 9, 2007, 2007 CPD ¶ 92 at 3.

The section 8(a) program has both competitive and noncompetitive (that is, sole-source) components. Generally, where a procurement for services exceeds a certain threshold (currently $4 million for non-manufacturing contracts), the requirement must be competed among qualified 8(a) program participants. 13 C.F.R. § 124.506(a)(2)(ii). Under certain circumstances, however, the competitive threshold dollar value does not apply when awarding a sole-source 8(a) contract to an Indian tribe-owned entity or an Alaska Native Corporation. Id. at § 124.506(b).

In implementing this statutory regime, the SBA has established limits on moving an existing requirement from the 8(a) competitive program to the 8(a) sole-source program. In relevant part, SBA’s regulations provide as follows:

(1) A Participant concern owned and controlled by an Indian Tribe or an [Alaska Native Corporation] may be awarded a sole source 8(a) contract where the anticipated value of the procurement exceeds the applicable competitive threshold if SBA has not accepted the requirement into the 8(a) [Business Development] program as a competitive procurement.

* * * *

(3) There is no requirement that a procurement must be competed whenever possible before it can be accepted on a sole-source basis for a tribally-owned or [Alaska Native Corporation] -owned concern, but a procurement may not be removed from competition to award it to a tribally-owned or [Alaska Native Corporation]-owned concern on a sole-source basis.

Id. at § 124.506(b)(1) (emphasis added).

As set forth above, HRCI/MPSC argues that the SBA improperly accepted the requirement for award to Alutiiq on a sole-source basis since the very same requirement was recently competed under the 8(a) program under solicitation No. W912JB-R-4001. The agency responds that the particular requirement at issue--providing administrative support services to the National Guard for a six month base period plus two 3-month options periods with a ceiling amount of $18 million--has not been previously accepted into the 8(a) business development program as a competitive procurement and, accordingly, that there is no restriction on the sole-source award of the requirement to an Alaska Native Corporation-owned entity such as Alutiiq Pacific.

The Army asserts that in determining whether a requirement has been accepted into the 8(a) business development program as a competitive procurement, our Office has previously referenced the SBA’s regulations for determining whether a solicitation is for a “new requirement,” which provide that:

[t]he expansion or modification of an existing requirement will be considered a new requirement where the magnitude of change is significant enough to cause a price adjustment of at least 25 percent (adjusted for inflation) or to require significant additional or different types of capabilities or work.

13 C.F.R. § 124.504(c)(1)(ii)(C); see JXM, Inc., B-402643, June 25, 2010, 2010 CPD ¶ 158. The Army argues that because the bridge contract is for less than 20 percent of the value and maximum contract term solicited under solicitation No. W912JB-R-4001, the bridge contract should be considered different from the requirement previously accepted into the 8(a) business development program as a competitive procurement.

At our Office’s request, the SBA provided its views on the protest. We accord great weight to the SBA’s interpretation of its regulations as to what constitutes a new requirement, unless the interpretation is unreasonable. NANA Servs., LLC, B-297177.3; B-297177.4, Jan. 3, 2006, 2006 CPD ¶ 4 at 10. Here, the SBA agrees that the Army has done nothing improper where the original contract was within the 8(a) program and the Army clearly intends to procure the follow-on contract as a competitive 8(a) set-aside, but is using this bridge contract only to provide continuity of service until the follow-on contract can be successfully awarded. According to the SBA, the facts of the case demonstrate that the requirements under the contract with Alutiiq are properly considered “new” as that concept would be applied under 13 C.F.R. § 124.504(c)(1)(ii)(C), when compared to the much larger contract anticipated by the previously issued solicitation (solicitation No. W912JB-R-4001). In this regard, the SBA notes that the bridge contract is for a six month base period with two 3-month option periods and has a maximum value of $18 million, whereas the contemplated competitive 8(a) award is for a five-year contract, including base and options, with a maximum value of $100 million. Based on this record, as discussed above, we see no basis to object to the Army’s decision to offer this bridge requirement to the SBA, or to the SBA’s decision to accept the requirement, as an 8(a) sole-source award to Alutiiq Pacific.

The protest is denied.  (HRCI-MPSC PASS, LLC, B-408919, B-408919.2, Jan 8, 2014)  (pdf)

Designer Associates alleges that the Air Force acted in bad faith. Designer Associates argues that the agency’s bad faith is evidenced by, among other things, the fact that the Air Force has changed the traditional duration of the contract here from its normal 5-year length, with an estimated value in excess of $6 million, to an 18-month contract, having an estimated value of less than $3 million, thereby permitting a noncompetitive award under the 8(a) program. See FAR § 19.805-1(a)(2). Government officials are presumed to act in good faith and, where a protester contends that contracting officials are motivated by bias or bad faith, it must provide convincing proof, since this Office will not attribute unfair or prejudicial motives to procurement officials on the basis of inference or suppositions. United Coatings, B-291978.2, July 7, 2003, 2003 CPD ¶ 146 at 14. Here, Designer Associates has not provided any proof to support this allegation. Moreover, we are unaware of any law or regulation dictating the “traditional duration” of a contract, see New Technology Mgmt., Inc., B-287714.2 et al., Dec. 4, 2001, 2001 CPD ¶ 196 at 4, and the record shows that the Air Force had valid reasons for limiting the duration of the contract here as it did, including the fact that the maintenance requirement would cease to exist with the privatization of Hill AFB family housing, estimated to occur in July 2004. (Designer Associates, Inc., B-293226, February 12, 2004) (pdf)

Purchases for an amount not greater than the simplified acquisition threshold are expressly exempted from the requirement that solicitations include a statement of all significant evaluation factors and subfactors that the agency reasonably expects to consider. 10 U.S.C. sect. 2305(a)(2)(A). Nevertheless, all procurements, including those to which this exemption applies, must be conducted consistent with the concern for a fair and equitable competition that is inherent in any procurement. General Metals, Inc., B-249259 et al., Nov. 3, 1992, 92-2 CPD para. 319 at 4. In this regard, an agency must evaluate quotations on the basis set forth in the RFQ. Id.  (Multi-Spec Products Corporation, B-287135, March 30, 2001)

Agency's sole-source award of contracts for services on a monthly basis through the Small Business Administration under the section 8(a) program, while the agency was developing specifications for a 1-year contract to be awarded on a sole-source basis through the section 8(a) program is not inconsistent with the provision in Federal Acquisition Regulation sect. 19.805-1(c) that prohibits an agency from dividing a proposed section 8(a) requirement into several separate action in order to avoid the $3 million threshold for competing such contracts.  (Champion Business Services, Inc., B-283927, January 24, 2000)

We have held that an agency need not consider subcontractor experience where the solicitation contemplates award of a service contract to a section 8(a) firm, and includes the provision at Federal Acquisition Regulation (FAR) sect. 52.219-14, which imposes a limitation on subcontracting to an amount less than 50 percent of the cost of contract performance. USATREX Int?l, Inc. supra at 4. In such cases, the agency properly may determine that only the offeror?s own capabilities are relevant for purposes of discriminating among the proposals. Since the RFP here provided for award of a service contract and contained the cited FAR provision, we think it properly could limit its evaluation to the prime contractor?s capabilities.  (North State Resources, Inc., B-282140, June 7, 1999)