GAO Has Jurisdiction Over BPA Modification Protests

The GAO has jurisdiction to decide protests challenging modifications to blanket purchase agreements, according to a recent GAO protest decision.  In GAO Protest of Crewzers Fire Crew Transport, Inc., B-406601 (July 11, 2012), the GAO rejected a procuring agency’s argument that BPA modifications are a matter of contract administration, and thus outside the GAO’s protest jurisdiction.

The Crewzers Fire Crew Transport GAO protest decision involved a RFQ issued in 2010 under the FAR BPA procedures.  The BPA contemplated the establishment of multiple BPAs for a 3-year period against which purchase orders for flame-retardant tents and canopies would be issued by federal and state agencies in the Forest Service’s Southwest Region.

The original RFQ contained a typographical error regarding how vendors’ prices would be evaluated.  However, the agency noticed the error, and corrected it before BPAs were established.

In May 2011, BPAs were established with a number of vendors, including Crewzers.  Inexplicably, the BPAs included the original, erroneous pricing formula, rather than the corrected formula.  The agency subsequently corrected the formula internally, but did not notify vendors.  Thus, the pricing formula contained in Crewzer’s BPA was different than the formula the agency was actually using to evaluate vendors’ pricing.

Crewzers subsequently complained to the agency that, according to its calculations, it should have ranked first on the agency’s priority list for certain tents to be procured under the BPA.  In response, the agency explained that it had revised the pricing formula internally.  Crewzers filed a GAO protest, alleging that the agency had improperly evaluated its pricing in a manner contrary to the BPA.

The Forest Service challenged the GAO’s jurisdiction to decide the protest.  It argued that the modification of a BPA concerns a matter of contract administration that is beyond the scope of the GAO’s bid protest function.  The Forest service stated that not only is a BPA not a contract, but that the modification in question did not change the scope of work and only represented a foreseeable, annual change in price rankings.

The GAO rejected the agency’s argument and held that it had jurisdiction to decide the protest.  The GAO wrote, “[b]ecause the price evaluation formula here forms the basis for the placement of orders under the terms of the BPA, our Office will consider the protest of the agency’s modification of the BPA’s formula. In this respect, although the BPA itself is not a contract, the terms of the BPA and the agency’s ordering procedures provide that the vendor that submits the lowest evaluated price will be the vendor first in line to receive orders.”

Unfortunately for Crewzers, although it won the jurisdictional battle, the results of the wider war were not as favorable.  Prior to submitting a response to the protest, the Forest Service issued a BPA modification formally changing the pricing formula in vendors’ BPAs and allowed all vendors to submit new pricing.

The GAO held that although it was improper for the Forest Service to evaluate Crewzers’ pricing on a materially different basis than expressed in the BPAs, the Forest Service’s corrective action was an appropriate means of addressing the matter, and was within the Forest Service’s discretion.  In other words, although Crewzers had the opportunity to submit new pricing under the correct formula, it was not entitled to be first on the priority list based on the old, incorrect formula.

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