GAO Sustains Protest Where Single FSS Contract Didn’t Extend Long Enough to Cover Awarded BPA

If you are a Federal Supply Schedule contract holder competing for a BPA, then there’s an important principle that you should bear in mind: your underlying FSS contract should cover the entire anticipated duration of the blanket purchase agreement, including all option years. And don’t try to provide this coverage with two different FSS contracts. That will get you into trouble–as one unfortunate contractor recently found out.

In NCS Techs., B-417956 et al. (Comp. Gen. Dec. 13, 2019), GAO analyzed an award made by the Social Security Administration for laptops, workstations, peripheral equipment, and installation services to use in its old-age, survivors, and disability insurance programs and its supplemental security income program. To acquire this equipment/services, SSA issued a single-award BPA to a small business holder of a FSS No. 70 contract (Information Technology).

Before getting to the protester’s arguments regarding this award, let’s touch on a little background regarding overlapping, or “continuous,” FSS contracts. In general, a BPA or order cannot extend beyond the expiration date of the FSS contract under which it is awarded, unless there are option periods remaining that, if exercised, would cover the BPA/order’s entire performance period. Given this requirement, sometimes a contractor needs to retain its current FSS contract to perform on existing BPAs and orders while simultaneously holding a second FSS contract to compete for new business. As a result, GSA policy allows for a contractor to request a new FSS contract under the same schedule before the the first FSS contract expires. If a contractor is awarded a second FSS contract under the same schedule (and thereby holds what GSA terms “continuous contracts”), it must agree not to use its first FSS contract for new business; it can only use that first FSS contract for performing pre-existing BPAs or orders.

Now back to the protest. There, the awardee listed its FSS (Schedule 70) contract with a performance period of July 22, 2003 to July 21, 2023 as the underlying contract it was using to compete for the BPA. Because this FSS contract would expire before the BPA’s 66-month performance period ran its course, the awardee also noted in its proposal that a second FSS contract was in process and would be awarded prior the award of the BPA. But in fact, this second FSS contract was awarded one month prior to the deadline for final proposal submission.

The protester argued that the award was improper because the awardee’s first FSS contract’s performance period was insufficient to cover the BPA’s duration. The awardee countered, arguing that the BPA was established under both its first and second FSS contracts; therefore, the award was proper because the second FSS contract had a performance period long enough to accommodate the BPA’s anticipated lifespan. At GAO’s invitation, GSA weighed in, asserting that the award was improper (not a good sign for the awardee).

GAO ultimately agreed with the protester and based its decision on several points.

First, the record showed that the awardee submitted its final revised proposal under its first FSS contract, and the agency established the BPA under the first contract. Because the first FSS contract’s period of performance could not cover the BPA, the awardee’s proposal was ineligible for award under solicitation’s terms.

Second, even if the BPA had been established using the awardee’s two FSS contracts, this arrangement violated FAR 8.405-3(d)(3). This provision only allows for an agency to award a BPA under a single FSS contract; it cannot split the award between two FSS contracts.

Third, GAO rejected SSA’s argument that it could have properly awarded the BPA under awardee’s second FSS contract and, therefore, using the first FSS contract should be considered a “minor procurement deficiency.” Fact is, the BPA wasn’t established under the first FSS contract. And while the awardee could have amended its final proposal to propose its second FSS contract as the underlying one, it didn’t. The contractor alone bears the burden of submitting a written proposal that contains all required information.

So, for you FSS contract holders: Be sure that when competing for a BPA your underlying FSS contract (at least the one that you propose) has a sufficient performance period to cover the BPA’s full temporal reach. And realize that you can’t use a combo of FSS contracts to satisfy this requirement. Also, for your non-FSS contract holders: Be sure that your proposal contains all required information. The fact that SSA knew that the awardee’s second FSS contract had been awarded prior to final proposal submission did not matter to GAO. The burden to include that critical information fell on the contractor. And its failure to capture the information cost it a valuable BPA. Caveat contractor! (That’s Latin for “contractor beware.”)