A Treasury Department solicitation did not require contractors to be certified HUBZone participants at the time the solicitation was issued, despite language in the solicitation arguably requiring just that in order to receive a high rating for socioeconomic status.

In a recent GAO bid protest decision, the GAO held that the agency properly interpreted the solicitation to require HUBZone certification at the time proposals were due, not the time the solicitation was issued.  The GAO’s ruling comports with the HUBZone program regulations, which do not require contractors to be certified at the time a solicitation is issued in order to be considered HUBZone participants for purposes of that solicitation.

The GAO’s decision in Government Acquisitions, Inc.; PCi Tec, Inc., B-407877.2, B-407877.3, B 407877.4 (Mar. 25, 2013) involved a Treasury Department solicitation for computer equipment and accessories.  The solicitation was not set-aside for HUBZone contractors.  However, the solicitation included a “socioeconomic status” evaluation factor under which HUBZone businesses were to receive the highest possible score, “Excellent.”  The Solicitation stated, “HUBZone contractors must be certified by the Small Business Administration (SBA) at time of solicitation and at time of award.”

After reviewing competitive proposals, the agency made award to Signet Computers, Inc.  Signet was evaluated as a HUBZone small business, and therefore received an “Excellent” socioeconomic status score.

Two unsuccessful offerors filed GAO bid protests challenging the award to  Signet.  The protesters contended, in part, that the phrase “at time of solicitation” meant the date on which the solicitation was issued.  The protesters pointed out that although the solicitation had been issued on June 6, 2012, Signet was not certified as a HUBZone firm until June 22.  The protesters argued that Signet was therefore not entitled to an “Excellent” score on the socioeconomic status factor.

The agency argued that the phrase “at the time of solicitation” meant “as long as the solicitation is open, which would be at least until the time proposals were due.”  The agency argued that since Signet obtained its HUBZone certification before the due date for proposals, it satisfied the solicitation’s requirement.

The GAO held that the phrase “at the time of solicitation” was ambiguous.  “While one interpretation of ‘time of solicitation’ may be when the solicitation was issued, it is not the only reasonable interpretation,” the GAO wrote.  “As a result, we conclude that the agency complied with the terms of the solicitation.”

The GAO also held that because the solicitation contained a patent ambiguity, the protesters were required to challenge the ambiguity in a pre-award protest, and that the post-award protest was untimely under the GAO’s timeliness rules.  “[S]ince any ambiguity was apparent from the face of the RFQ, the protesters may not now assert that the only permissible interpretation of the requirement is their own,” the GAO stated.

Although the GAO did not raise the issue, the agency’s interpretation was more closely aligned with the SBA’s HUBZone regulations.  Under 13 C.F.R. 126.601, in order to submit an offer on a HUBZone set aside contract, a firm must be HUBZone certified both at the date of initial offer and the date of award.  This procurement, of course, was not a HUBZone set-aside, but if certification on the initial proposal date is good enough for a HUBZone set-aside, shouldn’t it also be good enough for qualifying as a HUBZone contractor for purposes of a socioeconomic status factor?