OHA Lacks Jurisdiction for NAICS Appeal of GPO Procurement on VA’s Behalf

OHA recently confirmed that it lacked jurisdiction to decide a NAICS code appeal regarding a GPO procurement, even though that procurement was conducted on behalf on the VA. OHA’s dismissal was based on the fact that GPO, a legislative branch agency, is not subject to the same rules as the executive agencies.

OHA’s decision in Veterans4you, Inc., SBA No. NAICS-6021, (Aug. 13, 2019), involved a U.S. Government Publishing Office (GPO) procurement of suicide prevention gunlocks with printed components. The initial Invitation for Bids (IFB) was issued on behalf of the VA on February 14, 2019.

Prior to this NAICS appeal, the protester filed a GAO bid protest of the initial IFB, Veterans4You, Inc., B- 417340, (June 3, 2019). GAO sustained the protest on the grounds that the IFB improperly failed to give preference to SDVOSBs and VOSBs and recommended that “GPO coordinate its efforts with the VA to meet the VA’s requirement for suicide prevention gun locks so as to give effect to the requirements of the” Veterans Benefits, Health Care, and Information Technology Act of 2006. In a twist to the story, GPO’s renewed decision to not restrict the procurement to SDVOSBs and VOSBs was recently upheld by the Court of Federal Claims.

After the initial GAO decision, GPO reissued the procurement on June 13 under NAICS code 323111, for Commercial Printing (except Screen and Books). On June 24, the protester appealed the NAICS code decision, arguing that the correct NAICS code was 332510, for Hardware Manufacturing, since it was “primarily for suicide prevention gun locks with only minor, incidental printing.” The protester asserted, “characterizing the procurement as ‘printing’ (and under NAICS subsector 323) facilitates the VA’s ability to conduct the procurement through GPO and not to set this opportunity aside for veteran-owned small businesses,” all of which, it said, adversely affected its business.

Regarding the merits of this argument, OHA agreed with the protester’s position, explaining:

Indeed, according to Appellant’s estimates, printing constitutes an inconsequential percentage of total contract value. As a result, NAICS code 323111 does not best describe the principal purpose of the procurement. Conversely, NAICS code 332510 covers metal hardware and locks, and thus squarely describes the items sought by the IFB.

However, on July 22, GPO moved to dismiss the NAICS appeal. It argued that OHA lacks jurisdiction to review the procurement actions of legislative branch agencies, like GPO, because they are “excluded from the requirements of the Small Business Act and its implementing regulations.” It cited an appeals court decision, which recognized that “GPO is not subject to the Small Business Act, even if GPO conducts a procurement on behalf of an executive branch agency.” GPO added, “the requirements of FAR part 19 and Title 13 of the Code of Federal Regulations likewise do not apply to GPO.”

According to GPO, it was “acting as the servicing agency for a procurement of printing goods and services on behalf of VA,” and “[a]ny challenge to the procurement in this case, then, would be a challenge to a procurement conducted by GPO.” GPO asserted that it was “immaterial that GPO is conducting the instant procurement on behalf of VA, an executive branch agency.”

The protester argued that, because the VA “designated this procurement as involving ‘printing’ and therefore routed it through the GPO,” its appeal did “not involve solely the actions of the GPO,” but also “the actions of the VA, which designated this procurement as falling under [NAICS] Subsector 323.”

GPO responded that the VA’s requisition form did “not specify, or recommend, any particular NAICS code for this procurement.” And under FAR subpart 8.8 and 44 U.S.C. §§ 501 et seq., the VA was “required to conduct the procurement through GPO,” since it “involves printing and will utilize appropriated funds.”

OHA agreed “that legislative branch agencies such as GPO are not subject to the Small Business Act regardless of whether such agencies are contracting for executive agencies.” OHA explained:

Similarly, it is undisputed that SBA regulations and part 19 of the FAR do not apply to GPO procurements. Accordingly, because the instant procurement is being conducted by GPO, a legislative branch agency, OHA lacks jurisdiction over this appeal.

OHA found “no merit” to the protester’s argument that it was actually the VA which, “in effect chose the NAICS code for this procurement when VA determined that the procurement involved printing and requested that the procurement be processed by GPO.” OHA explained that

a NAICS code designation occurs at the time a solicitation is issued, whereas VA’s decision to direct the procurement to GPO would have occurred far earlier in the process, as a matter of acquisition planning. Contrary to Appellant’s contentions, then, GPO made the NAICS code designation at the time it issued the IFB.

OHA granted GPO’s motion to dismiss the appeal.

GPO asserted that the VA was required to procure these goods through GPO, because they “involved printing,” although even OHA stated that printing was a minor part of this acquisition. What it really came down to was the fact that the VA left the NAICS designation up to the legislative agency and so OHA was powerless to question the NAICS designation.

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