BNUMBER:  B-257634.3
DATE:  November 9, 1995
TITLE:  Gordon R. A. Fishman

**********************************************************************

Matter of:    Gordon R. A. Fishman

File:     B-257634.3

Date:     November 9, 1995

Neil I. Levy, Esq., Kilpatrick & Cody, for the protester.
Debra J. Turchin, Esq., General Services Administration, for the 
agency.
Scott H. Riback, Esq., and David A. Ashen, Esq., Office of the General 
Counsel, GAO, participated in the preparation of the decision.

DIGEST

Protest against rejection of proposal for the lease of office space as 
technically unacceptable is denied where record shows that the timely 
availability of the proposed space was contingent upon current 
tenant's future review and approval of a lease for space elsewhere.

DECISION

Gordon R. A. Fishman protests the award of a lease agreement to KD 
Development under solicitation for offers (SFO) No. GS-05B-15777, 
issued by the General Services Administration (GSA) for office space 
in Mount Clemens, Michigan, for the Internal Revenue Service (IRS).  
Fishman argues that the agency improperly found its offer technically 
unacceptable and made award to KD at a price higher than Fishman's.

We deny the protest.

The SFO requested offers to lease approximately 10,250 contiguous net 
usable square feet; the solicitation provided for award to the 
responsible firm submitting the offer that was "fully responsive to 
all requirements of this solicitation and is the lowest priced. . . ."  
GSA received two offers, one from Fishman and one from KD; both offers 
were included in the competitive range.

Although Fishman was the incumbent lessor for this requirement, IRS' 
needs had changed and the agency now required 10,250 square feet of 
contiguous office space.  In order to meet this requirement, it was 
necessary for Fishman to propose that the agency move its offices from 
the first floor to the second floor of its building.  Because GSA was 
aware of the presence of two tenants on the second floor of Fishman's 
building, it requested that Fishman provide as part of its best and 
final offer (BAFO) a letter from one of these tenants reflecting its 
commitment to vacate the second floor space so that the necessary 
renovations could commence.  (GSA did not require a letter from the 
other tenant because Fishman had represented that it was a 
month-to-month tenant.)  Fishman furnished with its BAFO a letter from 
the second floor tenant which provided that:  "[w]e are agreeable to 
re-locate to the first floor at our present location.  This 
re-location is contingent on the review and subsequent approval of the 
renewed lease."

GSA determined that Fishman's offer was technically unacceptable on 
numerous grounds.  Among the bases for GSA's determination was its 
finding that the space being offered was subject to an existing lease 
because Fishman's tenant had not provided an unequivocal commitment to 
move in time to implement Fishman's construction and relocation plan 
for the IRS.

Fishman challenges GSA's determination that its offer was technically 
unacceptable.  Fishman notes that its proposal included a promise to 
comply with all of the SFO's requirements.  Further, Fishman contends 
that the letter from its tenant showed that the tenant was willing to 
move, subject only to a contingency--the tenant's review and approval 
of a renewed lease agreement--which effectively was within Fishman's 
control.  In addition, Fishman argues that to the extent that GSA may 
have had concerns in this regard, the agency should have permitted it 
to clarify the matter.  In any case, argues Fishman, its ability to 
furnish the space was a matter of responsibility, rather than 
technical acceptability, which should have been referred to the Small 
Business Administration (SBA) since Fishman is a small business 
concern.[1]

Fishman's position is without merit.  An offeror must affirmatively 
demonstrate by the terms of its proposal that its offered product or 
service meets all of a solicitation's material requirements.  Alnasco, 
Inc., B-249863, Dec. 22, 1992,         92-2 CPD  430.  An agency may 
not properly accept for award a proposal that fails to meet one or 
more material solicitation requirements.  Brooks Towers, Inc.,      
B-255944.2, Apr. 28, 1994, 94-1 CPD  289, aff'd, Brooks Towers, 
Inc.--Recon.,        B-255944.3, Dec. 29, 1994, 95-1 CPD  4. 

Here, Fishman's offer specifically identified the second floor of its 
building as the space it was offering to meet the requirement for 
10,250 square feet of contiguous office space.  However, the proposal 
indicated that in order for Fishman to meet the SFO's contiguous space 
requirement, it would have to obtain an agreement from its tenant to 
move.  When the agency requested that Fishman provide an unequivocal 
agreement from its tenant to move, Fishman was unable to obtain such a 
commitment; instead, Fishman furnished a letter from the tenant which 
specifically conditioned its agreement to move on its future review 
and acceptance of a renewed lease agreement.  Since the tenant's 
agreement to move was contingent, we believe that the agency 
reasonably found that Fishman was not offering compliant space.  
Moreover, while Fishman generally agreed elsewhere in its offer to 
meet all of the SFO's requirements, this promise was simply 
inconsistent with the terms of the letter from its tenant.

We also find no merit to Fishman's assertion that its failure to 
provide its tenant's unequivocal agreement to move was a matter of 
responsibility rather than technical acceptability.  As noted, the SFO 
provided that award would be made to the firm whose proposal was fully 
responsive to all of the solicitation's requirements; the equivocal 
nature of the tenant's promise to move rendered the parcel being 
offered technically unacceptable because it did not meet the 
contiguous space requirement, and thus was a matter of the firm's 
acceptability.  Since its proposal was properly rejected as 
technically unacceptable for failure to offer compliant space, there 
was no need to refer the matter to the SBA for consideration of 
Fishman's responsibility.  See A&W Maintenance Servs., Inc., B-258293; 
B-258293.2, Jan. 6, 1995, 95-1 CPD  8 (where agency rejects proposal 
as technically unacceptable for reasons not related to responsibility 
as well as for reasons that properly would be categorized as 
responsibility, agency need not refer the matter to the SBA).

Although Fishman also asserts that it was not afforded adequate 
discussions concerning the availability of the required space, GSA, 
having specifically requested that the firm provide an unequivocal 
commitment from its tenant to move, was not required to seek further 
clarification of the matter when Fishman furnished something less.  
Hughes Training, Inc., B-256426.4, Jan. 26, 1995, 95-1 CPD  154.  

Finally, Fishman contends that the GSA's treatment of it throughout 
the procurement evidences bad faith on the part of the agency's 
contracting officials.  However, since the record supports the 
agency's determination that Fishman's 
proposal was technically unacceptable, there is no basis for a finding 
of bad faith.  See Wayne D. Josephson, B-256243, May 12, 1994, 94-1 
CPD  307; George A. and Peter A Palivos, B-245878.2; B-245878.3, Mar. 
16, 1992, 92-1 CPD  286.[2]

The protest is denied.

Comptroller General
of the United States

1. Fishman also maintains that the agency never actually found its 
offer technically unacceptable prior to making award to KD.  This 
allegation is simply incorrect; the agency's pre-award business 
clearance memorandum specifically found that Fishman's offer was 
nonresponsive to numerous SFO rerquirements.  

2. Fishman further argues that GSA improperly obtained a waiver from 
an agency-imposed moratorium on the award of leases based on incorrect 
representations concerning the state of IRS' current space.  This 
argument concerns the implementation of executive policy, not a 
procurement statute or regulation, and therefore is not a matter for 
consideration under our bid protest process.  See American Airlines, 
Inc., B-258271, Dec. 29, 1994, 95-1 CPD  5.