BNUMBER: B-280318; B-280319
DATE: August 31, 1998
TITLE: John Blood, B-280318; B-280319, August 31, 1998
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Matter of:John Blood
File: B-280318; B-280319
Date:August 31, 1998
John Blood for the protester.
Lynn W. Flanagan, Esq., Department of Agriculture, for the agency.
David R. Kohler, Esq., and Denise Benjamin-Bibby, Esq., for the Small
Business Administration.
Charles W. Morrow, Esq., and James A. Spangenberg, Esq., Office of the
General Counsel, GAO, participated in the preparation of the decision.
DIGEST
Timber stand improvement requirements were properly accepted into the
section 8(a) program where no adverse impact on small businesses was
found, pursuant to 13 C.F.R. sec. 124.309(c) (1998), because it was
reasonably determined that the requirements were new, such that there
were no incumbent small businesses who would be adversely affected.
DECISION
John Blood protests the decision of the Forest Service and Small
Business Administration (SBA) to contract under the section 8(a)
set-aside program with Juan Acevedo Reforestation pursuant to request
for proposals (RFP) No. CAZ-98-24, and with Arrowhead Starr Company
pursuant to RFP No. CAZ-98-27, for timber stand improvements in the
Arapaho and Roosevelt National Forests and the Medicine Bow-Routt
National Forests in Colorado and Wyoming.[1]
We deny the protests.
The Forest Service procures timber stand improvement in connection
with commercial timber sales. In order to prepare certain timber for
sale, the Forest Service identifies a plot of trees to undergo timber
stand improvement by thinning defective trees and/or removing
undesirable species of trees from the designated timber stand, so that
the most desirable trees are left in the stand for future growth and
sale. Timber stand improvement may also include reseeding,
replanting, or regeneration. According to the Forest Service,
repeated improvement to the same stand generally is not required.
Acevedo's 8(a) contract was negotiated through the SBA District Office
in Fresno, California and Arrowhead's 8(a) contract was negotiated
through the SBA District Office in Little Rock, Arkansas. In both
cases, the SBA determined that award of the contract for these
services would cause no adverse impact on any other small business
concerns.
Mr. Blood, who is a small business with various contracts with the
Forest Service for timber stand improvement, protests the propriety of
the adverse impact determinations.
Because the Small Business Act affords the SBA and contracting
agencies broad discretion in selecting procurements for the section
8(a) program, we will review challenges to decisions to procure
requirements under section 8(a) only to ensure that agency officials
have not acted in bad faith, and that applicable regulations have been
followed. American Consulting Servs., Inc., B-276149.2, B-276537.2,
July 31, 1997, 97-2 CPD para. 37 at 9.
The SBA regulation pertaining to adverse impact, 13 C.F.R. sec.
124.309(c) (1998), provides that the SBA will not accept a proposed
procurement not previously in the 8(a) program if the award
would have an adverse impact on other small business programs or
an individual small business, whether or not the affected small
business is in the 8(a) program. The adverse impact concept is
designed to protect small business concerns which are performing
Government contracts awarded outside the 8(a) program. Adverse
impact does not apply to "new" requirements. A new requirement
is a requirement which has not been previously procured by the
relevant procuring agency. Where a requirement is new, no small
business could have performed the requirement and, thus, an
impact determination need not be performed.
The purpose of the regulation is to protect incumbent small business
contractors. See Atlantic Coast Contracting, Inc., B-260686, July 13,
1995, 95-2 CPD para. 19 at 3.
The Forest Service and the SBA report that the determinations of no
adverse impact to small businesses were made because the projects in
question here constitute new requirements. The agencies assert that
timber stand improvement requirements generally constitute new
requirements because the work being performed usually involves
improvement to various timber stands in different geographical areas
within the forests. That is, for both acquisitions, the Forest
Service found, and reported to the SBA, that no small business
contractors had performed this work in these particular timber stands
within the previous 24-month period, and the SBA therefore determined
that these were new requirements and thus did not have an adverse
impact on small businesses.
Mr. Blood objects to the agencies' adverse impact determinations,
arguing that the adverse impact determinations are not documented, and
that the requirements are not new requirements because the Forest
Service has periodic recurring requirements for timber stand
improvements in the national forests in question here, many of which
are performed by small businesses outside the 8(a) program.
Although we agree with Mr. Blood that the documentation of the
decisions to accept these requirements under the 8(a) program did not
specifically identify the requirements as new requirements, we find
the Forest Service and the SBA can reasonably view timber stand
improvements conducted in different geographical areas within the
forests to be separate, rather than recurring, requirements. As
indicated by the Forest Service, these requirements become necessary
after the agency has identified a particular stand of trees for
growth, development, and commercial sale, and when this becomes
necessary the agency's practice is to enter into various contracts for
the different timber stands. While the Forest Service has an overall
recurring need for timber stand improvement, the agency has been
procuring a separate and new requirement each time the actual
geographical location changes. Under the circumstances, we find
nothing improper in the Forest Service's and the SBA's determinations
that the requirements in question here are new requirements, such that
there is no adverse impact on small businesses. See American
Consulting Servs., Inc., supra, at 11-12.
In sum, we find that the agencies properly placed these requirements
under the 8(a) program.
The protests are denied.
Comptroller General
of the United States
1. Section 8(a) of the Small Business Act, 15 U.S.C. sec. 637(a) (1994),
authorizes the SBA to contract with government agencies and arrange
for performance of those contracts by awarding subcontracts to small
socially and economically disadvantaged businesses.