TITLE:   EAI Corporation, B-283129, October 7, 1999
BNUMBER:  B-283129
DATE:  October 7, 1999
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EAI Corporation, B-283129, October 7, 1999

Decision

                    Matter of: EAI Corporation

File: B-283129

Date: October 7, 1999

William B. Barton, IV, Esq., and William T. Welch, Esq., Barton & Tolle, for
the protester.

Richard Ferguson, Esq., and Elizabeth M. Grant, Esq., Defense Logistics
Agency, for the agency.

Mary G. Curcio, Esq., and John M. Melody, Esq., Office of the General
Counsel, GAO, participated in the preparation of the decision.

DIGEST

Agency?s decision not to set aside portion of solicitation for exclusive
small business participation was proper where agency reasonably determined
that requirement to operate information analysis center for chemical and
biological warfare and requirement to perform additional research tasks in
the same subject areas are interrelated and interdependent, such that
partitioning the requirements is not practicable.

DECISION

EAI Corporation protests that Defense Logistics Agency (DLA) request for
proposals (RFP) No. SPO700-99-R-0050, which calls for contractor to
establish and operate a chemical warfare/chemical and biological defense
information analysis center (CBIAC), should have been partially set aside
for exclusive small business participation.

We deny the protest.

The purpose of the CBIAC is to provide scientific and technical analysis and
technical advisory services to assist the chemical and biological defense
community in meeting technical and operational objectives relating to
chemical warfare and chemical biological defense. RFP at 36. The successful
contractor will perform basic or core center functions, as well as
additional technical area tasks (TAT). The basic functions include
information collection, information processing, information analysis, and
information dissemination. Id. at 38-44. TATs are over and above the core
center functions and can be ordered by qualified users in 20 subject areas.
Id. at 45-68.

EAI argues that the solicitation should be divided into two components--the
core IAC function, and the TAT function--and that one of the portions should
be set aside for exclusive small business participation. In the alternative,
EAI argues that some of the individual TATs should be set aside for small
business participation. [1]

Federal Acquisition Regulation (FAR) sect. 19.502-3 requires, in relevant part,
that a portion of an acquisition be set aside for exclusive small business
participation when a total set-aside is not appropriate, and the requirement
is severable into two or more economic production runs or reasonable lots.
The determination as to whether a particular acquisition should be partially
set aside is left to the discretion of the contracting officer, provided the
determination is reasonably supported. Digital Sys. Group, Inc., B-258262.2,
Jan. 20, 1995, 95-1 CPD para. 30 at 7.

DLA determined that no portion of the TATs can be set aside because, while
the solicitation lists 20 areas in which TATs can be ordered, any specific
TAT can cover more than one area. Supplemental Report, Aug. 25, 1999, at
10-11. The agency is concerned that dividing the TATs by area may result in
multiple contractors performing a specific TAT, id. at 10, which would
increase the cost to the requesting activity and, more importantly, would
increase the potential for inadequate responses or errors due to
contractors? inability to determine which part of the TAT falls within their
jurisdiction. Id. at 11. Finally, the agency is concerned that the need to
coordinate the efforts among the contractors would cause delays in the
response time to the TATs. Id.

We think the agency?s concerns provided a reasonable basis for its
conclusion that it would be impracticable to set aside one or more of the
TATs for small businesses. Specifically, we think it is reasonable to
anticipate that responses to TATs could be degraded or delayed due to the
need to divide responsibilities among different contractors, and that the
involvement of more than one contractor in a TAT would increase the cost to
the user. Further, while it seems conceivable that a given TAT could concern
only a single research area, and thus could be effectively performed as a
partial set-aside, it is not apparent how the agency reasonably could
determine this in advance. We conclude that the TATs are not severable by
research area.

In any case, we find that the agency has established a sound basis for
having the TATs and the core functions performed by a single contractor. In
this regard, DLA explains that the CBIAC (as well as other IACs covering
different subject areas) were established to perform both the core functions
and additional tasks that go beyond the scope of, but are directly related
to, the core functions. Supplemental Report, Aug. 25, 1999, at Tab A. The
agency concludes that the tasks to be performed under the core and TAT
functions are interrelated and interdependent--and that it thus would not be
practicable to sever them--because (1) the TAT work requires access to the
various databases maintained under the core functions; (2) when a TAT is
completed, the results must be incorporated into the database for future
use; and (3) the scientists and other experts who perform the core center
functions are available to work on the TATs. Id. at 9-10. In the final
analysis, the CBIAC was designed to provide "one-stop shopping" for its
users. Id. at 11.

We find no basis for questioning the agency?s judgment. Since the TAT and
core functions cover the same areas within the larger chemical and
biological warfare area, we think the agency reasonably could conclude that
there is a significant benefit to be gained from having a single contractor
perform all tasks so that the contractor, as well as the experts performing
the tasks, will be able to build on information obtained from performing the
core functions. This approach appears consistent with the aim of avoiding
duplication of work and inconsistent results, and also with the aim of
ensuring that there is a well-respected and recognized central authority in
area.

Since DLA reasonably determined that the solicitation was not severable,
there was no requirement to set aside a portion of the solicitation for
exclusive small business participation. [2]

EAI also maintains that the solicitation improperly restricts competition
because it requires offerors to own or control certain laboratory
facilities. EAI argues that there are sufficient facilities within the
Department of Defense that DLA should make available to the awardee. This
argument is without merit. The solicitation does not require offerors to own
or control laboratory-testing facilities; rather, it requires only that
offerors have access to such facilities. RFP at 46-47. Access can be
demonstrated by several means: ownership or control; subcontract;
cooperative research and development agreement with a federal agency or
department; memorandum of agreement or memorandum of understanding with a
federal activity; or similar arrangements with non-government entities,
including partnership and joint venture agreements. Id. at 47. Given this
multitude of acceptable approaches to meeting the requirement, and the
absence of evidence showing that facilities in fact are unavailable to
potential offerors, there is no basis for finding that the access
requirement is restrictive. In this regard, we note that EAI in fact entered
into an agreement permitting it to use the testing facilities of a
government agency. Although this agreement ultimately fell through, it
demonstrates that there are available laboratories with which arrangements
can be made.

The protest is denied.

Comptroller General
of the United States

Notes

1. In its initial protest submission, EAI also argued generally that the
solicitation violates the Small Business Reauthorization Act of 1997, 15
U.S.C. sect. 631(j) (1999), by bundling multiple requirements without
justification. In its comments on the agency?s report, EAI for the first
time specified that the agency improperly bundled the TAT and core center
functions. EAI should have been aware of the specific basis for its bundling
argument at the time it filed its protest. Because EAI raised the specific
argument for the first time in its comments, the argument is untimely. See
Braswell Servs. Group, Inc., B-276694, July 15, 1997, 97-2 CPD para. 18 at 6-7.
Our Regulations do not contemplate the piecemeal development of protest
issues.

2. In its initial protest submission, EAI argued only that a partial
set-aside was required. It appears from subsequent submissions that EAI also
may be arguing that the entire solicitation should have been set aside for
small businesses. This argument is untimely, since it was not raised in the
initial protest. See Braswell Servs. Group, Inc., supra.