TITLE: B-310454.3, Singleton Enterprises-GMT Mechanical, Joint Venture--Costs, March 27, 2008
BNUMBER: B-310454.3
DATE: March 27, 2008
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B-310454.3, Singleton Enterprises-GMT Mechanical, Joint Venture--Costs, March 27, 2008

   Decision

   Matter of: Singleton Enterprises-GMT Mechanical, Joint Venture--Costs

   File: B-310454.3

   Date: March 27, 2008

   Arthur Wayne Singleton and Gary Michael Thompson, for the protester.

   Phillipa L. Anderson, Esq., Charlma Quarles, Esq., and Tracy Downing,
   Esq., Department of Veterans Affairs, for the agency.

   Paul N. Wengert, Esq., and Ralph O. White, Esq., Office of the General
   Counsel, GAO, participated in the preparation of the decision.

   DIGEST

   Protester's request that the Government Accountability Office recommend
   reimbursement of costs is denied where the agency did not file a report in
   response to a protest that was clearly meritorious, but instead, 2 days
   after the report was due, announced its intention to take corrective
   action; thus the corrective action was reasonably prompt, since the
   protester was not required to incur the costs of beginning to draft
   comments in answer to an agency report.

   DECISION

   Singleton Enterprises-GMT Mechanical, Joint Venture, requests that our
   Office recommend that the Department of Veterans Affairs (VA) reimburse
   Singleton's costs of filing and pursuing a protest, which our Office
   dismissed on the basis of corrective action proposed by the VA. Even
   though Singleton obtained corrective action in response to the protest,
   the firm asserts that it should be reimbursed its protest costs because an
   earlier protest raising the same issue in a similar situation was resolved
   in Singleton's favor, and therefore, in Singleton's view, this protest
   should not have been necessary.

   We deny the request.

   On September 5, 2007, the VA opened six bids submitted in response to
   invitation for bids (IFB) No. VA-249-07-IB-0085, for replacement of the
   roof on "Building One" at the VA Medical Center in Huntington, West
   Virginia. The IFB had been set aside for service-disabled veteran-owned
   small business concerns (SDVOSBCs).

   When opened, the fixed-price bids were, in ascending order of price, as
   follows:

   AGS Group $905,497

   KAR Contracting $1,185,508

   Whelan Properties $1,356,869

   Singleton Enters.-GMT Mech., joint venture $1,549,147

   Homeland Services $1,658,000

   Homeland Security $2,000,000

   The VA rejected the lowest bid because of a failure to meet a bonding
   requirement. The circumstances of the VA's rejection of the next-lowest
   bid are described in our decision in KAR Contracting, LLC, B-310454,
   B-310537, Dec. 19, 2007, 2007 CPD para. 226 at 7. The record does not
   include information on the rejection of the bid by Whelan Properties.

   The VA then proceeded to consider Singleton's eligibility for award, given
   its status as a joint venture. On September 26, in response to a request
   from the contracting officer (CO), Singleton provided the VA a copy of its
   joint venture agreement. On December 31, the VA informed Singleton that
   its bid had been rejected because the joint venture agreement showed that
   the firm was not eligible to compete under the SDVOSBC set-aside in the
   IFB.

   On January 10, 2008, Singleton filed a protest with our Office,
   complaining that the CO's rejection of Singleton's bid as non-responsive
   was improper, and arguing that the issue of the firm's eligibility for a
   SDVOSBC set-aside should have been referred to the Small Business
   Administration (SBA) for its review. On that same date, our Office issued
   a decision involving another procurement in which Singleton's joint
   venture agreement had also been rejected by the VA under an SDVOSBC
   set-aside. In our decision sustaining that protest, we concluded that the
   VA had failed to comply with its statutory obligation to refer the issue
   of Singleton's eligibility to the SBA. Singleton Enters.-GMT Mech., A
   Joint Venture, B-310552, Jan. 10, 2008, 2008 CPD para. 16 at 4.

   Singleton's January 10 protest--the instant dispute--generated a
   requirement for the VA to submit an agency report by February 11. See 31
   U.S.C. sect. 3553(b)(2)(A) (2000); Bid Protest Regulations, 4 C.F.R.
   sect. 21.3(c) (2007). On that date the VA did not file its report,
   although it subsequently indicated that it would respond by February 13.
   By letter dated February 13, the VA advised our Office that the agency was
   taking corrective action and would refer the question of the protester's
   eligibility for award to the SBA.

   Because the VA did not advise our Office of the agency's intent to take
   corrective action until 2 days after the report due date, Singleton argues
   that the agency unduly delayed taking corrective action in the face of a
   clearly meritorious protest. Thus, the protester argues that our Office
   should recommend that the VA reimburse Singleton's costs of filing and
   pursuing the protest. The VA opposed this request.[1]

   Our Bid Protest Regulations, 4 C.F.R. sect. 21.8(e), provide that where an
   agency takes corrective action in response to a protest, we may recommend
   that the agency reimburse protest costs, including attorneys' fees;
   however, we will make such a recommendation only where the agency unduly
   delayed taking corrective action in the face of a clearly meritorious
   protest. CSL Birmingham Assocs.; IRS Partners-Birmingham--Entitlement to
   Costs, B-251931.4, B-251931.5, Aug. 29, 1994, 94-2 CPDpara. 82 at 3. As a
   general rule, when an agency takes corrective action by the due date of
   its protest report, we regard such action as prompt, and decline a request
   for recommendation of reimbursement of protest costs. Alaska Structures,
   Inc.--Costs, B-298156.2, July 17, 2006, 2006 CPD para. 109 at 4.

   Here, Singleton argues that the need for corrective action under this IFB
   should have been apparent as early as November 30, 2007, when the SBA
   submitted a statement supporting Singleton's earlier protest. However, our
   decision sustaining Singleton's earlier protest (which, as noted, raised a
   similar issue, but involved a different solicitation), was only issued
   later--on January 10, 2008. Thus, on the day this protest was filed--also
   on January 10--there should have been no doubt on the part of the agency
   that Singleton's second protest raising the same issues present in the
   earlier VA procurement, presented a question our Office would view as
   clearly meritorious.

   Since we conclude the protest was clearly meritorious, the only question
   remaining is whether the agency's corrective action (in the face of this
   clearly meritorious protest) was unduly delayed. In this regard, we note
   that the agency did not submit a report, and 2 days after the date that
   report was due, advised our Office of its intent to take corrective
   action. Since no report was tendered, the protester was not required to
   expend unnecessarily the costs of preparing comments in answer to that
   report. Cf. Control Corp.; Control Data Sys., Inc.--Protest & Entitlement
   to Costs, B-251224.2 et al., May 3, 1993, 93-1 CPD para. 353 at 7 (where
   delay in corrective action required protester to expend unnecessary effort
   in preparing comments on agency report, recommendation of reimbursement of
   protest costs was appropriate). Thus Singleton was in no worse a position
   than it would have been if the agency had taken corrective action by the
   report due date--which, as mentioned above, is the point at which we will
   generally determine that an agency has not acted promptly. Accordingly, we
   will not conclude that the VA failed to take prompt corrective action in
   the face of a clearly meritorious protest.

   The request for costs is denied.

   Gary L. Kepplinger
   General Counsel

   ------------------------

   [1] The VA submission highlighted the fact that, in a decision dated
   February 20, the SBA Director for Government Contracting issued a decision
   concluding that Singleton was not an eligible SDVOSBC for purposes of the
   other solicitation because one of the joint venture partners was not
   controlled by a service-connected disabled veteran, and because the joint
   venture exceeded the number of solicitations on which a joint venture is
   allowed to compete as an SDVOSBC, under 13 C.F.R. sect. 121.103(h). VA
   Costs Opposition, exh. 1, SBA Decision, at 3-4. Singleton has appealed
   that decision to the SBA's Office of Hearings and Appeals.