TITLE: B-311137, National Conference Services, Inc. and Direct Marketing Productions, Inc. d/b/a Technology Forums, Inc., April 25, 2008
BNUMBER: B-311137
DATE: April 25, 2008
*********************************************************************************************************************************
B-311137, National Conference Services, Inc. and Direct Marketing Productions, Inc. d/b/a Technology Forums, Inc., April 25, 2008

   DOCUMENT FOR PUBLIC RELEASE

   The decision issued on the date below was subject to a GAO Protective
   Order. This redacted version has been approved for public release.

   Decision

   Matter of: National Conference Services, Inc. and Direct Marketing
   Productions, Inc. d/b/a Technology Forums, Inc.

   File: B-311137

   Date: April 25, 2008

   Antonio R. Franco, Esq., Jonathan T. Williams, Esq., and Gunjan R. Talati,
   Esq., Piliero Mazza, PLLC, for the protester.

   Stephanie A. Kreis, Esq., and William Mayers, Esq., Defense Information
   System Agency, for the agency.

   Linda C. Glass, Esq., and Ralph O. White, Esq., Office of the General
   Counsel, GAO, participated in the preparation of the decision.

   DIGEST

   Protest alleging that an agency unreasonably canceled a request for
   quotations for conference planning services after the receipt of proposals
   is denied where: (1) the agency decided to continue its co-sponsorship of
   an annual conference with a recognized scientific, technical, educational
   or professional organization, as allowed by the Department of Defense's
   Joint Ethics Regulation; (2) the agency officials involved have explained
   that they were using the procurement system in good faith, and were not
   soliciting contractors for the purpose of bringing pressure on their
   previous conference co-sponsor; and (3) the agency officials involved
   concluded that a continued partnership with the previous conference
   co-sponsor was in the government's best interest.

   DECISION

   National Conference Services, Inc. and Direct Marketing Productions, Inc.
   d/b/a Technology Forums, Inc. (TFI) protests the cancellation of request
   for quotations (RFQ) No. 254367, issued by the Defense Information System
   Agency (DISA) for conference meeting, event and trade show support and
   services for the DISA Customer Partnership Conference. The protester
   contends that the decision to cancel the RFQ was merely a pretext to avoid
   competition.

   We deny the protest.

   DISA has been hosting its Customer Partnership Conference for the past 5
   years, with the Air Force Communications and Electronic Association
   (AFCEA) serving as its co-sponsor. AFCEA is an "international non-profit
   association serving the military, government, industry and academia as a
   forum for advancing professional knowledge and relationships in the fields
   of communications IT intelligence and global security." Contracting
   Officer's (CO) Statement at 1.

   After using the co-sponsorship arrangement for the 5 prior years, the
   agency decided to issue a solicitation for a "no cost" conference support
   services contract for the 2009, 2010, and 2011 conferences. On November
   16, 2007, DISA issued the RFQ seeking discounted General Service
   Administration (GSA) schedule pricing. The RFQ required vendors to provide
   a full range of conference planning services, including the planning,
   marketing, registration, set-up, on-site administration, coordination and
   management of all logistical components of the conference. RFQ attach. 1,
   at 2.

   The RFQ contemplated the award of a fixed-price contract and announced
   that quotes would be assessed under four evaluation factors:
   technical/management approach, past performance, other non-cost factors,
   and cost/price. RFQ Attach. 2. The RFQ advised that the factors of
   technical/management would be approximately equal in value, and that other
   non-cost factors would be the least important factor. The RFP also
   indicated that the non-cost factors would be significantly more important
   than the cost/price factor, and that award would be made to the quotation
   offering the best value to the government. Id.

   The agency received quotations from eight small business concerns by the
   December 3 due date, but the quotations were never forwarded to the
   evaluation team. On the same day, DISA's Director of Strategic Planning
   and Information--the senior agency official responsible for this
   conference--decided to take another course. In a message to agency staff
   involved in the ongoing procurement, he announced:

     I met with AFCEA this noon. They made [the] required [] concessions. I
     want to stay with them for conference support. So, I do not want us to
     make an award for conference support from the RFP [sic] responses.
     Thanks[.]

   Agency Report (AR), Tab 13. As a result, the agency cancelled the RFQ the
   next day, December 4, on the basis that the agency had determined that it
   was in the best interest of the government to continue its relationship
   with AFCEA.

   TFI protests the cancellation of the RFQ and maintains that the agency's
   decision to cancel the solicitation was a pretext to avoid making a
   competitive award decision. The protester argues that the decision to
   cancel the RFQ was a violation of the Competition in Contracting Act
   (CICA) and the Department of Defense (DOD) Joint Ethics Regulations (JER),
   DOD 5500.7-R, which the protester argues requires DOD components
   sponsoring a conference to use normal acquisition procedures to procure
   any assistance they might need. In addition, TFI argues that the agency
   apparently engaged the procurement process with no intention of awarding a
   contract, but only for the purpose of gaining concessions from AFCEA. In
   TFI's view, this constitutes improper agency action, and it urges our
   Office to sustain its challenge to the cancellation decision.

   A contracting agency need only establish a reasonable basis to support a
   decision to cancel an RFQ; in this regard, so long as there is a
   reasonable basis for doing so, an agency may cancel a RFQ no matter when
   the information precipitating the cancellation first arises, even if it is
   not until quotations have been submitted and evaluated. Quality Tech.,
   Inc., B-292883.2, Jan. 21, 2004, 2004 CPD para. 29 at 2-3; DataTrak
   Consulting, Inc., B-292502 et al., Sept. 26, 2003, 2003 CPD para. 169 at
   5.

   DISA maintains that it canceled the RFQ to co-sponsor the conference with
   AFCEA because it was in the best interest of the government to continue
   its relationship with AFCEA. DISA explains that the purpose of the
   conference is to promote a technical exchange between government and
   industry, to inform the government of industry initiatives and their
   possible relevance to the DISA mission, and to discuss with industry the
   agency's plans and concerns regarding its existing programs. DISA contends
   that its relationship with AFCEA is beneficial because the functions of
   the AFCEA organization are directly related to DISA's mission and because
   the large AFCEA membership includes both corporations and individuals that
   have an interest in the agency's mission.

   DISA also states that AFCEA can bring a level of technical expertise to
   the planning of the conference that a support contractor cannot provide.
   Under the RFQ, a vendor would help select a conference site and hotel, and
   would provide conference management support necessary to implement the
   conference. In contrast, the Memorandum of Agreement (MOA) between DISA
   and AFCEA anticipates that AFCEA will be involved in substantive aspects
   of the conferences, to include development of the conference program, as
   well as matters of scope, theme, agenda and speakers. As a result, DISA
   argues that co-sponsorship of the conference with AFCEA enhances the
   quality of the conference for both government and non-government
   attendees. Finally, the agency maintains that the JER provides the agency
   with authority to enter into co-sponsorship arrangements for conferences
   with recognized scientific, technical, educational or professional
   organizations.

   We have reviewed the record here and we see no basis to question the
   agency's decision that its conference needs would be better satisfied by
   continuing its co-sponsor relationship with AFCEA. Moreover, we note that
   the JER anticipates this kind of relationship and recognizes that such
   co-sponsors can add to the substance of the event and also provide
   substantial logistical support. JER, DOD 5500.7-R, sect. 3-206. As DISA
   claims, the JER allows a DOD component to co-sponsor a conference, seminar
   or similar event with a non-Federal entity when five criteria are met,
   including the requirement that:

     (3) The non-Federal entity is a recognized scientific, technical,
     educational, or professional organization approved for this purpose by
     the DoD Component DAEO, giving due consideration to the prohibition
     against giving preferential treatment to non-Federal entity in 5 C.F.R.
     2635.101(b)(8) in subsection 2-100 of this Regulation (reference(h));

   JER sect. 3-206(b).

   In response to the agency's claim that it has authority to co-sponsor
   conferences with entities like AFCEA, the protester draws a distinction
   between having the claimed authority under the JER to co-sponsor a
   conference with a scientific, technical, educational or professional
   organization, and having a rational basis to cancel a procurement already
   underway. We appreciate the distinction. The agency's actions
   here--essentially encouraging private sector entities to incur the
   significant expense of preparing proposals,[1] while continuing to assess
   the viability of using a different available approach--is unfair to
   businesses and a bad procurement practice. Simply put, the government
   should not be asking private sector offerors to prepare and submit
   detailed proposals for work the agency has not yet decided to obtain using
   a procurement.

   In response to the protester's comments, we asked the agency to prepare a
   supplemental report addressing in greater detail the decision to use, and
   then abandon, the procurement process. In this regard, we have reviewed
   this record, including the declarations of the agency personnel
   responsible for these actions, and we find the explanations set forth
   therein to be credible and reasonable. Specifically, the declaration of
   the Director of Strategic Planning and Information for DISA explains that
   he concluded--despite the ongoing procurement--that DISA should continue
   working with the technical organization here if at all possible, and that
   there was a value to the agency in its continued collaboration with AFCEA
   on this conference. Agency Rebuttal, attach. 4, Declaration of DISA
   Director of Strategic Planning at 1. He also explains that there was no
   effort here to abuse the procurement process and that the concessions
   described in his message were matters first raised with AFCEA during the
   2007 conference. In addition, agency personnel involved in the procurement
   process also provided declarations explaining that they were acting in
   good faith, and had every expectation that they would be awarding a
   contract for this effort. Agency Rebuttal, attach. 1, 2 and 3. In short,
   we see no basis to question these representations, or the Director's
   determination, made in apparent good-faith, that co-sponsoring these
   conferences with AFCEA instead of contracting with a vendor to provide
   conference planning support services would be in the government's best
   interest.

   The protester also disagrees with the agency's description of its role as
   a co-sponsor of the conference and maintains that DISA is the sole sponsor
   of the event, and ultimately directs all facets of the conference. The
   protester contends that in circumstances such as these, the JER requires
   the agency to follow normal acquisition procedures to acquire support
   services. DOD 5500.7-R, sect. 3.206 (c). We do not agree. The record shows
   that the MOA between DISA and AFCEA for the 2007 conference provides for
   the sharing of the responsibility of planning the conference to include
   the scope, theme, agenda and acquiring speakers which is consistent with
   the JER requirements for co-sponsorship of an event. DOD 5500.7-R, sect.
   3.206. The agency states that it plans to complete a similar agreement for
   the 2009, 2010, and 2011 conferences as well. On this record we have no
   basis to question the co-sponsorship agreement.[2]

   The protest is denied.

   Gary L. Kepplinger
   General Counsel

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

   [1] Although the agency solicited quotes from FSS vendors, it sought
   submission of what were essentially proposals, and it anticipated a
   full-blown evaluation of these quote/proposals in four areas. There is
   little basis to distinguish the agency's actions during this procurement
   from the actions it would have used in conducting a standard negotiated
   procurement using the procedures described in Federal Acquisition
   Regulation part 15.

   [2] The protester argues that the 2007 co-sponsorship agreement between
   the agency and AFCEA violated the JER in that the agency improperly agreed
   in the agreement to assume responsibility for non-recoverable costs up to
   a minimum of $100,000 that AFCEA might have incurred should DISA cancel
   the conference. The protester contends that this violates the JER
   provision that any sponsorship agreement contain a disclaimer of
   government liability should the agency reduce its level of participation.
   The protester maintains that if the new agreement contains this language,
   the arrangement would violate this JER provision as well as other
   regulations. The 2007 MOA between DISA and AFCEA involves a conference
   period that is not covered by the instant RFQ and therefore not an issue
   in this protest. Moreover, the agency reports that it is in the process of
   completing the necessary requirements for co-sponsoring the relevant
   conferences with AFCEA and merely provided the 2007 MOA to demonstrate the
   relationship and shared responsibilities between the two organizations.