TITLE: B-311235, United Way of the National Capital Area, May 16, 2008
BNUMBER: B-311235
DATE: May 16, 2008
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B-311235, United Way of the National Capital Area, May 16, 2008
Decision
Matter of: United Way of the National Capital Area
File: B-311235
Date: May 16, 2008
Kelley P. Doran, Esq., Sean P. Bamford, Esq., Michael F. Scanlon, Esq.,
and Scott P. Lindsay, Esq., Kirkpatrick & Lockhart Preston Gates Ellis
LLP, for the protester.
Kerry McTigue, Esq., R. Alan Miller, Esq., and Linda Fallowfield, Esq.,
Office of Personnel Management, for the agency.
Jonathan L. Kang, Esq., and Ralph O. White, Esq., Office of the General
Counsel, GAO, participated in the preparation of the decision.
DIGEST
Government Accountability Office does not have jurisdiction to hear
protest of the signing of a memorandum of understanding under a
competition conducted by a Local Fund Campaign Committee of the Combined
Federal Campaign, because, while this action would appear to be a
procurement of services for the benefit of the government, a Local Fund
Campaign Committee is not a federal agency.
DECISION
The United Way of the National Capital Area protests the selection of
Global Impact by the Combined Federal Campaign of the National Capital
Area (CFCNCA) to serve as the principal combined fund organization (PCFO)
for the Combined Federal Campaign (CFC) activities in the Washington, D.C.
metropolitan area. The United Way argues that the CFCNCA did not conduct a
fair and reasonable competition in selecting Global Impact as the PCFO for
the 2008 CFC campaign year. The Office of Personnel Management (OPM)
argues that the CFCNCA is not a federal agency, and that our Office
therefore does not have jurisdiction to hear this protest. As discussed
below, we agree with OPM that our Office does not have jurisdiction to
hear the protest and dismiss it on that basis.
BACKGROUND
Organization of the CFC
The CFC is the only officially-sanctioned program for soliciting federal
government employees on behalf of charitable organizations. The CFC
conducts annual campaigns in the federal workplace, and allows federal
employees to make donations through payroll deductions or other forms of
payment to an approved list of charities. The CFC has existed in various
forms since the 1960s, and its origins lay in the efforts of various
federal entities and commissions in the 1940s and 1950s to achieve
uniformity in the manner in which federal employees are solicited by
charities.[1]
The current form of the CFC was established by two Presidential Executive
Orders signed by President Reagan. Executive Order (E.O.) No. 12353
recognized the need to "support and facilitate fund-raising on behalf of
voluntary agencies through on-the-job solicitations of Federal employees
and members of the uniformed services, and to ensure that the recipient
agencies are responsible in the uses of the monies so raised." E.O. No.
12353, 47 Fed. Reg. 12785 (Mar. 23, 1982). Executive Order No. 12404
further explained the objectives of the CFC as follows:
The objectives of the Combined Federal Campaign are to lessen the
burdens of government and of local communities in meeting needs of human
health and welfare; to provide a convenient channel through which
Federal public servants may contribute to these efforts; to minimize or
eliminate disruption of the Federal workplace and costs to Federal
taxpayers that such fund-raising may entail. . .
E.O. No. 12404, 48 Fed. Reg. 6685 (Feb. 10, 1983).
In order to meet the objectives of the CFC, the director of OPM is
directed to "make arrangements" for the annual CFC, including prescribing
"such rules and regulations as may be necessary to implement this Order."
E.O. No. 12353, 47 Fed. Reg. 12785 (Mar. 23, 1982). The CFC is now
governed by regulations promulgated by OPM at 5 C.F.R. part 950. These OPM
regulations define the CFC as "the charitable fundraising program
established and administered by the Director of the Office of Personnel
Management (OPM) pursuant to Executive Order No. 12353, as amended by
Executive Order No. 12404, and all subsidiary units of such program."[2] 5
C.F.R. sect. 950.101. The regulations state that the Director of OPM
"exercises general supervision over all operations of the CFC, and takes
all necessary steps to ensure the achievement of campaign objectives." Id.
The CFC is comprised of more than 250 local campaigns across the country.
Each local campaign is run by a local federal coordinating committee
(LFCC), which is "the group of Federal officials designated by the
Director to conduct the CFC in a particular community." Id. LFCCs are
comprised of volunteers who are federal government employees and
representatives of employee unions and other employee groups. 5 C.F.R.
sect. 950.103(a). Among the duties of the LFCC are ensuring compliance
with OPM regulations, determining the eligibility of local charitable
organizations to participate in the CFC, and selecting a PCFO to act as
the LFCC's "fiscal agent and campaign coordinator" to administer the
campaign. 5 C.F.R. sect. 950.104(b), (c).
LFCCs must solicit applications from entities seeking to serve as PCFOs
"on a competitive basis," and, in making a selection decision, must
consider such factors as "the capacity of the organization to manage an
efficient and effective campaign, its history of public accountability,
use of funds, truthfulness and accuracy in solicitations, and sound
governance and fiscal management practices." 5 C.F.R. sect. 950.104(c).
The competition by LFCCs to select a PCFO must provide for a public
solicitation, and the solicitation period must remain open for a minimum
of 21 days. Id. The OPM website provides additional guidance to LFCCs for
the selection of a PCFO, including deadlines for the LFCC to conduct the
competition, minimum solicitation notice and evaluation periods, and
requirements for evaluation. LFCC Guidance for PCFO Selection and
Oversight, available at:
http://www.opm.gov/cfc/suggestions/25-Oct-PCFO-Selection-Process.asp.
The PCFO is responsible for conducting the fundraising efforts of the
local campaign and ensuring that employee donations are properly
distributed to designated charities. 5 C.F.R. sect. 950.105(d).
Participation as a PCFO is limited to "federations, charitable
organizations or combinations thereof." Id. at (c). All fees and
reimbursement of expenses paid to a PCFO are taken from federal employees'
donations through the CFC; no appropriated funds are used to pay PCFOs.
OPM Request for Dismissal, Feb. 14, 2008, at 2.
The Instant Protest
The protest here concerns the competition conducted by the CFCNCA to
select a PCFO for the 2008 campaign. The CFCNCA issued a solicitation in
August 2007, stating that "[t]he Office of Personnel Management (OPM) has
authorized the [CFCNCA] to conduct a contracting initiative with a PCFO
for 2008." Solicitation at 1. The solicitation further states that "Title
5, Code of Federal Regulations, Part 950.104 authorizes the LFCC to
solicit applications from federations, charitable organizations, or
combinations thereof to serve as the PCFO; and to select a PCFO to act as
its fiscal agent and campaign administrator for the CFC." Id. at 2.
The solicitation anticipated award of a memorandum of understanding (MOU)
for a base period of 1 year, i.e., the 2008 campaign for the National
Capital Area, with options for up to 2 additional years, i.e., the 2009
and 2010 campaigns. Applicants were instructed to "provide evidence of the
organizational capacity, capability, and experience to meet the
requirements of the statement of work, and submit a written campaign plan
addressing the factors in the statement of work." Solicitation at 11. As
part of the written campaign plan, applicants were required to submit a
"complete budget based on projected expenses . . . along with a narrative
justification explaining rationale[s] or formulas used in calculating
major cost categories." Id. at 13. Applicants were also required to
certify that they "will abide by the directions, decisions, and
supervision of the LFCC and/or OPM's Director and [Office of the Combined
Federal Campaign]." Id.
In October 2007, the United Way responded to the solicitation.[3] On
February 1, 2008, the United Way received a letter stating that the CFCNCA
had not selected its "proposal" to serve as PCFO.[4] CFCNCA Letter to
United Way, Feb. 1, 2008. The letter, however, did not provide an
explanation for the rejection of the proposal, and did not state whether
an award had been made. The United Way requested a debriefing from the
CFCNCA and OPM regarding its proposal prior to filing this protest, but
both entities refused to debrief the United Way.[5] Protest at 7. On
February 1, the CFCNCA entered into an MOU with Global Impact. Because, as
discussed below, OPM declined to produce a report in response to this
protest, the limited record here does not indicate the basis for the
selection of the awardee's proposal.
The United Way filed this protest with our Office on February 8. The
protest named OPM and the CFCNCA as the contracting agencies responsible
for the procurement. Protest at 2. Prior to the due date for its report on
the protest, OPM requested that we dismiss the protest for lack of
jurisdiction. Specifically, OPM argued that the protest did not concern "a
procurement or contract from OPM or any federal agency," but instead an
MOU "between an organization made up of Federal employees acting in a
voluntary status in a program under the general supervision of OPM." OPM
Request for Dismissal, Feb. 14, 2008, at 1. OPM did not address any of the
allegations raised in the United Way's protest regarding the award
decision, nor did the agency request dismissal of the protest on any basis
other than jurisdiction.
On February 26, we advised the parties via telephone conference and e-mail
that we were still considering the jurisdictional issue, and that we would
not dismiss the protest at that juncture. The 100-day statutory timelines
in our protest process occasionally require us, as in this case, to
develop a protest at the same time that we are considering a request for
dismissal. We therefore requested that OPM submit a report on the protest,
but also advised that the agency could further address its arguments
regarding jurisdiction in its report. Instead of providing a report, OPM
submitted a "Renewed Motion to Dismiss."
DISCUSSION
As discussed in detail below, we conclude that our Office does not have
jurisdiction to hear the protest because it does not concern the award of
a contract for the procurement of services by a federal agency. Under the
Competition in Contracting Act of 1984 (CICA) and our Office's Bid Protest
Regulations, we review protests concerning alleged violations of
procurement statutes or regulations by federal agencies in the award or
proposed award of contracts for procurement of goods and services, and
solicitations leading to such awards. 31 U.S.C. sections 3551, 3552
(2000); Bid Protest Regulations, 4 C.F.R. sect. 21.1(a) (2008). Our
analysis of the issues in this protest concludes that, while what is at
issue appears to be a procurement for services[6] for the benefit of the
government, the procurement was not conducted by a federal agency, and we
therefore lack jurisdiction.
We first conclude that the MOU appears to concern a procurement for
services. We reach this conclusion based on the fact that the LFCC issued
a solicitation seeking competitive proposals for the performance of
various services, in return for a reimbursement of the successful
offeror's costs of performing those requirements. In addition, the
solicitation specifically identifies the "services to be provided" by the
PCFO in a "statement of work" that details the "requirements, performance
expectations and deliverables required to serve as the PCFO to the local
CFC campaign as outlined in 5 CFR 950 and CFC Guidance Memoranda."
Solicitation at 2, 4. Further, the MOU awarded here states that Global
Impact, the successful offeror, will "conduct CFC campaign support
operations during the campaign year," including supporting the CFCNCA's
oversight and audit responsibilities, and providing "annual, periodic, and
monthly financial and programmatic reports of CFCNCA activities and
events, budget, and financial matters." MOU at 1-2.
Next, we think that these services are for the benefit of the government
because the head of the executive branch, acting via the above-described
executive orders, has decided that there is a benefit to having a
streamlined system for the collection and distribution of charitable
employee donations in the federal workplace. As discussed above, the
relevant executive orders specifically charge the director of OPM with
establishing the CFC in order to "provide a convenient channel through
which Federal public servants may contribute" to charitable causes, and
"to minimize or eliminate disruption of the Federal workplace and costs to
Federal taxpayers that such fund-raising may entail." E.O. No. 12404, 48
Fed. Reg. 6685 (Feb. 10, 1983).
The services provided under the MOU here are thus procured for the purpose
of assisting OPM in meeting its obligations under the relevant executive
orders. In light of the purposes set forth in the executive orders, and
the scope of the services identified in the solicitation and MOU, we
conclude that the MOU would appear to be a contract for the procurement of
services of more than de minimis value to the government, which would
normally place the protest within the scope of our bid protest
jurisdiction.[7] See Great South Bay Marina, Inc., B-296335, July 13,
2005, 2005 CPD para. 135 at 3.
Finally, we address whether this procurement for services was conducted by
a federal agency. OPM argues that this protest concerns a competition
conducted by the LFCCs, which, it contends, are entities outside of, or
other than, the government. While we view this matter as a considerably
closer call than does OPM, we agree.
The legal character of LFCCs and their relationship to OPM is sui generis.
LFCCs are a creation of OPM, and OPM plays a central role in their
function. The regulations promulgated by OPM state that the CFC shall be
run at the local level by LFCCs, each of which is established by, and
subject to the direct control and supervision of, the director of OPM.[8]
5 C.F.R. sect. 950.101. The Director of OPM has authority to supervise,
audit, investigate, and discipline the LFCCs. 5 C.F.R. sections
950.102(c), 950.603. LFCCs, in turn, must obtain PCFO services, and must
solicit proposals to do so, in accordance with OPM regulations. 5 C.F.R.
sect. 950.104(c). Specifically, the OPM regulations direct the LFCCs to
conduct a competition to select a PCFO. 5 C.F.R. sect. 950.104(c).
While we recognize that LFCCs appear to act in a quasi-official capacity,
we see no basis to find that the LFCCs are themselves federal agencies.
Moreover, while LFCCs are regulated by OPM, it is not clear that OPM is
actually involved in, or responsible for the MOUs. As OPM notes, the
agency is not involved with the drafting or issuance of solicitations,
evaluation of proposals, or selection of successful offerors. Further, OPM
notes that the LFCC here, the CFCNCA, is not comprised of OPM employees,
but rather representatives from other federal agencies and employee
unions, all of whom are acting on a voluntary basis. Additionally, the MOU
here between the CFCNCA and Global Impact is signed by the chair of the
CFCNCA, and was not signed or otherwise approved by OPM. See MOU at 6. On
this record, while we think this issue is a close one, and while we
recognize that the LFCCs are being used by OPM to supplement its
management of the government-wide CFC effort, we cannot conclude the
procurement conducted here by the CFCNCA was actually conducted by OPM, or
any other federal agency.
In summary, we conclude that this protest does not concern a procurement
for services by a federal agency, and that therefore we do not have
jurisdiction to hear this protest.
The protest is dismissed.
Gary L. Kepplinger
General Counsel
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[1] As OPM's history of the CFC relates, "Prior to the 1950's, on-the-job
fundraising in the federal workplace was an uncontrolled free-for-all."
History of Charitable Fundraising Within the Federal Service, available
at: http://www.opm.gov/cfc/html/cfc_hist.asp.
[2] In appropriations law decisions, we have stated that our Office
"recognizes the CFC as a legitimate, government-sanctioned charity
fund-raising campaign with which government agencies may cooperate."
Invoice to IRS for that Agency's Share of CFC Solicitation Expenses
Incurred in Northern Utah in 1985, B-225860, Feb. 12, 1988, 67 Comp. Gen.
254. Our Office has also recognized that, under certain circumstances,
agencies may expend appropriated funds "for the preparation of campaign
instructions and mailing labels and for the distribution of campaign
materials" in support of the CFC. Id.
[3] The application at issue here was submitted by the United Way of the
National Capital Area and the United Black Fund, but the protest was filed
and pursued primarily by the United Way.
[4] The OPM regulations, discussed above, describe the submissions
provided as a result of this competition as "applications." 5 C.F.R. sect.
104(c). The solicitation here, and the letter advising the United Way that
it was not selected, refer to these submissions as proposals. E.g.,
Solicitation at 1 ("To be considered, 5 copies of your proposals must be
received by hand delivery . . ."); CFCNCA Letter to United Way, Feb. 1,
2008 ("Thank you for your proposal to serve as [PCFO] for the Combined
Federal Campaign of the National Capital Area."). From this point forward,
we will use the terminology of the solicitation and refer to these
submissions as proposals.
[5] The CFCNCA subsequently agreed to provide a debriefing to the United
Way on March 4. E-mail from CFCNCA to United Way, Feb. 26, 2008. On March
3, however, the CFCNCA withdrew its offer of a debriefing, explaining as
follows: "In light of the pending litigation initiated by [the United
Way], we are unable to meet with you and your representatives regarding
the [United Way] 2008 PCFO application on March 4, 200[8]." E-mail from
CFCNCA to United Way, Mar. 3, 2008.
[6] For purposes of this decision, we consider the MOU a contract because
it is a mutual agreement between the parties which requires Global Impact
to perform services for the LFCC in return for reimbursement of its costs.
In this regard, OPM argues that the MOU is not a government contract
because the LFCC is not a federal agency, and that no federal agency is a
party to the MOU; OPM does not dispute that the MOU appears to create a
contractual obligation between the LFCC and Global Impact. See OPM Renewed
Motion to Dismiss, Mar. 12, 2008, at 5.
[7] In its initial request for dismissal, OPM argued that our Office
lacked jurisdiction because the MOU does not involve appropriated funds.
Since the passage of CICA, our bid protest jurisdiction has not been based
on the expenditure of appropriated funds. USA Fabrics, Inc., B-295737,
B-295737.2, Apr. 19, 2005, 2005 CPD para. 82 at 2. Instead, as discussed
above, our jurisdictional concern is whether the procurement at issue is
being conducted by a federal agency. Id.
[8] As discussed above, OPM regulations define the CFC as the "charitable
fundraising program established and administered by the Director of [OPM]"
including "all subsidiary units of such program" such as the LFCCs. 5
C.F.R. sect. 950.101.