TITLE: B-311247, Lisa Hartman-Designated Employee Agent, May 6, 2008
BNUMBER: B-311247
DATE: May 6, 2008
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B-311247, Lisa Hartman-Designated Employee Agent, May 6, 2008
Decision
Matter of: Lisa Hartman-Designated Employee Agent
File: B-311247
Date: May 6, 2008
Lisa Hartman, Designated Employee Agent, the protester.
Phillipa L. Anderson, Esq., and Denis Foley, Esq., Department of Veterans
Affairs, 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 filed by a Designated Employee Agent alleging that a
public-private competition under Office of Management and Budget Circular
A-76 is required before the agency can award a contract for ground
maintenance services which are currently being provided by 7 civilian
employees (who also perform other functions, and none of whom will lose
their jobs here) is denied because the Circular does not require issuance
of a solicitation in the case of a function as small as this, and because
recently-enacted changes to the Office of Federal Procurement Policy Act,
41 U.S.C. sect. 403, do not impose cost comparison requirements on
conversions of functions performed by fewer than 10 employees.
DECISION
Lisa Hartman-Designated Employee Agent[1] protests the award of a contract
to DWBH Services, Inc. under request for proposals (RFP) No.
VA-786-07-RP-0220, issued by the Department of Veterans Affairs (VA),
National Cemetery Administration for grounds maintenance services for the
Chattanooga National Cemetery. The protester argues that the agency is
violating Office of Management and Budget (OMB) Circular A-76 by directly
converting functions performed by federal employees to contractor
performance without conducting a cost comparison.
We deny the protest.
The RFP was issued on September 13, 2007, as a service-disabled
veteran-owned small business (SDVOSB) set-aside for a 1-year base period
with three 1-year option periods. The services involve the setting and
alignment of new or replacement headstones; lawn maintenance, including
mowing, trimming and edging; and leaf collection. The amended closing date
for receipt of proposals was October 10, 2007. After the receipt and
evaluation of proposals, final proposal revisions were received on
November 28. Award was made to DWBH on January 16, 2008 and a notice of
award was published in FedBizOpps on January 18. This protest followed.
The protester states that seven federal employees are currently performing
the cemetery maintenance services at the Chattanooga Cemetery.[2] The
protester argues that the VA is violating the OMB Circular by directly
converting functions performed by federal employees to contractor
performance without conducting a cost comparison. The protester also
maintains that the affected employees have been placed at a competitive
disadvantage by the agency's action because they were not allowed to
compete to retain their own work.
The VA responds that it has not converted a function performed by federal
employees, because no agency job has been affected or lost as a result of
the RFP. The agency states that it has been contracting for these services
since 2001 and that it has informed current employees that this contract
action would not have an impact on current cemetery employees. The agency
also states that current employees perform interments, raising/realigning
of headstones, grounds maintenance, such as grave repair, over seeding,
headstone cleaning, shelter preparations, sod application, herbicide
applications, equipment/vehicle maintenance, and program preparations. The
agency states that as a result of the award under this RFP, the current
employees will perform all of their current functions except headstone
alignments and mowing.
With respect to the OMB Circular, the protester correctly notes that the
current version of the Circular prescribes two types of cost comparisons.
Where 65 or more full time equivalents (FTEs) are involved, the Circular
requires a "standard competition"; where fewer than 65 FTEs are involved,
the Circular permits either a standard or a "streamlined competition." OMB
Circular A-76 (May 29, 2003), attach. B, at B-1. In the situation here,
the protester argues that the Circular requires, at a minimum, a
streamlined competition for these requirements.[3]
In reviewing the protester's allegations, we note that even though the
Circular speaks of requiring a streamlined competition when a commercial
activity is performed by an aggregate of 65 or fewer FTEs, as this one is,
the Circular permits an agency to decide to contract out work based solely
on an internal analysis without the issuance of a solicitation, and hence
without use of the procurement system. Where an agency is not required to
use the procurement system, and does not do so, our bid protest function
has no role in reviewing the agency's actions. See Vallie Bray, B-293840,
B-293840.2, Mar. 30, 2004, 2004 CPD para. 52 at 3.
We recognize that the thresholds and requirements described in the OMB
Circular--and the rights that apply at certain thresholds--have been
significantly altered by a recently-enacted statute, which imposes its own
requirements. Specifically, the Office of Federal Procurement Policy Act,
41 U.S.C. sect. 403 et seq., as amended by the National Defense
Authorization Act for Fiscal Year 2008, requires a public-private
competition prior to converting public sector jobs to contractor
performance whenever the conversion involves "a function of an executive
agency performed by 10 or more agency civilian employees." National
Defense Authorization Act for Fiscal Year 2008, Pub. L. No. 110-181,
sect. 327, 122 Stat. 3 (2008). In these cases, the statute requires
agencies to conduct a public-private competition that, among other things:
A) formally compares the cost of performance of the function by agency
civilian employees with the cost of performance by a contractor;
(B) creates an agency tender, including a most efficient organization
plan, in accordance with Office of Management and Budget Circular A-76,
as implemented on May 29, 2003, or any successor circular;
(C) includes the issuance of a solicitation . . .
Id.
Because the function at issue here involves fewer than 10 FTEs, however,
the recent statutory requirements for a formal cost comparison, including
issuance of a solicitation, do not apply to this agency action.
The protest is denied.
Gary L. Kepplinger
General Counsel
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[1] Recently enacted changes to our bid protest statute grant interested
party status to any one individual who has been designated as the agent of
federal employees for purposes of representing them in a public-private
competition, or for purposes of arguing that a public-private competition
is required under the circumstances presented. Hence, we use the term
"designated employee agent" to refer to both the protester and the person
selected to represent federal employees in these challenges. See National
Defense Authorization Act for Fiscal Year 2008, Pub. L. No. 110-181,
sect. 326, 122 Stat. 3, 62-63 (2008).
[2] The protester states that the number of employees performing this work
has been reduced from 12 to 7, through attrition and a hiring freeze, with
no corresponding decrease in workload.
[3] The Circular explains the steps of a streamlined competition at
Attachment B, Section C. This process allows the agency to use cost
estimates to calculate the cost of performance, and encourages, but does
not require, the development of a detailed proposal process for the public
and private sectors.