Who Reviews an Option Exercise?

In March 2008 the Army set aside a requirement for portable chemical toilets at Fort Drum, New York, and by the end of May it had gone to a service-disabled veteran-owned joint venture out of Larue, Texas. Base year plus four one-year options, about as small as a federal services buy gets.

Fourteen months later the Army decided it did not want the first option year after all. It wanted four more months instead, and it took them under FAR 52.217-8, the clause that lets a contracting officer require continued performance at rates already in the contract.

A competitor called Major Contracting Services protested those four months.

And won.

That 2009 decision is the authority GAO leaned on this week, in a case it threw out.

Three Ways to Lose This Argument

On October 27 GAO decided B-424759, Symons Emergency Specialties, Inc. d/b/a Symbiosis. The VA had given Symbiosis a purchase order for non-emergent ambulance services at Long Beach, described in the contracting officer's own statement as "a short-term bridge order to prevent a break in available services due to litigation related to the competitive procurement for the long-term provision of the same services."

You have written that sentence about your own program.

The long-term award then went to EDG Entities LLC, an SDVOSB, under RFQ 36C26225Q1093.

Before that, EDG had protested the bridge, arguing the VA could not exercise the option on Symbiosis' purchase order because the option price had never been evaluated when the order was awarded. The VA took corrective action and unwound the option.

So Symbiosis protested that, plus a list of complaints about how EDG was performing: limitations on subcontracting, who was actually driving the ambulances, local licensing.

GAO dismissed all of it in four pages.

The reasoning is short because the jurisdiction is narrow. 31 U.S.C. § 3552 sends GAO protests about an alleged violation of procurement law, and its own rule at 4 C.F.R. § 21.5(a) says the administration of an existing contract "is within the discretion of the agency."

Three doors, two of them closed (chart below):

• The agency would not exercise an option on your contract. Administration. GAO cites Innotion Enterprises for having "repeatedly determined" it.
• The agency unwound an option it had already exercised. Administration too, because terminating an exercised option is "tantamount to a decision not to exercise the option."
• Performance complaints about the winner. Also administration, and GAO called them "quintessential."

There is a statutory exception and it is thinner than people think.

31 U.S.C. § 3551(1)(D) lets you protest a termination when the objection alleges the termination was "based in whole or in part on improprieties concerning the award." GAO noted that the cases decided under it are mostly a former awardee fighting a corrective-action termination triggered by somebody else's protest.

Symbiosis was a former awardee fighting a corrective-action termination, and it still lost, because it attacked the option rather than the award.