If it looks and smells like a contract, is it a contract? Ask GAO

The suspicion that the Federal Supply Service's nonmandatory, multiple-award,
indefinite-quantity, indefinite-delivery information technology contracts really are
contracts seems to be playing out in the protest decisions of the comptroller general.


In recent GAO decisions of protests from Severn Companies Inc. and LA Systems Corp.,
the comptroller general wasn't even subtle.


In the Severn ruling, the comptroller general said a delivery order placed under an
IDIQ contract set up by the General Services Administration's FSS was really the awarding
of a contract.


The decision ignored the solicitation's characterization as a request for pricing and
the contract award as an issuance of a delivery order under what appeared to be an
existing contract.


The agency involved argued that the Federal Acquisition Streamlining Act expressly
prohibited protests of delivery orders under multiple-award IDIQ contracts. It does. But
the agency still lost.


In the LA Systems case, the comptroller general said that a request for pricing, used
for soliciting price quotes from companies on the Multiple-Award Schedule, is sufficiently
like a request for proposals, which is used for awarding contracts. In other words,
awarding to a company that failed to meet the agency's stated requirements in the request
for pricing would be improper.


To get to the bottom of this, we sent procurement detective King Oxnard to interview
Dr. I.L. Ogic, congressional legislative historian in the Office of Strange Yet Weird
Interpretations of Legislative History and Regulatory Intent.


King Oxnard: Dr. Ogic, you were contacted by the comptroller general
for the express purpose of concocting strange yet weird interpretations of the Federal
Acquisition Streamlining Act, were you not?


I.L. Ogic: Well, concocting is a bit strong. I would say fabricating.
You see, the comptroller general, like other tribunals, hates to admit it can't decide
things, so it looks for exceptions that may not actually be there.


In this particular case, the law clearly states that a "protest is not authorized
in connection with the issuance or proposed issuance of a task or delivery order except
for a protest on the ground that the order increases the scope, period or maximum value of
the contract under which the order is issued."


King Oxnard: So how did you fabricate a legislative intent that would
comport with the comptroller general's wishes?


I.L. Ogic: We used a variation on the
it-couldn't-possibly-have-meant-this-rule theory. We ask a rhetorical question, "What
was the law designed to encourage irrespective of what the law actually says?"


In this case, the law was designed to encourage multiple-hyphenation contracts that had
not been widely used. The law was not designed to encourage FSS contracts; they needed no
encouragement. Therefore it follows, as morning follows afternoon, that the law does not
apply to FSS contracts.


King Oxnard: Is that it?


I.L. Ogic: No, we also had the any-distinction-is-a-difference rule.
FAR distinguishes between FSS contracts and other multiple-hyphenation contracts. That
should be interpreted as a difference so severe that the executive branch recognized that
they are not the same.


King Oxnard: How do you know which one is different?


I.L. Ogic: By determining the one that is the least similar. The FSS
rules regarding task order or delivery order contracts take precedence over normal
multiple-hyphenation contracts.


Therefore, normal multiple-hyphenation contracts are the least similar, because they
are subordinate to FSS multiple-hyphenated contracts.


King Oxnard: So if the protest prohibition only applies to the
subordinate regulations, that means they cannot apply to the dominant regulation where the
regulations differ.


I.L. Ogic: Precisely.


King Oxnard: Because FSS regulations never precluded a protest and
because they take precedence, if the comptroller general has decided protests relating to
FSS delivery orders, it follows that the comptroller general will continue to do so.


I.L. Ogic: Brilliant.


King Oxnard: But all the rules were established when the FSS used
agreements that weren't even contracts.


Wouldn't it be easier to admit they just weren't awarding the contracts in the first
place?


I.L. Ogic: That would be too logical.


Bob Little, an attorney who has worked for the General Accounting Office and a
Washington law firm, teaches federal contract law.


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