GAO dismisses security workers’ job competition protest
The General Accounting Office on Tuesday rejected a federal employee protest challenging the Agriculture Department's October 2003 decision to outsource security services work at a Maryland research center.
When agency officials choose to outsource work without first soliciting formal bids from prospective contractors, GAO lacks the authority to hear protests, according to Anthony Gamboa, GAO's general counsel. Agriculture's decision to contract out 24 security guard positions at a Beltsville, Md., research facility falls into that category, Gamboa explained in a March 30 ruling dismissing a protest filed earlier this month by Vallie Bray, president of American Federation of Government Employees Local 3147.
Agriculture decided to outsource the security work after following streamlined job competition procedures established in the Office of Management and Budget's May 2003 revisions to Circular A-76, the competitive sourcing rule book. Those procedures, designed for contests involving fewer than 65 jobs, permit agencies to contract out work without posting a solicitation.
In the security guard competition, Agriculture compared the projected cost of keeping the project in house to that of outsourcing it. Market research indicated that the agency could save money by letting a private company take over the work. Union officials have challenged this calculation, claiming that Agriculture used an inflated estimate of the cost of retaining the federal guards.
After deciding to outsource the jobs, Agriculture placed an order on the General Services Administration's Federal Supply Schedule. The agency did not issue a formal solicitation at any stage of the streamlined competition, Gamboa noted.
Under the 1984 Competition in Contracting Act and GAO's bid protest regulations the watchdog agency's "jurisdiction is limited to considering protests involving solicitations and awards made or proposed to be made under those solicitations," Gamboa wrote in Tuesday's decision. He emphasized that he based this decision on applicable laws, rather than OMB guidance.
"While it is true that [OMB's] revised [Circular A-76] states that no party may contest any aspect of a streamlined competition, this language does not preclude a protest to our office because CICA, not the revised circular, provides the basis for our bid protest authority," Gamboa said.
Tuesday's decision is in keeping with GAO's previous interpretations of the law. "It's always been true that if you came in with a protest and there was no solicitation, we would dismiss it," said Daniel Gordon, GAO's associate general counsel. This applies to any party filing a protest, including contractors, he added.
An interested party "may protest a streamlined competition to our office where the agency elects to use the procurement system and conducts a competition by issuing a solicitation to determine whether a private-sector entity can perform the work more cost-effectively," Gamboa said in Tuesday's ruling.
The ruling, however, does not settle an ongoing debate over the definition of "interested party." GAO is in the process of deciding whether federal employees or union representatives have legal standing to challenge job competition results.
Historically, GAO has not accepted protests from federal employees or unions, but the watchdog agency is reconsidering this policy in light of questions raised by OMB's May 2003 Circular A-76.
AFGE is still studying GAO's decision, said Martin Cohen, the union's assistant general counsel for litigation. "It's something that I'm going to look at carefully and discuss with [others]," he said, also expressing his surprise at the speed of the ruling. Cohen represented Bray in the protest.
Even though the Agriculture Department did not issue a formal solicitation for the security work, "We saw the actions of the agency . . . as constituting either a solicitation or a request in some other fashion for offers," Cohen said. "Just from a policy point of view, one would think that GAO would want to scrutinize the good faith of an agency as it goes through a competition, however the agency does [the competition]."