GAO declines to hear protest of Walter Reed competitive sourcing decision

The Government Accountability Office earlier this week dismissed a protest filed on behalf of employees at the Army's Walter Reed Medical Center, ruling that the employee group had no standing to challenge the outcome of a public-private job competition initiated prior to January 2005.

GAO's decision, announced on Wednesday, concluded that Alan King, Walter Reed's deputy garrison commander, was not an "interested party" with standing to pursue the protest on behalf of the federal employee group bidding in the competition.

The dismissal means that GAO will not consider King's challenge of a contest for base operations support services at Walter Reed. The competition began in January 2000. The in-house employee team won in September 2004, but the award was the subject of numerous appeals and a round of revisions leading to an award to Cape Canaveral, Fla.-based IAP Worldwide Services last month.

King's protest, filed on behalf of the employee group that bid to perform the work as a "most efficient organization," claimed that he had standing to represent the group before GAO as the "functional and legal equivalent" of an agency tender official. The ATO is authorized to represent federal employees in internal agency appeals under 2003 revisions to Office of Management and Budget Circular A-76 rules governing public-private competitions.

The previous version of A-76 rules, under which the solicitation was issued, does not recognize appeal rights for in-house employee teams; neither version of the rulebook addresses GAO appeal rights.

In dismissing the protest, GAO General Counsel Anthony Gamboa concluded that it was not A-76 rules, but the 1984 Competition in Contracting Act, that permits officials representing in-house teams to file protests with GAO. That act was amended in 2004 to allow such protests from ATOs, effective with A-76 studies initiated after Jan. 25, 2005, Gamboa wrote. King's protest, therefore, was not covered under the amendment and could not be considered.

The American Federation of Government Employees, which provided funding to back the protest, said the impetus to appeal came from Walter Reed managers who were disappointed to see how the competition process played out. While the initial employee bid was $7 million less than that of IAP Worldwide Services, a mid-stream solicitation change resulted in a recalculation of the bids by all parties and in IAP's bid coming in $7 million lower, said John Threlkeld, a lobbyist for AFGE.

Threlkeld said the process for recalculating the employee bid was flawed, resulting in the inflation of the estimate that rendered it uncompetitive with IAP's bid.

In addition to challenging the validity of the cost recalculation process, the employee group argued that the competition lasted longer than is allowed, and should be canceled. The fiscal 2006 Defense appropriations act, like previous appropriations acts, stipulates that an A-76 competition should last no more than 30 months.

Because the appeals route has been closed, the union will lobby Congress to see if the award can be canceled and the competition started again from scratch if judged necessary, Threlkeld said.

IAP did not respond to questions about the protest in time for publication, but a press release announcing the January award decision on the company's Web site quotes Chief Executive Officer Al Neffgen as saying, "IAP is pleased to continue its relationship with the U.S. Army and provide critical support services at the nation's pre-eminent Army medical center."

The entire five-year contract is valued at more than $120 million, according to the IAP press release, and includes support and environmental services, transportation functions, community activities, information management, logistics and public works.

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