But the Small Business Administration and Phoenix Corp. continued to fight the FAST initiative, alleging the contract did not go far enough in reaching out to small businesses and violated the 1997 amendments to the Small Business Act. The General Accounting Office's decision is the first interpretation of these amendments, according to Petkoff. "We understood what the law on [the Competition in Contracting Act] was, but the Small Business Act amendments of 1997 were kind of an unknown quantity," said Petkoff. The 1997 amendments set strict requirements that agencies must meet in order to justify the need for bundled contracts, which typically exclude small businesses. In dismissing the Small Business Administration's argument that the Air Force contract hurts small businesses, the General Accounting Office noted that two of the six contract awards were reserved for small firms. A GAO hearing to examine the Air Force's need for the contract was the turning point in the case, according to Phoenix CEO Maurice Allain. At the hearing, GAO officials heard testimony from Air Force managers who described how downsizing in maintenance and acquisition staff had left the department shorthanded to perform routine upkeep on aircraft. "What tipped the scales was testimony from an Air Force manager that this method of contract was needed because for one system, the C-5 transport aircraft, the Air Force had more than 3,000 parts with no known vendor," said Allain. Under the FAST initiative, the Air Force could quickly fulfill requests for those parts without going through the entire acquisition process. GAO occasionally convenes hearings while investigating protests of bids, a senior official said. "We hold hearings in approximately 50 cases a year, so they are relatively unusual but not rare," said Daniel I. Gordon, GAO's associate general counsel. The Small Business Administration and Phoenix Corp. both expressed hope that Congress would revisit the impact of bundled contracts on small businesses. The Air Force plans to award the FAST contracts by this summer.
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