To win schedule task orders, learn the ropes

Infotech and the Law | Legal insights for today's market

Jonathan Cain

It might seem self-evident, but apparently some government information technology contractors fail to appreciate that to be awarded Federal Supply Schedule task orders, a contractor actually must have an FSS contract that includes the labor categories sought by the task order. Two protests in the past several months have reinforced the point, and the facts are instructive.

In a case decided in December, the U.S. Court of Federal Claims agreed with the protester that the Defense Department improperly awarded an FSS task order to a company that had an FSS contract but lacked labor categories needed to fill the order.

The task order solicitation required that the successful bidder have a General Services Administration Schedule 69 contract, and it specified that the agency would award a firm-fixed price contract against the company's FSS contract. The company had a Schedule 69 contract but lacked certain special item numbers that covered the skills asked for in the solicitation. The company filled this gap by including a subcontractor with employees who possessed the specified skills. But the subcontractor did not have an FSS Schedule 69 contract.

After award, the losing bidder, the incumbent, protested on the grounds that the winning contractor could not supply all the requirements of the task order under an FSS contract. The court sustained the protest.

Although the issue was one of first impression for the U.S. Court of Federal Claims, the Government Accountability Office has decided on a number of occasions that an agency may not limit a solicitation to holders of GSA schedule contracts and then procure nonschedule services through the awarded contract. Although a schedule contractor may be permitted to use subcontractors to provide services in its FSS contract, "it may not properly use subcontractors to offer services not included in either its own or those companies' FSS contracts, since this would mean that it was improperly including non-FSS goods or services in an FSS sale," according to GAO.

When an agency announces an intention to order from an existing GSA schedule contractor, it means that "the agency intends to order all items using GSA's FSS procedures and that all items are required to be within the scope of the vendor's FSS contract," according to GAO. To acquire non-FSS services, the agency must use proper competitive procedures.

In another case, decided by the GAO in December, the Department of Veterans Affairs issued an FSS task order solicitation for medical records coders. The solicitation did not specify a GSA schedule but did specify the skills and experience required. Most schedule holders responded to the solicitation under Mission Oriented Business Integrated Services (MOBIS) schedules, but holders of FSS Schedule 70 contracts also responded. One Schedule 70 contract holder sought and obtained a modification to its schedule between the time it submitted its response to the solicitation and the date of the task order's award. The modification, however, added labor categories that were outside the scope of a Schedule 70 contract, and GSA revoked the modification two weeks later.

When it lost the award, the contractor protested. During the course of the protest, the protester also obtained a MOBIS contract under which it claimed it would be able to perform the task order.

GAO dismissed the protest, saying the protester lacked standing to challenge the award because its FSS contract did not contain all of the labor categories required to fill the task order, and the protester therefore could not be a supplier of the task-order services.

Jonathan Cain is a member of the law firm Mintz Levin in Washington, D.C. The opinions expressed in this article are his. He can be reached by e-mail at jtcain@mintz.com.

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