As discussed above, GSA clarified Q&A No. 80.1.c, explaining that contractors operating brick and mortar stores must be certified by AbilityOne, and must comply with AbilityOne requirements to be eligible for award under CLIN No. 4. GSA Corrective Action Letter (Apr. 21, 2014), Tab 1, GSA Clarification Notice. The agency contends that its clarification addressed the protester’s arguments concerning compliance with the JWOD Act, and that no further revisions to the solicitation are needed.

NIB argues that GSA’s clarification is not sufficient to ensure compliance with the JWOD Act, because AbilityOne does not have specific procedures to require brick and mortar stores to block sales of commercial ETS products. In this regard, NIB notes that AbilityOne requires prospective vendors of products on the Procurement List to be approved for such sales, and publishes Criteria for AbilityOne Distributors, which explains the process for approval; however, these criteria do not expressly address sales of commercial ETS products through brick and mortar stores. For this reason, the protester argues that GSA should either (1) cancel the solicitation provision that authorizes sales through brick and mortar stores, or alternatively, (2) amend the solicitation to require that offerors with brick and mortar stores not sell commercial items that are essentially the same as those on the Procurement List.

GSA responds that AbilityOne certifies vendors without regard to their method of sales (e.g., online or brick and mortar stores). The agency further contends that the absence of a specific approval for brick and mortar stores does not show that such vendors are ineligible for certification by AbilityOne, or that the solicitation’s reliance on certification by AbilityOne violates the JWOD Act. For the reasons discussed below, we agree with the agency and find no basis to sustain the protest.

As relevant here, prospective vendors must explain how their ordering system precludes purchases of [essentially the same] ETS, as follows:

The distributor must abide by the AbilityOne exclusivity principle, i.e., not to sell any commercial products to Federal customers if those products have been deemed “essentially the same” (ETS) as AbilityOne products. As a result, distributors should refrain from marketing both A- and B-List ETS commercial products on federal contracts, including the GSA Schedule and DoD E-Mall. . . . . Distributors must be able to explain and demonstrate how [their] ordering system will automatically block commercial ETS products and substitute the appropriate AbilityOne products. An automated blocking system is strongly preferred.

Criteria for AbilityOne Distributors ¶ 3. Additionally, for electronic catalogs, the AbilityOne provisions state as follows:

The AbilityOne Program requires that electronic (on-line and/or CD) catalogs fully integrate AbilityOne products into all search features as well as other pages where applicable. . . . Removal of all ETS items is required if the site is dedicated to federal customers. If the electronic catalog is part of a distributor’s commercial electronic catalog, the firm must still block the sale of ETS products to federal customers.

Id. ¶ 5.

NIB notes that the AbilityOne’s authorization procedures do not specifically address the prohibition on the sale of ETS in the context of brick and mortar stores. In contrast, the provisions quoted above require vendors who offer products through online systems to have a blocking system. Criteria for AbilityOne Distributors ¶¶ 3, 5. NIB also contends that the lack of a specific ETS enforcement provision in the RFP for brick and mortar stores places NIB at a disadvantage, because without such a provision, it is “highly likely” that large commercial firms would offer ETS products in their brick and mortar stores in violation of the JWOD Act. Protester’s Comments (Apr. 25, 2014) at 2. In addition, NIB argues that these commercial firms will likely offer “low ETS prices, name recognition, greater range of products, etc.” Id.

GSA argues that AbilityOne requirements apply to vendors without regard to a specific sales channel, e.g., online, or brick and mortar stores. AR at 3. GSA notes in this regard that the Criteria for AbilityOne Distributors does not set forth unique requirements for firms that operate brick and mortar stores, nor do the Criteria prohibit such firms from receiving authorization to be an AbilityOne distributor. For this reason, the agency contends, the solicitation as written complies with the JWOD Act because GSA may rely upon AbilityOne’s authorization agreements with vendors. AR at 6.

GSA notes that AbilityOne is the designated agency responsible for authorizing vendors to sell products under the AbilityOne program. AR at 5; 41 C.F.R. § 51-1.3. The AbilityOne Commission is responsible for “[e]stablish[ing] rules, regulations, and policies to assure effective implementation of the JWOD Act.” 41 C.F.R. § 51-2.2(a). GSA contends, and we agree, that to the extent unique requirements should be adopted for firms operating brick and mortar stores, those requirements must first be established in the vendor’s agreements approved by AbilityOne, and then negotiated with the authorized distributors.

With regard to the solicitation, GSA explains that offerors for CLIN No. 4 must demonstrate that they are an AbilityOne certified firm, RFP, SOW, at 36, and must provide GSA an authorization letter from AbilityOne; GSA, in turn, will confirm the authorization of each offeror with AbilityOne. Contracting Officer Statement (Apr. 30, 2014) at 1; RFP, Attach. 10, OS3 Checklist Information and Instructions for Solicitations at 4. AbilityOne’s confirmation of the authorization is considered the final determination in this matter; GSA has no discretion to second-guess AbilityOne’s authority in this area. Contracting Officer Statement (Apr. 30, 2014) at 1. The agency also states that it will conduct end-user training to reinforce the obligation of buyers with regard to the Procurement List. AR at 4.

On this record, we find no basis to sustain the protest. We see no requirement in the JWOD Act, the FAR, or any regulations or policies issued by AbilityOne, that requires an agency such as GSA to include more specific solicitation provisions to block the purchase of ETS merchandise at commercial brick and mortar stores. Instead, the relevant statutes and regulations provide AbilityOne with the authority to set the requirements for vendors under the JWOD Act. Because the solicitation relies on AbilityOne’s authorization agreements with commercial vendors, we find that the RFP complies with the JWOD requirements.

Finally, NIB argues that GSA improperly failed to reopen the competition following the clarification of the solicitation regarding brick and mortar stores. The protester argues that the clarification was a material revision to the terms of RFP, and that offerors would have likely required revisions to their proposals. NIB Response to Summary Dismissal Request (Apr. 24, 2014) at 3. We find no basis to sustain the protest based on this concern. Even if the agency’s clarification could be construed as a new requirement, we find that the protester was not prejudiced because, as the protester has repeatedly stated, it cannot compete without a further amendment to the solicitation that would require offerors to block the sale of ETS products at commercial brick and mortar stores in a manner analogous to the requirements for online sales. See id. at 2-3; Protester’s Comments (Apr. 25, 2014) at 2. Because, as discussed above, we find no basis to conclude that the agency was required to include such a solicitation provision, we find no basis to sustain the protest.

The protest is denied.  (National Industries for the Blind, B-409528.20: Jul 2, 2014)  (pdf)

OSC Solutions, Inc. of West Palm Beach, Florida, protests the General Services Administration's (GSA) cancellation of a request for quotations (RFQ) and subsequent sole-source award of a blanket purchase agreement to the Industries of the Blind, Greensboro, North Carolina (IBNC), for tarps.

(sections deleted)

OSC Solutions argues that GSA could not issue the blanket purchase agreement and orders to IBNC under the authority of the JWOD Act, because the tarps are not on the JWOD procurement list. Given that the agency could not purchase the tarps from IBNC under the authority of the JWOD Act, OSC Solutions argues that the agency did not have a reasonable basis to cancel the RFQ, where OSC Solutions had submitted a responsive quotation.

A contracting agency needs a reasonable basis to support a decision to cancel an RFQ. Deva & Assoc. PC, B-309972.3, Apr. 29, 2008, 2008 CPD para. 89 at 3. We have recognized that a solicitation may be cancelled where, during the course of the procurement, the item or services involved are discovered to be on, or have been added to, the JWOD procurement list. See Best Foam Fabricators, Inc., B-259905.3, June 16, 1995, 95-1 CPD para. 275 at 2; Microform Inc., B-246253, Nov. 13, 1991, 91-2 CPD para. 460, aff'd on recon., B-246253.2, Mar. 31, 1992, 92-1 CPD para. 338.

Here, we find that GSA had no reasonable basis to cancel the RFQ, because the tarps obtained from IBNC under the authority of the JWOD Act are not on the procurement list.[8] Accordingly, GSA's noncompetitive purchase of the tarps was not authorized by the JWOD Act. See JAFIT Enters., Inc., supra, at 2. Given that the noncompetitive purchase of the tarps from IBNC under the JWOD Act was the agency's only documented basis for cancellation of the RFQ, we find that GSA did not have a reasonable basis to cancel the RFQ.

GSA nevertheless argues that OSC Solutions was not prejudiced by the agency's cancellation of the RFQ. Specifically, GSA contends that it could have issued an order under the RFQ to IBNC[9] or to Premier and further argues that it would not have issued an order to OSC Solutions under the RFQ because the firm's quoted delivery schedule was too long. Our Office will not sustain a protest unless the protester demonstrates a reasonable possibility that it was prejudiced by the agency's actions, that is, unless the protester demonstrates that, but for the agency's actions, it would have had a substantial chance of receiving the award. McDonald‑Bradley, B‑270126, Feb. 8, 1996, 96‑1 CPD para. 54 at 3; see Statistica, Inc., v. Christopher, 102 F.3d 1577, 1581 (Fed. Cir. 1996).

We find a reasonable possibility that OSC Solutions was prejudiced by GSA's cancellation of the RFQ and improper issuance of orders to IBNC under the JWOD Act. GSA's arguments do not establish that there was no reasonable possibility that OSC Solutions would not have had a substantial chance of receiving an order under the RFQ. OSC Solutions raised colorable arguments disputing whether Premier or IBNC offer TAA-compliant tarps that would satisfy the RFQ requirements. We did not address these arguments, given the agency's cancellation of the RFQ.[10] With respect to the agency's arguments that the delivery schedule quoted by OSC Solutions was too long, the contemporaneous record does not show that the agency considered OSC Solutions's quotation to be unacceptable, either due to the quoted delivery schedule or for any other reason.

We sustain the protest. While we would normally recommend that the agency cancel the orders to IBNC and consider issuing an order or orders under the RFQ, GSA has advised us that it terminated for convenience the orders issued to IBNC, after having received 68,406 tarps, and conducted a limited competition for the remaining 93,393 tarps, under which GSA received a quotation from OSC Solutions. Given that there is no longer a requirement for the tarps and that OSC Solutions was given an opportunity to compete for a portion of the tarps, we recommend that OSC Solutions be reimbursed a pro‑rated amount of the firm's costs of quotation preparation, see Hydro Research Sci., Inc.--Costs, B-228501.3, June 19, 1989, 89-1 CPD para. 572 at 5‑6, and reimbursed its costs of filing and pursuing the protest, including reasonable attorneys' fees. 4 C.F.R. sect. 21.8(d)(1), (2) (2009). OSC Solutions should submit its certified claim for costs, detailing the time expended and costs incurred, directly to GSA within 60 days after the receipt of this decision.  (OSC Solutions, Inc., B-401498, September 14, 2009) (pdf)

Cancellation of request for quotations (RFQ) for 1 year of janitorial and grounds maintenance services, with 4 option years, on the basis that the services had to be procured pursuant to the Javits-Wagner-O'Day (JWOD) Act, was improper where only services for 240 days or fewer had to be acquired under the statute. Related RFQ to cover a shorter term properly was canceled, however, since a reasonable basis existed for cancellation.  (Aleman & Associates, Inc., B-287275.2; B-287356.2, July 2, 2001)

(section deleted)

The site is in a remote desert area. The closest hospital is 30 miles away. There is no public transportation to the site. All the current job descriptions require that employees be able to drive, lift up to 100 pounds, engage in strenuous physical exertion during stressful conditions, and be available 24 hours a day.

The Army proposes taking this work away from the incumbent, with whom it has no complaint, at the expiration of the contract in order to give the work to the intervenor, Skookum Educational Systems (“Skookum”), who promises to do the work using at least sixty percent severely disabled workers. Under the terms of the applicable statute, severely disabled workers cannot be otherwise competitively employable. 41 U.S.C. § 8501(8) (Supp. V 2012). Skookum has “zero” experience with this precise type of work. AR 2525.

While to an outsider it would appear that what the Army proposes is sheer folly, the government has aggressively defended its actions as permissible under the Javits-Wagner-O’Day Act (“JWOD”), 41 U.S.C. §§ 8501-506. That act authorized creation of the Committee for Purchase from People Who Are Blind or Severely Disabled (the “Committee” or “AbilityOne”). Id. § 8502; see Pub. L. No. 95-739, 52 Stat. 1196 (1938) (“That there is hereby created a Committee . . . to determine the fair market price of all brooms and mops and other suitable commodities manufactured for the blind and offered for sale to the Federal Government . . . .”). The purpose of the Committee is to “increase employment and training opportunities for persons who are blind or have other severe disabilities.” 41 C.F.R. § 51-1.1(a) (2012). A “severely disabled” individual is the following:> [A] person other than a blind person who has a severe physical or mental impairment (a residual limiting condition resulting from an injury, disease, or congenital defect) which so limits the person’s functional capabilities (mobility, communication, selfcare, self-direction, work tolerance, or work skills) that the individual is unable to engage in normal competitive employment over an extended period of time. 41 C.F.R. § 51-1.3.

(section deleted)

The Committee held an Executive Session on April 24, 2012, at which representatives of SA-TECH and Skookum were permitted to make presentations. AR 2490. During the session, committee member Kathy Martinez told plaintiff’s counsel,

I am very concerned about your concept of what a significant disability means and what people with significant disabilities can do? I happen to be a blind person. I don’t work on a shooting range, but I am you know, a significant, I am a person with a significant disability who is employed. And, I am unaware that the term significant disability means that you can’t hold down a job.

AR 2508.  After plaintiff’s counsel read the statutory definition of “severely disabled,” Ms. Martinez replied, “I think that’s a very antiquated definition frankly.” Id.

On July 20, 2012, the Committee again voted to add the YTC contract to the Procurement List. Nine members voted in favor, one was undecided, and three disapproved. AR 2566. The three dissenting members of the Committee expressed doubts as to the propriety of awarding this contract through AbilityOne. They were concerned because the principal behind the incumbent contractor was a disabled person who employed service disabled and other veterans, the work did not seem safe for severely disabled individuals, Skookum was allowed a long phase in period and a low goal for the percentage of severely disabled individuals employed, and Skookum had not presented a plan for transporting severely disabled individuals 33 miles to and from YTC. See AR 2567.

What should have been equally disturbing was Skookum’s ultimate guarantee that if it couldn’t do the work, it would abandon the effort to achieve even 60% and simply use able-bodied workers. While these assurances might be relevant to meeting the capability requirement, they are obviously at odds with the statutory expectation that a meaningful number of jobs could be created for the severely disabled. Skookum’s efforts to straddle both requirements created a built-in tension in its proposal. It was MICC’s and the Committee’s obligation to identify that tension and resolve it, not to ignore it and in effect turn the procurement into an experiment.

Based on this record, we cannot defer to the conclusion by the MICC and the Committee that there was a potential for creating jobs for the severely disabled. It is of particular concern to the court that the individual at the Army whose responsibility it was to protect the Army’s interests showed an inclination to accept creative applications of the term “severely disabled,” AR 856, 1509, and seemed more eager to promote AbilityOne in general and Skookum in particular than to address the serious misgivings being raised. In addition, some Committee members seemed hostile to statutory limitations on the term “severely disabled,” AR 2508 (“I think that’s a very antiquated definition frankly.”), and the terms “disabled” and “severely disabled” are used interchangeably throughout the record as if there were no distinction. Compare AR 1885 with AR 1669.

(sections deleted)

On the basis of the existing record, it was arbitrary and capricious for the AbilityOne Committee to designate the YTC for placement on the Procurement List. Because Skookum was the only contractor being considered, that means that its designation as the contractor for the work was also arbitrary and capricious. Plaintiff therefore succeeds on the merits.

(sections deleted)

CONCLUSION

Plaintiff’s motion for judgment on the administrative record is granted. Defendant’s motion for judgment on the administrative record is denied. Defendant is enjoined from placing the YTC contract on the AbilityOne Procurement List and from contracting with Skookum for the work. The Clerk is directed to enter judgment for plaintiff accordingly. Costs to plaintiff.  (Systems Application & Technologies, Inc., v. U. S. and Skookum Educational Systems, No. 12-526, December 10, 2012)  (pdf)

Magic Brite received the contract at issue under a purchase exception, pursuant to 41 C.F.R. § 51-5.4 and 48 C.F.R. § 8.706. See Def.’s App. at 5-6. The granting of an exception does not have the effect of removing the contract from the JWOD procurement list -- such a “deletion” is accomplished under an entirely different regulation, 41 C.F.R. § 51-6.8. Moreover, the removal of a contract from the JWOD procurement list requires the same notice and comment rulemaking procedures as are followed in adding contracts to the list. See 41 U.S.C. § 47(a)(2) (requiring the Committee to follow 5 U.S.C. § 553(b)-(e) to make additions or subtractions to the JWOD procurement list); see also 41 C.F.R. § 51-2.8(d) (additions to and deletions from the list are published in the Federal Register). Nothing of the sort was alleged to have been followed in the granting of the exception. Since the contract was not removed from the procurement list, the procedures for adding a contract to the list are irrelevant. Magic Brite has not identified any statutory or regulatory requirement that would force the Committee, the GSA, or any other part of the Government to consider the impact on Magic Brite of a decision to return the contract to a NISH-approved agency. Nor does the Solicitation promise any such procedure -- to the contrary, it stresses that the Government’s option is “unilateral” and adds: “The exercise of options is a Government prerogative, not a contractual right on the part of the Contractor.” Ex. 1 to Gomez Aff., § F.3. And in any event, because the 3 contract was still on the JWOD procurement list and the exception had expired, it appears that the Committee and GSA were required by JWOD to award the contract to a NISH-approved agency if any such agency were willing to accept the contact at the specified price. See 41 U.S.C. § 48; see also 41 C.F.R. §§ 51-1.2, 51-5.4; 48 C.F.R. § 8.706. Thus, plaintiff seems to have things backwards -- the default position was not that the option be exercised, but that a NISH approved agency be utilized. (Magic Brite Janitorial, v. U. S., No. 05-1380C, January 19, 2006) (pdf)