You Can’t Order Items Not Listed on the Vendor’s FSS Schedule

January 17, 2018

by Shelley Hall

In Bluewater Management Group, LLC, B-414785, Bluewater protested the Navy’s award of lodging and transportation services to DMC Management Services, LLC, stating that the award was improper because DMC’s GSA Schedule contract did not include transportation services.

The Navy issued an RFQ to small business holders of GSA Schedule 48 for lodging and transportation services. The RFQ was issued pursuant to FAR Subpart 8.4, Federal Supply Schedules (FSS), where GSA manages the FSS program and federal agencies can use a less complex process to buy commercial supplies and services.

In the RFQ’s scope of work, offerors were to provide an average of 120 extended-stay hotel rooms within 25 miles of the naval base and daily round trip transportation to the naval base. The RFQ broke out the lodging and transportation services as separate CLINs and told offerors that all products and services were to be included in their current GSA Schedule contract.

DMC holds a Schedule 48 contract, but it only lists pricing for lodging and housekeeping services. It does not include pricing for transportation.  The Navy awarded DMC the task order for an evaluated price of $38,009,781.

Bluewater protested, stating the award was improper because the transportation services from DMC were outside the scope of its Schedule 48 contract. The Navy responded that the transportation services were ancillary to complete the task order lodging requirement.

In rejecting the Navy’s argument, GAO wrote, “[t]he Navy provides no legal authority for this assertion, nor does it provide any evidence that DMC’s schedule contract listed these services or otherwise explain why the transportation services are not required to be listed and priced on the FSS contractor’s schedule.” GAO found that the Navy’s argument that the transportation services were “other direct costs,” wrong since DMC did not offer a description or established price for transportation services.

GAO explained that “[n]on-FSS products and services may not be purchased using FSS procedures; instead, their purchase requires compliance with the applicable procurement laws and regulations, including those requiring the use of competitive procedures. GAO sustained the protest, affirming that “[w]here an agency orders from an existing FSS, all items quoted and ordered are required to be on the vendor’s schedule contract as a precondition to receiving an order.”

Bottom line is that the government cannot order items or services not listed on the vendor’s FSS schedule.

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