PETITION TO THE US ARMY TO BRING TRANSPARENCY AND OVERSIGHT
TO ITS OWN PROCUREMENT PRACTICES
The Fairness in Procurement Alliance (FPA)1 is appealing to the Army to report, within 30 days, on the allegations raised
through GAO Protest B‐406075 and this petition claiming that the Army contracting community – through a
discriminatory pattern of abuse – has been abusing and retaliating against small businesses through the use of unfair
justifications2 and/or have not allowed small businesses due process on GAO and Size protests brought up for actions
which involve allegations of contracting abuse, fraud, retaliation and/or procurement incompetence.
The alleged pattern of contracting abuse – reported to elected officials in 20103 and to the public through an OP‐ED4
now include unfairly denying awards to winners of reverse auctions; cancelling solicitations/awards which have been the
subject of protests to purposely render them as ‘academic;’ preventing transparency to uncover and penalize fraud
violators through GAO and Size protests and/or ignoring the guidance of GAO protest decisions such as the Delex5 and
the Aldevra6 decisions, both of which have ruled that the GSA Federal Supply Schedule (FSS) is subject to the set‐aside
provisions of The Small Business Act.
The Aldevra GAO decision deserves mentioning, because a Government Assistant Secretary for Acquisitions, distributed
a Memo ordering the Contracting Community ‘to ignore the GAO decision’ by claiming that “GAO’s interpretation is
flawed and legally incorrect. Executive Branch agencies are not bound by GAO's legal advice.”
The Army is now attempting to prevent GAO from ruling on Protest B‐406075 which alleges that the Army contracting
community lied to avoid not reserving the procurement for small businesses and used the government reverse auction
to offer preferential treatment. FPA wishes for GAO to recommend options to penalize Agencies which get caught using
abusive practices in the same fashion it recommended penalties for contractors’ fraudulent abuses on GAO Report 11‐
739.7 Plenty of solicitations have already been identified where abusive practices have been used.8
The discriminatory pattern of cancelling solicitations or awards subject to GAO Protests to render them as worthless as
Size Protests has contributed to the Government’s lost of credibility, as noted by the Pew Research Center9 and the
allegations FPA has raised against the Army’s contracting practices deserve the transparency the Obama Administration
has demanded through its Small Business Agenda.10 ‐ MORE ‐
The Fairness in Procurement Alliance. ‐ http://www.fpaportal.org/FPA/PressDocs/What_is_FPA.pdf
Unfair Justification is the procurement practice of allowing requisitions to offer preferential treatment to brands or suppliers.
Reporting Contracting Abuse to Members of Congress. ‐ http://bit.ly/flA7pz
OP‐ED Accounting for Retaliation and Contracting Abuse. ‐ http://bit.ly/Govt_Retaliation
GAO Delex Protest Decision. ‐ http://www.gao.gov/decisions/bidpro/400403.pdf
GAO Aldevra Decision. ‐ http://www.gao.gov/decisions/bidpro/405271.pdf
GAO Report on Lack of Agency Oversight. ‐ http://1.usa.gov/tYIhGw
Contracts Alleging Abusive Procurement Practices. ‐ http://bit.ly/djRq8N
The Pew Research Center Report. ‐ http://bit.ly/uE0lUk
The White House May 2011 Small Business Agenda Report. ‐ http://1.usa.gov/q4vMpf
Patterns of Abuse. – FPA is respectfully requesting the Army to address and report, within 30 days, on the following
specific allegations that its contracting community is using government reverse auctions to:
a) avoid acknowledging communications from its vendors on BUYS as the solicitations are called;
b) avoid having to account to the SBA Procurement Center Representatives (PCR) for their BUYS so many of them
are purposely not set‐aside for small businesses as would be required.
c) avoid having to post many of their BUYS on the FPO Portal as required;
d) avoid having to post the end‐user justifications for BUYS which specify ‘sole‐brand ’ to circumvent the
e) avoid having to automatically award those who ‘lead’ the BUYS at their conclusion ‐ if the CO chooses not to ‐ as
auction protocol would dictate;
f) offer preferential treatment to suppliers and/or to brand‐names in direct violation of four (4) separate directives
from the Office of Federal Procurement Policy (OFPP)11
g) restrict competition on the BUYS by limiting the bidding of many procurements between $3,000 and $150,000
to GSA Federal Supply Schedule Holders without regards to the mandated requirements of the statutes as they
relate to small businesses;
h) manipulate the ‘leading and lagging’ functions of the BUY through the arbitrary use of the ‘Active Target Price’
(ATP) so that sellers never compete against each other, but against the arbitrary ATP entered by buyers without
adequate research and without any oversight.
i) circumvent the mandated set‐aside requirements of the Small Business Act and the FAR Part 19 regulations.
The SBA Office of Advocacy, on its 2008 r3 initiative,12 determined that the rules of Reverse Auctions allow Agencies to
circumvent the regulations that protect small businesses. Neither the FAR nor the GSA’s own Manual address reverse
auctions. Government regulators have avoided addressing the subject, but – instead ‐ have come up with a new
regulation, FAR 19.502‐413 which is inconsistent with the FAR and with applicable laws by giving contracting officials
discretionary power in setting aside procurements under $150,000 on the FSS in direct violation of the Small Business
Act and its statutes.
SBA, through a Legal Opinion14 has stated that “according to statute and regulations, small business set asides are
mandatory for acquisitions valued from $3,000 to $100,000 (upgraded to $150,000 in 2011) and take priority over GSA
Schedule contracts. This interpretation is consistent with the declared and unambiguous intent of Congress as it relates
to Federal procurement and small businesses.” In other words, Agencies do not have any discretion on the matter.
The mission of FPA is to bring fairness to public procurements so that small businesses can receive "maximum practicable utilization"
(MPU) as prescribed by P.L. 95-507 and thus compete and prosper at the federal, state and local levels.
The OFPP Procurement Directives against Unfair justifications. ‐http://bit.ly/Unfair_Justifications
The 2008 r3 Initiative Schedules Reverse Auction Rules for an Overhaul. ‐ http://bit.ly/vsb6EG
An inconsistent new regulation. ‐ http://1.usa.gov/skYcrV
The SBA Legal Opinion on the GSA Exemptions. ‐ http://bit.ly/rkHKvg