[Federal Register: July 29, 1997 (Volume 62, Number 145)]
[Notices]
[Page 40509-40510]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr29jy97-50]
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DEPARTMENT OF EDUCATION
Arbitration Panel Decision Under the Randolph-Sheppard Act
AGENCY: Department of Education.
ACTION: Notice of arbitration panel decision under the Randolph-
Sheppard Act.
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SUMMARY: Notice is hereby given that on June 11, 1996, an arbitration
panel rendered a decision in the matter of Mississippi Department of
Rehabilitation Services v. United States Department of Defense,
Department of the Air Force (Docket No. R-S/94-3). This panel was
convened by the U.S. Department of Education pursuant to 20 U.S.C.
107d-1(b), upon receipt of a complaint filed by the Mississippi
Department of Rehabilitation Services.
FOR FURTHER INFORMATION CONTACT: A copy of the full text of the
arbitration panel decision may be obtained from George F. Arsnow, U.S.
Department of Education, 600 Independence Avenue, SW., Room 3230, Mary
E. Switzer Building, Washington, DC 20202-2738. Telephone: (202) 205-
9317. Individuals who use a telecommunications device for the deaf
(TDD) may call the TDD number at (202) 205-8298.
SUPPLEMENTARY INFORMATION: Pursuant to the Randolph-Sheppard Act (20
U.S.C. 107d-2(c)), the Secretary publishes in the Federal Register a
synopsis of arbitration panel decisions affecting the administration of
vending facilities on Federal and other property.
Background
On or about June 24, 1993, the U. S. Department of Defense,
Department of the Air Force (Air Force), issued a request for proposals
(RFP) for full food services at Keesler Air Force Base, Mississippi.
The Mississippi Department of Rehabilitation Services, State licensing
agency (SLA), responded
[[Page 40510]]
to the RFP, providing both technical and cost information.
In August 1993, the Air Force's Technical Evaluation Committee
(TEC) met to evaluate the SLA's proposal along with the other proposals
that were submitted. Subsequently, the Air Force contracting officer
informed the SLA that its proposal was determined to be within the
competitive range along with 15 of the original 19 offerors. On
September 16, 1993, the TEC sent a discussion letter to the SLA and to
the other offerors who were within the competitive range. Shortly
thereafter, the SLA responded to the Air Force regarding the questions
asked in the discussion letter.
On September 28, 1993, the SLA filed a protest with the Air Force's
contracting officer concerning the Air Force's alleged failure to award
the SLA the food service contract following the determination that it
was within the competitive range. The SLA contends that, based upon
Department of Defense (DOD) Directive 1125.3 and regulations of the
Secretary of Education (34 CFR 395.33(b)), either the contract must be
awarded to the SLA following a determination that the SLA is within the
competitive range established by the contracting office or the
contracting office must consult with the Secretary of Education
regarding its justification for not doing so. The Air Force never
responded to the SLA's protest, nor was the contract awarded to the
SLA.
On November 12, 1993, the TEC met to review the offerors' responses
to questions asked regarding DOD's concerns and determined that 9 of
the 13 remaining offerors' proposals, including the SLA's, were
acceptable. Subsequently, the contracting officer sent a second round
of discussion letters to all 13 offerors, including those that were
deemed technically unacceptable. The SLA received the second discussion
letter on November 23, 1993, and again responded, objecting to the Air
Force's failure to comply with Randolph-Sheppard requirements. At the
same time, in order to maintain its eligibility for the award, the SLA
fully responded to all discussion questions.
The TEC again met and conducted a final technical evaluation, at
which time the SLA's proposal was determined to be fully acceptable
from a technical standpoint. However, the contracting officer later
made a determination that the SLA's proposal was technically
unacceptable as the result of its response to a section of the RFP
regarding the use of sighted employees.
Subsequently, a second competitive range was established by the Air
Force's contracting officer. Following the establishment of the second
competitive range, the SLA received from the Air Force a Determination
for Exclusion letter indicating the exclusion of the SLA's proposal.
The Air Force's stated reasons for the exclusion of the SLA's proposal
from the second competitive range were the SLA's response on the use of
sighted employees at the facility and the SLA's higher pricing
structure compared to the other offerors within the competitive range.
Arbitration Panel Decision
The issues heard by the arbitration panel were--(1) Whether the Air
Force violated the Randolph-Sheppard Act, 20 U.S.C. 107 et seq.; Air
Force regulation 34-2, DOD Directive 1125.3; Section L-901 of RFP No.
F222600-92-R-0156; and Randolph-Sheppard regulations in 34 CFR 395.33
by its alleged failure to award the full food service contract to the
SLA and by its alleged failure to consult with the Secretary of
Education following the determination that the SLA was within the
competitive range; and (2) Whether the Air Force's alleged arbitrary,
capricious, and bad faith conduct violated the Administrative
Procedures Act, 5 U.S.C. 706, and Federal Acquisition Regulations, 48
CFR 1.602-2(b) and 48 CFR 15.608(a).
As to the first issue, the panel majority concluded that the
process by which the Air Force determined the competitive range in
March 1994 was fully in accord with all governing laws and regulations.
Specifically, the majority members concluded that an earlier decision
by the contracting officer that 4 of the 19 offerors had submitted
noncomplying proposals, based upon a review for technical sufficiency,
did not establish a competitive range within the meaning of DOD
Directive 1125.3 or Randolph-Sheppard regulations in 34 CFR 395.33(b).
The panel majority ruled that the Air Force determined a competitive
range, as contemplated under the governing regulations, only after full
cost data was submitted by the 15 remaining offerors, including the
SLA, who were solicited on the basis of their technically sufficient
initial submissions. The panel majority concluded the SLA was properly
excluded from the final competitive range because its proposal was not
competitive in comparison to the numerous proposals offering lower
costs.
One panel member dissented regarding this part of the majority
opinion.
The panel members unanimously ruled that the Air Force violated the
Randolph-Sheppard Act and applicable regulations by excluding the SLA
from the competitive range, in part, because of its alleged failure to
give the assurance required concerning minimizing the employment of
sighted persons at the cafeteria facility. The panel ruled that
compliance issues raised by this requirement should be addressed
through pre-contract negotiations with the contractor and not by
exclusion from the bid process. The majority of the panel ruled,
however, that this action by the Air Force was a harmless error
inasmuch as the SLA's proposal had been properly excluded on other
grounds.
The views and opinions expressed by the panel do not necessarily
represent the views and opinions of the U.S. Department of Education.
Dated: July 23, 1997.
Judith E. Heumann,
Assistant Secretary for Special Education and Rehabilitative Services.
[FR Doc. 97-19865 Filed 7-28-97; 8:45 am]
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