Comptroller General

of the United States

United States Government Accountability Office

Washington, DC 20548 

DOCUMENT FOR PUBLIC RELEASE 

The decision issued on the date below was subject to 

a GAO Protective Order. This redacted version has 

been approved for public release. 

Decision 

Matter of: J&J Maintenance, Inc. 

File: B-405310 

Date: October 17, 2011 

Joseph A. Yazbeck, Jr., Esq., and D. Brent Carpenter, Esq., Yazbeck, Cloran & 

Bowser, PC, for the protester. 

Maj. Christine C. Fontenelle, Lt. Col. Dana J. Chase, and Maj. Mark A. Ries, 

Department of the Army, for the agency. 

Pedro E. Briones, Esq., and Guy R. Pietrovito, Esq., Office of the General Counsel, 

GAO, participated in the preparation of the decision. 

DIGEST 

Protest that a solicitation for hospital operation and maintenance services in the 

Republic of Korea was set aside for local sources and did not grant “invited 

contractor status” to non-local firms under the Status of Forces Agreement between 

the United States and the Republic of Korea is denied where the agency reasonably 

determined that local offerors could perform the required services. 

DECISION 

J&J Maintenance, Inc., (J&J) of Austin, Texas, protests the terms of request for 

proposals (RFP) No. W91QVN-11-R-0135, issued by the Department of the Army, 

for operation and maintenance (O&M) services for Medical Command-Korea 

(MEDDAC-K) facilities in the Republic of Korea. 

We deny the protest. 

BACKGROUND 

The RFP, issued under the commercial acquisition procedures of Federal 

Acquisition Regulation (FAR) Part 12 as a set-aside for local sources, provides for 

the award of a fixed-priced contract for O&M services and related functions at Army 

medical facilities located throughout the Republic of Korea for a 1-month phase-in 

period, a base year, and 4 option years. The RFP states that “invited contractor 

status” under the Status of Forces Agreement (SOFA) between the United States of 

America and the Republic of Korea would not be granted to non-local offerors and 

that offerors must have or obtain the requisite Korean business licenses, as well as 
comply with, among other things, Korean labor, tax, and immigration laws and 

regulations. See RFP at 3; RFP amend. 1, at 6. The RFP also states that if no 

acceptable offers are received, the agency may re-solicit the requirement and grant 

invited contractor status. See RFP at 3. 

Under the SOFA, United States businesses present in Korea solely for the purpose 

of performing contracts for United States armed forces may be designated “invited 

contractors” and are thereby exempted from Korean customs duties, taxes, and 

employment laws and regulations, as well as business and corporation licensing and 

registration requirements, among other things. Agreement under Article IV of the 

Mutual Defense Treaty between the United States of America and the Republic of 

Korea, Regarding Facilities and Areas and the Status of United States Armed 

Forces in the Republic of Korea, July 9, 1966, art. XV; 17 U.S.T. 1677, T.I.A.S. 

No. 6127 (1967). SOFA provides that invited contractor status may only be granted 

upon consultation with the Korean government and where open competition is not 

practicable due to: security considerations; the technical qualifications of the 

contractors involved; limitations under United States law; or, as relevant here, the 

unavailability of materials or services required by United States standards. See id., 

§ 2; see U.S. Forces Korea, Reg. No. 700-19, The Invited Contractor & Tech. Rep. 

Prog., June 4, 2007; see, e.g., Kongdan Kumnan Rest./Good Food Serv., 

B-276846.2, Feb 23, 1998, 98-1 CPD ¶ 57. 

As relevant here, Department of Defense (DOD) hospitals and medical facilities 

including facilities like MEDDAC-K that are located overseas, must be accredited 

by the Joint Commission (TJC).1 See DOD Instr. No. 6025.13, Feb. 17, 2011, Med. 

Quality Assurance & Clinical Quality Mgmt. in the Mil. Health Sys., at 1, 6. TJC is 

an independent organization that accredits United States hospitals and health care 

organizations (HCO) consistent with United States laws, regulations, and medical 

practices. See Agency Report (AR) at 14; www.jointcommission.org; see also

University of Kansas Med. Ctr., B-278400, Jan. 26, 1998, 98-1 CPD ¶ 120 at 1, n.1. 

A detailed performance work statement (PWS) was provided that requires the 

contractor to, among other things, meet TJC standards and to ensure that all 

MEDDAC-K medical facilities maintain TJC accreditation at all times. See RFP, 

PWS, at 8-9, 26; see also RFP amend. 1, at 2-4. In this regard, the contractor will 

also be required to provide monthly reports detailing on-going compliance with TJC’s 

Comprehensive Accreditation Manual for Hospitals. See PWS, attach. 2, Technical 

Exhibit 1-006, “TJC Reporting Requirements.” 

The RFP states that award will be made on a lowest-priced, technically acceptable 

basis considering the following evaluation factors: management, experience, 

 

1

 TJC was previously known as the Joint Commission on Accreditation of Healthcare 

Organizations (JCAHO). 

Page 2 B-405310 
technical, past performance, and price; offerors are required to submit separate 

proposals under each factor. See RFP at 77, 89-92. Under the experience factor 

the RFP identifies two subfactors: prime contractor experience and key personnel. 

See id. at 89-91. Under the technical factor the RFP identifies two subfactors: 

mission capability and transition of operations (phase-in and phase-out plan). Id.

With respect to the key personnel experience subfactor, the RFP requires offerors 

to propose certain key personnel with varying levels of experience working at TJC 

accredited hospitals, and states that the agency will evaluate the proposed 

personnel’s actual level of TJC experience. See RFP, amend. 1, at 5. Specifically, 

the RFP requires offerors to propose (and the PWS requires the contractor to 

provide), as key personnel, a project manager, alternate project manager, quality 

control manager, and area manager/foreman, each with varying minimum amounts 

of continuous years of TJC experience within the last 10 years from the issuance 

date of the RFP. Id.; PWS at 23-24. 

In contrast, with respect to the prime contractor experience subfactor, the RFP 

requires that offerors have relevant experience performing O&M services as a prime 

contractor in a hospital/healthcare facility, irrespective of the facility’s accreditation.2

 

See RFP at 81. The RFP states that the agency will evaluate the degree to which 

the offeror has previously encountered the same kind of work, uncertainties, 

challenges, and risks that it is likely to encounter under the contract. See id. at 90. 

With respect to the technical evaluation factor, the RFP states that the agency will 

evaluate the offeror’s understanding of the PWS and its proposed approach to 

executing the requirements. See id. As relevant here, under the mission capability 

subfactor, the RFP states that the agency will evaluate the offeror’s ability to 

understand and execute all functional area requirements in the PWS.3

 Id. In this 

regard, the RFP requires technical proposals to address each functional area, 

 

2

 The RFP defines relevant experience as experience in hospital/healthcare facilities 

that provide the “same or similar” services based on the size, scope, bed count, 

square footage, complexity, contract type, and facility description, as described in 

the PWS, and instructs offerors to provide specified documentation that the 

company has a minimum of 6 years of experience in that regard within the last 10 

years from the issuance date of the RFP. RFP at 89-90; see also RFP amend. 1, 

at 4. 

3

 The PWS categorizes the required O&M services under 10 functional work areas: 

work classification and management; quality control; buildings and structures 

maintenance; fire protection and prevention; utility systems; heating and steam 

systems; water and sewage collection systems; heating, ventilation, and air 

conditioning systems; emergency power and electrical systems; and general 

equipment repair and commercial kitchen systems. PWS at 12. 

Page 3 B-405310 
including a thorough explanation of the concept of operations as it relates to the TJC 

requirements and quality control and quality assurance, among other things. See id.

at 82. 

DISCUSSION 

J&J complains that setting aside the RFP for local sources under SOFA (and not 

granting invited contractor status to non-local offerors) unnecessarily restricts 

competition. See Protest at 2. The protester contends that no Korean company has 

the experience or technical capability needed to perform the contract work in 

accordance with TJC standards. See id.; Comments at 15, 2-21. In this regard, J&J 

argues that the prime contractor must have experience at TJC accredited facilities, 

because the PWS requires that the performance of the contract be in accordance 

with TJC standards. J&J also notes that the RFP requires that the prime contractor 

have relevant experience, which is defined as including work of the same or similar 

complexity as that described within the PWS; J&J argues that this too requires that 

the prime contractor have specific experience at TJC accredited facilities. See

Comments at 12-14. J&J also contends that for local firms to satisfy the key 

personnel experience requirements and to perform the contract, they will be required 

to hire U.S. personnel with TJC experience, which the protester states is 

impracticable because of Korea’s 3-year limitation on work visas. Id. at 27. 

The Army responds that the terms of its SOFA with Korea restricts the agency from 

granting invited contractor status where Korean firms can provide hospital O&M 

services at TJC standards. See AR at 16. The agency states that, prior to issuing 

the solicitation, it issued a sources sought notice and conducted market research to 

determine whether there were adequate local resources and contractors with the 

technical expertise, qualifications, and certifications to meet the requirements. See

Supp. Contracting Officer’s Statement at 1; see also Acquisition Plan, Sept. 13, 

2010, at 6-8. The Army determined that there were a number of Korean firms that 

could perform these O&M services at TJC standards. 

A contracting agency has the discretion to determine its needs and the best method 

to accommodate them. JRS Mgmt., B-402650.2, June 25, 2010, 2010 CPD ¶ 147 

at 3. However, those needs must be specified in a manner designed to achieve full 

and open competition. Exec Plaza, LLC, B-400107, B-400107.2, Aug. 1, 2008, 

2008 CPD ¶ 143 at 5. Solicitations may include restrictive requirements only to 

the extent they are necessary to satisfy the agency’s legitimate needs. 10 U.S.C. 

§ 2305(a)(1)(B)(ii) (2006). Where a protester challenges a specification or 

requirement as unduly restrictive of competition, the procuring agency has the 

responsibility of establishing that the specification or requirement is reasonably 

necessary to meet the agency’s needs. See Total Health Resources, B-403209, 

Oct. 4, 2010, 2010 CPD ¶ 226 at 3. We will examine the adequacy of the agency’s 

justification for a restrictive solicitation provision to ensure that it is rational and can 

Page 4 B-405310 
withstand logical scrutiny. SMARTnet, Inc., B-400651.2, Jan. 27, 2009, 2009 CPD 

¶ 34 at 7. A protester’s mere disagreement with the agency’s judgment concerning 

the agency’s needs and how to accommodate them does not show that the agency’s 

judgment is unreasonable. Exec Plaza, LLC, supra. 

The record here establishes that the agency reasonably found from its market 

research that there were a number of local firms that could perform these O&M 

services at TJC standards. Specifically, in response to the Army’s sources sought 

notice, five Korean firms expressed interest in providing the hospital O&M services 

to the agency, including the protester’s subcontractor on the incumbent contract.4

 

See MEDDAC-K Market Research Memorandum, June 25, 2010, at 2; Acquisition 

Plan, Sept. 13, 2010, at 7. The agency also searched the central contractor 

registration (CCR) and found that there were 24 active Korean firms available to 

perform hospital O&M services. MEDDAC-K Market Research Memorandum, 

June 25, 2010, at 2. 

Prior to conducting its market research, the agency’s MEDDAC-K facilities director 

began investigating O&M practices of hospitals across South Korea and toured 

several Korean hospitals to determine the level of service that their O&M staff was 

providing. Statement of Facilities Director, Sept. 23, 2011, at 1. The facilities 

director found that there were number of Korean hospitals that had been accredited 

by the Joint Commission International (JCI).5 Id. In this regard, the Army states 

that, since the requirement for these services was last competed in 2006 (when the 

protester was granted invited contractor status), ten Korean hospitals have been 

accredited by the JCI. 

The Army found that, although there were some differences between the TJC and 

JCI standards, the two accreditation standards had substantial similarities and, in 

some regards, were almost identical. AR at 14. Moreover, the agency found that, to 

the extent that JCI and TJC accreditation standards differed, the agency’s 

requirements would be satisfied by requiring the contractor to provide experienced 

 

4

 The Army notes that the protester’s subcontractor (a Korean firm) has for a number 

of years performed 90 percent of the O&M services at all MEDDAC-K hospitals. AR 

at 10, 15. The protester does not dispute that its subcontractor has performed 90 

percent of the work on the incumbent contract and, in fact, concedes that its 

subcontractor has TJC experience. See Comments at 15. 

5

 JCI is the international arm of TJC, and accredits hospitals and HCOs outside the 

U.S consistent with international standards and locals laws and practices. See 

www.jointcommissioninternational.org. JCI accreditation was first accorded to a 

Korean Hospital in 2007. 

Page 5 B-405310 
key personnel with the specific, working knowledge of TJC standards. Statement of 

Facilities Director, Sept. 23, 2011, at 2.6

J&J disagrees with the agency that the TJC and JCI standards are sufficiently similar 

to allow the agency to conclude that firms with experience at JCI accredited facilities 

could satisfy TJC standards.7 In this regard, the protester cites to a question and 

answer in the RFP regarding key personnel experience. Comments at 18, citing, 

RFP amend. 1, at 3. Specifically, the agency was asked whether, in order to meet 

the requirements under the key personnel experience subfactor, key personnel 

experience at a JCI accredited hospital would be accepted as qualifying experience. 

See RFP amend. 1 at 3. The agency answered that “[f]or this requirement, [JCI] 

experience is not to be considered as equivalent to experience at a facility with [TJC] 

certification.” Id. Contrary to J&J’s assertion, however, this answer only indicates 

that the agency required more specific experience for key personnel. Although J&J 

disagrees with the agency’s judgment concerning the similarity of the JCI and TJC 

standards, this disagreement does not demonstrate that the agency’s judgment was 

unreasonable. 

J&J also complains that it is impractical to hire “U.S. citizens” as key personnel with 

specific experience at TJC accredited facilities, because “there is a three-year limit 

 

6

 The protester contends generally that the agency’s determination is not supported 

by contemporaneous documentation and argues that the facilities director’s 

statement should be accorded little weight because it was produced in response to 

the protest. 2nd Supp. Comment at 2, 4-6, 11. We disagree that the record is not 

sufficiently documented. In this regard, the agency provided contemporaneous 

documentation of its market research and acquisition plan. This documentation, 

coupled with the statement of the MEDDAC-K facility director, adequately explains 

the basis for the agency’s determination to set aside the RFP for local firms in 

accordance with the SOFA. In this regard, while we accord greater weight to an 

agency’s contemporaneous record of its procurement action than to arguments and 

documentation prepared in response to protest contentions, we do not limit our 

review to contemporaneous evidence, but consider all the information provided, 

including the parties’ arguments, explanations, and documentation prepared in 

response to protest contentions. Systems Research and Applications Corp.; Booz 

Allen Hamilton, Inc., B-299818 et al., Sept. 6, 2007, 2008 CPD ¶ 28 at 12. 

7

 The protester also contends that no local prime contractor can satisfy the RFP’s 

requirement for six years of relevant experience, because Korean hospitals have not 

been JCI accredited for a long enough period of time to allow local firms to meet this 

experience requirement. See Comments at 19. The RFP, however, provides that 

prime contractors must have six years of performing relevant O&M services “in a 

Hospital/Healthcare facility environment, irrespective of hospital accreditation.” RFP 

amend. 1, at 4. 

Page 6 B-405310 
Page 7 B-405310 

on work visas in Korea.” Comments at 27. The RFP, however, does not require that 

key personnel be United States citizens. Given that the protester’s Korean 

subcontractor has been performing these services at the Army’s TJC accredited 

facilities, there are already a number of individuals in Korea with the requisite 

experience to meet the key personnel experience requirements here. Moreover, 

even accepting the protester’s argument that there are practical difficulties in hiring 

experienced key personnel, does not demonstrate that it will be impossible for local 

firms to hire experienced key personnel. 

In sum, we find that the agency’s decision not to grant invited contractor status to 

non-local offerors under SOFA is reasonable and that the record adequately justifies 

the RFP’s restriction to local sources.8 Although not conclusive, the meaning 

attributed to treaty provisions by government agencies charged with their negotiation 

and enforcement is entitled to great weight. National Westminster Bank, PLC, v. 

U.S., 512 F.3d 1347, 1358 (Fed. Cir. 2008) citing Sumitomo Shoji Am. v. Avagliano, 

457 U.S. 176, 184-85 (1982), (according great deference to agency’s position where 

treaty’s signatories, neither of which were parties to the lawsuit, agreed as to 

interpretation). 

The protest is denied. 

Lynn H. Gibson 

General Counsel 

 

8

 The agency has received proposals under the RFP and is conducting discussions 

with a number of offerors. The protester contends that we should review the 

proposals, and the agency’s initial evaluation and conduct of discussions, to 

determine whether the agency’s decision to set aside the RFP for local firms was 

reasonable. This inquiry into the agency’s preliminary evaluations is not, however, 

relevant to whether the agency’s decision to restrict the RFP in accordance with the 

SOFA was reasonable.