United States Government Accountability Office

Washington, DC 20548

Comptroller General

of the United States

 

Decision

Matter of: Crosstown Courier Service, Inc. 

File: B-407404

Date: November 30, 2012

Christopher J. Noyes for the protester.

Russell L. Emery, Esq., Department of Veterans Affairs, for the agency.

Paul E. Jordan, Esq., and David A. Ashen, Esq., Office of the General Counsel, 

GAO, participated in the preparation of the decision.

DIGEST

Protest challenging an agency’s decision not to set aside a procurement for 

service-disabled veteran-owned small businesses (SDVOSB) is denied where the 

agency concluded from its market research that it did not have a reasonable 

expectation of receiving proposals from two or more SDVOSBs capable of 

performing the required services.

DECISION

Crosstown Courier Service, Inc. (CCS), of Chicopee, Massachusetts, protests the 

terms of Department of Veterans Affairs’ (VA) request for proposals (RFP) 

No. VA-259-11-RP-0115, a small business set-aside, for medical courier and dry ice 

delivery services for the VA Salt Lake City (Utah) Health Care System 

(VASLCHCS). CCS, a service-disabled veteran-owned small business (SDVOSB) 

concern, asserts that the VA should have set the procurement aside for SDVOSBs. 

BACKGROUND

The RFP sought proposals for all necessary labor, equipment, and transportation 

services for pick-up and delivery each week-day between the VASLCHCS and 

(1) the Ogden (Utah) VA community Based Outpatient Clinic (CBOC), Pocatello 

(Idaho) VA CBOC, Elko (Nevada) VA CBOC, and Idaho Falls (Idaho) CBOC, 

constituting the Northern Area; and (2) the Orem (Utah) VA CBOC, Nephi (Utah) VA 

CBOC, and Price (Utah) Primary Care Tele-Outreach Clinic, comprising the 

Southern Area. The courier services in both areas include delivery of dry ice, and 

pick-up of pharmaceuticals, supplies, x-rays, lab specimens, patient records, office 

supplies, forms, and other items as required. The RFP included four evaluation 
Page 2 B-407404 

factors, in descending order of importance: technical capability (ability to deliver 

services at the times and frequencies requested); past performance; veteran-owned 

small business (VOSB) or SDVOSB status (VOSBs receiving partial and SDVOSBs 

receiving full credit); and price. All non-price factors, combined, are significantly 

more important than price. 

In February 2011, prior to issuing the RFP, the contracting officer conducted market 

research of firms with North American Industry Classification System (NAICS) code 

No. 492110 (courier services) using the Veterans Information Pages (VIP)1 and the 

Central Contract Registration (CCR) databases. Based on her VIP research, the 

contracting officer found 63 SDVOSBs/VOSBs and 52 SDVOSBs. Contracting 

Officer’s Statement at 4. However, the initial search identified only a single vendor 

in Utah (and none in Idaho), but it was no longer in the VIP database when the 

search was repeated in August 2011. Id. At that time, the contracting officer found 

no SDVOSBs with NAICS code No. 492110 in Utah or Idaho. The CCR search 

identified 1,315 small businesses with that NAICS code, 412 of which represented 

themselves as VOSBs, and 244 of which represented themselves as SDVOSBs. Of 

these, there were 7 small businesses in Utah and 8 in Idaho, but none in either 

state was identified as an SDVOSB or VOSB. Because there were no 

SDVOSB/VOSB concerns in Utah or Idaho, where the majority of delivery sites are 

located, the contracting officer determined that there was no expectation of two or 

more SDVOSBs that would respond to the RFP. Id. Based on the 15 Utah and 

Idaho small businesses with the appropriate NAICS code, she instead set the 

procurement aside for small business concerns. Prior to the closing time for receipt 

of proposals, CCS submitted both an offer and this protest. 

DISCUSSION

CCS raises a number of arguments challenging the VA’s determination to set aside 

the procurement for small businesses rather than for SDVOSBs. We have 

considered all of the protester’s arguments and find that none provide a basis to 

object to the VA's decision to set aside the RFP for small businesses. This decision 

addresses CCS’s primary arguments. 

CCS asserts that the VA failed to perform sufficient market research to ascertain the 

interest and capability of SDVOSBs to perform the requirement. Specifically, the 

protester notes that there are at least two capable SDVOSB firms: CCS which is 

performing a VA courier contract in Montana, administered by the same contracting 

officer, and another SDVOSB courier firm, Medical Logistics, which is located in 

 1 The VA has designated the VIP as the database of businesses approved to 

participate in VA's veteran-owned small business program, and www.VetBiz.gov 

(VetBiz) as the Web portal that hosts the VIP. See 38 C.F.R. § 74.1.
Page 3 B-407404 

Utah. Given these two firms, CCS concludes that the contracting officer abused her 

discretion in failing to set the procurement aside. 

Under the Veterans Benefits, Health Care, and Information Technology Act of 2006, 

38 U.S.C. §8127, and the VA's implementing regulations, VA Acquisition Regulation 

(VAAR) §§ 819.7004, 819.7705, the VA is required to set aside acquisitions for 

SDVOSBs whenever it determines that there is a reasonable expectation that offers 

will be received from at least two SDVOSB firms and that award can be made at a 

fair and reasonable price. 38 U.S.C. § 8127(d); VAAR § 819.7005. The 

determination as to whether there is a reasonable expectation of receiving offers 

from two or more SDVOSB firms that are capable of performing the required work is 

a matter of informed business judgment within the contracting officer's discretion 

that we will not disturb absent a showing that it was unreasonable. Buy Rite 

Transport, B-403729, B-403768, Oct. 15, 2010, 2010 CPD ¶ 245 at 3. The 

requirements of the 2006 VA Act do not dictate the use of any particular 

methodology in assessing the availability of SDVOSB firms to perform a 

requirement; measures such as prior procurement history, market surveys, advice 

from the agency’s small business specialist, and information concerning prospective 

offerors’ business history and capability or capacity may all provide a reasonable 

basis for a decision to set aside, or not set aside, a requirement for SDVOSBs. 

FlowSense, LLC, B-310904, Mar. 10, 2008, 2008 CPD ¶ 56 at 3. 

The contracting officer’s market research and resulting set-aside determination 

were reasonable. In this regard, the statements of work for the two regions required 

the successful contractor to provide labor, equipment, and transportation services 

each week-day for pick-up and delivery between the VASLCHCS in Salt Lake City, 

Utah and four VA clinics each in the northern and/or southern regions (covering 

Utah, Idaho, and Nevada). RFP at 7-9. While the RFP did not restrict competition 

to firms located in this geographical area, there was nothing unreasonable in the 

contracting officer’s market research focusing on that area and the likelihood of 

whether firms from outside it would respond to the RFP. See American Connecting 

Source d/b/a Connections, B-276889, July 1, 1997, 97-2 CPD ¶ 1 at 3 (agencies 

may properly restrict procurements to offerors within a specified geographical area if 

the restriction is reasonably necessary for the agency to meet its minimum needs). 

Here, using the NAICS code for courier services (No. 492110), the contracting 

officer searched both the VIP and CCR databases to identify available firms. While 

the CCR database identified hundreds of VOSB and SDVOSB firms, none of them 

were located in the states of Utah or Idaho where the majority of the courier work is 

to be performed. Likewise, of the more than 50 (courier) SDVOSBs found in the 

VIP database, the contracting officer ultimately found none that were located in 

Utah or Idaho. Although she initially found one such firm located in Utah, her 

subsequent search found that the firm was no longer listed, and the firm identified 
Page 4 B-407404 

by CCS in its protest is no longer listed in VIP. 2 Neither of these firms would be 

eligible for award under an SDVOSB set-aside. As for CCS, while it is an SDVOSB, 

it is currently performing its VA courier contract in Montana, not in the states 

encompassed by this procurement. In any case, even if the VA had considered 

CCS’s interest, the firm represents only one SDVOSB and the protester has not 

identified any other VIP-eligible SDVOSB that would be interested in competing for 

this requirement. Given the large geographical area and the daily nature of the 

work covered by the RFP, the contracting officer reasonably concluded that there 

was no expectation that two or more SDVOSBs from outside this area would 

respond to the solicitation. Contracting Officer’s Statement at 4. 

The protest is denied.

Lynn H. Gibson

General Counsel

 2 Our own search of the VIP database identified 67 SDVOSB and VOSB firms, but 

none of them were located in Utah, Idaho, or Nevada where the services are to be 

performed.