Government Contracts VA Erred in Contractor Preference
Monday, December 7, 2020

VA Erred in Contractor Preference

By Government Contracts Editorial Staff

The Court of Federal Claims enjoined the government from transitioning requirements for prescription eyeglasses to the AbilityOne Program because an exception of the Department of Veterans Affairs Contracting Preference Consistency Act of 2020 for requirements set aside for veteran-owned small businesses and service-disabled VOSBs was not limited to competitively awarded contracts. VA awarded the protester short-term sole-source eyewear contracts to comply with the Court of Appeals for the Federal Circuit’s holding that “where a product or service is on the [AbilityOne] List and ordinarily would result in the contract being awarded to a nonprofit qualified under the [Javits-Wagner-O’Day Act], the [Veterans Benefits, Health Care, and Information Technology Act of 2006] unambiguously demands that priority be given to [VOSBs]” (PDS Consultants, Inc. v. U.S., et al., 62 CCF ¶81,501).

Consistency Act. In response to PDS Consultants, Congress passed the Consistency Act, which amended the VBA to require VA to use AbilityOne non-profit providers, rather than prioritizing VOSBs, when procuring any products or services added to the AbilityOne list prior to December 22, 2006 (38 USC 8127(a)). An exception provides that, if VA awarded a contract for a covered product or service to a VOSB pursuant to a Rule of Two determination between December 22, 2006, and August 7, 2020, it could not transition the requirements back to the AbilityOne program until a new Rule of Two analysis was conducted and there was no reasonable expectation that two or more VOSBs could compete for the work (§8127(d)(2)(B)). Here, VA determined it was required to use an AbilityOne vendor for the eyeglass requirements because they were “covered products” and the award to the protester was a sole-source award under §8127(c), not an award under §8127(d). The protester contended VA’s decision violated the Consistency Act and a VA class deviation.

Scope of Exception. At issue was whether the Consistency Act’s exception at §8127(d)(2)(B) is limited to competitively awarded contracts. The court determined the exception was not limited. Section 8127(d)(2)(B)(i)(I) refers to contracts “awarded under paragraph (1),” and §8127(d)(1) refers to all contracts awarded pursuant to a Rule of Two analysis. Therefore, §8127(d)(1) and the exception were not limited to contracts awarded pursuant to a Rule of Two analysis and on the basis of competition. Similarly, the VA class deviation did not refer to competitive awards and focused only on contracts issued pursuant to a Rule of Two determination. (Superior Optical Labs, Inc. v. U.S., et al., FedCl, 64 CCF ¶82,008)

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