Blog 25 USMC 20150725 SOLICITATION NUMBER ARMY W912D1- 15-R-0012 -GAO PRE-AWARD PROTEST AGAINST US ARMYs RFQ W912D1-15-R-0012 FOR BUNDLING TO CIRCUMVENT SMALL BUSINESS ACT

CAMP ARIFIJAN’S 926TH & 408TH

GAO PRE-AWARD PROTEST AGAINST U.S. ARMY’S W912D1-15-R-0012 CAMP ARIFIJAN’S 926TH & 408TH

Latvian Connection LLC Shareefa Complex 5th Floor Kuwait City, Kuwait Tel: 011 385 9344

March 31, 2015

BY REGISTERED EMAIL

General Counsel

Government Accounting Office

441 G Street, NW

Washington DC 20548

Email: [email protected]

Attn: Procurement Law Control Group, Room 1139

RE: PRE AWARD PROTEST AGAINST DEPT OF THE ARMY, 926TH / 408TH FOR NOT SETTING ASIDE

SOLICITATION W912D1-15-R-0012 (FURNITURE) FOR BUNDLING

Dear Procurement Law Group:

Latvian Connection General Trading and Construction LLC, (“ LC LLC”), Shareefa Complex, 5th Floor, Kuwait City,

Kuwait, tel: [011 707 385 9344].

Email: [[email protected]]¹ , a SAMS Registered company ( DUNS 830587791 and CAGE

5GLB3, with a LOCAL office in the Middle East in Kuwait, DUNS 534749622 and CAGE SGM59 submits this Pre-

Award Protest against Camp Arifjan’s Contracting Office of ( 926th & 408th)’s solicitation W912D1-15-R-0007 for

FURNITURE exclusively for U.S. Small Businesses.

(Exhibit 14)

State argues that the GAO decision of Latvian Connection General Trading and Construction LLC, B-408633,

Sept. 18, 2013 CPD ¶ 224, applies here. In that case, GAO ruled that FAR 19.000(b) limits the application of FAR

part 19 (dealing with SBA’s small business programs) to acquisitions conducted in the United States (and its

outlying areas). We believe the basis for the GAO’s ruling was that SBA’s regulation were silent on this issue and

therefore, the more specific far regulations controlled.

Heeding this advice, the SBA recently promulgated regulations to address this issue. Specifically, SBA made

wholesale changes to 13 CFR § 125.2 on October 2, 2013. As a result, SBA issued a final rule stating that: “Small

business concerns must receive any award ( including orders, and orders placed against Multiple Award Contracts)

or contract, part of any such award or contract, and any contract for the sale of Government property, regardless of

the place of performance, which the SBA and the procuring or disposal agency determine to be in the interest of:”

13 C.F.R. § 125.2(a)(emphasis added). Likewise, the rule also states that: “Small Business Act requires each

Federal agency to foster the participation of small business concerns as prime contractors and subcontractors in the

contracting opportunities of the Government regardless of the place of performance of the contract.” Id. 125.2

(c)(emphasis added).

Therefore, SBA’s policy and legal interpretation of the Small Business has been incorporated into the regulations.

In sum, according to statute and regulations, small business set asides, regardless of place of performance, are

mandatory for acquisitions valued from $ 3,000 to $ 150,000. ))) PLEASE INVITE THE SBA TO COMMENT(((


Latvian Connection LLC filed the Pre Award Protest for the Army not setting aside for U.S. Small Businesses and

the Army cancelled the solicitation to state they would bring the solicitation out as a set aside.(Exhibit 1, 2, 3, and

4)

The Army have instead brought out a bundled contract under the construction terminology of MATOC Multiple

award contract that has a total value of $ 10 Mil – but the Army do not declare how many awardees or if one will be

a U.S. Small Business.

GAO POST-AWARD PROTEST AGAINST U.S. ARMY’S W912D1-15-R-0012

This solicitation circumvents the rules against bundling contracts greater than $ 2 Million.

Latvian Connection LLC request that one of the awardees be for U.S. Small Businesses due to the solicitations

claim that some of the task order awards will be over $ 3,000 and it is now established that contract awards between

$ 3,000 and $ 150,000 are reserved exclusively for U.S. Small Businesses.

That is the basis of this protest and the protest is timely if filed before the bid due in date and time of 1 APR 2015 at

5 PM Kuwait Local time.

_________________________________________________________________________________________________________ In accordance with 4 C.F.R. § 21.1 (c ) (1), the relevant electronic mail address for this protest is [email protected] ( Representative for the Protester Latvian Connection General Trading and Construction

LLC)

² The Dept of the Army Contracting Office is 926th / 408th and the contracting officer is Betty McCormack and her email address is [email protected]. and the address is US ARMY CONTRACTING COMMAND SWA – KUWAIT, BLDG T-346, RED BALL EXPRESS RD, Kuwait


Per FAR 33.103 Protests to the agency

(2) Latvian Connection LLC

Shareefa Complex

Kuwait City, Kuwait

Representative of Protester: Keven Barnes, CEO

Email – [email protected]

The U.S. Government Accountability Office (“GAO”) should sustain this protest, stay the performance of the

Contract and rule that the Army has failed to comply with Federal Laws, Statutes and Regulations in issuing this

solicitation and inviting foreign companies when the contract award must be set aside exclusively for U.S. Small

Businesses only. (Exhibit 18)

INTERESTED PARTY STATUS

As discussed below LC LLC seeks to compete for the RFQ. Latvian Connection LLC incorporates all the below facts

and (Exhibits) into this “Interested Party Status” section. Latvian Connection LLC is registered in SAM.gov, the ONLY

Federal database that is required or recognized by the Federal Acquisition Regulations. Latvian Connection LLC is

LOCAL to Kuwait with a DUNS code of 534749622 and CAGE CODE of SGM59. Any diligent and responsible

contracting officer would have found Latvian Connection LLC, a Veteran Owned Small Business in Kuwait and also

know that there are other U.S. Small Businesses in the world that will compete for this contract.

Further, if this protest is sustained and the Department of the Army evaluates Latvian Connection’s proposal, then

LC LLC, a VOSB, responsible offeror and a U.S. Small Business concern – will have a reasonable chance of winning the

Contract. Therefore, Latvian Connection LLC is an actual offeror whose direct economic interest is affected by the award

of the Contract and hence, an interested party. 31 U.S.C. § 3551 (2000); FAR 33.101; 4 C.F.R. § 21.0(a)(2006); Designer

Assoc. , Inc.,B-293226, FEB 12, 2004 C.P.D. ¶ 114 at 2

Army Contracting Command continues to violate the Small Business Act and discriminate against Latvian Connection

LLC in order to pander to foreign companies rather than award contracts to U.S. Small Businesses.

19.202-2 Locating small business sources. The contracting officer must, to the extent practicable, encourage maximum participation by small business,

veteranowned small business, service-disabled veteran-owned small business, HUBZone small business, small

disadvantaged business, and women-owned small business concerns in acquisitions by taking the following actions: (a) Before issuing solicitations, make every reasonable effort to find additional small business concerns, unless lists

are already excessively long and only some of the concerns on the list will be solicited. This effort should include

contacting the SBA procurement center representative (or, if a procurement center representative is not assigned, see

19.402(a)). (b) Publicize solicitations and contract awards through the Governmentwide point of entry (see Subparts 5.2 and 5.3).

19.202-4 Solicitation. The contracting officer must encourage maximum response to solicitations by small business, veteran-owned small

business, service-disabled veteran-owned small business, HUBZone small business, small disadvantaged business,

and women-owned small business concerns by taking the following actions: (a) Allow the maximum amount of time practicable for the submission of offers. (b) Furnish specifications, plans, and drawings with solicitations, or furnish information as to where they may be

obtained or examined.

http://www.acquisition.gov/far/current/html/Subpart%2019_4.html#wp1080442













(c) Provide to any small business concern, upon its request, a copy of bid sets and specifications with respect to any

contract to be let, the name and telephone number of an agency contact to answer questions related to such prospective

contract and adequate citations to each major Federal law or agency rule with which such business concern must comply in performing such contract other than laws or agency rules with which the small business must comply when doing

business with other than the Government.

It is now however the law that the Army only award contracts to U.S. Small Businesses, wherever the performance in

the world when the contract value is between $ 3,000 and $ 150,000.

(Exhibit 14)

State argues that the GAO decision of Latvian Connection General Trading and Construction LLC, B-408633, Sept. 18,

2013 CPD ¶ 224, applies here. In that case, GAO ruled that FAR 19.000(b) limits the application of FAR part 19 (dealing

with SBA’s small business programs) to acquisitions conducted in the United States (and its outlying areas). We believe

the basis for the GAO’s ruling was that SBA’s regulation were silent on this issue and therefore, the more specific far

regulations controlled.

Heeding this advice, the SBA recently promulgated regulations to address this issue. Specifically, SBA made wholesale

changes to 13 CFR § 125.2 on October 2, 2013. As a result, SBA issued a final rule stating that: “Small business concerns

must receive any award ( including orders, and orders placed against Multiple Award Contracts) or contract, part of any

such award or contract, and any contract for the sale of Government property, regardless of the place of performance,

which the SBA and the procuring or disposal agency determine to be in the interest of:” 13 C.F.R. § 125.2(a)(emphasis

added). Likewise, the rule also states that: “Small Business Act requires each Federal agency to foster the participation of

small business concerns as prime contractors and subcontractors in the contracting opportunities of the Government

regardless of the place of performance of the contract.” Id. 125.2 (c)(emphasis added).

Therefore, SBA’s policy and legal interpretation of the Small Business has been incorporated into the regulations. In sum,

according to statute and regulations, small business set asides, regardless of place of performance, are mandatory for

acquisitions valued from $ 3,000 to $ 150,000.

TIMELINESS OF THIS PROTEST

The Pre-Award protest against the Department of the Army is timely because it is filed prior to the bid due in time

and date of 5 PM Local Kuwait time 01 APR 2015.

§ 21.2 Time for filing.

(a)(1) Protests based upon alleged improprieties in a solicitation which are apparent prior to bid opening or the time set for

receipt of initial proposals shall be filed prior to bid opening or the time set for receipt of initial proposals. In

procurements where proposals are requested, alleged improprieties which do not exist in the initial solicitation but which

are subsequently incorporated into the solicitation must be protested not later than the next closing time for receipt of

proposals following the incorporation.

The Department of the Army, in not setting aside exclusively for U.S. Small Businesses under the mandatory rules

and are violating the Intent of Congress and the “wholesale changes” made by the SBA October 2, 2013 in response to

the B-408633 GAO decision and reversed that decision by:


“Heeding this advice, the SBA recently promulgated regulations to address this issue. Specifically, SBA made



or contract, part of any such award or contract, and any contract for the sale of Government property, regardless

of the place of performance, which the SBA and the procuring or disposal agency determine to be in the interest

of:” 13 C.F.R. § 125.2(a)(emphasis added). Likewise, the rule also states that: “Small Business Act requires each

Federal agency to foster the participation of small business concerns as prime contractors and subcontractors in

the contracting opportunities of the Government regardless of the place of performance of the contract.” Id. 125.2




mandatory for acquisitions valued from $ 3,000 to $ 150,000.”

In not setting aside for U.S. Small Businesses, the 926th and 408th have ignored [read: bad faith) and quite

the opposite of presumed (good faith and fair dealings) the wholesale changes made to the regulations and

NO Large Business or Foreign Business can be awarded the contract.

I. FACTUAL GROUNDS OF THE PROTEST The RFQ

The Department of the Army’s Kuwait contracting officer under the direction of the 408th and 926th has issued a

solicitation W912D1-15-R-0012 for a Furniture and Appliances

DESCRIPTION: This is a combined synopsis/solicitation Indefinite Delivery Indefinite Quantity (IDIQ) Multiple Award Task

Order Contract (MATOC) for commercial items prepared in accordance with the format in Subpart 12.6, as supplemented

with additional information included in this notice. This solicitation is being issued as a request for proposal (RFP)

W912D1-15-R-0012. This RFP announcement constitutes the only solicitation requesting proposals for this procurement.

This solicitation incorporates clauses and provisions in effect through the Federal Acquisition Circular 2005-56. The

resulting contract will be an Indefinite Delivery Indefinite Quantity (IDIQ), MATOC contract with firm fixed unit prices,

a minimum guaranteed of $3,000 and a maximum of $10,000,000, under FAR Part 12 Acquisition of Commercial Items

and FAR Part 13 Simplified Acquisition. The period of performance will be for one base twelve month period and three

(3) option year periods each for twelve months. The NAICS Code is 337127 and Classification Code is 71.

.

ADDENDUM - 52.212-1

1. INFORMATION TO OFFERORS (ITO) AND INSTRUCTIONS FOR PROPOSAL

PREPARATION: Each Offeror shall submit only one (1) offer conforming to the requirements

of this request for proposal. To insure a timely evaluation, the proposal must be complete, self-

sufficient, and respond directly to the requirements of this solicitation.

Initial proposals. Offerors shall submit initial proposals with their most favorable terms, from

both a technical and price standpoint. The Government reserves the right to award this effort

based on the initial proposal, as received, without discussions.

The Government intends to award using the Lowest Price Technically Acceptable

(LPTA) approach. Offers will be evaluated using the Factors listed in provision 52.212-2 for

Award. A proposal that is sufficiently documented to support performance claims in a

complete and orderly manner will enable the Government to perform a thorough and fair

evaluation. The Offeror’s proposal must include all data and information requested and must

be submitted in accordance with these instructions.


II. LATVIAN CONNECTION LLC’s PROPOSAL

Latvian Connection LLC is a Veteran-Owned Business (VOSB), if bidding against ONLY other U.S. Small

Businesses has a reasonable chance of winning the contract award.

In 2007, GAO attorney Peter Verchinski’s decision (Exhibit 3 B-299237) in the Hawkeye Glove stated:

Turning to the merits, in view of the congressional policy favoring small businesses, contracts may be awarded

under small business set-aside procedures at premium prices, so long as those prices are not unreasonable.

Hardcore DuPont Composites, LLC, B-278371, Jan. 20, 1998, 98-1 CPD 28 at 3. In any case, there is a range

above the price an agency may receive under an unrestricted procurement that may be considered reasonable in

a set-aside situation, Browning-Ferris Indus., B-209234, Mar. 29, 1983, 83-1 CPD para. 323 at 2-3; CDI Marine

Co., B-188905, Nov. 15, 1977, 77-2 CPD para. 367 at 2-3, and we have found a price premium of as much as 51

percent to be reasonable. See Browning-Ferris Indus., supra. Therefore, the fact that Hatch's price was 48

percent higher than the protester's would not mandate a finding that the price was unreasonable

The Presumed Loss of not setting aside for U.S. Small Businesses is covered in the GAO’s GAO-15-54 (Exhibit 6) report

and also codified in the Federal Register. (Exhibits 8)

Under the Small Business Jobs Act of 2010 (the “Jobs Act”), there is a presumption of loss equal to the value of the contract or other instrument when a concern willfully seeks and receives an award by

misrepresentation. Pub. L. No. 111-240. This provision applies to prime contracts, subcontracts, cooperative

agreements, cooperative research and development agreements, and grants (collectively, “Federal Procurements”). In the final rule issued on June 28, 2013 implementing a part of the Jobs Act, the

Small Business Administration (“SBA”) noted that the presumption of loss will be applied in all criminal, civil, administrative, contractual, common law, or other actions in which the government seeks to redress willful

misrepresentation. 78 F.R. 38811 (6/28/13).

Request of a ruling by the Comptroller General of the United States

Latvian Connection LLC (VOSB) specifically requests that the GAO level Pre-Award protest be referred to the Small

Business Administration for their review. Latvian Connection LLC also requests that the Comptroller General of the

United States ruling be made about the Pre-Award protest. We ask that the Comptroller direct the Department of the

Army to take corrective action and set aside the solicitation for U.S. Small Businesses ONLY, and direct the Department

of the Army, specifically the contracting office of Camp Arifjan to include LOCAL (Middle East) Latvian Connection

LLC to be included on all Army privately conducted solicitations with Middle East performance, and to have all

solicitations with a value of between $ 3,000 and $ 150,000 that will not be electronically advertised sent to Latvian

Connection LLC – one of the U.S. Small Businesses in Kuwait. Just as importantly, instruct the Army Contracting

Command that ALL solicitations with a value of between $ 3,000 and $ 150,000 be reserved exclusively for U.S. Small

Businesses, regardless of the solicitation’s country of performance. (Exhibit 14)

We do not request that this protest be expedited.


President Obama’s Executive Office of the President, Office of Management and Budget issued a Memorandum on

the subject of a April 25, 2012 meeting of the Small Business Procurement Group (Exhibit 27) and this memo from

Joseph G. Jordan, Administrator for Federal Procurement Policy, and Karen G. Mills, Administrator of the Small Business

Administration state that there were “immediate steps to ensure small businesses are utilized to the maximum extent

possible.” Maximizing Opportunities for Small Businesses under the Simplified Acquisition Threshold “ Pursuant to

longstanding statutory requirements in the Small Business Administration Act, agencies are required to automatically set

aside work for small businesses that is equal to or less that the value of the Simplified Acquisition Threshold (SAT)

(generally $ 150,000). There are more than 5 U.S. Small Businesses in the Middle East Region, SMI-USA LLC, Trade

Links USA LLC, American General Trading, and Latvian Connection LLC. (Exhibit 26 & 27)

REQUEST FOR HEARING OR CONFERENCE AND PROTECTIVE ORDER

If the issues in this case cannot be resolved on the basis of the documents requested, then Latvian Connection LLC

requests a hearing on all of the matters set forth above. 4 C.F.R. § 21.1 (d)(2008). LC LLC does not request a protective

order.

III. LEGAL GROUNDS OF PROTEST

There is Overwhelming Evidence of Latvian Connection LLC that the Department of the Army issued this solicitation

(Exhibit 1) and foreign companies are invited instead of soliciting only U.S. Small Businesses of which VOSB Latvian

Connection LLC is one of them in Kuwait. This contracting should have linked the posting of ASFI to the GPE

www.fbo.gov since the value was greater than $ 25,000, and to maximize U.S. Small Businesses that could participate.

Where is the Army’s SF2579 ? Greater than $ 10,000 comma / including awards……..

Latvian Connection LLC is one U.S. Small Business in Kuwait and there other others. Trade Links USA, SMI,

American General Trading, to name but a few Small Businesses in Kuwait, and as the Senior Attorney from the Small

Business Administration stated in her review comments to the GAO for B-407391, Protest of Latvian Connection LLC,

Request for Reconsideration, Dec 12, 2012, § 15(j) of the Small Business Act, § 19.502-2 of the Federal Acquisition

Regulations.

(FAR), and GAO rulings on small business set-asides, all of which state that small business set-asides below the

Simplified Acquisition Threshold (SAT) are automatic; in other words, a contracting officer must set-aside the

http://www.fbo.gov/

http://www.fbo.gov/


acquisition for small business unless he/she can demonstrate that the agency will not receive at least two competitive

offers from small businesses.

FAR Part 19 also recognizes VOSBs, see FAR § 19.201(a) (“It is the policy of the Government to provide maximum

practicable opportunities in its acquisitions to small business, veteran-owned small business, service-disabled

veteranowned small business, HUBZone small business, small disadvantaged business, and women-owned small business

concerns.”) (emphasis added), although no separate VOSB program like the set-aside program for VOSBs is found in

FAR Part 19.

Latvian Connection LLC is a VOSB Veteran Owned Small Business as applicable to FAR Part 19 and the Small Business

Act.

(SBA Senior Legal Opinion)

In the legal opinion and analysis of B-407391, SBA’s Senior Attorney stated that the GAO gave deference to the SBA’s

interpretation of its statute, citing Chevron, U.S.A., Inc. v Natural Resources Defense Council Inc., 467 U.S. 837(1984)

and the GAO state that wen a statute under consideration creates a program to be administered by the SBA” it is the

views of the SBA, rather than [another agency], to which our Office will afford deference.” General Service

Administration – Reconsideration, B-406040.2, Oct 4, 2012. In this case, we are interpreting 15 U.S.C. §§ 644(a) &

644(j), which are set forth in § 15 of the Small Business Act. The Small Business Act specifically provides that: “ Small

Business Administration’ ( herein referred to as the Administration)…” 15 U.S.C. § 633. Congress granted SBA the

authority to administer the Act. As a result, GAO must afford SBA deference over the FAR in creating policy and

interpreting the Small Business Act, especially when the two conflict. SBA’s regulations on this issue state the

following:

(f) Contracting Among Small Business Programs

(1) Acquisitions Valued At or Below the Simplified Acquisition Threshold. The contracting officer shall set aside

acquisition with an anticipated dollar value exceeding the Micro-Purchase Threshold but not exceeding the

Simplified Acquisition Threshold (defined in the FAR at 48 CFR 2.101) for small business concerns when there is

reasonable expectation that offers will be obtained from at least two small business concerns that are competitive

terms of quality, and delivery and award will be made at fair market prices.

The SBA Senior attorney went on to state that 13 C.F.R. § 125.2 (f); 13 C.F.R. §§ 124.503(j), 125.19(b), 126.607(b),

127.503(d), SBA’s regulations require a contracting officer to set-aside all acquisitions valued above or below the

simplified acquisition threshold for small businesses, including those awarded and/or performed overseas, if market

research indicates that the “rule of two” may be met. As a result, we believe that the FAR is inconsistent with SBA’s

regulations and the SBA’s regulations should control. See C & G Excavating, Inc., v U.S, 32 Fed.C1. 231, 239 (1994)

(Where there is a conflict between SBA’s regulations on the COC program and the FAR “the SBA’s procedures

generally should control, especially considering that the SBA is the agency charged with issuing COC’s, not DoD,

GAO, or NASA.”) Hawpe Const., Inc., v U.S. 46 Fed.C1. 571, 582 (2000) (Conflicts between FAR and SBA

regulations should be resolved by looking to the SBA’s latest intent on the issue and by relying on the SBA to

determine which provision best implements the policies of the agency itself.”)

Finally, we note that GAO has addressed this issue already, with respect to the SBA’s COC Program. In Discount

Machinery & Equipment. Inc., the Panama Canal Commission believed that FAR § 19.000(b) precluded the SBA’s

review of any Federal procurement if the procuring agency is located outside the United States. The GAO stated that:

Based on our review of the Small Business Act and the applicable regulations, we find that the location of the

Contracting agency has no bearing on the applicability of SBA’s COC program. Nothing in the Small Business

Act imposes any geographic limitation regarding a contracting agency’s location which would exempt procurements

from the Act’s coverage. Rather the factor which determines whether a small business concern qualifies for SBA’s

COC proceedings is the nationality of the business.


This legal analysis was given by SBA Senior Attorney Laura Mann Eyester and John Klien, Associate General Counsel

for Procurement Law for the SBA. (Exhibit 16 & 17)

I. Contracting officers generally are required to set aside for small business all procurements exceeding

$150,000 if there is a reasonable expectation of receiving fair market price offers from at least two

responsible small business concerns. Federal Acquisition Regulation (FAR) § 19.502-2(b). A partial set-aside

must be made if a total set-aside is not appropriate, the requirement is severable into two or more economic

production runs or reasonable lots, and one or more small business concerns are expected to have the

technical competence and productive capacity to satisfy the set-aside portion at a reasonable price. FAR §

19.502-3(a). FAR § 19.202-2 generally requires contracting officers, before issuing solicitations, to make

“every reasonable effort to find additional small business concerns” and to maximize small business

participation.

What does the Army not understand about maximize small business participation Army Office of Small and

Disadvantaged Business ?

10 U.S.C. § 2304 B-271492

When using simplified acquisition procedures, agencies must promote competition “to the maximum extent

practicable.” 10 U.S.C. § 2304(g)(3) (2012). In meeting this requirement, agencies must make reasonable efforts,

consistent with efficiency and economy, to afford all eligible and interested vendors an opportunity to compete.

S.D.M. Supply, Inc., B-271492, June 26, 1996, 96-1 CPD ¶ 288 at 4.

13 C.F.R. § 125.2, 124.503(j), 125.19(b), 126.607(b), 127.503(d),

The SBA Senior attorney went on to state that 13 C.F.R. § 125.2 (f); 13 C.F.R. §§ 124.503(j), 125.19(b),

126.607(b), 127.503(d), SBA’s regulations require a contracting officer to set-aside all acquisitions valued

above or below the simplified acquisition threshold for small businesses, including those awarded and/or

performed overseas, if market research indicates that the “rule of two” may be met. As a result, we believe

that the FAR is inconsistent with SBA’s regulations and the SBA’s regulations should control. See C & G

Excavating, Inc., v U.S, 32 Fed.C1. 231, 239 (1994) (Where there is a conflict between SBA’s regulations on

the COC program and the FAR “the SBA’s procedures generally should control, especially considering that

the SBA is the agency charged with issuing COC’s, not DoD, GAO, or NASA.”) Hawpe Const., Inc., v U.S.

46 Fed.C1. 571, 582 (2000) (Conflicts between FAR and SBA regulations should be resolved by looking to the

SBA’s latest intent on the issue and by relying on the SBA to determine which provision best implements the

policies of the agency itself.”)

15 U.S.C. § 644 SMALL BUSINESS ACT

First, the Small Business Act provides for an automatic set-aside, or reservation, for small businesses for

acquisitions valued below SAT as follows:

(j)Small business reservation

(1) Each contract for the purchase of goods and services that has an anticipated value of greater than $ 2,500

but not greater than $ 100,000 shall be reserved exclusively for small business concerns unless the

contracting officer is unable to obtain offers from two or more small business concerns that are competitive

with the market prices and are competitive with regard to the quality and delivery of the goods or services

being purchased.

15 U.S.C. § 644 ( emphasis added). In other words, every acquisition under the SAT is reserved for small

businesses unless the contracting officer will be unable to obtain offers from two or more small businesses.

Moreover, the statute states that it is up to the contracting officer – not a specific small business advocating

for a small business set-aside, not SBA, and not any other entity – to perform adequate market research to be


able to make a determination that there are not at least two small businesses capable of performing the

requirement.

(SBA Senior Legal Opinion)

In the legal opinion and analysis of B-407391, SBA’s Senior Attorney stated that the GAO gave deference to

the SBA’s interpretation of its statute, citing Chevron, U.S.A., Inc. v Natural Resources Defense Council Inc.,

467 U.S. 837(1984) and the GAO state that wen a statute under consideration creates a program to be

administered by the SBA” it is the views of the SBA, rather than [another agency], to which our Office will

afford deference.” General Service Administration – Reconsideration, B-406040.2, Oct 4, 2012. In this case,

we are interpreting 15 U.S.C. §§ 644(a) & 644(j), which are set forth in § 15 of the Small Business Act. The

Small Business Act specifically provides that: “ Small Business Administration’ ( herein referred to as the

Administration)…” 15 U.S.C. § 633. Congress granted SBA the authority to administer the Act. As a result,

GAO must afford SBA deference over the FAR in creating policy and interpreting the Small Business Act,

especially when the two conflict. SBA’s regulations on this issue state the following:

(f) Contracting Among Small Business Programs

(1) Acquisitions Valued At or Below the Simplified Acquisition Threshold. The contracting officer shall set aside

acquisition with an anticipated dollar value exceeding the Micro-Purchase Threshold but not exceeding the

Simplified Acquisition Threshold (defined in the FAR at 48 CFR 2.101) for small business concerns when there

is reasonable expectation that offers will be obtained from at least two small business concerns that are

competitive terms of quality, and delivery and award will be made at fair market prices.

19.202-2 Locating small business sources.

small

disadvantaged business, and women-owned small business concerns in acquisitions by taking the following

actions: (a) Before issuing solicitations, make every reasonable effort to find additional small

business concerns, unless lists are already excessively long and only some of the concerns on

the list will be solicited. This effort should include contacting the SBA procurement center

representative (or, if a procurement center representative is not assigned, see 19.402(a)). (b) Publicize solicitations and contract awards through the Government-wide point of entry (see Subparts 5.2 and 5.3).

19.202-4 Solicitation. The contracting officer must encourage maximum response to solicitations by small business, veteran-owned

small business, service-disabled veteran-owned small business, HUBZone small business, small disadvantaged business, and women-owned small business concerns by taking the following actions: (a) Allow the maximum amount of time practicable for the submission of offers. (b) Furnish specifications, plans, and drawings with solicitations, or furnish information as to where they may be

obtained or examined. (c) Provide to any small business concern, upon its request, a copy of bid sets and specifications with respect to

any contract to be let, the name and telephone number of an agency contact to answer questions related to

such prospective contract and adequate citations to each major Federal law or agency rule with which such

business concern must comply in performing such contract other than laws or agency rules with which the

small business must comply when doing business with other than the Government.

That would seem to suggest that this solicitation should be posted on www.fbo.gov or, LOCAL U.S. Small

Businesses should be invited to bid on the Total Small Business Set Aside competition.

The contracting officer must, to the extent practicable, encourage maximum participation by small business,

veteran-owned small business , service-disabled veteran-owned small business, HUBZone small business,












http://www.fbo.gov/

http://www.fbo.gov/


(Exhibit 14)

SMALL BUSINESS ADMINISTRATION LEGAL OPINION - AUG 25, 2014

Overseas Requirements

State has also argued that this requirement cannot be set-aside for small businesses because the FAR and GAO

ruling preclude the set-aside of overseas requirements. SBA does not agree with this assertion for the following

reasons.

Second . The Small Business Act states the following with respect to proposed acquisitions value below the

simplified acquisition threshold:

( j ) Small business reservation

( l ) Each contract for the purchase of goods and services that has an anticipated value greater than $2,500 but not

greater than $ 100,000 shall be reserved exclusively for small business concerns unless the contracting officer us

unable to obtain offers from two or more small business concerns that are competitive with market prices and are

competitive with regard to the quality and delivery of the goods or services being purchased.

15 U.S.C. § 644 (emphasis added ). Both the FAR and SBA have codified this statutory mandate in its regulations.

For example, the SBA’s regulations state:

( f ) Contracting Among Small Business Programs. ( 1 ) Acquisitions Valued at or Below the Simplified Acquisition

Threshold The contracting officer shall set aside any acquisition with an anticipated dollar value exceeding

Micropurchase Threshold but not exceeding the Simplified Acquisition Threshold (defined in the FAR at 48 CFR

2.101) for small business concerns when there is a reasonable expectation that offers will be obtained from at least 2

small business concerns.

2 The Small Business Act states that small business set asides are mandatory for the acquisition of supplies and services valued at $2,500 to

$100,000. 15 U.S.C. § 644 (j)(l). However, the FAR Council has implemented an inflationary adjustment pursuant to 41 U.S.C. § 441a and

the FAR now states that “Before the settling aside an acquisition under the paragraph, refer to 19.203 (b). Each acquisition of supplies or

services that has an anticipated dollar value exceeding $ 3,000 ($15,000 for acquisition described in 13.201(g)(1)), but not over $150,000,

($300,000 for acquisition described in paragraph ( 1 ) of the simplified Acquisition Threshold definition at 2.101), is automatically reserved

exclusively for small business concerns and shall be set aside for small business unless the contracting officer determines there is not a

reasonable expectation of obtaining offers from two or more responsible small business concerns that are competitive in terms of market

prices, quality, and delivery.” 48 C.F.R. § 19.502 that are competitive in terms of quality and delivery and award will be made at fair market

prices. This requirement does not preclude a contracting officer from making an award to a small business under 8(a), BD, HUBZONE, SDVO

SBC, or WOSB programs.

13 C.F.R. § 125.2 (emphasis added). The FAR states that “Small business set-asides have priority over acquisition using

full and open competition. See requirements for establishing a small business set-aside at subpart 19.5.” FAR § 19.203(e).

FAR 19.601

( e) Contracting officers, including those located overseas, are required to comply with this subpart for U.S. small

business concerns.

Where is Army ’s SF2579 ? Greater than $ 10,000 comma / including awards……..


State argues that the GAO decision of Latvian Connection General Trading and Construction LLC, B-408633, Sept.

18, 2013 CPD ¶ 224, applies here. In that case, GAO ruled that FAR 19.000(b) limits the application of FAR part 19

(dealing with SBA’s small business programs) to acquisitions conducted in the United States (and its outlying

areas). We believe the basis for the GAO’s ruling was that SBA’s regulation were silent on this issue and therefore,

the more specific far regulations controlled.

Heeding this advice, the SBA recently promulgated regulations to address this issue. Specifically, SBA made



or contract, part of any such award or contract, and any contract for the sale of Government property, regardless of

the place of performance, which the SBA and the procuring or disposal agency determine to be in the interest of:”

13 C.F.R. § 125.2(a)(emphasis added). Likewise, the rule also states that: “Small Business Act requires each

Federal agency to foster the participation of small business concerns as prime contractors and subcontractors in the

contracting opportunities of the Government regardless of the place of performance of the contract.” Id. 125.2




mandatory for acquisitions valued from $ 3,000 to $ 150,000.

IV. Latvian Connection LLC Has Been Prejudiced

Prejudice requires a reasonable likelihood that Latvian Connection LLC would have been awarded the Contract if

the solicitation was set aside for U.S. Small Businesses exclusively. Such a determination is not susceptible to a

precise mathematical calculation; rather, prejudice requires only that “but for the agency’s actions, the protestors

would have had a reasonable chance of receiving the award. Anthem Alliance for Health, Inc., TRICARE

Management Activity – Reconsideration, B-278189.5, July 13, 1998, 98-2 CPD 66. A reasonable possibility of

prejudice therefore is sufficient to sustain the protest. United Int’l. Eng’g., Inc., B-245448.3, Jan 29, 1992, 92-1

C.P.D. ¶ 122. Europe Displays, Inc., B-297099. Latvian Connection LLC has been prejudiced by Army from Camp

Arifjan since June 2009.

It has long been the “declared policy of the Congress” that a “fair proportion” of federal contracts be

awarded to small businesses. In support of this policy, Congress has enacted various statutes

authorizing procuring agencies to conduct competitions in which only small businesses may

compete, or to make noncompetitive (“sole-source”) awards to such firms in circumstances when

similar awards could not be made to other firms.

Federal agencies may award contracts to small businesses by several different methods,

depending upon the value of the contract and the number of small businesses likely to submit

offers, among other factors.

• “Small purchases” valued at between $3,000 and $150,000 are “reserved

exclusively” for small businesses and may generally be made using simplified

acquisition procedures (e.g., purchase orders, blanket purchase agreements),

sealed bidding, or contracting by negotiation.

• Contracts whose value exceeds $150,000 may be awarded via sealed bidding or

contracting by negotiation in competitions in which only small businesses may

participate (i.e., “competitive set-asides”), so long as the contracting officer

http://www.wifcon.com/cgen/297099.pdf

http://www.wifcon.com/cgen/297099.pdf


reasonably expects offers from at least two small businesses, and the award can be

made at fair market price.

• Contracts whose value exceeds $150,000 may, in some cases, be entered into by

negotiating directly with a small business if the contracting officer does not

reasonably expect offers from at least two small businesses, or in certain other

circumstances.

V. ARMY IS BEING UNREASONABLE

By the Army not setting aside this solicitation, or inviting only LOCAL U.S. Small Businesses to Kuwait, as

required by the FAR and the Small Business Act, the contracting officer is acting unlawfully and unreasonably and

not acted in GOOD FAITH AND FAIR DEALINGS.

Latvian Connection LLC is Local and SAM registered so that even a Army contracting officer could consult

the ONLY FAR approved database (SAM.gov) and solicit Veteran Owned Small Business Latvian Connection LLC

and other U.S. Small Businesses in a Full and Open competition.

It has long been the “declared policy of the Congress” that a “fair proportion” of federal contracts be

awarded to small businesses (23%). In support of this policy, Congress has enacted various statutes

authorizing procuring agencies to conduct competitions in which only small businesses may compete,

or to make noncompetitive (“sole-source”) awards to such firms in circumstances when similar

awards could not be made to other firms.

Federal agencies may award contracts to small businesses by several different methods,

depending upon the value of the contract and the number of small businesses likely to submit

offers, among other factors.

• “Small purchases” valued at between $3,000 and $150,000 are “reserved

exclusively” for small businesses and may generally be made using simplified

acquisition procedures (e.g., purchase orders, blanket purchase agreements),

sealed bidding, or contracting by negotiation.

• Contracts whose value exceeds $150,000 may be awarded via sealed bidding

or contracting by negotiation in competitions in which only small businesses may

participate (i.e., “competitive set-asides”), so long as the contracting officer

reasonably expects offers from at least two small businesses, and the award can be

made at fair market price.

• Contracts whose value exceeds $150,000 may, in some cases, be entered into

by negotiating directly with a small business if the contracting officer does not

reasonably expect offers from at least two small businesses, or in certain other

circumstances.

The fact is that $ 63 Billion in Contingency funding is allocated to Contingency Operations and the Department of

Defense is not Setting Aside the mandatory set-asides and certainly not giving U.S. Small Businesses their fair share

of procurement dollars which would be 23% of the $ 63 Billion. This solicitation not being set aside for U.S. Small

Businesses only is just one of the many examples.

REQUEST FOR DOCUMENTS

Latvian Connection LLC requests that the following materials be included in the agency report, pursuant to 4

C.F.R. § 21.1(d)(2008):


• All Market Research regarding Veteran Owned Small Businesses in Kuwait.

• Signed DD Form 2579, Small Business Coordination Record for solicitation

• Source Selection, Bid Abstract and Evaluations for solicitation

• Copy of the Army’s bid list

REQUEST FOR RELIEF AND CONCLUSION

The remedy is simple is that this awarded contract is cancelled. That the Army solicit Latvian Connection LLC and

other U.S. Small Businesses for the requirement exclusively by posting the requirement on www.fbo.gov for “maximum

competition.” The Comptroller should request the Army that every single solicitation that the Army does not intend to

electronically advertise or link to www.fbo.gov , with a value of between $ 3,000 and $ 150,000 is emailed to Latvian

Connection LLC so that we may bid upon it when it has performance in Kuwait or the Middle East.

The Army should educate their contracting officers of the August 2013 “wholesale” SBA changes that all solicitations

with a value between $ 3,000 and $ 150,000 are reserved exclusively and will be awarded ONLY to U.S. Small Businesses.

The Comptroller should warn the Army about the appearance of Organizational Conflicts of Interests and favoritism in

awarding contracts reserved exclusively for U.S. Small Businesses to foreign companies.

Exhibit 8 and 9

Although the SBA has codified the Presumed Loss to U.S. Small Businesses from willful misrepresentation by

Large and foreign companies to take U.S. Small Business reserved contracts:

Under the Small Business Jobs Act of 2010 (the “Jobs Act”), there is a presumption of loss equal to the

value of the contract or other instrument when a concern willfully seeks and receives an award by

misrepresentation. Pub. L. No. 111-240. This provision applies to prime contracts, subcontracts, cooperative

agreements, cooperative research and development agreements, and grants (collectively, “Federal

Procurements”). In the final rule issued on June 28, 2013 implementing a part of the Jobs Act, the Small

Business Administration (“SBA”) noted that the presumption of loss will be applied in all criminal, civil,

administrative, contractual, common law, or other actions in which the government seeks to redress willful

misrepresentation. 78 F.R. 38811 (6/28/13).( Exhibit 12)

The Army has not taken corrective action against contracting officers who “willfully” assist Large companies and

foreign companies in being awarded U.S. Small Business contracts using the UCMJ. Contracting Officers are “willfully”

disobeying Federal Laws, Regulations, and Statutes and do not carry out what the Army’s leadership in the Pentagon

continually request in Memos; President Obama’s memos; the Undersecretary of Defense memos, the agency’s own Head

of Contracting Authorities own meaningless memos demonstrate the contracting officers fail to heed due to the deep-rooted

Organizational Conflicts of Interest in the Army Contracting Command, the Pentagon, and the other Department of Defense

Agencies.

No one could look more disingenuous at the moment than President Obama’s new OFPP appointee stating that:

The Administration has also increased opportunities for small businesses, a key source of innovation in our

economy, even as we reduce contracting spending. (rubbish)

(2) design improved online tools for vendors to more easily find opportunities to compete for Federal

contracts, such as building on “FBOpen,” an online tool to help small businesses more easily find the

information they need to determine if they wish to bid on solicitations; and (3) develop a single website for

http://www.fbo.gov/

http://www.fbo.gov/

http://www.fbo.gov/

http://www.fbo.gov/


Federal contractors to use for Federal contract reporting requirements related to labor laws, as well as other

reporting requirements as practicable. ( it takes educated and honest contracting officers to operate that Ms.

Rung )

In particular, greater attention must be paid to regulations related to procurements of commercial products

and services, as the Government is typically not a market driver in these cases and the burden of

Government-unique practices and reporting requirements can be particularly problematic, especially for

small businesses. (the only thing that is problematic is the corruption and OICs of the Army)

Within 180 days of the date of this memorandum, OFPP, in consultation with the Chief Acquisition Officer

Council and the FAR Council, will make recommendations to the Deputy Director for Management on specific

actions that can be taken to reduce burden in commercial item acquisitions, especially for small businesses,

and increase the use of effective commercial solutions and practices by the Government. (Only placing all

contracting duties in the Department of Treasury could such an idea be successful)

President Obama, I am not the CEO of Sony, but I am the CEO of Latvian Connection LLC, a Veteran Owned

Small Business that your Army discriminates against, and you and Ms. Rung there who just issued that tripe

on December 4th can give me a call any time at (707) 385-9344 and I will tell you about the corruption and

discrimination of Veteran Owned Small Business Latvian Connection LLC at the hands of MAJ Williams, the

926th and the 408th.

The fact is President Obama, the U.S. Small Business owners are who contribute to the American economy –

far more than a $ 9 movie ticket. And it is Small Business Owners that vote.

It would seem that the directives flowing out of the President of the United States office are orders and those

orders are not being followed by General Officers, Regular grade officers, and contracting officers are in defiance to invite

LOCAL VOSB Latvian Connection. Latvian Connection LLC requests the removal of any contracting officer in the

Middle East who cannot follow the Federal Acquisition Regulations, Laws, and Statutes, CICA or Small Business Act.

The SBA Senior Lawyer has stated that set-aside is mandatory exclusively for Small Business and the FAR and SBA rules

do apply overseas. We ask that the GAO refer this protest to the SBA for their comments.

We also request that Latvian Connection LLC be reimbursed the costs of filing and pursuing its protest, including

reasonable protest preparation fees. Bid Protest Regulations 4 C.F.R. § 21.8(d)(1) (2010).

We also request that LATVIAN CONNECTION LLC LLC be reimbursed the costs of filing and pursuing its protest,

including reasonable protest preparation fees. Bid Protest Regulations 4 C.F.R. § 21.8(d)(1) (2010).

Under the Competition in Contracting Act of 1984, the GAO may recommend that protest costs be reimbursed where

they find that an agency’s action violated a procurement statute or regulation. 31 U.S.C. § 3554(c)(1) (2010). The


GAO’s Bid Protest Regulations provide that, where the contracting agency decides to take corrective action in response to

a protest, the GAO may recommend that the protester be reimbursed the costs of filing and pursuing its protest, including

reasonable attorneys’ fees. 4 C.F.R. § 21.8(e) (2010). The GAO has stated that it “does not mean that costs should be

reimbursed in every case in which an agency decides to take corrective action; rather, a protester should be reimbursed its

costs where an agency unduly delayed its decision to take corrective action in the face of a clearly meritorious protest.

Griner’s-A-One Pipeline Servs., Inc.--Costs, B-255078.3, July 22, 1994, 94-2 CPD ¶ 41 at 5.

Respectfully submitted,

__________________________

Keven L. Barnes

CEO

Latvian Connection LLC

CC:

FRANK KENDALL – UNDERSECRETARY OF DEFENSE

News & Politics

Blog 25 USMC 20150725 SOLICITATION NUMBER ARMY W912D1- 15-R-0012 -GAO PRE-AWARD PROTEST AGAINST US ARMYs RFQ W912D1-15-R-0012 FOR BUNDLING TO CIRCUMVENT SMALL BUSINESS ACT