Foul but No Harm? Strict FAR Compliance Can Be a One-Way Street

Albert B. Krachman

Contractors and contractor teams competing for set-aside contracts should internalize the Federal Acquisition Regulation (“FAR”) compliance lesson imparted by a recent Government Accountability Office (“GAO”) protest decision related to small business set-aside procurements. In Kira Training Services, LLC, B-419149.3 (January 4, 2021) GAO illustrated that in the set-aside area, an Agency can violate a mandatory FAR provision, but a contractor cannot complain unless it takes timely proactive steps to protect itself from the government error. In Kira, GAO found that on a set-aside contract, the Navy violated the FAR by not sending the required pre-award list of intended awardees to all offerors, but the small business protester was not competitively prejudiced by the Navy error because it failed to protect itself by filing a post-award size protest.

The purpose of the pre-award notice on small business set aside contracts is to allow competitors to timely file size protests against proposed awardees who may not be an eligible small business. The regulations make it more advantageous for a bidder to challenge a competitor’s size before award, as opposed to post award, when an adverse size or status ruling may not prevent the government from proceeding with the challenged procurement even if the size protest is sustained.

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