HHS lease contract still drawing protests from Pr. George’s County developers

Developers who tried to entice the U.S. Department of Health and Human Services to move its offices in Rockville to Prince George’s County are once again alleging that the process used to give the nearly $450 million lease to a Montgomery County bidder was unfair.

The U.S. Government Accountability Office is reviewing the award of the 15-year lease by the General Services Administration to Fishers Lane/JBG Cos. The GAO heard testimony from federal officials Tuesday and Wednesday during two private hearings in Rockville.

Three developers in Prince George’s County who did not win the lease agreement filed a protest in September and asked GAO to conduct the hearings.

Ralph O. White, GAO’s managing associate general counsel, said the independent federal agency received about 2,300 protests last year. GAO held hearings on about 60 of those cases.

“When you have a complex record, you can’t do it on the paper in front of you,” White said. “This is a close fight, and it’s a lot of money.”

This is the second round of protests by One Largo Metro, Metroview Development Holdings and King Farm Associates. The lease would affect the location of 3,000 office workers.

The proposed locations in Prince George’s are in New Carrollton, Largo and Hyattsville.

In a redacted copy of the protest obtained by The Washington Post, Metroview Development Holdings argues that the process was not “above reproach.” According to Metroview, GSA allegedly signed a lease with Fishers Lane/JBG for its Parklawn Building a week before a decision was announced.

Jay Bernstein, an attorney for GSA, referred calls to the agency’s media office, which did not return a message.

Metroview also said the decision was “materially flawed.” The agency did not weigh access to Metrorail as the most important evaluation factor, despite its push to “make the lease as green as possible.” According to Metroview’s protest, a GSA evaluation board originally selected King Farm for the award, but it was later overruled by the “head of the contracting activity.”

Metroview also contends that GSA “abused its discretion by not conducting a new round of discussions and final proposal revisions” following the first protest and review.

Attorneys for the bidders would not comment on the protest.

Earlier this year, GSA said it would keep the HHS offices in Montgomery County and awarded the lease to Fishers Lane/JBG, which has held a five-year, $108 million lease on the HHS space while the process continued. The three Prince George’s bidders protested to GAO, which ruled in June that GSA unfairly awarded the lease to the Rockville-based company. At the time, agency officials said that “GSA failed to evaluate offers in a way it had outlined in the solicitation.”

In August, GSA announced that it once again had decided to keep the HHS offices at the Parklawn Building. The agency described it as “a sound business decision.” that was “based on price against location, building characteristics and past performance.”

GAO did not hold hearings on the previous protests.

Ovetta Wiggins writes about K-12 education.
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