State Will Re-Compete Illegal Sole-Source Contract The State Department will end a sole-source contract with an 8(a) joint venture after the Government Accountability Office said it was improperly awarded. The IDIQ contract for security equipment at U.S. embassies, worth up to $354 million, was awarded under a blanket waiver granted by SBA, allowing State to exceed the $3 million limit on sole-source contracts for security work. GAO said the blanket waiver was illegal because SBA may issue waivers only on a case-by-case basis. RDR Inc., an 8(a) firm, had been installing equipment such as alarms, cameras and X-ray machines at diplomatic posts since 1992. When RDR graduated from the 8(a) program, it created EmbSec, a mentor-protégé joint venture with 8(a) firm BP International. EmbSec was awarded the sole-source contract in 2003. GAO said State Department officials indicated they wanted RDR to continue to do the security work, so they did not compete the contract. The auditors said SBA has not adequately monitored EmbSec’s performance to insure that the protégé, BP International, was doing a meaningful share of the work. BPI was a small IT management and consulting firm when RDR selected it as a protégé. EmbSec subcontracts a major portion of the work to Dyncorp, a large security firm. In response to the audit, the department said it would not exercise the final option year on the EmbSec contract and is already planning to compete the requirement. SBA said it would assess the mentor-protégé arrangement.