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B-177691 1 (1973-06-28)

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                          COVS'rNOLtzEt GENERAL OF THE UNITED STATES
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      B-177691                                             Jn 28, 1973



      The Honorable James T. Lynn
      The Secretary of Houring and Urban
        Development
        r                .
      Dear Mr. Secretary:

           We have considered your departmental reports of January 30, March 2,
      March 26 and April 18) 1973, on the protest of the Consad Corporation against
      the noncompetitive award of contract H-2040 to hiT Associates, Inc., for
      phase II of the demand experiment of the Housing Allowance Experimental Pro-
      gram in the estimated amount of C17.9 million. From our revit of the pro-
      curement, which is set out in deteil below, we recounend that severable
      portions of the contract be terminated and resolicsited competitively, if
      feasible'

           After publication of an advance volicitation of interest on
      September 9, 1971, in the Commerce Business Daily, request for proposals
      (RFP) H-11-72 was issued November 5, 1971, for the conduct of experiments
      to test and evaluace a Housing Allowance Experimental Program (HAEP).    As
      defined in the RFP, a Housing Allowance it * * * a direct subsidy pay-
      ment to a low or moderate income family to be used primarily for housing.
      The goal of HAEP as statid in the RFP is !'* * * to provide reliable informa-
      tion to help policy-makers decide whether the potential advantages of
.     such an approach would justify its full implementation as an operating
      program and to define the moot effective means to operate the program,
      HASP has been divided into three separate experiments: demand, supply
      and adminii;trative agency. The demand experiment concerns the manner in
      which a household receiving different kinds of housing allowances spends
      it. The supply experiment concerns the behavior of suppliers of housing
      and housing services in a market in which the demand is increased by the
      introduction of housing allowances. The administrative agency experiment
      involves the manner in which existing Governmental &gencieo, Federal,
      state and local, or nonprofit organizations may best be utilized to
      administer the actual payment procedures.

          .The scope of work was defined generally in attachwent C to the RP:

          A ik * furwLsh the necessary professional, technical and
          clerical services, equipment, and facilities to perform
          all the work required under the contract.

          The conduct of the field operations covers the administration
          of'the experiwuents at various sites including selectinr 2,

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