Washington PR Firm Protests FCC’s DTV Contract With Burson-Marsteller

Weber Merritt alleges that the contract, which the FCC awarded Burson-Marsteller Tuesday and announced Thursday, should have been given to a small-business contractor, as the commission’s solicitation indicated it would, a Weber Merritt spokesman told us. “The matter is now in the hands of the GAO and the FCC,” the spokesman said. We couldn’t reach GAO representatives right away. A spokesman for the FCC said it had no comment.

Burson-Marsteller spokesman Paul Cardasco responded to an inquiry with a written statement that seemed meant for distribution for would-be subcontractors. “Burson-Marsteller has been notified of award of a contract by the FCC for media services relating to the DTV transition and is evaluating the requirements of the program in collaboration with the FCC,” Cardasco said. “We will keep your contact information handy should your services be needed as the program unfolds. Thank you for your interest in the important final push to DTV transition on June 12th.” He didn’t respond to further queries.

The contract says the FCC will pay Burson-Marsteller nearly $579,000 for general advertising, print relations and media services and $35,000 to assemble a targeted media distribution list. In its solicitation, the FCC said it sought a contractor “with the proven ability to provide advertising and public relations expertise, a variety of media services, publications and targeted distribution services that will supplement and expand our consumer education and awareness campaign relating to the digital television transition throughout the United States.”

With the analog cutoff approaching, the contractor “must have the wherewithal to complete multiple assigned tasks with short deadlines,” the solicitation said. Above all, it said, the contractor “must be able to identify the ethnic and other specialized media that can most effectively reach these demographic groups and to distribute materials and communications to those media.”

At least twice during the solicitation process, the FCC indicated it was seeking a small business as the contractor. In the request for quotes itself, the commission said that “all firms or individuals responding must be registered with the Central Contractor Registration” and that “North American Industrial Classification Standard (NAICS) 541820 and size standard of $7 million apply to this solicitation.” Many we polled with experience in government contracts said they took that to mean companies with annual revenue higher than $7 million need not apply.

As recently as April 17, when the FCC published a list of vendor questions it had received along with government replies, a vendor asked, “Do previous vendors have an advantage?” The FCC answered with a flat “no.” Another asked whether minority-owned businesses and those owned by the disabled would have an advantage. The commission replied that no, “there is no bidding ‘advantage’ for those groups identified, although this process will first be set-aside for HUBZones and then Small Businesses, and there is a price evaluation preference for HUBZone Small Business Concerns.”

The HUBZone (for “Historically Underutilized Business Zone") program was enacted into law as part of the Small Business Reauthorization Act of 1997. Run by the Small Business Administration, the program encourages economic development in depressed areas through a system of contract preferences. A 2008 SBA report said the vast majority of HUBZone money contracted for through the federal government was through small business set- asides of the sort the FCC said it would impose for the contract that went to Burson- Marsteller, which had 2008 U.S. revenue of $100-$200 million, according to the trade publication PRWeek.