Link: GAO Opinion
Agency: Department of Veterans Affairs
Disposition: Protest denied.
General Counsel P.C. Highlight:
GAO denied the protest of B&B Medical Services, Inc. regarding the award of a contract to Rotech Healthcare, Inc., under a request for proposals (RFP), issued by the Department of Veterans Affairs (VA) for home oxygen services.
The RFP contemplated the award of two fixed-price requirements contracts, each for a base and four option years. The RFP provided for the unrestricted award to the offeror whose proposal was determined most advantageous to the agency based on price and the following four non-price factors: technical capability; quality control (QC) program; past performance; and service-disabled veteran-owned small business (SDVOSB) participation/commitment to small businesses.
B&B challenged the contracting officer’s affirmative determination of Rotech’s responsibility, arguing that the CO failed to consider available relevant information in determining that Rotech had the financial resources to perform the contract and a satisfactory record of integrity and business ethics. GAO first found that the CO requested a Dun & Bradstreet (D&B) supplier qualifier report to assist with the responsibility determination. The report showed that Rotech had a supplier evaluation risk (SER) rating of nine, which represented the highest risk. The D&B report also showed that Rotech’s rating showed an unbalanced financial condition rating; a high proportion of past due balances; a low proportion of satisfactory payment experiences to total payment experiences; and a high proportion of slow payment experiences. However, the line of credit and earnings update gave the CO confidence to conclude that Rotech had adequate financial resources. GAO concluded that the record supported the view that the CO considered all information and made an informed decision that Rotech showed a low risk of late payment. The CO considered all information pertaining to the loan and acted reasonably in relying on the information contained in the report.
B&B next argued that the agency’s evaluation of Rotech’s past performance was unreasonable based on two prior contracts. However, GAO concluded that the CO had a reasonable basis for assigning Rotech a past performance rating of substantial confidence based on positive ratings (very good to exceptional) on questionnaires on the two very relevant contracts.