Link: GAO Opinion
Agency: Department of the Navy
Disposition: Protest denied.
1. Where past performance and experience evaluations were based in part on relevance–similarity in size, scope, and complexity–agency reasonably established size threshold for relevance at approximately one-half annual value of solicited work, and reasonably rated protester no higher than satisfactory for experience and past performance based on single project above threshold, despite high rating on that project from past performance reference.
2. Agency reasonably evaluated protester’s proposal as satisfactory under technical approach factor where proposal failed to address a required position and lacked discussion of specific risks, and agency had concerns with performance risk where price proposal indicated lack of available capital funds.
3. Agency properly considered past performance and experience record of awardee’s parent firm and affiliates where awardee’s proposal demonstrated that resources of those entities would affect performance and solicitation did not prohibit consideration of parent/affiliate information.
General Counsel P.C. Highlight:
AAJV asserts that the agency failed to follow the evaluation criteria in assigning AAJV a satisfactory rating under the experience and past performance factors, because it introduced an undisclosed limitation of $5 million in annual value as a threshold for considering projects relevant. GAO states that in evaluating proposals, an agency properly may take into account specific, albeit not expressly identified, matters that are logically encompassed by, or related to, the stated evaluation criteria. Size is a proper consideration in determining whether an offeror has experience and a record of past performance under similar contracts.
Here, the agency established a minimum relevance value of $5 million; the estimated contract value of the first option year was expected to be approximately $11 million, and the agency determined that a contract approximately half that size would be sufficient to be predictive of the quality of performance of the current requirement. Establishing a threshold value in this manner was sufficiently related to the relevance criterion, and GAO finds nothing inherently unreasonable in a threshold of approximately one-half the value of the current requirement. While AAJV believes, essentially, that a lower contract value should not have precluded consideration of its other, lower value projects in the evaluation, there simply was no requirement that the agency give weight to such projects.
AAJV asserts that the agency improperly evaluated its proposal under the technical approach factor by assessing two weaknesses–one, its failure to associate risks with specific requirements, and another, denominated as significant, failure to indicate complete coverage of the military airport desk. In AAJV’s view, the agency gave undue weight to these weaknesses and should have rated its proposal higher than satisfactory. The evaluation was consistent with the RFP’s requirements. In this regard, the RFP called for offers to identify the risks expected to be encountered under the performance objectives and standards of the RFP, and to explain how the proposed technical approach and contingency plans would mitigate those risks. Offerors were warned that failure to identify risks apparent to the evaluators could result in a reduced rating. Although AAJV’s proposal mentioned risks for all aspects of the work–such as Guam’s remote and isolated location, its severe weather conditions, contractor transition, phase-in of the Andersen Air Force Base work, and fluctuating workload–the agency found that AAJV had taken a generalized approach in explaining its risk mitigation strategies, providing little distinction among the identified risks.
As for the second weakness, the Navy Guest Inns and Suites aspect of the performance work schedule specifically required a military airport desk, seven days per week, to coincide with scheduled commercial flights. AAJV’s proposal priced this requirement, but its technical proposal did not include a description of how the requirement would be addressed. AAJV asserts that the weakness is not significant because it would account for only [deleted] full-time employees. However, the agency notes that the proposal did not explain how many positions would be allocated, and states that it considered the lack of information to indicate risk that this aspect of the requirement would not be performed satisfactorily. Since AAJV failed to address a clear proposal requirement, and the record provides no basis for us to question the agency’s judgment, GAO concludes that the agency reasonably found the weakness to be significant.
Finally, AJV asserts that the awardee’s parent and sister companies are not teamed with or otherwise contractually committed to perform the awarded contract, and that it therefore was improper for the agency to consider those firms’ past performance and experience in evaluating the awardee’s proposal. GAO states that an agency properly may consider the experience or past performance of an offeror’s parent or affiliated companies where the firm’s proposal demonstrates that the resources of the parent or affiliated company will affect the performance of the offeror.
The awardee’s proposal stated that its parent company’s and several of its sister companies’ resources–including workforce, management, key personnel, facilities and performance strategies–would be provided and relied upon for contract performance. For example, the proposal stated that the awardee would transition key personnel from the current contract in Guam performed by a sister company; had reach-back capability to tap more than 6,000 of the parent company’s and affiliate employees worldwide; and would rely on the expertise of various subject matter experts, including two named personnel–an individual who had been the project manager on an affiliate’s base operating systems contract on Wake Island as well as the project manager for the incumbent Guam contract, and the awardee’s own president, who had experience with the awardee and two of its affiliates on 21 prior contracts. In addition, the parent company would provide general and administrative support, including accounting, human resources, legal and risk, compliance and regulatory information technology, project transition, and business development services. The parent company’s representatives would also assist with interviewing and hiring employees; meeting security requirements; overseeing safety, quality control, and accounting setup; purchasing or leasing equipment; and bringing utilities on line. The fact that these affiliates and personnel are not contractually bound to perform these services, does not render the agency’s consideration of their experience and past performance unreasonable. The RFP did not require any such commitment and, based on the awardee’s representations, GAO thinks the agency reasonably concluded that the awardee’s proposal demonstrated that the resources of the parent and affiliated companies would affect the awardee’s performance. Thus, there was nothing improper in the agency’s consideration of their respective experience and past performance. The protest is denied.