Link: GAO Opinion
Agency: Department of Justice
Disposition: Protest denied.
1. Protest of alleged improprieties apparent on face of task order solicitation, filed after issuance of the task order, is dismissed as untimely under GAO’s Bid Protest Regulations.
2. Protest that the agency unreasonably evaluated the competitors’ proposals, based primarily on the agency’s alleged failure to sufficiently credit the protester’s incumbent status and advantages, is denied where the record shows the agency evaluation was reasonable and in accordance with the stated evaluation criteria.
3. Alleged misrepresentations by vendor that was issued the task order were not material where the agency did not rely upon them.
4. Nature and extent of agency’s price realism analysis, including proposed labor rates, of proposals responding to fixed-price task order solicitations are matters within the reasonable exercise of the agency’s discretion
General Counsel P.C. Highlight:
ITC first and second arguments focus on the terms of the RFP. ITC argues that the mission capability subfactors of the RFP improperly allowed for the submission of corporate CPCSs as well as individual CPCSs in the task order proposals and that the agency’s addition of a 10-day period for transition activities by Amendment 3 improperly modified the start date for performance of the task order. Basically, ITC claims that unfair competitive advantage has been given to non-incumbent contractors. In the context of the Competition in Contract Act of 1984 (CICA), 31 U.S.C. sect. 3551(1) (2006), FASA, and GAO’s well-established practices and procedures employed to implement the protest jurisdiction conferred by those statutes, GAO views section 843 of the NDAA authorization to consider –a protest of an order valued in excess of $10,000,000— as providing the same substantive protest jurisdiction conferred by CICA and FASA. Consistent with GAO’s past practice and CICA’s provisions that define a protest as –a written objection by an interested party to . . . [a] solicitation or other request by a Federal agency for offers for a contract for the procurement of property or services, GAO finds the NDAA’s authorization for GAO to consider protests of task orders in excess of $10 million as extending to protests objecting to the terms of the task order solicitation. Thus, GAO’s bid protest regulations including our timeliness requirements, such as those pertaining to apparent solicitation improprieties, are applicable to task order protests.
ITC knew or should have known upon receipt and review of the RFP that the task order would be issued for an amount in excess of $10 million, given that it was the incumbent contractor, its initial proposal was almost $[REDACTED] million, and the government provided within the RFP itself a description of the level of effort required including the number of individuals and number of labor hours from which any of the CAPS contractors should have been able to calculate that the resultant task order would be valued well in excess of $10 million. Accordingly, these ITC challenges to alleged solicitation improprieties are untimely filed under Bid Protest Regulations and will not be considered.
The remainder of ITC’s protest challenges the agency’s evaluation of proposals under the mission capability, past performance, and price/cost evaluation factors. GAO states that the evaluation of proposals is a matter within the discretion of the contracting agency, and in reviewing protests against allegedly improper evaluations it is not our role to reevaluate proposals. Rather, GAO will examine the record to determine whether the agency’s judgment was reasonable, in accord with the evaluation factors set forth in the solicitation, and whether the agency treated offerors equally in its evaluation of their respective proposals and did not disparately evaluate proposals with respect to the same requirements. A protester’s mere disagreement with the agency’s judgment does not render the evaluation unreasonable. As discussed below, GAO finds that the agency’s evaluation of the proposals to be reasonable and in accordance with the solicitation evaluation criteria.
The agency reasonably evaluated the proposals based upon the RFP evaluation criteria and assigned ratings based on the standards set forth in the solicitation. ITC argues that it should have received more credit and a higher rating under the technical capability factor because it was the incumbent and would more certainly provide the incumbent personnel. However, ITC’s disagreement with the agency’s decision to not assign a higher rating than was given the awardee’s proposal under technical capability subfactor by reason of ITC’s incumbent status and ITC’s ability to provide the incumbent personnel does not provide a basis for finding the agency’s rating was unreasonable, particularly given the low risk approach reasonably found in the awardee’s proposal under this subfactor. While ITC disagrees with the agency’s judgment, it has not shown the agency’s failure to give ITC’s proposal a strength or to assign its proposal a higher rating than the awardee’s was unreasonable or inconsistent with the RFP evaluation scheme.
ITC’s protest also asserts that the agency evaluation under the mission capability factor was further flawed due to the agency’s reliance on the awardee’s material misrepresentations included in its proposal. GAO states that an offeror’s material misrepresentation in its proposal can provide a basis for disqualification of the proposal and cancellation of a contract award based upon the proposal. A misrepresentation is material where the agency relied upon it and it likely had a significant impact on the evaluation.
GAO agrees with the agency that there is no basis in the record for finding that the agency relied upon the statements such that they had a significant impact on the evaluation. As detailed above, the agency determined the awardee’s two-prong approach of attempting to recruit the incumbents and providing a large pool of qualified alternative employees was an acceptable means of demonstrating its ability to provide qualified individuals meeting the education and experience requirements for the proposed labor category/skill level. As noted by the agency, there is no suggestion that it relied on or even considered the allegedly erroneous [REDACTED] provided in the awardee’s proposal in evaluating its mission capability. The evaluation documentation included in the record concerning the evaluation of the awardee’s proposal under the mission capability factor is simply devoid of any reference to, let alone credit for, providing the reference to its ability to offer [REDACTED].
ITC finally asserts that the awardee’s proposed price as unreasonable and unrealistic, given that it was approximately eight percent less than ITC’s proposed price. GAO states that in general, there is no requirement that a price realism analysis be performed when award of a fixed-price contract is contemplated. However, a solicitation for a fixed-price contract may provide for a price realism analysis for the purpose of assessing offerors’ understanding of the requirements or the risk inherent in offerors’ proposals. The nature and extent of a price realism analysis ultimately are matters within the exercise of the agency’s discretion, and GAO’s review of such an evaluation is limited to determining whether it was reasonable and consistent with the solicitation’s evaluation criteria.
The agency provided in the RFP that price proposals would be evaluated for reasonableness and realism. For a price to be reasonable the RFP stated that –it must represent a price to the government that a prudent person would pay when consideration is given to prices in the market. The solicitation did not provide that the Air Force would engage in any specific method of price or cost analysis.
In performing its price evaluation, the agency chose to first determine whether the offeror had proposed in accordance with the Government’s estimate or had proposed an alternative approach. All three offerors were found to have proposed in accordance with the labor categories, number of personnel in each category, number of labor hours, and the travel costs set forth in the solicitation. The agency then compared the labor rates proposed by each offeror for the task order to that offeror’s labor rates in its CAPS contract, and found that each offeror’s proposed labor rates for the task order were equal to or less than the labor rates proposed on the basic contract. While ITC asserts that the analysis of the awardee’s proposed labor rates should have been more extensive, the agency found that since all offerors proposed to the Government’s Estimated Contractor Labor Support and the proposed rates were equal or less than the maximum rates in their CAPS contracts, a more extensive and detailed analysis of the proposed labor rates was not necessary. The agency also calculated the TEP for each proposal by adding the government estimated travel costs to the proposed prices for the base and option years, and compared each offerors’ TEP to the independent government estimate and the TEPs of the other offerors. Based upon the foregoing analyses, the contracting officer determined that adequate price competition existed for the requirement and found each offeror’s proposed pricing was reasonable and realistic for the work to be performed, reflected a clear understanding of the requirements, and was consistent with the offeror’s technical proposals.
This case highlights an ongoing issue in bid protest, what value, if any, should be placed on incumbancy. Recently there have been several decision based on this issue both in favor of and against the incumbant. What seems fairly settled with the GAO is that while an incumbant’s status can’t be held against it, being the incumbant doesn’t automatically give you the highest past performance rating and as here it does not entitle the incumbant to a higher rating in technical capability. There are obvious advantages to being the incumbant, but incumbants should work just as hard to give the customer what they are asking for in the solicitation and not rely on their status to give them the award.