Matter of: Fluor Federal Solutions, LLC
Agency: Department of the Navy
Disposition: Protest Sustained
Decided: January 18, 2017
Released: November 20, 2017
General Counsel P.C. Highlight: Proposal evaluation and source selection decisions must be consistent between offerors. When the record shows disparate evaluation and the protester is disadvantaged, a protest may be sustained.
Summary of Facts
This is the third protest regarding this particular acquisition. Flour originally protested the agency’s evaluation of proposals and conduct during discussions in 2015. After the agency reopened discussions, they awarded the contract to DZSP a second time. A subsequent protest led to an outcome prediction alternative dispute resolution procedure at the request of the Navy. Following this, the Navy indicated their intent to take corrective action, which led to dismissal of the second protest in March of 2016. The Navy subsequently engaged in limited discussions and evaluated revised proposals. The agency selected DZSP for a third time. Fluor protested for a third time.
The RFP was for base operations support services on the island of Guam. The award was for a cost reimbursement contract with a 12-month base period, four 1-year option periods, and three 1-year award option periods. The award was to be made on a best value basis, considering cost and non-cost factors. The non-cost factors included past performance, occupational safety, staffing and resources, technical approach, and small business utilization.
Both firms submitted revised proposals after the Navy indicated they would take corrective action. The agency made no significant changes to the non-cost proposals, where Fluor received a higher rating than DZSP. Despite Fluor’s technically superior rating, the award was again made to DZSP, based on a $2.6 million savings.
DZSP’s proposal anticipated replacing all current workers over the life of the contract at an undisclosed percentage per year. Further, DZSP explained they would hire new workers at a lower rate of pay. Fluor’s plan, on the other hand, anticipated retaining 95 percent of incumbent staff.
Basis for Protest
Fluor argues the agency misevaluated proposals and made an unreasonable source selection decision. The RFP called for an evaluation of whether an offeror demonstrates the “ability to recruit and retain qualified local workforce and key personnel/managers.”
In evaluating Fluor’s proposal, the Navy expressed concern about Fluor’s ability to retain incumbent workers at the wage rates they proposed. In fact, the evaluators suggested the lower rates could impact both morale and retention. Consequently, the evaluators questioned Fluor’s ability to meet their proposed 95 % retention rate.
In evaluating DZSP’s proposal, and their plan to replace all incumbent staff during the contract, evaluators focused on whether replacement was realistic. Based on the age of incumbent staff, evaluators concluded the plan was realistic. However, the source selection authority (SSA) did not appear to be aware of DZSPs plan to replace the existing work force during the life of the contract, stating, “While both proposals received Outstanding ratings for Factor C (staffing and resources), I conclude DZSP provides slightly more value because FFS’ initiative to recruit the experienced incumbent workers at lower salaries imposes some risk of loss of a portion of that workforce’s experience.”
In reviewing the record, the GAO noted that the Navy criticized Fluor’s proposed approach. The Navy found that Flour’s proposal carried the risk that it would not be able to retain the incumbent work force. At the same time, the Navy failed to recognize DZSP’s approach of replacing the workforce carried comparable risk.
Considering the disparate approach to evaluating the proposals, the GAO sustained the protest and recommended that the agency reevaluate the proposals in a manner consistent with the GAO decision.