Matter of Dynaxys LLC

Agency: Department of Housing and Urban Development

Disposition: Protest Sustained In Part

Decided: April 18, 2018

Released: May 4, 2018

Keywords: Best Value, Evaluations,

General Counsel P.C. Highlight:

Evaluation of proposals should be carefully reviewed to determine if strengths awarded are justified. When an agency does not evaluate approaches equally, there may be grounds for a protest.  Further, when making best value determinations, an agency must consider substantive differences between proposals and justify their tradeoff decision.

Summary of Facts

Dynaxys LLC protests the award of a support services contract to KeyBank National Association (KeyBank).  The request for proposals (RFP) indicated the award would be based on a best value tradeoff considering six non-price factors which, combined, were more important than price.  However, as the proposals became more equal in non-price factors, price became more important.

The non-price factors, in descending order of importance, included:

• Technical approach;
• Management plan;
• Quality control plan;
• Key personnel;
• Past performance; and
• Socioeconomic participation.

After evaluation of all proposals, the agency found only Dynaxys and KeyBank qualified for consideration for the award.  The evaluation resulted in the following findings for the relevant proposals:

	Dynaxys	KeyBank
Technical Approach	Good	Good
Management Plan	Good	Good
Quality Control Plan	Good	Good
Key Personnel	Excellent	Good
Past Performance	Excellent	Neutral
Socioeconomic Participation	Excellent	Marginal
Price	$68,269,998	$46,729,263

The source selection authority (SSA) determined the technical superiority of Dynaxys does not justify paying a 31.55% price increase.  The SSA further found the government can obtain services “nearly as good without paying the premium price.”

Basis of Protest – Technical Approach

Dynaxys protests the award based on three factors.  First, they challenge the evaluation of proposals under the technical approach, alleging the agency did not evaluate the proposals equally.  This is particularly important where both Dynaxys and KeyBank received the same rating for this factor.  KeyBank was awarded two strengths for their technical approach. However, Dynaxys points out the two strengths awarded only establish KeyBank’s proposal met the requirements of the solicitation.  The strengths awarded were for providing multiple fields of loan servicing and providing a transition within 90 days.  Dynaxys argues these strength awards were unreasonable, in that the RFP called for both of these as minimum requirements.  HUD argued first the evaluation was reasonable, and second, even if the argument is valid, Dynaxys did not show competitive prejudice.

Basis of Protest – Best-Value Tradeoff Determination

Dynaxys protests the decision in that the agency failed to consider the substantive differences between the proposals and did not explain why their proposal did not merit a higher price.

 Protest Sustained – Technical Approach

The record fails to demonstrate how KeyBank’s proposed transition approach exceeded the minimum requirements or otherwise merited the award of two minor strengths.  Further, Dynaxys’ proposal also met these minimum requirements and they were not awarded minor strengths for this.  The record shows Dynaxys received other minor strengths, thus the technical approach exceeded the requirements in ways KeyBank did not.  The agency’s failure to consider the added benefits of Dynaxys’ proposed approach raises sufficient possibility of prejudice.

Protest Sustained – Best-Value Tradeoff Determination

While the government may select a lower priced proposal, even if it is rated lower,  when the agency determines the higher price is not justified, they must provide a tradeoff analysis to support the decision. This is particularly true where price is secondary to technical considerations.  Additionally, when a source selection decision is based on information that is inconsistent or inaccurate concerning the technical evaluation of proposals, the decision is not reasonable.

In this particular case, first, as noted above, the technical approaches of the two offerors were not identical.  Second, while the adjectival rating for both was the same for management plan and quality control plan, the balance of the factors favored Dynaxys.  The unreasonableness of the technical approach evaluation renders the source selection unreasonable.  Additionally, the agency’s source selection determination fails to provide meaningful comparison of the proposals.  There is no substantive comparison or analysis of the proposals, nor any substantive analysis of the determination the strengths of Dynaxys’ proposal do not outweigh the price premium.  The sweeping statements offered by the SSA fall far short of the requirement to justify cost/technical tradeoff decisions.