Matter of M.C. Dean, Inc.
Agency: National Security Agency
Disposition: Protest Sustained
Decided: June 15, 2020
Keywords: Key Personnel
General Counsel P.C. Highlight: Offerors are obligated to advise agencies of material changes in proposed staffing, even after submission of proposals.
Summary of Facts
M.C. Dean, Inc. protests the award of a contract to PTSI Managed Services, Inc. (PTSI) under RFP No. H98230-19-R-0148, issued by the National Security Agency (NSA) to provide maintenance, installation, and distribution services for the agency’s comprehensive enterprise class physical security system.
NSA intends to award a single indefinite-delivery, indefinite-quantity contract with fixed-price and time-and-materials delivery orders. The solicitation provided for a best-value tradeoff decision based on multiple factors, including personnel qualification. The RFP identified seven key personnel labor categories, including the program manager. The RFP also stated that the program manager “shall be responsible for the successful cost, schedule, and performance of the contract” and is required to possess top secret/sensitive compartmented information clearance with a full scope polygraph at award.” The RFP required offerors to provide resumes for all of the key personnel and to notify the NSA for approval of any changes to the key personnel. Three offerors submitted proposals and PTSI’s proposal was selected for award. M.C. Dean filed this protest.
On December 12, 2019, PTSI’s program manager was denied a security clearance. The program manager received his official denial letter on January 21, 2020. PTSI believed that the program manager would appeal the decision, but on March 16, 2020, after contract award, PTSI learned that the program manager had not appealed the denial.
Basis of Protest
M.C. Dean argues that PTSI was aware that several of its proposed key personnel, including its program manager, became unavailable prior to award and remain unavailable to perform on the contract and, thus, PTSI’s proposal is unacceptable. The NSA acknowledges that after the award, it was notified that three of PTSI’s key personnel needed to be replaced, but argues that PTSI “had no reasonable basis to expect either at or before contract award that the program manager would be unavailable to perform, and therefore had no obligation to inform the agency prior to award that the program manager was unavailable.”
Protest Sustained
GAO explained that “offerors are obligated to advise agencies of material changes in proposed staffing, even after submission of proposals. While an offeror generally is required to advise an agency where it knows that one or more key employees have become unavailable after the submission of proposals, there is no such obligation where the offeror does not have actual knowledge of the employee’s unavailability.” GAO reasoned that “a firm may not properly receive award of a contract based on a knowing material misrepresentation in its proposal.” When an agency is notified of the withdrawal of a key person, it can either evaluate the proposal as submitted without considering the resume of the unavailable employee or open discussions to permit the offeror to amend its proposal.
GAO noted that the RFP required that the program manager have a security clearance to accessclassified information specific to the contract. However, one month after PTSI submitted its proposal with a specific program manager, NSA denied a security clearance for the proposed program manager, who received official notice of this decision in January 2020. GAO determined that “as a result of the denial, PTSI had actual knowledge that its program manager would not be able to obtain the security clearance necessary” to work on the contract, and thus would not be available to perform under the contract. Thus, GAO concluded that PTSI was required to inform the NSA of the program manager’s unavailability, which it did not do.
The NSA argues that the program manager had until March 6, 2020, to appeal the denial and had not yet exhausted his legal remedies when the contract was awarded. The NSA further argues that given the program manager’s ability to appeal, PTSI didn’t have “actual knowledge” of the program manager’s unavailability. However, GAO explained that PTSI stated that it merely “understood” that the program manager was going to appeal the security clearance decision, but provided no information about whether or why PTSI believed an appeal would be successful, much less that an appeal decision would be made before the contract award. GAO determined that “the fact that the program manager could appeal the denial does not, by itself, excuse PTSI from having actual knowledge of the unavailability of its proposed program manager.”
The NSA also argues that it does not matter whether the program manager was unavailable because reliance on the program manager’s resume was not material to the evaluation. However, GAO determined it is irrelevant whether the program manager’s resume was material to the NSA’s evaluation of PTSI’s proposed key personnel. GAO ultimately concluded that PTSI had actual knowledge prior to award that its program manager would not be able to perform on the contract after he was denied a security clearance and had an obligation to inform the NSA of the unavailability of its program manager, which it did not do.
GAO sustained the protest on this basis. GAO recommends that the NSA either evaluate PTSI’s proposal as submitted, without considering the previously proposed program manager, or open discussions with all offerors and allow for revised proposals to be submitted.