Link: GAO Opinion
Agency: Department of the Army
Disposition: Protest denied.
Keywords: Corrective Action
General Counsel P.C. Highlight: Corrective Action following a prior protest must be reasonably related to the areas expressed by GAO as areas of concern, but will not necessarily require a reopening of the competition.
Northrop Grumman Technical Services, Inc. (NGTS) protests the corrective action taken by the Department of the Army, U.S. Army Materiel Command (AMC), in response to protests by NGTS, L-3 Communications Integrated Systems, and Lockheed Martin Corporation (LM), against the Army’s award of a contract to The Boeing Company, under a request for proposals (RFP), for the development and initial production of the Enhanced Medium Altitude Reconnaissance and Surveillance System (EMARSS).
The solicitation provided for award on a “best value” basis considering four evaluation factors: technical, including subfactors for integration approach and aircraft approach; cost/price; performance risk, reflecting an assessment of the offeror’s likelihood of success based on recent and relevant past performance by the offeror and its major subcontractors; and small business participation. Offerors were required to demonstrate in their proposals (with a “complete discussion and analysis”) that their proposed EMARSS systems will meet certain minimum, threshold performance requirements identified in the solicitation Performance Based Specification (PBS), as well as to identify where their proposed systems will exceed the threshold requirements and/or meet the objective requirements. Boeing, NGTS, L-3 and LM submitted proposals in response to the solicitation. After conducting extensive discussions and obtaining revised proposals, the Army determined that Boeing’s proposal and EMARSS system represented the best value. NGTS, L-3 and LM thereupon filed protests challenging the source selection.
The protesters raised numerous challenges to the evaluation of proposals under each of the evaluation criteria. Among the arguments raised were challenges to the agency’s evaluation of the performance of the offerors’ EO/IR sensors as part of their proposed EMARSS systems, including assertions that Boeing’s proposed EMARSS system improperly was determined to be compliant with a number of the PBS threshold requirements. After a hearing was held, GAO conducted an outcome prediction alternative dispute resolution conference in which the cognizant GAO attorney indicated that GAO likely would sustain L-3’s protest against the past performance evaluation. In this regard, the GAO attorney indicated that it appeared that the Army, in evaluating Boeing’s proposal under the performance risk factor, had improperly given Boeing credit for the past performance of a subcontractor that, although critical to Boeing’s proposed effort, nevertheless did not satisfy the prerequisite of being a major subcontractor for consideration in the past performance evaluation. In addition, the GAO attorney expressed concerns about the adequacy of the agency’s evaluation of the performance of the EO/IR sensors as part of the offerors’ proposed EMARSS systems.
In response, the agency advised the parties that, consistent with the provisions of the solicitation governing the scope of the performance risk evaluation, the Army would reevaluate the performance risk of Boeing, without consideration of the past performance of the cited critical, but not major, subcontractor. The agency further advised that the Army would also reexamine the performance validations for all offerors as to the performance of their EO/IR sensors. Finally, the agency advised that after performing the above, the Source Selection Authority would render a new source selection decision.
NGTS challenges the extent of the proposed corrective action. NGTS asserts that the corrective action is unduly limited, and that the agency instead should reopen discussions with all offerors followed by the opportunity to generally revise proposals. GAO states that contracting officers in negotiated procurements have broad discretion to take corrective action where the agency determines that such action is necessary to ensure a fair and impartial competition. As a general matter, the details of a corrective action are within the sound discretion and judgment of the contracting agency. In this regard, an agency’s discretion when taking corrective action extends to a decision on the scope of proposal revisions, and there are circumstances where an agency may reasonably decide to limit the revisions offerors may make to their proposals. GAO generally will not object to the specific corrective action, so long as it is appropriate to remedy the concern that caused the agency to take corrective action.
Here, the Army’s intended corrective action focused not only on the very procurement deficiency (an unreasonable past performance evaluation) that led to GAO’s ADR prediction that L?3’s protest would be sustained, but also on the concerns expressed by GAO regarding the adequacy of the evaluation of the performance of the EO/IR sensors as part of the offerors’ proposed EMARSS systems. Since the agency’s corrective action responded to the areas of concern identified by GAO, and nothing in NGTS’s protest demonstrates that the agency’s approach was an abuse of discretion, GAO denies NGTS’s protest regarding the scope of the corrective action. The protest is denied.