Link: GAO Opinion
Agency: Department of State
Disposition: Protest denied.
Keywords: Responsibility Determination
General Counsel P.C. Highlight: in making a negative responsibility determination, a contracting officer is vested with a wide degree of discretion and, of necessity, must rely upon his or her business judgment in exercising that discretion.
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Torres International, LLC (TI JV), protests the Department of State’s (DOS) determination that TI JV was not responsible to perform the services required under a task order request for proposals (TORFP), issued by DOS for the provision of protective security services in Irbil, Iraq.
DOS awarded multiple indefinite-delivery/indefinite-quantity (ID/IQ) contracts in support of the Worldwide Protective Service (WPS) program. An IDIQ contract was awarded to TI JV, a joint venture consisting of Torres Advanced Enterprise Solutions, LLC (Torres AES), Sallyport Global (Sallyport), and Blue Hackle North America (BHNA). Under the WPS program, all ID/IQ contractors are required to hold top secret facility clearances. According to the agency, all three of the TI JV members would each have to have a top secret facility clearance in order for TI JV to be issued a top secret facility clearance. The award notification advised TI JV that it was responsible for obtaining an interim top secret facility clearance within 60 days of the ID/IQ contract award and a final clearance within 120 days of award. TI JV was also advised that until a top secret facility clearance was issued, it could not perform any work under the ID/IQ contract. DOS issued a cure notice to TI JV concerning its failure to obtain the required facility clearance. TI JV was specifically advised that, as a matter of responsibility, it was ineligible for award of any task orders until it received a final top secret facility clearance. Torres AES responded and advised the agency that it was the majority and senior joint venture member of TI JV and that each of the joint venture members had completed all required steps to obtain clearances. Torres AES indicated that it would “fully absorb” TI JV and immediately request that the Defense Security Service (DSS) provide a top secret facility clearance to TI JV based on Torres AES’ existing facility clearance. Torres AES further stated that Sallyport and BHNA would “remain on the sidelines” while awaiting their clearances and would “return to the [joint venture]” once their facility clearances were granted. DOS considered TI JV no longer to be a responsible party to perform task orders issued under the WPS contract.
The agency issued the subject TORFP for the provision of protective security services in Irbil, Iraq. The TORFP included two mandatory requirements. The first mandatory requirement was that offerors were required to submit evidence of current private security company licenses issued from both the Iraqi and Kurdistani Ministries of Interior. The second mandatory requirement was for offerors to provide evidence of their top secret facility clearances with their proposals. In this regard, the TORFP stated that DOS would not evaluate proposals from offerors that lacked current top secret facility clearances. TI JV filed a timely agency-level protest challenging as unduly restrictive the requirement that offerors possess a Kurdistani license. TI JV submitted a proposal in response to the TORFP and included evidence that it had a top secret facility clearance. DOS denied the agency-level protest and again advised TI JV that it remained ineligible for award of the task order because it did not possess a top secret facility clearance.
TI JV contends that the agency’s negative responsibility determination on the basis that TI JV lacked the required facility clearance was improper. GAO states that in making a negative responsibility determination, a contracting officer is vested with a wide degree of discretion and, of necessity, must rely upon his or her business judgment in exercising that discretion. Although the determination must be factually supported and made in good faith, the ultimate decision appropriately is left to the agency, since it must bear the effects of any difficulties experienced in obtaining the required performance. For these reasons, GAO generally will not question a negative determination of responsibility unless the protester can demonstrate bad faith on the part of the agency or a lack of any reasonable basis for the determination. GAO’s review is based on the information available to the contracting officer at the time the determination was made.
Here, GAO finds that the contracting officer’s negative determination of TI JV’s responsibility was reasonable. While TI JV submitted with its proposal a letter from DSS granting a top secret facility security clearance, TI JV recognizes that the clearance was based on a restructuring of the joint venture that in essence eliminated two of the joint venture members. The contemporaneous record shows that TI JV did not just change the ownership percentages of its joint venture members; it eliminated two of the three joint venture members. As the agency makes clear, it awarded the ID/IQ contract to a joint venture that consisted of three firms; it did not award the contract to an entity that consisted only of Torres AES. The record shows that DOS specifically advised the protester that it did not approve of Torres AES assuming 100% member interest in TI JV. Moreover, the record further shows, and the protester acknowledges, that two of the joint venture members did not have top secret facility clearances 120 days after award of the ID/IQ contract and still did not have top secret facility clearance when the protester supplemented its corrective action plan with the agency after filing this protest. Based on this record, GAO finds reasonable the contracting officer’s judgment that TI JV, as that entity was structured when it received the IDIQ contract, did not possess a top secret facility clearance. Since TI JV did not have the appropriate clearance required by the solicitation, the contracting officer reasonably determined that TI JV was ineligible for award of this task order. The protest is denied.