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Tuesday, January 12, 2016

GAO's Annual Report to Congress on Bid Protests, 2015

GAO's annual report to Congress on bid protest statistics does not register on the seismic meter. In the dry statistics department, there is not much change from last year, nor do the 5 year statistics suggest any major change beyond status quo.

That said, in the ADR department, the recent year's success rate dropped considerably from the norm over the past several years, from a norm of 82%+/- to 70%. The success rate measures the percentage of protest cases resolved without a formal GAO decision after ADR. Perhaps this is reflective of the steady increase in protests over the last year (at an annual rate of about 2.6%/year), while the sustain rate of protests is the lowest in 5 years, albeit only slightly lower than last year.

The GAO continues to assert, "It is important to note that a significant number of protests filed with our Office do not reach a decision on the merits because agencies voluntarily take corrective action in response to the protest rather than defend the protest on the merits. Agencies need not, and do not, report any of the myriad reasons they decide to take voluntary corrective action."

GAO is now required to include a summary of the most prevalent grounds for sustaining protests during the preceding year. Emphasis must be had on the operative word "summary":
Of the protests resolved on the merits during fiscal year 2015, our Office sustained 12 percent of those protests. Our review shows that the most prevalent reasons for sustaining protests during the 2015 fiscal year were: (1) unreasonable cost or price evaluation; 1 (2) unreasonable past performance evaluation;2 (3) failure to follow evaluation criteria;3 (4) inadequate documentation of the record;4 and (5) unreasonable technical evaluation.5
The footnotes are to representative cases, with a terse statement of the holding in those cases. Those details are at the link above.

Fortunately, Attorney Brian P. Wagner of the firm Hursch Blackwell LLP, has filled in a bit more of the details for us in his blog post/firm advisory below, which is also reported on the Lexology website.

GAO’s guide to winning bid protests
Here is GAO’s list, along with a brief summary of the decision that GAO cites to illustrate it.
1. Unreasonable cost or price evaluation
The decision in Computer Sciences Corp.; HP Enterprise Servs., LLC; Harris IT Servs. Corp.; Booz Allen Hamilton, Inc., B-408694.7 et al. (Nov. 3, 2014), involved the Air Force RFP for the “NETCENTS-2” contract. The Air Force received 21 proposals, of which 20 were evaluated as technically acceptable. The prices for a sample cost-reimbursable task order ranged from $34.8 million to $110 million. The Air Force awarded contracts to the “10 lowest-priced offerors with substantial confidence ratings.”

GAO sustained the protests filed by some of the unsuccessful offerors because the Air Force failed to conduct an adequate cost realism evaluation. As to the mix of labor rates and hours presented in the various proposals, the contracting officer asserted that the pricing was “fairly uniform” and that differences in the offerors’ hourly rates were offset by the number of proposed hours.

GAO found that the record did not support the contracting officer’s assertions. The number of proposed labor hours varied by more than 100 percent. Several offerors proposed hours lower than the agency’s minimum baseline. And nothing in the record showed how the agency reconciled these issues.
2. Unreasonable past performance evaluation
The procurement addressed in Al Raha Group for Technical Services, Inc.; Logistics Management International, Inc., B-411015.2; B‑411015.3 (Apr. 22, 2015), was Air Force solicitation for F-15 fighter jet transportation services for the Royal Saudi Air Force. The Air Force selected SupplyCore at an evaluated price of $111 million. Having submitted prices of $106 million and $108 million, LMI and RGTS protested the award and challenged the Air Forces’ past performance assessments.

SupplyCore’s four reference contracts had an aggregate value of only $152,000 and an aggregate performance period of 19 months. One involved a $466 3-day contract involving automotive control assemblies. In its evaluation, the Air Force found SupplyCore’s references “somewhat relevant” and assigned a rating of “substantial confidence.” GAO sustained the protest of this rating, finding the government’s analysis “unsupportable.”

GAO also sustained LMI’s protest of its own past performance rating. Since LMI was a newly-formed company, it submitted references for its CEO and another senior official. The agency reviewed three past performance questionnaires submitted with LMI’s proposal, finding all of them directly relevant and one of them “sufficiently detailed.”

Rather than addressing its follow-uop questions with the points-of-contact identified in LMI’s questionnaires, the Air Force contacted another individual who had never had day-to-day interactions with LMI’s CEO. Citing questions raised by this individual, the Air Force assigned LMI a past performance rating of “limited confidence.”

GAO found the Air Force’s conclusions as to LMI’s past performance unreasonable. The information in LMI’s questionnaires had been verified by knowledgeable agency officials. There was no justification to ignore this verified information in favor of unverified information offered by another government official.
3. Failure to follow evaluation criteria
The RFP in Tantus Technologies, Inc., B-411608; B-411608.3 (Sept. 14, 2015), sought proposals for assistance with testing IT systems comprising the federally-operated health insurance exchanges established under the Affordable Care Act. CMS awarded the task order to Edaptive Systems LLC, which submitted a proposal with an evaluated price of approximately $70 million. Tantus, whose evaluated price was approximately $69 million, protested the evaluation that led to the award.

The protest focused on Edaptive’s proposal to use “incumbent staff”—individuals who were currently providing similar marketplace testing services to CMS—to perform the work. CMS identified this element of Edaptive’s proposal as a “significant strength.”

GAO concluded that CMS’s conclusion was not justified. Edaptive proposed to relocate a substantial portion of its workforce after the first year of performance. One of the evaluation factors identified in the RFP was “’[t]he extent to which the proposed staffing plan ensures that appropriately qualified staff are available to meet the require requirements of this contract on an ongoing basis.’” (Quotation from RFP; emphasis added by GAO.) GAO found that CMS failed to consider whether Edaptive’s proposed relocation plan would have affected its ability to have qualified staff available during the entire performance period.
4. Inadequate documentation of the record
The solicitation in CFS-KBR Marianas Support Services, LLC; Fluor Federal Solutions LLC, B-410486, et al. (Jan. 2, 2015), sought to award a cost-reimbursement contract to provide base operations support services on the island of Guam. After evaluating proposals, the Navy awarded a contract with an estimated value of $532 million to DSZP 21 LLC.

GAO’s decision on Fluor’s protest focuses on the Navy’s assessment of the cost impact of the staffing plans submitted by DSZP, CFS-KBR, and by Fluor. In discussions, the Navy asked all three of the offerors to review and revise their staffing plan by adding a specific number of full-time equivalents. The number identified in discussions corresponded to the difference between the staffing levels proposed by each offeror and those in the government’s estimate.

In its final offer, Fluor added the precise number of FTEs identified in the Navy discussion questions. CFS-KBR and DSZP also added FTEs, but not as many as the Navy had suggested.

Fluor and DSZP both received outstanding ratings for staffing and resources. CFS-KBR received a good rating for staffing and resources. A note in the Navy’s technical evaluation report stated that “each firm’s proposed staffing was adequate in light of their technical approach.”

But that one note was the extent of the Navy’s analysis. GAO sustained the protest because there was insufficient documentation of the Navy’s decision. In GAO’s words, “there is no critical analysis or description of the offerors’ proposed staffing or unique technical approaches that led to these conclusory findings.”
5. Unreasonable technical evaluation
The procurement at issue in US Investigations Services, LLC, B-410454.2 (Jan.15, 2015), involved a request for quotations to provide personnel qualified to perform research and analysis services in connection with the FBI’s National Name Check program and its FOIA/Declassification program. The agency awarded a delivery order to FCi Federal, Inc., which submitted the lowest evaluated price of $13.3 million.

USIS’s protest asserted that FCi Federal was ineligible for award because the labor categories required to perform the FBI task order were not on FCI’s Federal Supply Schedule contract. The RFQ sought “research analysts, program managers, general consultants, and legal administrative specialists.” For three of these labor categories, FCi proposed to use “program management analysts.”

GAO sustained the protest because the RFQ made it clear that “the duties, responsibilities and qualifications of the types of employees solicited by the agency are not encompassed within FCi’s program management analyst category.” There was nothing in the agency record or in the FBI’s response to the protest that could adequately demonstrate how the agency could reasonably have reconciled the “divergence” between FCi’s labor categories and those identified in the RFQ.
My fellow and sister Guamanians may take particular interest in #4, which was previously reported in this blawg as Protest of Navy's BOSS contract on Guam upheld.

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