When all salient factors are rated similarly for best value, there is no prejudice to rejected offeror; But...

In a best value photo finish, when a protesting offeror’s past performance evaluation factor was recognized by the agency as more advantageous than the others, there is a reasonable possibility that the protester was prejudiced by award being made to another offeror. Thus, the protest was valid.

The following GAO decision is instructive for its discussion of the means for evaluating technical factors, past performance factors and price factor trade-offs. It is particularly instructive for dealing with photo finishes. As always, I take great liberty in presenting cases and articles, so this is not an official recitation. If you need that, go to the link.

Matter of: SITEC Consulting, LLC; VariQ Corporation; Logistics Systems, Inc.

1. Protests challenging the agency’s evaluation of technical proposals are denied where the evaluations were reasonable, performed in accordance with the solicitation evaluation criteria, and equal.

2. Protests challenging the agency’s failure to conduct an adequate risk assessment of the awardee’s price are actually challenges that the agency failed to perform a price realism analysis and, where the solicitation did not provide for a price realism analysis, such challenges are without merit.

3. Protest challenging the agency’s evaluation of past performance is sustained where the agency concedes errors in its past performance evaluation and the record establishes that one protester was prejudiced.

Under the terms of the RFQ, award was to be made to the firm whose proposal represented the best value to the government, considering technical approach, past performance, and price. Technical approach was more important than past performance. Those two factors, when combined, were significantly more important than price.

With respect to past performance, the RFQ advised offerors that the government would evaluate “relevant past performance.” Relevant is defined as “similar to the IT services in the PWS and similar in nature, scope, size and complexity to the required services.”

Past performance was to be rated based on a stepped adjectival rating scale from “Significant Confidence” (highest) to “Confidence” to “Neutral” to “No Confidence” (lowest). Each rating was defined, for instance: ‘Confidence’ shows “the Vendor’s past performance record indicates the Vendor should be able to successfully perform the required effort. Some Government intervention is expected to be required in achieving the required level of performance.” The next lowest rating, ‘Neutral’, shows “the Vendor has no relevant performance record. A thorough search was unable to identify any relevant past performance information. This is a neutral rating. It does not hinder or help the Vendor.”

In the Technical evaluation, one offeror (the highest price) was rated a notch above the other three offerors, who all received the same rating. In Past Performance evaluation, the agency rated all offerors equally, as “Confidence”. In the result, award was made to CWS, the second lowest price offeror. VariQ protested. It asserted that the agency deviated from the past performance evaluation criteria specified in the solicitation and should have been rated higher than its given rating.

Here, the agency ultimately admitted the substance of the protested error. A review of the agency’s own evaluation of past performance information supplied by CWS, SITEC, and LSI supports a past performance rating of neutral for each of those offerors. The agency determined that while LSI and CWS had some past performance that was similar in scope, it was smaller in size. The agency also determined that SITEC had past performance that was narrower in scope than the current requirement. However, in all cases, because the agency did not find any negative past performance, it assigned each of those offerors a confidence rating. The agency conceded that neutral is the appropriate past performance rating for all of the offerors except VariQ.

But, the agency asserted that the errors in the past performance evaluation did not prejudice the protester, and that even if the other three vendors had been given a “Neutral” rating for past performance, the source selection authority (SSA) could not have used that as a discriminator due to the fact that a “Neutral” rating can neither hinder nor help the vendor. In effect, the agency said that the hierarchy of the four rating levels specified in the solicitation was neutralized by the description of one of them.

But the agency had chosen a “best value” method of source selection, and that entails a trade-off of the various stated factors according to their relative ratings. The agency’s assertion that the SSA could not have considered VariQ’s past performance confidence rating in VariQ’s favor in its tradeoff decision, because the other offerors’ proposals were rated neutral, is inconsistent with prior decisions of this Office. Although agencies may not rate an offeror that lacks relevant past performance favorably or unfavorably with regard to past performance standing alone, an agency may, in a price/technical tradeoff, determine that a high past performance rating is worth more than a neutral past performance rating.

Competitive prejudice is an essential element of a viable protest; where the protester fails to demonstrate that, but for the agency’s actions, it would have had a substantial chance of receiving the award, there is no basis for finding prejudice, and our Office will not sustain the protest. However, GAO will “resolve doubts regarding prejudice in favor of the protester; a reasonable possibility of prejudice is sufficient to sustain a protest.”

Here, the RFQ stated that the technical factor is more important than the past performance factor and that those two factors combined are significantly more important than price. The record shows that there are variances behind the technical factor ratings, the offeror’s prices are clustered relatively closely together, and, as the agency has now stated, VariQ’s proposal is the only one to have a past performance rating of confidence rather than neutral.

Under these circumstances, we find a reasonable possibility that the protester was prejudiced. Consequently, we sustain VariQ’s challenge to the agency’s past performance evaluation.

FURTHER READING: GAO Makes Rare Finding of Error in Past Performance Evaluation, and Underscores Incumbents Are Not Automatically Entitled to Highest Technical Rating