A recent decision of the Government
Accountability Office (GAO) provides a reminder of how protesters can win the
battle but still lose the war – through no fault of their own. The case,
Strategic Technology Institute, Inc., B-408005.2 (Comp.
Gen. Oct. 21, 2013), involves the United States Coast Guard’s cancellation of a
solicitation for analytical support services under a very unusual set of
facts.
The solicitation, which was issued under the
Federal Supply Schedule (FSS) procedures in Federal Acquisition Regulation (FAR)
Subpart 8.4, provided for a task order to be issued based on a best value
evaluation of price, technical capability, and past performance. The Request
for Proposal (RFP) required specific numbers of asset material managers and
field terminal operators to support certain product lines and identified those
positions as key positions, listing specific duties and location of performance
for each.
The Coast Guard received proposals from six
offeors, including the protestor, Strategic Technology Institute Inc. (STi).
They were evaluated by the agency’s technical evaluation team (TET), which
assigned adjectival ratings under each factor and subfactor supported by
narratives identifying strengths and weaknesses.
STi’s proposal, which was third lowest priced,
received a technical capability rating of “Satisfactory” and a past performance
rating of “Confidence”. The TET also identified a number of strengths and
weaknesses in STi’s proposal. Ultimately, the TET recommended award to the
incumbent contractor, whose proposal was the highest rated and highest priced.
The contracting officer (CO), who served as source selection authority for the
procurement, disagreed with the TET’s evaluation of STi’s proposal, increasing
the technical rating from “Satisfactory” to “Good”. However, the CO also
rejected the TET’s award recommendation, instead awarding the task order to
another offeror with a higher rating and higher price than STi.
When STi protested the initial award decision to
GAO, the agency announced its intent to take corrective action in the form of a
reevaluation new source selection decision and GAO dismissed the protest as
academic.
When the proposals were reevaluated by the
original TET, the results were the same, with the TET again recommending award
to the incumbent – and again rating STi’s technical proposal as merely
“Satisfactory”. This time around, the CO rejected the TET’s entire reevaluation
“because it did not document the evaluations in compliance with the evaluation
factors, which directly relate to the SOW.” The CO then established a new TET,
which included two members of the original TET.
The third evaluation of proposals resulted in the
TET concluding that STi was “Unsatisfactory” under the technical factor because
of a significant weakness. According to the new TET, STi had failed to propose
qualified personnel for the asset materials manager and field terminal operator
positions. The TET then again recommended that an award be made to the
incumbent. And the CO again rejected the TET’s recommendation, concluding that
the RFP’s “SOW was so deficient that only an incumbent contractor, having
performed the services before, would have been able to understand all
requirements of the SOW.” Then the CO cancelled the solicitation and announced
an intent to resolicit with “a revised [SOW] and refined evaluation
criteria.”
STi protested, arguing that the Coast Guard
lacked a reasonable basis for the cancellation.
The Coast Guard first argued that STi lacked
standing to protest because it was not next in line for award because there are
higher rated proposals. GAO rejected that argument, noting that best value
procurements involve trade-offs that can result in awards to offerors with lower
rated, lower priced proposals, particularly where, as here, earlier trade-offs
had been abandoned and/or rejected.
As a result, the agency’s primary argument was
that the SOW was so confusing that only an incumbent would have been able to
understand all the requirements. Noting that FAR Subpart 8.4 requires only a
reasonable basis for cancelling a solicitation, GAO agreed with the Coast Guard
and found its basis to be reasonable. While STi argued that the asserted
reason for the cancellation was merely a pretext in support of reworking the
solicitation to further favor the incumbent, GAO concluded that the agency was
sincere in its desire to refine the SOW so that offerors other than the
incumbent would have a more meaningful opportunity to compete. GAO considered
the fact that the agency itself proved unable to reasonably evaluate the
proposals, not once but three times, as ample evidence that the CO had a
reasonable basis for the cancellation.
Thus, even though STi’s challenge to the original
award decision had merit — and even though the CO agreed that two different
TETs had misevaluated STi’s proposal on a total of three occasions, STi’s
protest still didn’t result in an award. While the same can be said in every
case where another offeror’s proposal provides best value to the Government, the
problem here was different: STi didn’t win because the agency was unable to
properly conduct a best value analysis under its existing solicitation. And
it’s far from clear that STi could have changed the outcome by doing anything
differently.
What’s the take-away from all this? Protesters
need to remember the limits of their power to control protest outcomes,
especially to the extent they turn on agency actions. Sometimes living to fight
another day is the best that can be achieved, but that’s not nothing.
Eric Whytsell is the attorney responsible for the content of this article.
© Jackson Kelly PLLC 2013