Strategies to Successfully Prevent and Defend Bid Protests

Strategies to Successfully Prevent and Defend Bid Protests 2014, August 06

Agenda Overview of GAO Bid Protests Basic Principles Applicable to Bid Protests Pre-Award Steps (Prior to the receipt of proposals) Pre-Award Steps (After receiving proposals) Post-Award Steps Post-Protest

Types of Protests Bid Protests Overview • Pre-Award • Regarding terms of a solicitation or competitive range determination • Post-Award • Regarding an award • Bid Protests are legal challenges brought by bidders against the way the Government has conducted a procurement. • An interested party may protest to the agency, the Government Accountability Office (GAO), or the United States Court of Federal Claims (COFC).

Bid Protest Trends 4

Basic Principles: The Competition in Contracting Act (CICA) • The Competition in Contracting Act (CICA) is a 1984 statute that is the most important law for the purpose of Federal contracting and ourdiscussion of bid protests • CICA was the first major revision to Federal procurement law since the 1940s • CICA established that full and open competition is the primary goal of Federal procurement • And CICA provided express statutory authorization for GAO to hear bid protests • Policy underlining the requirement for competition and even the protest process: transparency, economy, integrity

Basic Principles: Surviving a Protest You will most often win or lose the protest before it is even filed

Basic Principles: Surviving a Protest • GAO defines the basic standard of review for a bid protest as: • “The evaluation of an offeror’s proposal is a matter within the agency’s discretion. A protester’s mere disagreement with the agency’s judgment in its determination of the relative merit of competing proposals does not establish that the evaluation was unreasonable. While we will not substitute our judgment for that of the agency, we will question the agency’s conclusions where they are inconsistent with the solicitation criteria and applicable procurement statutes and regulations, undocumented, or not reasonably based.”

Pre-award Steps • It is well established that the government benefits from knowing industry’s capabilities and the industry benefits from knowing the government’s needs. FAR 15.201. • Review RFP critically during its development, focusing on Section L (instructions to offerors) and Section M (evaluation criteria). Note: The focus of this Seminar is not on pre-award protests, but if received, use as opportunity to re-review Solicitation. • Is it clear what the agency expects from offerors? • Do L and M track together? • Do evaluation factors/subfactors truly represent key discriminators/significant requirements? • Can evaluators explain what would make a proposal “outstanding” vs. “acceptable” for a given evaluation factor?

1. • Follow the Solicitation Key Principles for Source Selection • 2. • Treat All Offerors Equally • 3. • Document the Record

1. • Follow the Solicitation • GAO will not consider challenges to the terms of a solicitation after the final date proposals are submitted; if a contractor believes there is an inherent flaw within the terms of the solicitation, they must protest that flaw prior to submitting a proposal

1. • Follow the Solicitation • GAO states the basic rule as: • “Agencies are required to evaluate proposals based solely on the factors identified in the solicitation, and must adequately document the bases for their evaluation conclusions. … Although we will not substitute our judgment for that of the agency, we will question the agency’s conclusions where they are inconsistent with the solicitation criteria, undocumented, or not reasonably based.”

1. • Follow the Solicitation Case Study #1: Raytheon Company, B-404998 (June 25, 2011) • In a protest brought against an award by the Patent and Trademark Office, the solicitation stated the following with respect to an Experience factor: “The Government is seeking five (5) reference contracts for the offeror who is proposing as the contractor … the Government expects to see contract references that collectively demonstrate experience in the following areas” • Raytheon submitted the required 5 contract references under the Experience factor and the agency identified 31 weaknesses under this factor.

1. • Follow the Solicitation Case Study #1: Raytheon Company, B-404998 (June 25, 2011) • GAO examined the language of the solicitation and sustained the protest: • “We think that the agency’s interpretation of the RFP is unreasonable. Nothing in the express language of the solicitation supports the agency’s position that each reference had to demonstrate experience in all six areas. Moreover, an interpretation that each reference had to address all six areas would render superfluous the term “collectively,” as the agency’s interpretation would effectively substitute the word “individually” for the word “collectively.”

1. • Follow the Solicitation Case Study #2: Exelis Systems Corporation, B-407111 (Nov. 13, 2012) • In a protest brought by Exelis Systems against an award by the Department of State, the solicitation defined the past performance and experience evaluation factor as: • “The Government will use past performance information…to assess the capability of the Offeror…to meet the solicitation performance requirements, including the relevance and currency of the work experience of the Offeror. In determining relevance, consideration will be given to the similarity of the service performed in hostile, austere, and remote locations; complexity; technology; magnitude of effort; contract scope and type; and schedule.” Another way an agency can fail to follow the solicitation is by applying an evaluation criteria that is unstated in the solicitation

1. • Follow the Solicitation Case Study #2: Exelis Systems Corporation, B-407111 (Nov. 13, 2012) • Exelis Systems submitted a proposal that included the required past performance information, however the agency assigned weaknesses to the proposal for failing to provide examples of specific experience with the Department of State. • These weaknesses were relied upon by the source selection authority, who concluded: “Exelis’ proposed approach…show a lack of direct contracting experience with the Department of State.” • Exelis Systems argued in its protest that it was improper for the agency to assign a weakness for lack of experience with the Department of State, because the solicitation did not require that specific experience.

1. • Follow the Solicitation Case Study #2: Exelis Systems Corporation, B-407111 (Nov. 13, 2012) • GAO agreed with the protester: • “The RFP did not contain a requirement for an offeror to demonstrate ″direct contracting experience with the Department of State″…While the solicitation required offerors to provide OMSS services at DOS facilities, the evaluation criteria did not inform offerors of the concerns reflected in the record…Specifically, it was not clear from the solicitation that the agency was seeking and would give more credit for experience of the type that DOS found desirable here, that is, general DOS practices or the ways in which DOS differs from other agencies.”

1. • Follow the Solicitation Case Study #3: Esegur-Empresa de Seguranca, SA, B-407947 (April 26, 2013) • In the matter of Esegur-Empresa de Seguranca, SA, the solicitation stated with respect to the price evaluation: “Unrealistically high, low, or unbalanced prices may serve as a basis for rejection of the proposal. The price evaluation will document the reasonableness and completeness of the total evaluated price.” • The protester argued that the awardee had proposed a price that was so below the government estimate as to be unrealistic. The Agency admitted that it did not assess the awardee’s price for realism but argued that the solicitation did not require such an evaluation. Requirement to follow solicitation applies equally to price evaluation

1. • Follow the Solicitation Case Study #3: Esegur-Empresa de Seguranca, SA, B-407947 (April 26, 2013) • GAO disagreed with the agency and found that in this context the language of the solicitation required an evaluation of price reasonableness: • “Here, notwithstanding the agency’s argument to the contrary, the solicitation contemplated a price realism evaluation of the awardee’s low price … the solicitation advised offerors that ″unrealistically″ low prices may serve as a basis for rejection of a proposal. Implicit in the solicitation’s reference to unrealistically″ low prices is the presumption that the agency would actually consider whether an offeror’s price is in fact unrealistic and, as a consequence, unacceptable.”

2. • Treat All Offerors Equally • A fundamental federal procurement principle is to treat all offerors fairly and equally so as to promote competition. • Evaluators must evaluate consistently among all offerors. • If evaluators downgrade an offeror for a deficiency, they must downgrade other offerors for the same deficiency. Park Sys. Maint., Inc., B-252453, 93-1 CPD ¶ 466 (June 16, 1993). • If evaluators give credit to one offeror, they should give like credit to another offeror for the same provision. Brican Inc., B-402602, 2010 CPD ¶ 141 (June 17, 2010).

2. • Treat All Offerors Equally Raytheon Tech. Svcs. Co. LLC, B-404655.4, 2011 CPD ¶ 236 (Oct. 11, 2011). • RFP contemplated an award on a best value basis to provide all management, supervision, labor, facilities, and materials necessary to deliver foreign law enforcement training for foreign agencies and nationals. • 10 offerors submitted proposals; 7 were in the competitive range. • Protest was sustained where agency treated offerors unequally by assigning strength to awardee's proposal for management feature while failing to credit protester's proposal with a strength for a comparable feature. Tip: Give like credit for strengths across all offerors’ proposals. Consistently evaluate features of offerors’ proposals under the correct evaluation factor.

2. • Treat All Offerors Equally Modular Commc’n Sys., Inc., B-241858, 91-1 CPD ¶ 263 (Mar. 8, 1991). • Forest Service procured the supply of a dispatch console system (multiline and multiposition radio console for use in an Interagency Fire Center). • 2 proposals received. • Awardee did not have separate volume controls (material specification), but stated that separate volume controls were not required due to the dynamic range of its receive compressor amplifiers. • In the absence of any substantive explanation from the agency, a plain reading of the requirement and the awardee’s original and clarifying responses showed that the awardee’s automatic system did not meet the requirement for independent level adjustments available to the operator. • GAO found that material specifications were relaxed for one offeror and not the other. Tip:Don’t relax material specifications. Hold all offerors to the same standards articulated in the Solicitation.

2. • Treat All Offerors Equally SRA Int’l, Inc., B-408624, 2013 CPD ¶ 275 (Nov. 25, 2013). • Best value procurement for coaching and organizational development services. • 10 proposals received; 9 were in the competitive range. • GAO sustained protest where record failed to demonstrate that the agency assigned ratings in an even-handed manner. Agency treated protester unequally in assigning its proposal a significant weakness for failing to adequately address organizational strategic planning when failing to label an equally serious weakness in other offerors’ proposals as significant. Tip:Similar failures to demonstrate compliance with a solicitation requirement should be consistently assigned for all offerors who do not comply with the solicitation requirement.

2. • Treat All Offerors Equally CitiWest Props., Inc., B-274689.4, 98-1 CPD ¶ 3 (Nov. 26, 1997). • Total small business set-aside for real estate asset manager services for single-family properties owned by (or in the custody of) HUD. • 12 proposals received; 5 were in competitive range and had discussions. • Agency provided protester opportunity to revise its proposal, which did not constitute meaningful discussions because it wasn’t given the opportunity to respond to the specific weaknesses/deficiencies in its proposal that ultimately resulted in the competitive range determination. • Unequal discussions occurred where one competitive range offeror was advised of areas in its proposal believed to be deficient, but the other competitive range offeror was not. Tip: If you conduct discussions with one offeror, you need to conduct discussions with all offerors by giving all offerors the opportunity to respond to deficiencies, significant weaknesses, and adverse past performance.

3. • Document the Record Basic Principles • A number of provisions of the FAR address documentation of the procurement record: • FAR 4.801(Documenting the Contract File): requires sufficient documentation to provide “a complete background as a basis for informed decisions at each step in the acquisition process” • FAR 8.405-2(f) (For Federal Supply Schedule orders) • FAR 13.106-3(b) (For Simplified Acquisitions)

3. • Document the Record Basic Principles • FAR Part 15 includes numerous provisions requiring procuring agencies to document the procurement record • FAR 15.305(a): "strengths, deficiencies, significant weaknesses" • FAR 15.102(e): oral presentations • FAR 15.406-3(a): price negotiation and documentation of the “principal elements of the negotiated agreement”

3. • Document the Record Basic Principles • Of particular importance is documenting the Source Selection Decision • FAR 15.308: "The source selection decision shall be documented, and the documentation shall include the rationale for any business judgments and tradeoffs made or relied on by the SSA, including benefits associated with additional costs. Although the rationale for the selection decision must be documented, that documentation need not quantify the tradeoffs that led to the decision."

3. • Document the Record • GAO's Bid Protest regulations require agencies to produce a record of documents reflecting the procurement. There is also direction regarding what documents to include in the record in FAR Part 33. • GAO's bid protest regulations address the required documentation at 4 C.F.R. § 21.3(d), and include a request for "all evaluation documents." • FAR 33.104(a)(3)(iii) addresses the agency record in a GAO protest and includes "all relevant evaluation documents."

3. • Document the Record • During a GAO protest, these requirements for adequate documentation are translated into the following standard of review: • “In order for us to review an agency's evaluation judgment, an agency must have adequate documentation to support its judgment. …While we consider the entire record, including the parties' later explanations and arguments, we accord greater weight to contemporaneous evaluation and source selection material than to arguments and documentation prepared in response to protest contentions. Where an agency fails to provide documentation of its evaluation, it bears the risk that there may not be adequately supporting rationale in the record for us to conclude the agency had a reasonable basis for its evaluation and selection decision.”

3. • Document the Record Case Study #1: Supreme Foodservice, GmbH, B-405400.3 (Oct. 11, 1012) • The Defense Logistics Agency was awarded a contract for the supply and delivery of food items to military locations in Afghanistan. The solicitation included a requirement that the contractor meet a 97% “fill rate” for deliveries and stated that as part of the past performance evaluation the agency would evaluate “whether the firm has a successful history of providing consistently high fill rates, which meet the contractual requirement of 97%” • The awardee was evaluated as “acceptable” under this past performance criterion, however, the protester pointed out that the awardee’s proposal plainly indicated that the awardee did not have a history of meeting the 97% fill-rate on previous contracts.

3. • Document the Record Case Study #1: Supreme Foodservice, GmbH, B-405400.3 (Oct. 11, 1012) • GAO did not find the agency’s reference to unexplained in-house data to be very persuasive: • “Although an agency is not required to retain every document generated during its evaluation of proposals, the agency’s evaluation must be sufficiently documented to allow our Office to review the merits of a protest. … The record here does not reflect the basis for the agency’s reliance on a set of fill rates that are higher than the set of fill rates ANHAM provided in its proposal--which generally do not meet the solicitation-specified threshold of 97 percent.”

3. • Document the Record Case Study #2: IAP World Services, Inc.; EMCOR Government Services, B-407917.2 (July 10,2013) • The documentation requirement applies to the conclusions listed in the Source Selection Decision and GAO will parse the SSD to ensure that all conclusions are adequately documented, or explained, on an individual basis. • The protesters challenged the Navy’s award of a contract for base operating support services to a company called J&A World Services, arguing that the SSD failed to consider technical superiority offered by the protesters and failed to adequately explain why J&A’s lower rated proposal should receive the award over the higher rated proposals on the protesters.

3. • Document the Record Case Study #2: IAP World Services, Inc.; EMCOR Government Services, B-407917.2 (July 10,2013) • GAO concluded the Navy’s SSD failed to adequately explain in the SSD why J&A was the best value: • “The record here does not evidence any meaningful consideration of the evaluated differences in the firms’ offers. Rather, the SSA’s selection decision merely identified certain features of J&A’s proposal and stated, without explanation, that J&A’s technical proposal compared favorably to IAP’s and EMCOR’s proposals, despite those firms’ higher technical ratings.”

3. • Document the Record • Documentation requirement applies to oral presentations • Resource Dimensions, LLC, B-404536 (Feb. 24, 2011): • “[W]e cannot find that the agency's documentation in regard to Resource's Q&A session is sufficient to allow us to review the reasonableness of the agency's judgments.” • Documentation requirement applies to past performance evaluation Technology Concepts & Design, Inc., B-403949.2 (March 25, 2011): • “State responds that its evaluation was based on “observed performance and user feedback” but provides no explanation or documentation of what was observed or what feedback it received … In short, State has failed to provide either contemporaneous documentation or subsequent explanation supporting its assessment of this weakness in TCDI's proposal.”

3. • Document the Record • Experienced bid protest counsel frequently assert a failure to adequately document the procurement record along with challenges to specific aspects of the evaluation. A protest to the assessment of a weakness against the protester becomes both a challenge to the weakness itself and an assertion that the agency's failed to document the record by not precisely explaining the weakness to the satisfaction of the protester.

3. • Document the Record • While not recommended as the optimal approach, it is possible to add post-protest documentation for GAO’s consideration. In the matter of, ASRC Research & Technology Solutions, LLC, B-406164 (Feb. 14, 2012), GAO explained the circumstances as follows: • “While we generally give little or no weight to reevaluations and judgments prepared in the heat of the adversarial process, post-protest explanations that provide a detailed rationale for contemporaneous conclusions, and simply fill in previously unrecorded details, will generally be considered in our review of the rationality of selection decisions so long as those explanations are credible and consistent with the contemporaneous record.”

Clarifications v. Discussions • Clarifications • Discussions • FAR 15.306(a) • FAR 15.306(d) • Clarifications are limited exchanges with an offeror for the sole purpose of eliminating minor irregularities, informalities, or apparent clerical mistakes in the proposal. Offeror does not have an opportunity to revise or modify its proposal. • Discussions are any oral or written communication between the Government and an offeror (other than communications conducted for the purpose of clarification) that involves information essential for determining the acceptability of a proposal, or provides the offeror an opportunity to revise or modify its proposal. Tip:Look at the substance of the communications to determine whether they are clarifications or discussions. Equally treat all offerors: if you open discussions with one, open discussions with all. • Discussions

Discussions Example “Ultimately, it is the actions of the parties that determine whether discussions have been held and not the characterization of the communications by the agency.”[3] [3] ERIE Strayer Co., B-406131, 2012 CPD ¶ 101 at 9 (Feb. 21, 2012).

Discussions Example

Discussions vs. NOT DiscussionsAdditional Examples

Post-award: Debriefings • Authority: 10 U.S.C. § 2305(b)(5-6); FAR § 15.505-506 • Purpose: Inform offeror of significant weakness and deficiencies and provide essential information in a post-award debriefing on the rationale for the source selection decision. • An unsuccessful offeror may request a post-award debriefing • Submit written request for a debriefing within 3 days of the date offeror receives postaward notice. • “To the maximum extent practicable,” the contracting officer must conduct the postaward debriefing within 5 days of the date the agency receives a timely request.

Post-award: Debriefings • Must NOT Include: • A point-by-point comparison of the debriefed offeror’s proposal with other offerors’ proposal; or • Any information prohibited from disclosure under FAR §24.202 or exempt from release under the Freedom of Information Act, including the names of individuals providing reference information about an offeror’s past performance. • Must Include: • The agency’s evaluation of the deficiencies and significant weaknesses in the offeror’s proposal; • The overall ratings of the debriefed offeror and the successful offeror; • A summary of the rationale for the award decision; • The make and model number of any commercial item(s) the successful offeror will deliver; and • Reasonable responses to relevant questions.

General Considerations: Post-award: Debriefings • The goal is to explain why debriefed party was unsuccessful or successful, subject to limits on disclosure. • Practice debriefings (“dry runs”); debriefings can be done in person or in writing (CO’s discretion). • Sometimes protesters file protests to gain information; Agencies are encouraged to provide as much information as possible to the debriefed offeror about that offeror’s proposal. This is an opportunity to learn how to improve offers in future.[4] • Ensure there is a definite “closing” of debriefings. See Harris IT Servs. Corp., B-406067, 2012 CPD ¶ 57 (Jan. 27, 2012). [4] See OFPP’s February 2, 2011 “Myth-Busting” memorandum (http://www.whitehouse.gov/sites/default/files/omb/procurement/memo/Myth-Busting.pdf) and OFPP’s May 7, 2012 “Myth-Busting 2” memorandum (http://www.whitehouse.gov/sites/default/files/omb/procurement/memo/myth-busting-2-addressing-misconceptions-and-further-improving-communication-during-the-acquisition-process.pdf).

Post-award: Debriefings Harris IT Servs. Corp., B-406067, 2012 CPD ¶ 57 (Jan. 27, 2012). • Agency argued that protest was untimely because filed more than 10 days after protester received written debriefing. • Agency offered written debriefing; offeror requested verbal; telephone call conducted after written debriefing. • GAO: “In our view…the above communications reflected, at a minimum, considerable ambiguity as to whether the agency’s debriefing process was continuing. Given this ambiguity, and considering that we resolve doubts regarding timeliness in favor of protesters, we find the protester’s challenges to the agency’s evaluation are timely when filed within 10 days of the agency’s conclusion of what [the unsuccessful offeror] refers to as its ‘oral debriefing.’” Tip: Treat all offerors fairly. When debriefings are closed, they are closed. Sometimes unsuccessful offerors request more information after the conclusion of debriefings. Do not reopen them, unless you want to reopen them for all offerors.

Evaluation team • GAO will not review the composition of an acquisition team absent a showing of conflict of interest or bias. Agric. Tech. Partners, B-272978, 96-2 CPD ¶ 226 (Dec. 5, 1996). • Source Selection Authority (SSA) – FAR 15.303 • Approve the acquisition plan and source section strategy • Ensure that proposals are evaluated based on solicitation • Consider the recommendation of the advisory boards • Use independent judgment to select an awardee documented in the Source Selection Decision (FAR 15.308). Tip:Use evaluators who are experts in the field and make sure that all evaluators, advisors, and the SSA can dedicate the required amount of time to the source selection effort.

1. • Follow the solicitation Key Takeaways • 2. • 5. • 6. • Use subject matter experts for evaluation team and ensure dedicated time • Treat all offerorsequally • Make clear end to debriefings • 3. • Document the record • Characterize discussions and clarifications • appropriately • 4.

Strategies to Successfully Prevent and Defend Bid Protests