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If a solicitation states that the agency reserves the right to make award without discussions, and if the agency evaluates a proposal as technically unacceptable, then the agency does not have to go on to evaluate the proposal's price, right? This is assuming that the agency is sticking with it's prerogative to make award without discussions. It seems like a moot point for the agency to evaluate the proposal's price once it has already deemed the proposal technically unacceptable: the agency cannot make award to that proposal anyways, see?

I tried to find an example of this scenario from GAO but could not find one. Does anyone know of any support for this?

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I know my old office used to routinely write it into Section M that "A failure on any single Pass/Fail criteria will also make the proposal ineligible for award, with no further evaluation of the technical and pricing proposal accomplished by the Government."However the language for Not Acceptable was different, saying instead that getting a Not Acceptable "in any single Factor may result in the overall proposal being determined Not Acceptable and therefore ineligible for award." (emphasis added)

The question you face is what if the technically Acceptable proposals are then found Unacceptable on the cost side? What happens then?

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Guest Vern Edwards

If the proposal is technically unacceptable, then it cannot be the basis for a contract award and there is no need to evaluate the reasonableness of its price or to compare its price to the prices of acceptable proposals.

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I assume that you are asking if one is permitted not to perform a price analysis or evaluation of specific, lower priced, technically unacceptable proposal, if award can be made at a fair and reasonable price to a conforming proposal. You may also be asking about not having to evaluate pricing of higher priced, technically unacceptable proposals. I believe that there has been previous discussion in this Forum confirming that the agency may have the perogative to use simplied evaluation procedures, such as starting with the lowest price proposal and checking for technical acceptability, then awarding, if it is determined to be fair and reasonable. And others have commented on the "can I get by with this" aspect of your question.

Regardless of being able to get by with it, Is your responsibility simply make an award or to also obtain the "best value" for the customer and for the taxpayers, taking various considerations into account? I think both must be considered. This requires the exercise of business judgement, which contracting professionals are supposed to have and use.

Some considerations may include the time and cost vs. expected benefit of any possible discussions, the nature of the unacceptable aspect or aspects of the lower priced proposal, ease and likelihood of being able to obtain an acceptable proposal, etc. It might be also be feasible that there could be benefits to consider the ease and likelihood of correcting a higher priced proposal that might also result in lower prices. Again, it really depends upon the circumstances.

Below are some FAR principles and responsibilities of the acquisition team, led by the Contracting Officer or other source selection authority for your consideration. I have personally seen many instances where acquisition teams appear to overlook these principles in the quest to simply make an award.

Beyond the "Can I get away with it to make an award" aspect, I think that the team is also charged with weighing all considerations and trying to obtain the "best value" to the customer and taxpayer, which you defined in the acquisition approach chosen.

“FAR 1.102 -- Statement of Guiding Principles for the Federal Acquisition System.

(a) The vision for the Federal Acquisition System is to deliver on a timely basis the best value product or service to the customer, while maintaining the public’s trust and fulfilling public policy objectives.”

“FAR 1.102-1 -- Discussion.

...(b ) Vision. All participants in the System are responsible for making acquisition decisions that deliver the best value product or service to the customer. Best value must be viewed from a broad perspective and is achieved by balancing the many competing interests in the System.”

“15.302 -- Source Selection Objective.

The objective of source selection is to select the proposal that represents the best value.”

“15.303 -- Responsibilities.

…(b ) The source selection authority shall --

…(6) Select the source or sources whose proposal is the best value to the Government (10 U.S.C. 2305(b )(4)(B ) and 41 U.S.C. 253b(d )(3))."

“15.306 -- Exchanges With Offerors After Receipt of Proposals.”

...(d) (2) The primary objective of discussions is to maximize the Government’s ability to obtain best value, based on the requirement and the evaluation factors set forth in the solicitation.”

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Guest Vern Edwards

Here was the opening question:

If a solicitation states that the agency reserves the right to make award without discussions, and if the agency evaluates a proposal as technically unacceptable, then the agency does not have to go on to evaluate the proposal's price, right? This is assuming that the agency is sticking with it's prerogative to make award without discussions.

The question was answered by Post #3. Nowhere did the poster say that the unacceptable proposal was the lower priced proposal. (It would not have changed the answer if he had.) Nowhere did the poster say anything about merely getting away with anything. The answer did not say that there were no other possibilities, it merely answered the question that was asked. The poster asked a straightforward question and was entitled to a straightforward answer, not a lecture.

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You stated that "there is no need to evaluate the reasonableness of its price or to compare its price to the prices of acceptable proposals." My reply, which I was working on before anyone else posted replies, was meant to advise that there are other considerations, which might mean that it may be advisable to review the pricing of tun acceptable proposals, even if not "required" to. I was not responding to your answer or anyone else's. In fact I hadn't even seen any when I first pushed the post button.

Of course, only certain posters on this forum are entitled to "lecture" others on the professionalism expected of the acquisition workforce.

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Guest Vern Edwards

If you'd simply answered the question and skipped the bit about getting away with something, which the poster did not deserve in this case, you might have gotten your post off more quickly. It's not often that we get such a clearly worded question. Why not start a blog if instead of answering questions you want to lecture about professionalism. Bob will be glad to have you do it and I'd be eager to read what you have to say.

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To rephrase my earlier post above - others did provide an answer of sorts to the specific question of "the agency does not have to go on to evaluate the proposal's price, right?" However, even if you don't "have to" evaluate the proposal's price, I feel that the acquisition team is also charged with weighing more considerations and should try to obtain the "best value" to the customer and taxpayer.

I assume you defined the best value in the acquisition approach chosen. In that case, you "should consider" whether the government might obtain a better price, if you evaluate the proposal price and find that it would provide a better value. Some considerations might include the time and cost to condusct discussions vs. expected benefit of discussions, the nature of the unacceptable aspect or aspects of the lower priced proposal, ease and likelihood of being able to obtain an acceptable proposal, etc. It might be also be feasible that there could be benefits to consider the ease and likelihood of correcting a higher priced proposal if it could result in lower prices upon discussions and the opportunity for a firm to correct deficiencies and revise its pricing. The discussion process might not be worth the effort, time and cost to conduct. Again, it really depends upon the circumstances.

I didn't mean to come off as though I'm accusing you of getting away with something. I wished to emphasize that the acquisition team should be concerned with obtaining the best value, considering more than just being able to award without discussions.

I don't know if your team has the perogative to take the time and effort to do that or if there would be any value in it. Maybe the unacceptable proposals arent worth messing with or there is no time to do it.

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Joel's first post brought up important points for the first time. The "straightforward" question did not specify whether the solicitation was LPTA or best value, which would make a big difference in evaluation. Even under LPTA, it seems unwise to ignore price just because you can. If the technically unacceptable proposal was significantly lower in price and could have been made acceptable, either with minor changes or somewhat more substantive disucssions, the first answer would have ruled out that approach. Joel took the discussion out of "tunnel vision" mode into a wider perspective that provided not only a better answer but also a broader understanding of why it is a better answer.

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Guest Vern Edwards

Look, the question included an important proviso:

This is assuming that the agency is sticking with it's prerogative to make award without discussions.

Joel and now Cajuncharlie are essentially making the point that award without discussions may not be the best way to go. That is true, but gov2310 did not ask for advice in that regard. He asked a very specific question based on a very specific premise. I don't see any indication that gov2310 was ignorant of the possible benefit of discussions. In fact, his proviso indicates that he understands what discussions are and how they might be used and that the agency has already considered discussions and rejected the idea.

When we get a clear question from a colleague, it's ridiculous to lecture, including scriptural FAR quotes, then repeat the lecture, then restate the lecture. Moreover, if you are going to lecture a colleague, it helps to know what you're talking about. See Sletten Companies/Sletten Construction Co., B-402422, April 21, 2010, 2010 CPD para. 97:

Sletten also challenges the source selection decision, complaining that the SSA failed to consider Sletten's lower price. Because we conclude that the agency found the protester's proposal to be technically unacceptable, the agency was not required to consider the firm's lower proposed price in its tradeoff decision, since it is well established that a technically unacceptable proposal cannot be considered for award. EMSA Ltd. P'ship, B-254900.4, July 26, 1994, 94-2 CPD para. 43 at 5.

Finally, if you are going to lecture you should know the right terminology. The two approaches to source selection are LPTA and "trade-off process," not LPTA and "best value." The term "best value" does not refer to a process, it refers to a result. See the definition of "best value" in FAR 2.101. The answer I gave to gov2310 is valid no matter which process the government uses. Whether gov2310's agency should conduct discussions is their business. I don't see any reason to treat someone as if they don't know what they're doing when they give us no reason to think so.

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if you are going to lecture a colleague, it helps to know what you're talking about. See Sletten Companies/Sletten Construction Co., B-402422, April 21, 2010, 2010 CPD para. 97:

Quote

"Sletten also challenges the source selection decision, complaining that the SSA failed to consider Sletten's lower price. Because we conclude that the agency found the protester's proposal to be technically unacceptable, the agency was not required to consider the firm's lower proposed price in its tradeoff decision, since it is well established that a technically unacceptable proposal cannot be considered for award. EMSA Ltd. P'ship, B-254900.4, July 26, 1994, 94-2 CPD para. 43 at 5."

Vern, thank you for this decision. It validates my point, above. The government evaluated both the prices and the technical proposals, considered the merit and likelihood of obtaining a compliant proposal from the protestor and the likelihood that the price would increase in response to fixing the proposal. Then - it decided that discussions weren't required to obtain the best value.

QUOTE:

"The CO concluded that all proposals, except Mortenson's, required extensive revisions through discussions and that, based upon her experience, she expected that offerors' proposed prices would increase as a result of the revisions. The CO determined that there was no benefit in conducting discussions and recommended award to Mortenson."

In the cited Stetten decision, the agency did evaluate the price of the non-conforming offer as well as the likelihood of a price increase. The GAO did not say that "the agency does not have to go on to evaluate the proposal's price." The GAO said that "the agency was not required to consider the firm's lower proposed price in its tradeoff decision."

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Guest Vern Edwards

Okay.

The GAO decision that I cited stands for exactly what I said it stands for: When a proposal is found to be technically unacceptable, the agency need not evaluate the proposed price, because the proposal is not eligible for award.

I should not have said that you didn't know what you were talking about in that regard, since you didn't talk about that at all. I'm sorry. Same to Cajuncharlie. Anyway, I did say: "Joel and now Cajuncharlie are essentially making the point that award without discussions may not be the best way to go. That is true... "

Truce.

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Guest Vern Edwards

Just to make sure that everyone understands, see:

Ocean Services, LLC, B-406087, February 2, 2012, 2012 CPD para. 62:

There is also no merit to Ocean's objection that NOAA excluded its proposal from the competitive range for these CLINs without consideration of its price. While an agency may not exclude a technically acceptable proposal from the competitive range without meaningful consideration of that proposal's cost or price to the government, see Kathpal Tech., Inc.; Computer & Hi–Tech Mgmt., Inc., B–283137.3 et al., Dec. 30, 1999, 2000 CPD para. 6 at 9, where, as here, the agency concludes that a proposal is technically unacceptable, it is proper to exclude the proposal from the competitive range without considering price. TMC Design Corp., B-296194.3, Aug. 10, 2005, 2005 CPD para. 158 at 5.

F&S Environmental, LLC, B-405232, Sep. 22, 2011, 2011 CPD para. 195:

F & S next argues that it was nevertheless improper for FEMA to exclude the firm's proposal from the competitive range without considering its price. To the contrary, an agency need not consider an offeror's price when establishing a competitive range where, as here, the proposal is technically unacceptable. TMC Design Corp., B-296194.3, Aug. 10, 2005, 2005 CPD para. 158 [FN 6]

FN 6: F & S argues similarly in a supplemental protest that FEMA ignored positive past performance known to the agency. Even if we were to accept F & S's assertion, which we do not, F & S has failed to establish competitive prejudice, since its proposal was reasonably found to be technically unacceptable.

TMC Design Corp., B-296194.3, Aug. 10, 2005, 2005 CPD para. 158:

TMC also argues that the agency improperly failed to consider price and performance risk in determining to exclude its proposal from the competitive range. While an agency may not exclude a technically acceptable proposal from the competitive range without consideration of price, Kathpal Techs., Inc.; Computer & Hi–Tech Mgmt., Inc., B–283137.3 et al., Dec. 30, 1999, 2000 CPD para. 6 at 9, where, as here, the agency reasonably concludes that a proposal is technically unacceptable, and thus cannot be considered for award, it is proper to exclude the proposal from the competitive range without considering price. Aid Maint. Co. Inc., B-255552, B-255552.2, Mar. 9, 1994, 94-1 CPD para. 188 at 8. Similarly, given TMC's unacceptable rating under the technical performance factor, which rendered the proposal as a whole technically unacceptable, its rating under the performance risk criterion is irrelevant.

The Austin Co., B-291482, Jan. 7, 2003, 2003 CPD para. 41:

Austin also complains that the agency failed to consider its low proposed price and/or failed to properly apply the solicitation's “cost limitation” provision to the other offerors' proposals. With regard to Austin's proposed price, a technically unacceptable proposal cannot be considered for award; accordingly, any purported cost savings flowing from the offeror's stated price regarding its technically unacceptable proposal are irrelevant.

SWR, Inc., B-286229, Dec. 5, 2000, 2000 COD para. 196:

SWR argues that CDC improperly failed to consider past performance, a stated evaluation factor, in determining whether to include its proposal in the competitive range. This argument is without merit. Since the agency concluded-- reasonably, we have found--that SWR's proposal was technically unacceptable, there was no possibility that SWR would receive the award, even with a favorable past performance evaluation. Under these circumstances, it would have served no purpose--and the agency thus was not required--to consider SWR's past performance. See generally Telestar Corp., B-2758855, Apr. 4, 1997, 97-1 CPD para. 150 at 6(where proposal is deemed technically unacceptable, and therefore ineligible for award, agency need not consider price in setting competitive range).

In JBlanco Enterprises, Inc., B-402905, Aug. 5, 2010, the RFP warned offerors that if their technical volume was found to be technically unacceptable the agency would not evaluate their proposed price or past performance.

Bottom line: Once a proposal has been found to be technically unacceptable in accordance with the evaluation factors in the RFP it is not eligible for award and need not be further evaluated and given further consideration. The proposed price need not be evaluated (considered) either in making a competitive range decision or an award, even if it is the lowest price. It may be evaluated and given further consideration, but whether it will be given further consideration is a matter of judgment for the source selection authority. When I say evaluated I mean compared to other proposals or determined to be fair and reasonable based on market information.

As you can see, the longstanding no-need-to-evaluate-when-technically-unacceptable rule applies not only to price, but to other factors as well, and it applies in both LPTA and tradeoff analysis source selections.

The rule also applies when considering quotations for orders against GSA Schedules. See Coley & Assocs., B-404034, Dec. 7, 2010, 2011 CPD para. 6.

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OK, truce - truce.

Vern,please don't take this as personal. Some of the decisions you cited do refer to "evaluating" price. Some use the term "consider", which may or may not have a different connotation than "evaluate". The act of considering often follows an evaluation. HOWEVER - we don't necessarily disagree that one would be within the letter of the law for not "evaluating price" if the proposal is technically deficient.

At the risk of repeating myself - just as you here have - I am advocating that the KO should consider more than simply meeting the minimum legal or regulatory requirements.

You have certainly commented many times over the years about the importance of the contracting profession looking beyond simple legal sufficiency and that true professionals also exercise sound business judgement.

From an agency perspective, I've seen and heard of numerous design-build projects, for instance, where the government awarded without discussions because they had an awardable - but mediocre - design proposal. Proposals with less than optimal features usually come back to haunt the Army or Air Force customer. They raise Heck, then we have to conduct after action reviews, answer the Generals and Colonels, etc. We must live forever with poor architecture or poor building systems, while nobody remembers the speed of the award or a low price. We actually have folks who think that they can't conduct discussions if they have an awardable proposal. Then everyone later bitches for years about what they get.

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Guest Vern Edwards

Joel:

You couldn't just accept the apology, could you?

I know what you're advocating. It's not a complicated point, Joel. But you and I are talking about two different things. I am talking about an answer to a clear question from gov2310 about a legal requirement. You are talking about sound practice, on which we agree.

gov2310 asked: "If a solicitation states that the agency reserves the right to make award without discussions, and if the agency evaluates a proposal as technically unacceptable, then the agency does not have to go on to evaluate the proposal's price, right?"

That strikes me as clear. The answer is yes. But you responded with a condescending sermon:

Regardless of being able to get by with it, Is your responsibility simply make an award or to also obtain the "best value" for the customer and for the taxpayers, taking various considerations into account? I think both must be considered. This requires the exercise of business judgement, which contracting professionals are supposed to have and use.

Evaluate versus consider? All price or cost evaluation entails comparison. Analysis might also be part of it -- as in cost allowability analysis, cost realism analysis, and incentive structure analysis -- but the sine qua non of evaluation is comparison of the proposed price to (1) the competition and (2) some standard of reasonableness, which could be the competition or something else. If a pricing situation is simple and price standing is immediately apparent from the face of the proposals, I would not expect a question about the legal need to evaluate price.

If a proposal is found to be technically unacceptable, and we do not want to conduct discussions, am I (1) legally required to compare the proposed price to the prices of the other competitors and (2) legally required to to determine the reasonableness of the proposed price? The answers are NO and NO. A CO could wait for technical evaluations before conducting price or cost evaluations and set aside technically unacceptable proposals without further consideration (evaluation), thus saving some time and effort, especially in an LPTA source selection or in a tradeoff source selection when there are a large number of proposals and price is the least important factor.

Should a CO evaluate the price of a technically unacceptable proposal anyway? The only answer that I would give is: It depends. You would have been much less condescending to gov2310 had you said: "You don't have to, but you might want to consider... " and skipped the sermon. Had you written something like that, I would not have said a word.

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Understood. The suggestion of "you might want to consider.." is probably okay here. I should not have come across as condescending to the poster. There wasn't enough information in the original question to know if the poster had considered anything else and we dont know whether the circumstances warranted the opportunity or value to consider anything other than an award to a conforming offeror.

The forum is widely read and a lot of people often take shallow issues as gospel for adoption to real world scenarios. I have noticed a huge tendency to cut and paste a single solution to most any situation. I am involved with some massive programs that required 100's of source selections and large task orders for construction and design-build construction. I found a tendency among some of the organization to not take advantage of the opportunity to negotiate for better performance or pricing, then complain about the end product. I wanted to address some of those other considerations other than making award based upon a conforming proposal, without regard to other possible pricing opportunites. My zealousness sometimes is reflected in my writing.

Yep - there is no way of knowing in this situation whether or not that is necessary. It may be a straight forwad purchase of a service or supplies. I will also admit that I read into the question that the other proposal was lower priced but the emphasis or plan was to award without discussions. This might be perfectly acceptable or most practical for some types of acquisitions but not for all.

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In the original post, govt2310 included an assumption that the agency is sticking with its prerogative to make an award without discussion. Actually, the agency doesn’t have to evaluate the unacceptable proposal’s price even if the agency conducts discussions, provided the agency eliminates the unacceptable proposal from the competitive range because of its unacceptability. The cases excerpted by Vern in post #16 recognize the discretion available to the agency to eliminate technically unacceptable proposals from competition without evaluating price (or other factors). However, I offer a caution related to a comment by woops85 in post #2 and the JBlanco Enterprises case cited by Vern in post #16. In both instances cited, the agency stated that it would not evaluate further if some event occurred (failure of single pass/fail criterion and proposal technical unacceptability, respectively). I think that potentially in those instances and particularly if the solicitation follows with something like “and your proposal will be rejected” or “and your proposal will not be further considered for award” (proponents of such language typically rationalizing that there’s less work if you can just eliminate an “unacceptable” offeror early and not have to expend further resources completing the evaluation), elimination of the unacceptable proposal may be nondiscretionary, and the agency may be prevented (unnecessarily) from conducting discussions with a potentially correctable offeror .

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  • 1 month later...

Thanks to everyone for being so engaged on this topic.

Now I am wondering what happens when we go the other way:

If a Price Proposal is found "unacceptable" (for example, say the solicitation's instructions to offerors required the submission of labor rates, and the Offeror submitted a Price Proposal with absolutely no labor rates), does the agency still have to evaluate that Offeror's Technical Proposal?

My belief is that the answer is the same: No, there is no point in evaluating the Technical Proposal when the agency has already established that this Offeror's Proposal cannot be the basis of a contract award in that we cannot figure out what the real price being offered is as the Price Proposal is lacking required information to figure out the est. total.

But I wonder what others have to say on this question.

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Should we take the same assumption of no discussions, and that there is another completely acceptable proposal?

I would say, assuming there isn't the criterion of award without discussion, that you would most definitely want to evaluate it. If you are running a trade-off source selection, what if the offeror who sent you a price, just not broken down into labor rates and categories, was by far the most technically sound proposal you received that you would be willing to pay somewhat of a premium to obtain? Would you then throw the entire proposal out the window because they offered you a price, but not broken down into labor categories? I'd say it is worth the discussions to correct it in that case.

The GAO documents this well, and it can go either way depending on what you wrote in your solicitation. You have significant discretion as a contracting officer to make these decisions. I don't think it is wise to throw someone out on a technicality, especially when the proposal in this case could be easily corrected through discussions and an FPR. They should have the labor breakdowns already on hand.

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