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OldHickory

Negotiations with Offerors AFTER Award

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We were awarded a task order contract by the USACE after submitting the lowest price technically acceptable offer. The award was signed in May 2012 and we turned in the bonds. A few days later we received a suspension of work notice due to several protests that had been filed by disappointed offerors. We did not intervene in those protest actions.

This week, we received a notice from the USACE stating:

"In accordance with Federal Acquisition Regulation (FAR) 15.306 entitled "Exchanges with offerors after receipt of proposals," the Government has now determined that discussions are necessary. Your proposal was evaluated against all evaluation criteria contained in the amended solicitation and was determined to be within the competitive range which allows for discussions to commence.

You are provided the opportunity to provide a revised price proposal. Your responses to the EN(s) and revised price proposal constitute your final proposal revisions.

Your response(s) to these questions are due: not later than 5:00 P.M. Central Daylight Time, October 26, 2012."

Our award was never cancelled. So this is perplexing to us. After we notified the COR of our concerns that our pricing had already been disclosed the other offerors through the award, the USACE stated we could resubmit pricing. This doesn't really answer our concerns.

Can the USACE re-open negotiations after contract award? Is there any recourse for us relative to the disclosure of our pricing which now puts us at a considerable disadvantage to the offerors?

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The Corps of Engineers is probably taking some corrective action as a result of the protests. This corrective action apparently will involve updated proposals and a new evaluation. You might win the new evaluation, or you might not.

You could ask the contracting officer (not the COR) directly and in writing if the protests from back in May have been resolved by a final decision. A GAO protest should only last 100 days, and your 100 days are over.

You could have filed as an intervenor -- that way, you would be aware of whatever has been going on between the agency, the GAO, and the protesters -- you don't need an attorney to be an intervenor, but an attorney can always be helpful in these matters. Because you didn't file as an intervenor, you're in the dark and you're unable to file motions at GAO to protect your interest in the task order award. The agency, the GAO, and the protesters are analyzing the award record and discussing resolutions and corrective actions, all without you in the room. You're in the dark.

For the time being, you should read the contract clause at FAR 52.233-3, Protest After Award. You need to be tracking and documenting costs.

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I didn't address your basic question.

Yes, the Corps of Engineers can do anything it wants to. If you think they shouldn't do something they are doing, you need to take an action. If you think you have been disadvantaged by the disclosure of your prices to your competitors, you can file a protest to stop the agency's effort to acquire updated proposals. If you do nothing, you may forfeit your right to complain later.

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Thank you, ji20874. Your responses are very helpful.

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This week, we received a notice from the USACE stating:

"In accordance with Federal Acquisition Regulation (FAR) 15.306 entitled "Exchanges with offerors after receipt of proposals," the Government has now determined that discussions are necessary. Your proposal was evaluated against all evaluation criteria contained in the amended solicitation and was determined to be within the competitive range which allows for discussions to commence.

You are provided the opportunity to provide a revised price proposal. Your responses to the EN(s) and revised price proposal constitute your final proposal revisions.

Note: Discussions have commenced. Feel free to "discuss" anything and everything of concern to you with the contracting officer. And do it now, before discussions end on Friday.

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Yes, the Corps of Engineers can do anything it wants to.

That's the second post in a week in which you've said something like that. Knock it off. It's not true. It's misleading. It's total bull****. Agencies cannot do anything they want to do. Contrary to what Old Hickory said, statements like yours are not helpful. If an agency violates laws or regulations there are consequences that could be very costly to its programs and to the taxpayers.

Old Hickory:

It may be appropriate for the Corps to reopen discussions after award, re-evaluate proposals, make a new source selection decision, and terminate your contract. See, e.g., Mission Essential Personnel, LLC, GAO Decision B-404218.2, 2011 CPD para. 120. However, such an action may be inappropriate.

Also, the contracting officer is in charge of discussions, controls what he or she will discuss, and may be unwilling to discuss "everything of concern to you." See, e.g, American K-9 Detection Services, Inc., GAO Decision B-400464.6, 2009 CPD para. 107:

[A]s a general matter, the details of a corrective action are within the sound discretion and judgment of the contracting agency. Rockwell Elec. Commerce Corp., B–286201.6, Aug. 30, 2001, 2001 CPD ¶162 at 4. Moreover, in appropriate circumstances where the agency has established a reasonable basis for doing so, our Office has not objected to an agency's decision to limit discussions under a negotiated procurement in implementing corrective action in response to a protest. See Rel–Tek Sys. & Design, Inc.-Modification of Remedy, B–280463.7, July 1, 1999, 99–2 CPD ¶ 1 at 3.

Then again, limiting discussions may be improper.

If the contract is of importance to you, hire an attorney right away to advise you and to protect your interests. And be careful whom you take advice from.

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Vern,

I know the USACE can't do whatever it wants; otherwise, there would be no need for the FARs or any other regs or laws. So, I completely disregarded that statement. I was also just trying to be nice in my response.

Anyway, I'm approaching this from a contractual standpoint: we have a contract with the USACE, so I don't see how the USACE can now entertain discussions with the other offerors as if this contract does not exist. I could understand perhaps if the contact was T4C, but that hasn't happened. Even if that had happened, I would expect the RFP to be re-solicited. Are you, in all your years of experience, aware of a situation when a government agency resumed negotiations with the rejected offerors after contract award as if the award never happened? From my reading of 4 CFR 21.8, resuming negotiations as a remedial measure with the disappointed offerors isn't an option. This isn't a case where the agency is making an award to a different offeror in order to comply with a reg or statute. Rather, the USACE is changing the terms of the negotiation.

Our concern is if we protest, the USACE will just cancel the RFP and resolicit to a MATOC pool or set the award aside for service disabled vets or some other group that we are excluded from. This is simply a crummy situation the USACE has put us in by disclosing our pricing to our competitors and then changing the rules of the game. And, we have been engaged in "discussions" over the past week, complaining quite loudly about how this recent procurement action is prejudicial and not in the spirit of FAR 15.306.

As for intervening, we received heavily redacted copies of the GAO protests (two of which were dismissed, one withdrawn). Each one was based on allegations the USACE has improperly deemed their respective proposals as technically unacceptable for reasons stated in the de-brief that had never before been raised in the previous discussions. So, intervening would have done little for us but cost us money and resources.

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Are you, in all your years of experience, aware of a situation when a government agency resumed negotiations with the rejected offerors after contract award as if the award never happened?

Yes, in the Mission Essential decision I cited. This was the GAO's recommendation:

We recommend that the agency reevaluate vendors’ quotations consistent with our decision, reopen discussions if necessary, and make a new source selection decision. If, upon reevaluation of vendors’ quotations, another firm’s quotation is found to offer the best value to the government, DIA should terminate SAIC’s contract for convenience of the government and issue the order to that firm.

There have been other such decisions. See. e.g., LIS, Inc., GAO Decision B-400646.2, 2010 CPD para. 5:

We further recommend that the agency perform a new evaluation consistent with this decision, reopen discussions, if necessary, and make a new source selection decision. If Labat is not selected for award, the agency should terminate Labat's contract.

My advice is that you retain an attorney, or at least talk to one, immediately. Don't trust the Corps. In my opinion, the fact that they're doing this does not bode well.

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Thank you, Vern. I appreciate you taking the time to make such a comprehensive response with citations to GAO decisions that are relevant to this matter. I agree with you that I don't think the USACE's actions bode well for us, and we'll be prepared to take appropriate legal action if our contract is awarded to another offeror based on improper procurement actions by the USACE.

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"It may be appropriate for the Corps to reopen discussions after award, re-evaluate proposals, make a new source selection decision, and terminate your contract. See, e.g., Mission Essential Personnel, LLC, GAO Decision B-404218.2, 2011 CPD para. 120. However, such an action may be inappropriate.

. . .

Then again, limiting discussions may be improper."

Could you please explain what circumstances the corrective action taken in Mission Essential would be inappropriate? And under what circumstances limiting discussions may be improper? I'm currently reading the decisions you cited, so it that explanation is contained in them, I apologize. I just wanted to make sure I asked you while you were still online here.

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The corrective action be improper if it is unreasonable. Suppose that the government receives a protest after award and decides to take corrective action by reopening discussions, soliciting revised proposals, and making a new evaluation and a new decision. Suppose that it decides that its first award decision was wrong and so it terminates the contract and makes a new award. If the protest did not have a valid basis, then the corrective action was unreasonable and improper. See Sheridan Corp. v. U.S., 95 Fed. Cl. 141 (2010):

This Court has not hesitated to enter injunctive relief where circumstances warrant, such as when the Government has taken improper corrective action consisting of terminating a contract for convenience and resoliciting the contract. See Delaney Constr. Corp., 56 Fed.Cl. at 476; MCII Generator & Elec., Inc. v. United States, No. 02–CV–00085, 2002 WL 32126244 (Fed.Cl. Mar. 13, 2002).

Limiting discussions would be improper if the limitation would be unfair to an offeror. Read the American K-9 Detection Services decision I cited above, which discusses the problem.

Okay, I'm done with the tutorial. Call that lawyer. I have a bad feeling that you're going to need one.

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Old Hickory,

The reason you need to call that lawyer is because without internal oversight and external visibility, the Corps of Engineers can do anything it wants. It can even do things that are contrary to the FAR and to case law. I don't think it will do so purposefully, but certainly it can do so absent-mindedly. As I wrote in my first posting--

Because you didn't file as an intervenor, you're in the dark and you're

unable to file motions at GAO to protect your interest in the task order

award. The agency, the GAO, and the protesters are analyzing the award

record and discussing resolutions and corrective actions, all without you

in the room. You're in the dark.

(me, no. 2)

I have great respect for the Corps of Engineers, and for the acquisition staffs across the federal government. But individual persons and program offices as a whole can and do make mistakes. If you believe, as someone has asserted here, that the Corps cannot make an error (cannot do anything it wants), then you don't need that lawyer. Notwithstanding our differing starting points, we both gave you essentially the same ending advice--

If the contract is of importance to you, hire an attorney right away to advise

you and to protect your interests. And be careful whom you take advice from.

(Vern, no 6)

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Oh, what nonsense. If you mean that the Corps might break the law inadvertently or unintentionally, then say so. Saying that they can do anything they want is misleading and untrue. And who said that the Corps cannot make an error?

Just give well-written and well-documented answers and knock off the rest.

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