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Special Standard of Responsibility Use & Application

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I am seeking some a better understanding of "Special Standards of Responsibility" as mentioned in FAR 9.104-2.

I especially want to understand the relationship between "Special Standards of Responsibility" and evaluation factors.

Can both be applied in the same requirements?

If yes, how are they different and not the same?

If not, how does one tell if they should be using one versus the other?

Are "Special Standards of Responsibility" included in the solicitation and the award?

I would greatly appreciate examples.

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They are not the same.

Special standards of responsibility must be identified as such in a solicitation (FAR 9.104-2(a) requires this), rather than disguising them as evaluation factors.  

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Myfrogleaps:  You may want to read DFARS 252.237-7000, Notice of Special Standards of Responsibility.  The provision is prescribed for Advisory and Assistance Services, when you have a solicitation for audit services.  This may answer - in part -  your questions.

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Well myfrogleaps that's what you sometimes get when you ask for free advice ("beggars can't be choosers").  I don't have any experience using Special Standards of Responsibility, but I'll try and set you down the right path:

First, you should think about the difference between a standard for responsibility and an evaluation factor.  The latter is supposed to focus on areas that will discriminate amongst potential offerors during the evaluation process while the former is a requirement for award eligibility (in all cases I'm aware of they are binary [e.g. Is the contractor debarred? Does the contractor have adequate financial resources to perform the subject effort?] so they're not discriminators, but they are hurdles an offeror must clear in order to receive a contract award).

See FAR 15.304(b):

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(b) Evaluation factors and significant subfactors must --

(1) Represent the key areas of importance and emphasis to be considered in the source selection decision; and

(2) Support meaningful comparison and discrimination between and among competing proposals.

Second, if you do a standard Google search for "Special Standards of Responsibility" one of the top returns is the following DFARS link (http://www.acq.osd.mil/dpap/dars/dfars/html/current/252237.htm) which provides an example of a Special Standard of Responsibility that is required when contracting for audit services.  If you read the clause, it details necessary requirements for a potential contractor that intends to provide audit services, but those requirements would not be discrimators amongst the offerors as to which one offers the best value.  That's presumably why they're treated as a responsibility standard instead of an evaluation factor.

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Weno2: Thank you for pointing me to that reference. I had not read that and was not aware that the "Special Standard of Responsibility" was specificatlly for audit services.

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Matthew Fleharty: Thank you for responding. The way in which you contrasted the two helps me better see the difference and their applicability; especially when looking at whether or not a stipulation is discriminant.

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On 8/24/2017 at 11:36 AM, myfrogleaps said:

I especially want to understand the relationship between "Special Standards of Responsibility" and evaluation factors.

Special standards of responsibility, FAR 9.104-2, like general standards of responsibility, FAR 9.104-1, are pass/fail standards that must be met in order for an offeror to be considered qualified to perform the contract work. An offeror either meets the standard of it doesn't. If it does, it's qualified. If it doesn't it's not. Agencies do not use responsibility standards to compare offerors to each other.

The GAO refers to special standards of responsibility as "definitive responsibility criteria." See Prime Mortgage Corp., GAO B-238680, 90-2 CPD ¶ 48:

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FAR § 9.104–2 (FAC 84–39) authorizes the contracting officer's development of special standards of responsibility. We refer to these special standards as definitive responsibility criteria.

Special standards are specific and objective standards of responsibility that are used in a specific procurement or class of procurements. See NEIE Medical Waste Services, LLC, GAO B-412793.2, 2016 CPD ¶ 213:

Quote

Definitive responsibility criteria are specific and objective standards established by an agency for use in a particular procurement for the measurement of an offeror's ability to perform the contract. These special standards of responsibility limit the class of offerors to those meeting specified qualitative and quantitative qualifications necessary for adequate contract performance, e.g., unusual expertise or specialized facilities. Fluor Daniel, Inc., B–262051, B–262051.2, Nov. 21, 1995, 95–2 CPD ¶241 at 11.

A general standard of responsibility such as experience, see 9.104-1(e), becomes a special standard when it is stated in specific (definitive) terms, such as a requirement that an offeror must have performed within the past two years two contracts similar to the prospective contract in terms of scope, dollar value, and duration. Again, the standard is pass/fail

Unlike special responsibility standards, evaluation factors are used to compare offerors to each other. For instance, if experience is used as an evaluation factor, the offerors are compared to each other on experience, and the one with more or better experience is evaluated more highly than one whose experience us not as good.

So the key difference between special responsibility standards and evaluation factors is how they are used. Responsibility standards are used to determine whether an offeror meets a threshold requirement for qualification. Evaluation factors are used to compare offerors and rank them. Considerations such as experience or past performance could be used as a special responsibility standard or as an evaluation factor. See Sanford and Sons Co., GAO B-231607, 88-2 CPD ¶ 266:

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The technical factors on which Sanford's proposal was judged technically unacceptable—organization/administration and past performance—traditionally are considered responsibility factors, that is, matters relating to Sanford's ability to perform the contract. See Federal Acquisition Regulation (FAR) §§ 9.104–1(c), (e) (FAC 84–18). As the Corps notes, we have stated that traditional responsibility factors may be used as technical evaluation criteria in a negotiated procurement. See, e.g., Pacific Computer Corp., B–224518.2, Mar. 17, 1987, 87–1 CPD ¶ 292. In doing so, however, we have stated that, as a general matter, the factors may be so used only if the agency's needs warrant a comparative evaluation of those areas. SBD Computer Services Corp. B–186950, Dec. 21, 1976, 76–2 CPD ¶ 511.

 

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The above discussion primarily compares "Special Standards of Responsibility" and evaluation factors used in a best value, trade-off source selection.

I have a question about "Special Standards of Responsibility" vs LPTA evaluation factors, which are also evaluated on a pass/fail basis.  Under Simplified Acquisition Procedures, assuming the discriminating factors that you want to evaluate are responsibility type factors (e.g. Experience, Adequate Facility, Required Certification) is there a benefit to choosing one type of evaluation over another, i.e., Price only evaluation with Special Standards of Responsibility vs LPTA?  I have not dealt with Special Standards of Responsibility much, but it seems that the general process would be similar and the outcome the same.

For DoD organizations, the FY17 NDAA requires a limitation on the use of LPTA be included in the DFARS.  Would changing LPTA evaluation factors into Special Standards of Responsibility (to the extent you can) be a way of maintaining a similar source selection process without having to deal with the limitations, justifications, and other hurdles that may be implemented in the DFARS?  I know we can’t really answer that last question until we see what the regs say.  But if anyone has ideas on the matter, I’d be interested in hearing them.

Thanks.

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2 hours ago, Lionel Hutz said:

I have a question about "Special Standards of Responsibility" vs LPTA evaluation factors, which are also evaluated on a pass/fail basis.  Under Simplified Acquisition Procedures, assuming the discriminating factors that you want to evaluate are responsibility type factors (e.g. Experience, Adequate Facility, Required Certification) is there a benefit to choosing one type of evaluation over another, i.e., Price only evaluation with Special Standards of Responsibility vs LPTA?  I have not dealt with Special Standards of Responsibility much, but it seems that the general process would be similar and the outcome the same.

You can use responsibility type considerations as pass/fail evaluation factors in an LPTA source selection. However, a key distinction between special standards of responsibility and comparative evaluation factors is that the GAO has decided that if you use any traditional responsibility consideration such as those listed in FAR 9.104-1 as a comparative evaluation factor, then the SBA's Certificate of Competency program, FAR Subpart 19.6, does not apply. But if you use a responsibility consideration as a pass/fail evaluation factor, then the SBA's Certificate of Competency program does apply.

So suppose that you conduct an LPTA source selection and the only nonprice evaluation factors are experience and past performance, to be evaluated pass or fail. And suppose that you determine, pass/fail, that a small business offeror with a lower price than the winner is technically unacceptable on the basis of experience. In that case you would have to refer the small business offeror to the SBA for Certificate of Competency consideration before making an award. See e.g., Estrategy, Inc., GAO B-406419, 2012 CPD ¶ 171, footnote 3:

Quote

Furthermore, where an agency evaluates a responsibility related evaluation factor, such as a license requirement, on a pass/fail basis rather than comparatively, the rejection of a small business offeror as unacceptable is tantamount to a nonresponsibility determination, which must be referred to the Small Business Administration for consideration under that agency's certificate of competency procedures. Joanell Labs., Inc.; Nu–Way Mfg. Co, Inc., B–242415.8, et al., Apr. 15, 1992, 92–1 CPD ¶ 369 at 6.

See also Sanford and Sons, Inc., GAO B-231607, 88-2 CPD ¶ 266, DA Defense Logistics HQ, GAO B-411153.3, 2015 CPD ¶ 58, and many other such decisions. Of course, this applies only when an agency rejects an offer from a small business.

FAR 15.101-2(b)(1) warns you about this with regard to past performance, but fails to warn you that it applies whenever you use a responsibility-type factor such as those mentioned in FAR 9.104-1 as pass/fail evaluation factors.

See Alternative Procurement Strategies: An Obscure Aspect Of The FAR, The Nash & Cibinic Report, May 2001:

Quote

COs should be aware that FAR 15.101-2 does not state the full rule. As can be seen from the above quotation from Nomura [Nomura Enterprises, Inc., Comp. Gen. Dec. B-277768, 97-2 CPD ¶ 148], the requirement to permit an offeror to obtain a Certificate of Competency from the SBA when there is a go/no-go evaluation applies not only to past performance but to all “traditional responsibility factors.” This means that almost all evaluations of the capability of the offerors are subject to the same rule. This would include experience, the capability of key personnel, the availability of necessary equipment, and financial capability among other factors. If COs want to evaluate such factors without subjecting the procurement to the Certificate of Competency process, the factors should be made comparative evaluation factors.

If you're not afraid of the chance of having to refer a small business offeror to SBA for COC consideration, then you can save a lot of evaluation time by sticking to responsibility determinations rather than turning responsibility-type factors into pass/fail evaluation factors.

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Thank you Vern!  I understand that a trade off process would offer an "advantage" in that small business wouldn't have to be referred to the SBA for COC consideration.

But, when comparing only an LPTA using "responsibility-type" evaluation factors to a Price only evaluation using Special Standards of Responsibility, it sounds like neither option provides an "advantage" over the other (with regard to SBA COC issues) because both would require referral to the SBA.  Is that correct?

 

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26 minutes ago, Lionel Hutz said:

But, when comparing only an LPTA using "responsibility-type" evaluation factors to a Price only evaluation using Special Standards of Responsibility, it sounds like neither option provides an "advantage" over the other (with regard to SBA COC issues) because both would require referral to the SBA.  Is that correct?

Yes, correct with regard to SBA COC issues. Whether LPTA or price only, if you eliminate a lower-priced small business offeror on the basis of either an LPTA  pass/fail assessment of responsibility type evaluation factors or a price-only determination of nonresponsibility, then you must refer that offeror to SBA for COC consideration before making an award.

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9 minutes ago, Vern Edwards said:

Yes, correct with regard to SBA COC issues. Whether LPTA or price only, if you eliminate a lower-priced small business offeror on the basis of either an LPTA  pass/fail assessment of responsibility type evaluation factors or a price-only determination of nonresponsibility, then you must refer that offeror to SBA for COC consideration before making an award.

Thanks, again.

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One additional point.

If an RFP establishes a special standard of responsibility, and if an agency eliminates a lower priced small business offeror on the basis of that standard and must refer the matter to the SBA, the question may arise whether SBA is bound by that special standard when deciding whether to issue a COC. As far as I can tell the answer is no. See Geochemical Testing, Inc., GAO B-203757, 81-2 CPD ¶ 519:

Quote

THE LOW BIDDER FOR THIS PROCUREMENT, BLACK ROCK TEST LABORATORIES, A SMALL BUSINESS, WAS FOUND NONRESPONSIBLE BY DOE. THE AGENCY REFERRED THE MATTER TO THE REGIONAL OFFICE OF THE SMALL BUSINESS ADMINISTRATION (SBA), AS REQUIRED BY THE SMALL BUSINESS ACT, 15 U.S.C. SEC. 637(B)(7) (SUPP. III 1979), AND THE SBA INITIALLY REFUSED TO ISSUE A CERTIFICATE OF COMPETENCY (COC) BECAUSE BLACK ROCK DID NOT MEET THE SPECIAL STANDARDS OF RESPONSIBILITY. DURING DEVELOPMENT OF THE PROTEST, HOWEVER, THE SBA REOPENED THE QUESTION AND MADE A NEW DETERMINATION THAT BLACK ROCK WAS CAPABLE OF PERFORMING THE CONTRACT REGARDLESS OF THE SPECIAL STANDARDS. AS A RESULT, THE SBA ISSUED A COC TO BLACK ROCK ON DECEMBER 2, 1981.

THE SBA'S ACTION HAS THE EFFECT OF OVERRIDING THE SPECIAL STANDARDS. WE HAVE STATED THAT SBA'S AUTHORITY IS NOT LIMITED BY SPECIAL STANDARDS OR DEFINITIVE CRITERIA OF RESPONSIBILITY WHICH A PROCURING AGENCY INCLUDES IN A SOLICITATION, SINCE SBA HAS STATUTORY AUTHORITY TO MAKE FINAL DETERMINATIONS WITH REGARD TO ALL ASPECTS OF RESPONSIBILITY OF SMALL BUSINESS CONCERNS. OUR OFFICE WILL NOT QUESTION SBA'S ISSUANCE OF A COC UNLESS THERE IS A PRIMA FACIE SHOWING THAT ITS FINDINGS WERE MADE FRAUDULENTLY OR WITH SUCH WILLFUL DISREGARD OF THE FACTS AS TO IMPLY BAD FAITH. SEE BAXTER & SONS ELEVATOR COMPANY, INC., 60 COMP.GEN. 97 (1980), 80-2 CPD 414; J. BARANELLO AND SONS, 58 COMP.GEN. 509 (1979), 79-1 CPD 322. IF AN AGENCY DISAGREES WITH SBA'S FINDINGS, IT CAN REQUEST THE SBA TO RECONSIDER IF THE RECORD INDICATES THAT CERTAIN VITAL INFORMATION BEARING ON THE RESPONSIBILITY OF THE BIDDER WAS NOT REVIEWED.

Capitalization in original.

That's an old decision, but I did not find anything more recent on that issue. I checked SBA's regulations and Standard Operating Procedure for COCs and found no mention of special standards of responsibility.

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While it is common practice for contracting officers to combine special standards of responsibility with evaluation factors, the GAO is able to tell the difference (as illustrated in the cases that Vern cited).  But all along, FAR 9.104-2(a) tells us that "[t]he special standards shall be set forth in the solicitation (and so identified) and shall apply to all offerors" (emphasis added).  Thus, a contracting officer errs when he or she combines special standards of responsibility with evaluation factors, and categorizes all of them as evaluation factors.

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14 minutes ago, ji20874 said:

 Thus, a contracting officer errs when he or she combines special standards of responsibility with evaluation factors, and categorizes all of them as evaluation factors.

What does "combines" mean? I don't understand what would constitute "combining" special standards of responsibility with evaluation factors and then categorizing all of them as evaluation factors. Please provide an example.

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