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Duty to notify agency of unavailability of proposed Key Personnel?

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I remember seeing somewhere, maybe in a GAO decision now lost, that the FAR requires an offeror to notify the agency of the unavailability of a proposed key personnel, even after submission of proposals.  But I can't find this in the FAR (I was mainly looking through FAR Part 15 and FAR 52.215-___).  Can anyone tell me where it says this in the FAR?

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Government contractors frequently find themselves in a sticky situation where, after submitting a “best and final offer” (BAFO), but before award, they learn that material information provided in their proposal has become stale. This type of situation often arises when the contractor learns that proposed key personnel are no longer available, or otherwise will not be able to participate in the contract if awarded. The contractor facing such a situation must quickly decide whether, prior to contract award but after submission of its BAFO, it should notify the contracting officer of the newly discovered potential unavailability of such proposed key personnel. As discussed below, this is a gray area in the law, with Government Accountability Office decisions supporting either notification or remaining silent depending on the specific facts at issue.  

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Despite these risks, contractors also should be aware that numerous GAO opinions could be interpreted to require pre-award notification of any “material change” in the offeror’s proposal. In Greenleaf Constr. Co, Inc., B-293105.18, 2006 CPD ¶ 19 (Comp. Gen. Jan. 17, 2006), for example, the GAO sustained a protest where, after submission of the awardee’s proposal but prior to award, both the offeror’s key personnel and the proposed technical approach had materially changed. The GAO reasoned that because of the material changes, “the agency never evaluated the awardee’s actual resources and technical approach as they existed at the time of award.” Similarly, in Paradigm Tech. Inc., B-409221.2, 2014 CPD ¶ 257 (Comp. Gen. Aug. 1, 2014), the GAO sustained a protest where the procuring agency was aware that the awardee’s proposal failed to satisfy a material solicitation requirement concerning key personnel. Citing Greenleaf, the GAO admonished the offeror that it “should not have allowed almost three months to pass before notifying the agency that one of its two key people was no longer available,” noting that identification of key personnel was a material term of the solicitation and any changes must be reported to the contracting officer.

 A number of recent GAO cases cite Greenleaf as mandating that “offerors are obligated to advise agencies of changes in proposed staffing and resources, even after submission of proposals.” See, e.g., Brandes Assoc. Inc., B-412548.5, 2016 CPD ¶ 245 (Comp. Gen. Aug. 24, 2016) (citing Greenleaf as holding: “The failure of an offeror to inform the agency of a change in proposed staffing and resources may render the evaluation and subsequent award decision unreasonable where it results in the agency being unable to evaluate the actual employees as they existed at the time of award.”). Additionally, relevant commentary suggests that an offeror likely should notify the government of the change. See, e.g., Steven W. Feldman, Government Contract Awards: Negotiation and Sealed Bidding §10.26 (Oct. 2016) (suggesting that “if in the interval between submission of revisions and the award the offeror learns that the key personnel representations are no longer accurate,” the offeror should “volunteer the information to the agency so as to avoid tainting the award with a possible misrepresentation”).

https://www.law360.com/articles/928640/risks-for-contractor-with-new-info-after-proposal-submission

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Brandes’s allegation that Amelex failed to inform the agency of a material change in its key personnel was not clearly meritorious at the time the agency filed its agency report. In this regard, our Office has held that offerors are obligated to advise agencies of changes in proposed staffing and resources, even after submission of proposals. Greenleaf Constr. Co., Inc., B-293105.18, B-293105.19, Jan. 17, 2006, 2006 CPD ¶ 19 at 10. The failure of an offeror to inform the agency of a change in proposed staffing and resources may render the evaluation and subsequent award decision unreasonable where it results in the agency being unable to evaluate the actual employees as they existed at the time of award.

Brandes Associates Inc., B-412548.5, Aug. 24, 2016

https://www.gao.gov/assets/680/679861.pdf

 

 

 

 

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With regard to the FAR consider going beyond to your agency supplement to the FAR and even your agency policy as you may have language that you did or should have included in your solicitation requiring such notification.    By example  for the Agency of International Development at AIDAR 752.204.70 such a requirement exists.   

Beginner hint - Go to your favorite FAR website that includes all agency supplements and search on "key personnel" you might find what you are looking for and you might not.

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Is it there? Is it where? While you eat your green eggs and ham, these are the only reasons you should care:

Is it in the solicitation?

Is it in the contract?

Is it in the FAR? (Is it also included in the solicitation or contract?)

Is it in your agency's FAR supplement(s)? (Is it also included in the solicitation or contract?)

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I’ve seen this as a special condition where it requires the contractor to notify the Government anytime their key personnel are changed from what was initially proposed. I don’t know that it’s in the FAR though, and while it doesn't specifically state unavailability, it's something similar in my agency supplement. 

 

 

KEY PERSONNEL
 

(a) The personnel as specified below are considered essential to the work being performed under this contract and may, with the consent of the contracting parties, be changed from time to time during the course of the contract by adding or deleting personnel, as appropriate.

(b) Before removing, replacing, or diverting any of the specified individuals, the Contractor shall notify the contracting officer, in writing, before the change becomes effective.  The Contractor shall submit information to support the proposed action to enable the contracting officer to evaluate the potential impact of the change on the contract.  The Contractor shall not remove or replace personnel under this contract until the Contracting Officer approves the change.

The Key Personnel under this Contract are:

(specify key personnel)
(End of clause)

 

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13 hours ago, Deaner said:

I’ve seen this as a special condition where it requires the contractor to notify the Government anytime their key personnel are changed from what was initially proposed. I don’t know that it’s in the FAR though, and while it doesn't specifically state unavailability, it's something similar in my agency supplement. 

This is a clause is pertinent to the administration of a contract. It is not a solicitation provision relevant to the evaluation of proposals.

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The USDA has a key personnel clause. 

The prescription states: "The contracting officer shall insert a clause substantially the same as the clause at 452.237-74, Key Personnel, in contracts if contract performance requires identification of the contractor’s key personnel."

The clause reads:

KEY PERSONNEL (FEB 1988)

(a) The Contractor shall assign to this contract the following key personnel: __________________

(b) During the first ninety (90) days of performance, the Contractor shall make no substitutions of key personnel unless the substitution is necessitated by illness, death, or termination of employment. The Contractor shall notify the Contracting Officer within 15 calendar days after the occurrence of any of these events and provide the information required by paragraph (c) below. After the initial 90-day period, the Contractor shall submit the information required by paragraph (c) to the Contracting Officer at least 15 days prior to making any permanent substitutions.

(c) The Contractor shall provide a detailed explanation of the circumstances necessitating the proposed substitutions, complete resumes for the proposed substitutes, and any additional information requested by the Contracting Officer. Proposed substitutes should have comparable qualifications to those of the persons being replaced. The Contracting Officer will notify the Contractor within 15 calendar days after receipt of all required information of the decision on substitutions. The contract will be modified to reflect any approved changes of key personnel.

(End of Clause)

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If you would like to see a non-prescribed Key Personnel Clause with detailed requirements, take a look at the one you will find at this link: http://www.hanford.gov/page.cfm/PrimeContracts which takes you to the prime contracts page. Then scroll down to CH2M Hill Plateau Remediation Company, LLC (CHPRC);

Click on "CHPRC Conformed Contract"

Click on Section H, and then on clause H.15.

Enjoy.

 

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I faced this same scenario where our folks identified as key personnel in a proposal had moved on by the time our award rolled around. 

Our staffing matrix and qualifications for key personnel held significant weight in the technical evaluation too.

At the time I searched for anything in the solicitation or otherwise that forced a contractor to disclose they’d left and ultimately I did not find anything that required this disclosure. With the eval criteria you could argue there should have been.

Knowing that a disclosure of this change to the agency could have thrown our tech evaluation upsidedown, albeit completely unintentional, it wasn’t worth the risk of disclosing prior to a fully executed contract. 

We abided by the key personnel clause in the award and no one got too bent out of shape. But it was a balance to not appear a bait and switch was going on (which if intentional  would be a much different situation).

The adage better to ask for forgiveness than permission did cross through my mind once or twice 

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On 10/17/2017 at 2:51 PM, govt2310 said:

I remember seeing somewhere, maybe in a GAO decision now lost, that the FAR requires an offeror to notify the agency of the unavailability of a proposed key personnel, even after submission of proposals. But I can't find this in the FAR (I was mainly looking through FAR Part 15 and FAR 52.215-___).  Can anyone tell me where it says this in the FAR?

As has previously been stated, FAR is silent on the matter. We have to think about this like contracting practitioners, not just as bureaucrats. Think contracts. Think offer and acceptance.

What information did the agency ask for in its RFP?

Did the agency ask the offerors to describe the key personnel that they are offering (promising) to employ under the contract or did it ask the offerors merely to describe the key personnel that they currently employ or that they plan to employ under the contract? Do you see the distinction? One description is prospectively contractually binding, while the other is not.

If the agency asked offerors to describe the key personnel that they are offering (promising), and if after the submission of offers an offeror finds that it is no longer able to offer (promise) one or more of those persons, then it had better notify the agency and ask for the opportunity to revise its proposal. If it doesn't, and if the agency accepts its offer, then it will breach the contract on Day One. If denied the opportunity to revise its proposal, then the offeror had better withdraw its offer.

If the agency asked offerors merely to describe the personnel that they intend or plan to employ, but did not ask them to make promises in that regard, then there should be no inherent legal obligation for offerors to notify the agency of changes in key personnel since proposal submission, unless the RFP instructed them to do so. I'm not sure what the GAO's stance is in this regard. The case cited by napolik had to do with task order proposals under a MATOC, which may involve different implications than proposals for new contracts.

Agencies must think things through. Why do they want information about key personnel? Do they want promises about what persons offerors will employ or do they want indications of the general quality of offeror employees? It would be stupid to ask for promises, unless the acquisition is for R&D and the agency is going to make its pick primarily on the basis of the relative merits of offerors' principal investigators. In that case, offerors should and might obtain prospectively binding offers for subcontracts with prospective principal investigators in order to bind them to work under the contract. Otherwise, employees come and go and they die, and an offeror would be stupid to promise someone on the basis of simple employer/employee relations. 

Allowing an offeror to revise its proposal in the event of a change in key personnel would entail discussions, not clarifications. Once notified of a change, the agency must think about how to evaluate the proposal, whether to conduct discussions, and whether to include the offeror in the competitive range. Agencies should think about the possibility of key personnel changes between proposal submission and award and decide in advance what such changes would mean, if anything, in terms of offer and acceptance and how they would handle them.

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2 hours ago, Vern Edwards said:

The case cited by napolik had to do with task order proposals under a MATOC, which may involve different implications than proposals for new contracts.

Would the MATOC, or GSA BPA, contain clauses governing submission and evaluation of quotes/ proposals? Maybe. I used those clauses.

Every contract specialist must read the clauses contained in the MATOC or GSA BPA to see how they affect contract performance AND the solicitation and evaluation of quotes/ proposals. If the the MATOC or GSA BPA clauses don't contain proposal submission and evaluation language, the CO could add the same language on proposal submission and evaluation in the solicitation as seen in provisions in a solicitation for a new contract. 

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As a contractor in this situation I think it’s important to evaluate things beyond just the terms and conditions spectrum as well. 

Once you have cleared what you see to be the legal hurdles (solicitation language, FAR, contract) will your firms reputation still be in tact?

Even if you’ve determined you’re not obligated to disclose a thing, how will your actions be perceived by the govt or others?

There is a difference between substituting a key position where 1) you know your company has 5 more equally qualified replacements who wouldn’t skip a beat and 2) the one of a kind project lead that you’d be up a creek without a paddle looking to replace.

If it were the latter and you knew the award depended on this person, even if you risk losing the business, it may be worth disclosing to the agency (if you still had the chance to). If you didn’t and you can’t deliver you likely just cost yourself a customer.

If it were the former you can probably sleep well at night knowing that you can still staff a high performing individual at a key position (and one that the govt won’t freak that you’re replacing).

This might not good advice but it was what I thought about after having cleared contractual obligations 

 

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What would one do in this scenario?

A Fed agency covered by the FAR issues a solicitation calling for transportation services. The SOW includes a spec for the motor vehicles. The award will be made on a tradeoff basis. Quality of the motor vehicle is an evaluation factor.

Contractor X will compete relying on a subcontractor to furnish the motor vehicles. One subcontractor,  Luxurious Imports Inc. (LMI) furnishes Mercedes. The other subcontractor, Cinque Cento (C2 )motors, provides Fiat 500s. Both meet the solicitation spec requirement. 

Since the source selection will be a tradeoff, X proposes LMI vehicles. Later, after dispute breakouts our between X and LMI, X decides to use C2..

Is X required to notify the contracting officer that it will provide Fiat 500s instead of Mercedes? 

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5 hours ago, Vern Edwards said:

We have to think about this like contracting practitioners, not just as bureaucrats. Think contracts. Think offer and acceptance.

On that note:

  1. What would the government have to gain by maintaining a draconian approach to Key Personnel?   I'm convinced that there are Key Personnel provisions/clauses floating around out there that are probably illegal, as they read more like Mandates for Indentured Servitude than solicitation provisions. And are you really going to T4C someone because one of their people had the temerity to (gasp!) change jobs??  (Cutting off your nose to spite your face comes to mind.)
  2. As a contractor, wouldn't you out of normal business practice inform the government of a material change to your offering before award, such as an obsolete part# or model#?  What responsible businessperson would propose a product or level of service they knew they couldn't provide?
  3. If Key Personnel are SO critical to success such that a change of name(s) would affect your evaluation, should you be in the R&D or Grants arena?

The FAR isn't necessary to the formation of rational decisions on either side.

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1 hour ago, REA'n Maker said:

What would the government have to gain by maintaining a draconian approach to Key Personnel?   I'm convinced that there are Key Personnel provisions/clauses floating around out there that are probably illegal, as they read more like Mandates for Indentured Servitude than solicitation provisions.

Brandes’s allegation that Amelex failed to inform the agency of a material change in its key personnel was not clearly meritorious at the time the agency filed its agency report. In this regard, our Office has held that offerors are obligated to advise agencies of changes in proposed staffing and resources, even after submission of proposals. Greenleaf Constr. Co., Inc., B-293105.18, B-293105.19, Jan. 17, 2006, 2006 CPD ¶ 19 at 10. The failure of an offeror to inform the agency of a change in proposed staffing and resources may render the evaluation and subsequent award decision unreasonable where it results in the agency being unable to evaluate the actual employees as they existed at the time of award.

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In the absence of a specific solicitation requiring one to, does ‘relevant commentary’ suggestions, and the GAO’s reasoning where some interpretations could require contractors to notify an agency of a material change, equate to.. contractors must do so? 

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44 minutes ago, Michael11 said:

In the absence of a specific solicitation requiring one to, does ‘relevant commentary’ suggestions, and the GAO’s reasoning where some interpretations could require contractors to notify an agency of a material change, equate to.. contractors must do so? 

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We conclude that there was a material change in the awardee’s proposed staffing and EMS approach that occurred after CLF certified that its January 2005 FPR remained valid, but more than 2 months prior to the agency’s final evaluation and award of the M&M contract. Under these circumstances, CLF was required to advise the agency of the material change in its proposed resources and technical approach, in order to ensure that the evaluation was based on consideration of the staffing and EMS that CLF actually intended to use in performing the contract. See Dual, Inc., B-280719, Nov. 12, 1998, 98-2 CPD ¶ 133 at 3-6, as recently explained in SAMS El Segundo, LLC, B-291620, B-291620.2, Feb. 3, 2003, 2003 CPD ¶ 44 at 19-20. Because CLF failed to do so, the agency never evaluated CLF’s actual employees and EMS approach as they existed at the time of award; as a result, the evaluation--and, it follows, the award determination that was based on the results of the evaluation--were unreasonable. Dual, Inc., supra, at 6. To allow such an award to stand would call into question the integrity of the competition. Accordingly, we sustain the protest on this basis.

Greenleaf Constr. Co, Inc., B-293105.18, B-293105.19, Jan. 17, 2006

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Since the agency's evaluation of Camber's proposal was based upon Camber's representation that it would perform much of the TSA contract with its own employees, when, in fact, that will not be the case, the evaluation is flawed. Therefore, the SSA's best value determination and selection of Camber as the second awardee under the partial small business set-aside, which was based entirely upon the results of the flawed evaluation, is also suspect.

 In these circumstances, Camber had an obligation to advise the agency of the sale, at the very latest on June 28, when it agreed to the sale and lease back of facilities. See Professional Safety Consultants Co., Inc., B-247331, Apr. 29, 1992, 92-1 CPD Para. 404 at 4. See also Mantech Field Eng'g Corp., supra. Because Camber did not do so, the agency's evaluation and its selection of Camber were based upon representations concerning Camber's personnel that were no longer true. The award was based on Camber's proposal representations, and to allow such an award to stand in spite of the fact that Camber had not disclosed to the agency that it would not perform the contract as proposed would call into the question the integrity of the competition. See AAA Eng'g & Drafting, Inc., B-250323, Jan. 26, 1993, 93-1 CPD Para. 287 at 6. Accordingly, we are sustaining the protest on this ground.

Dual, Inc., B-280719, Nov. 12, 1998

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20 hours ago, napolik said:

What would one do in this scenario?

A Fed agency covered by the FAR issues a solicitation calling for transportation services. The SOW includes a spec for the motor vehicles. The award will be made on a tradeoff basis. Quality of the motor vehicle is an evaluation factor.

Contractor X will compete relying on a subcontractor to furnish the motor vehicles. One subcontractor,  Luxurious Imports Inc. (LMI) furnishes Mercedes. The other subcontractor, Cinque Cento (C2 )motors, provides Fiat 500s. Both meet the solicitation spec requirement. 

Since the source selection will be a tradeoff, X proposes LMI vehicles. Later, after dispute breakouts our between X and LMI, X decides to use C2..

Is X required to notify the contracting officer that it will provide Fiat 500s instead of Mercedes? 

Two questions:

1. You say that the source selection will be a tradeoff. How will the government evaluate the cars? Will it look to see only whether a proposed car meets the spec or will it evaluate the cars on other value-adding attributes, as well?

2. What will the contract say? Will it retain the spec in the solicitation or will it specify the car by make and model?

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3 minutes ago, Vern Edwards said:

1. You say that the source selection will be a tradeoff. How will the government evaluate the cars? Will it look to see only whether a proposed car meets the spec or will it evaluate the cars on other value-adding attributes, as well?

First, the cars must meet the minimum spec. Then, additional value will be assigned based upon horsepower, max velocity, seat space, IT mechanisms, etc.

Quote

2. What will the contract say? Will it retain the spec in the solicitation or will it specify the car by make and model?

Like many, if not most, solicitations, there is no clause explicitly stating that the proposed vehicle must be furnished. However, the solicitation defines clearly the contents of the proposal/ offer, and the contracting officer will accept the proposal/ offer.

PS - Another competitor will offer a Renault.

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napolik,

My practice:  Whenever I conduct a trade-off, and the winner is selected because of some feature or aspect of its offer or proposal (yes, these are different), I want to incorporate that feature or aspect into the resulting contract. 

Vern,

i hope your efforts here will result in a contracting officer somewhere shifting more towards evaluating offers (promises) and less on evaluating proposals.  This means our solicitations should ask more for offers (promises) and less for proposals.

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