LPTA Evaluation Factor: Previous Corporate Experience

[kpearce]

Many RFPs which utilize the LPTA method of evaluation break the Technical Proposal into the following factors:

Factor 1: Previous Corporate Experience

Factor 2: Key Personnel

Factor 3: Technical Approach

Factor 4: Past Performance

Each of these factors are evaluated as either technically acceptable or unacceptable.

My questions are as follows:

Can a "newly established entity" successfully answer Factor 1, without having any " Previous Corporate Experience"?

How can a "newly established entity" be found neutral on Factor 4 (Past Performance) and unacceptable on Factor 1(Previous Corporate Experience)?

In reading the GAO decision on the matter of: Olympus Building Services, Inc. / File Number: B-282887

It seems the precedent has been established that "the Agency Acquisition officials have broad discretion in the selecting of evaluation factors that will be used in an acquisition". I would take this to mean that the Contracting Officer can make the decision as to whether he/she will accept the "newly established entity" key personnel / corporate officer previous experience on projects of similar size, scope, and complexity - but there is no legal requirement for the Contracting Officer to do so. Is this a correct interpretation?

Under this LPTA method, the "newly established entity" may drop to neutral on the "Past Performance" factor (Primarily b/c of the protection 15.305 offers firms with no relevant past performance, however, the "newly established entity" does not have the same safeguard in the "Previous Corporate Experience" factor.

Please comment on this issue.

Please recommend applicable GAO Decision history.

[Guest Vern Edwards]

Many RFPs which utilize the LPTA method of evaluation break the Technical Proposal into the following factors:

Factor 1: Previous Corporate Experience

Factor 2: Key Personnel

Factor 3: Technical Approach

Factor 4: Past Performance

Each of these factors are evaluated as either technically acceptable or unacceptable.

My questions are as follows:

Can a "newly established entity" successfully answer Factor 1, without having any " Previous Corporate Experience"?

That depends on how the agency has defined the factor. The agency might be willing to give the entity credit for the experience of its key personnel in their prior work, even though the entity itself has no experience; however, it does not have to do so. See my GAO citation, below. If this is not clear from the solicitation you should ask the CO.

How can a "newly established entity" be found neutral on Factor 4 (Past Performance) and unacceptable on Factor 1(Previous Corporate Experience)?

An agency can do that because experience and past performance are different things, even though they are evaluated on the basis of the same sources of information, and because the law says that if an entity has no past performance an agency may not evaluate the entity favorably or unfavorably on past performance, but does not say that about experience.

In reading the GAO decision on the matter of: Olympus Building Services, Inc. / File Number: B-282887

It seems the precedent has been established that "the Agency Acquisition officials have broad discretion in the selecting of evaluation factors that will be used in an acquisition". I would take this to mean that the Contracting Officer can make the decision as to whether he/she will accept the "newly established entity" key personnel / corporate officer previous experience on projects of similar size, scope, and complexity - but there is no legal requirement for the Contracting Officer to do so. Is this a correct interpretation?

Yes. It is legally permissible for an agency (the CO) to take the position that it is interested only in the entity's performance as a unit, and not in the performance of its individual members or subcontractors. However, the agency should make its intentions clear in the RFP. See my GAO citation and quote, below.

Under this LPTA method, the "newly established entity" may drop to neutral on the "Past Performance" factor (Primarily b/c of the protection 15.305 offers firms with no relevant past performance, however, the "newly established entity" does not have the same safeguard in the "Previous Corporate Experience" factor.

Please comment on this issue.

Please recommend applicable GAO Decision history.

I don't know what kind of comment you are looking for. You are correct: a new firm may receive a "neutral" rating on past performance and a rating of "unacceptable" on previous corporate experience. What more is there to say?

As for GAO history, see, e.g., Blue Rock Structures, Inc., B-287960.2, Oct. 10, 2001, 2001 CPD ? 184 (GAO denied protest that agency rated offeror "neutral" for past performance and "unacceptable" for corporate experience):

Blue Rock first protests the evaluation of its proposal under the corporate experience factor. Since the protester's proposal contained no actual experience information about Blue Rock as a corporate entity, and instead offered only limited relevant experience gained by an individual principal of the firm while he was employed by another firm, the agency evaluated the Blue Rock proposal as unacceptable under the corporate experience factor. The firm alleges that the agency should have attributed the project management experience of its individual principals, albeit gained while working on contracts performed by other companies, to Blue Rock to bolster its corporate experience evaluation rating.

* * *

As the agency points out, although an agency properly may, in appropriate circumstances, consider the experience of supervisory personnel in evaluating the experience of a new business, there is no legal requirement for an agency to attribute employee experience to the contractor as an entity. See The Project Management Group, Inc., B-284455, Apr. 14, 2000, 2000 CPD ? 66 at 4; Hard Bodies, Inc., B-279543, June 23, 1998, 98-1 CPD ? 172 at 4.

In this regard, an agency must make its intentions clear to prospective offerors. See Singleton Enterprises, B-298576, Oct. 30, 2006, 2006 CPD ? 157, in which the GAO sustained the protest that the agency had not given the offeror credit for its subcontractors' experience, because the agency had not made its intentions clear in the request for proposals.

All of that having been said, if you are a small business for a procurement, and if an agency finds you technically unacceptable in an LPTA source selection due to lack of experience, the agency may have to refer you to the U. S. Small Business Administration for certificate of competency consideration on grounds that the evaluation is tantamount to a determination of non-responsibility. See FAR Subpart 19.6. How you would fare in such a case would depend on how the agency wrote the evaluation factor.

You should consult an attorney if this is a legal issue for you. You should not accept free information at a website as gospel.

[joel hoffman]

Many RFPs which utilize the LPTA method of evaluation break the Technical Proposal into the following factors:

Factor 1: Previous Corporate Experience

Factor 2: Key Personnel

Factor 3: Technical Approach

Factor 4: Past Performance

Each of these factors are evaluated as either technically acceptable or unacceptable.

My questions are as follows:

Can a "newly established entity" successfully answer Factor 1, without having any " Previous Corporate Experience"?

How can a "newly established entity" be found neutral on Factor 4 (Past Performance) and unacceptable on Factor 1(Previous Corporate Experience)?

In reading the GAO decision on the matter of: Olympus Building Services, Inc. / File Number: B-282887

It seems the precedent has been established that "the Agency Acquisition officials have broad discretion in the selecting of evaluation factors that will be used in an acquisition". I would take this to mean that the Contracting Officer can make the decision as to whether he/she will accept the "newly established entity" key personnel / corporate officer previous experience on projects of similar size, scope, and complexity - but there is no legal requirement for the Contracting Officer to do so. Is this a correct interpretation?

Under this LPTA method, the "newly established entity" may drop to neutral on the "Past Performance" factor (Primarily b/c of the protection 15.305 offers firms with no relevant past performance, however, the "newly established entity" does not have the same safeguard in the "Previous Corporate Experience" factor.

Please comment on this issue.

Please recommend applicable GAO Decision history.

I do find it interesting that the WIFCON analysis pages for Protests do not list "experience" or "corporate experience" as issues, key words, etc. I had to look under "past performance" to find the discussion of "experience". I wonder why the Webmaster doesn't seem to distinguish between experience and past performance (I may have missed it) because a lot of people don't understand that the two may be separate factors or aspects and they may be evaluated using separate criteria.

Yes, the GAO has distinguished the "extent and relevancy aspects" of a firm's experience from the "qualitative aspects" of a firm's experience in numerous decisions - but generally when the Solicitation distinguishes between them. Many Solicitations (incorrectly, in my opinion) mix them under a "Past Performace" factor. You can read excerpts from some of these decisions and references to other decisions at this link in WIFCON: http://www.wifcon.com/pd15305a2iii.htm

The DoD Guide to Evaluation of Past Performance and the Army Source Selection Manual distinguish between experience and past performance.

I also looked in the second edition of The Government Contracts Reference Book. I couldn't find a definition for "experience". Interestingly, I found a definition for "past performance", which started with "(a)n EVALUATION FACTOR used to assess an offeror's capability, comprising three elements: "(1) observations of the historical facts of a company's work experience - what work it did, when and where it did it, whom it did it for, and what methods it used; (2) qualitative judgements about the breadth, depth, and relevance of that experience based on those observations; and (3) qualitative judgements about how well the company performed, also based upon those observations." Edwards, How to Evaluate Past Performance: A Best Value Approach (The Geo. Wash. Univ. Law School, Government Contracts Program 1996)..."

However FAR 42.1501 defines "past performance information" as "relevant information, for future source selection purposes, regarding a contractor's actions under previously awarded contracts. It includes, for example, the contractor's record of conforming to contract requirements and to standards of good workmanship; the contractor's record of forescasting and controlling costs; the contractor's adherence to contract schedules, including the administrative aspects of performance; the contractor's history of reasonable and cooperative behavior and commitment to customer satisfaction; and generally, the contractor's business-like concern for the interest of the customer."

There is no direct mention in FAR 42.15 of anything resembling " observations of the historical facts of a company's work experience - what work it did, when and where it did it, whom it did it for, and what methods it used" or "(2) qualitative judgements about the breadth, depth, and relevance of that experience based on those observations".

The FAR at 15.305 discusses evaluation of past performance (see definition in 42.1501); FAR 15.305 (2) (iv) requires, "(i)n the case of an offeror without a record of relevant past performance or without a record of relevant past performance or for whom information on past performance is not available, the offeror may not be evaluated favorably or unfavorably on past performance." The FAR implemented this PP provision from either the Federal Acquisition Reform Act or Federal Acquisition Streamlining Act (I forget which one).

Thus, if the government distinguishes between extent of experience and past performance, as defined in FAR 42.1501, it can legally evaluate them differently in the case of a firm with no experience vs. a firm with no history of or information on past performance.

It really depends upon the language in the actual solicitation. If the government has mixed up extent and relevancy of corporate experience with the quality of experience under the same factor, without any differentiation between them for evaluation purposes, then I think that they have to treat lack of experience the same as lack of past performance history.

But if they have (wisely, in my opinion) differentiated between them, the solicitation will probably allow the government to downgrade or even disqualify a firm for lack of any experience relevant to the instant contract work. And the government may refuse or elect to consider either the experience or the past performance of key personnel or key subcontractors in making the evaluation but should state such in the evaluation criteria. See the example decisions in WIFCON at the link above.

I also think that, if you are a small business and the government disqualifies you for having no experience, they might have to go through the SBA's Certificate of Competency procedures, if challenged. I haven't recently looked at this. I don't remember the GAO addressing that aspect, because I don't think it is under their area of purview (I may be wrong). I know that I disqualified firms for lack of relevant experience on a few LPTA source selections 15 years ago. We didn't go to SBA and nobody challenged us. These were SDB set-asides for construction under an old DoD program, where we required some minimal experience by the prime or it's trade subcontractor (if any) on critical trade work.

I agree with Vern that you need to get some professional advice, if you intend to protest the terms of the solicitation or an evaluation.

[Guest Seeker]

Mr. Hoffman, Is the gist of your long comment that experience and past performance are different things, as Mr. Edwards already said? You seem to be saying the same things he said only without references. Why didn't you mention Mr. Edwards' blog entry of 23 Feb 09, "The "'Neutral' Rule and the Evaluation of Experience"? It explains everything more clearly than you did and with extensive references.

[Guest Seeker]

I just want to know if I'm missing something in what you wrote. I don't mean to be disrespectful.

[kpearce]

Mr. Hoffman, Is the gist of your long comment that experience and past performance are different things, as Mr. Edwards already said? You seem to be saying the same things he said only without references. Why didn't you mention Mr. Edwards' blog entry of 23 Feb 09, "The "'Neutral' Rule and the Evaluation of Experience"? It explains everything more clearly than you did and with extensive references.

Seeker - I could not find the 23 Feb 09 blog entry from Mr. Edwards. Could you please point me in the right direction or copy and paste it into this topic. Much appreciated.

[Guest Seeker]

Go to the top right of this page and click on "Blogs" Then click on "Vern Edwards' Blog." Then go to page 3. Then scroll down until you find the post. It's near the bottom of page 3.

[Guest Vern Edwards]

kpearce:

You might find this useful: "Past Performance/Experience," by Michael Golden, an attorney who was formerly with the GAO. You can get it at this link: http://www.tricare.mil/contracting/acquisi...Performance.pdf. It contains extensive case law citations,

[joel hoffman]

"Mr. Hoffman, Is the gist of your long comment that experience and past performance are different things, as Mr. Edwards already said?"

Yes. Sorry that I took up your time. I read the original post in a thread mistakenly posted to the"Contracting Workforce" area. After posting there, I discovered Vern's well written response.

"You seem to be saying the same things he said only without references."

Sorry that you couldn't read anything at the decisions and references to other decisions that I provided at this link in WIFCON: http://www.wifcon.com/pd15305a2iii.htm. Guess you want a free lawyer.

"Why didn't you mention Mr. Edwards' blog entry of 23 Feb 09, "The "'Neutral' Rule and the Evaluation of Experience"? It explains everything more clearly than you did and with extensive references."

Super. He is a great scholar and excellent author. Sorry to waste your time and mine.

[Guest Vern Edwards]

Your post was fine, Joel.