Jump to content

Recommended Posts

Hi--

if the contracting officer received two proposals under LPTA, and only one was evaluated and determined to be technically-acceptable, may the contracting officer turn this procurement into a negotiated procurement to discuss with the one technically-acceptable offeror without canceling and resoliciting?

I appreciate whatever feedback I get.

Link to comment
Share on other sites

Why wasn't the second proposal evaluated? Or did you mean that after evaluations, only one was found technically acceptable?

Thanks for clarifying.

The second proposal was clearly deficient in all criteria, making it technically-acceptable.

V/r--EB

Link to comment
Share on other sites

ooops, technically-unacceptable.....

okay--both were evaluated and only one was determined to be acceptable.

I should have finished my java before posting.

I apologize for the lack of clarity but still would appreciate feedback.

V/r--EB

Link to comment
Share on other sites

Guest Vern Edwards

It already is a "negotiated procurement." I think what you are asking is what kind of discussions can you have, pursuant to FAR 15.306(d), about the one acceptable proposal.

The main purpose of discussions in an LPTA is to let offerors eliminate deficiencies that keep their proposals from being technically acceptable. Since you already have a technically acceptable proposal, what do you want to talk about with the offeror whose proposal is already acceptable?

But, assuming you have a reason, you firm have to establish a competitive range, which means that you have to decide whether it is worth the time and trouble to include the unacceptable proposal. If the unacceptable proposal could easily be made acceptable, then you probably should include it and conduct discussions with both offerors. However, it is legal to have a competitive range of one.

Second, assuming that you have excluded the unacceptable proposal from the competitive range, thereby establishing a competitive range of one, the question is what can you talk about with the offeror whose proposal is acceptable. You cannot reduce requirements in the specification or statement of work and seek an even lower price. If you do, you might have to issue an amendment and give the unacceptable offeror a chance to submit a revised proposal. If you change it too much you might have to cancel the solicitation and start over. But if you don't change requirements you can probably try to negotiate an even lower price, if that would be wise and fair, which it probably wouldn't.

In theory, you should be able to negotiate increased requirements in the specification or statement of work as long as you do not let the already acceptable offeror increase its price, but it's not certain that that would be permissible. It could be risky.

In short, you can conduct discussions with the LPTA offeror, but you better be careful about what you discuss and what revisions you let the offeror make.

Link to comment
Share on other sites

It already is a "negotiated procurement." I think what you are asking is what kind of discussions can you have, pursuant to FAR 15.306(d), about the the one acceptable proposal.

The main purpose of discussions in an LPTA is to let offerors eliminate deficiencies that keep their proposals from being technically acceptable. Since you already have a technically acceptable proposal, what do you want to talk about with the offeror whose proposal is already acceptable?

But, assuming you have a reason, you firm have to establish a competitive range, which means that you have to decide whether it is worth the time and trouble to include the unacceptable proposal. If the unacceptable proposal could easily be made acceptable, then you probably should include it and conduct discussions with both offerors. However, it is legal to have a competitive range of one.

Second, assuming that you have excluded the unacceptable proposal from the competitive range, thereby establishing a competitive range of one, the question is what can you talk about with the offeror whose proposal is acceptable. You cannot reduce requirements in the specification or statement of work and seek an even lower price. If you do, you might have to issue an amendment and give the unacceptable offeror a chance to submit a revised proposal. If you change it too much you might have to cancel the solicitation and start over. But if you don't change requirements you can probably try to negotiate an even lower price, if that would be wise and fair, which it probably wouldn't.

In theory, you should be able to negotiate increased requirements in the specification or statement of work as long as you do not let the already acceptable offeror increase its price, but it's not certain that that would be permissible. It could be risky.

In short, you can conduct discussions with the LPTA offeror, but you better be careful about what you discuss and what revisions you let the offeror make.

Thank you, Vern--

I appreciate your help.

Essentially, we expected to get more responses but only received two. One was clearly a last minute, cut and paste proposal that did not even address the requirements of the solicitation. The other was one of the expected proposals and met/exceeded our minimum requirements, offering more than what we needed. We like much of the proposal of the technically-acceptable offeror, but some elements need to be removed as costly and not needed and there are some other aspects that the client would like for us to discuss. That is why I asked if we can turn this into negotiated and conduct some trade offs. V/r-EB

Link to comment
Share on other sites

Guest Vern Edwards

In my opinion, you can negotiate with the offeror and ask it to remove the proposed excess and to propose a lower price, as long as you do not change any of your requirements. To be clear, as I understand it the proposal meets all specified requirements, minimums and maximums, and is acceptable, but offers more than you want. I do not think you can get into trouble by establishing a competitive range of one and asking the offeror to remove the excess in its proposal and reduce its price. However, I suggest that you not refer to "tradeoffs." Just point out the excesses and ask that the offeror delete them and propose a lower price.

Link to comment
Share on other sites

In my opinion, you can negotiate with the offeror and ask it to remove the proposed excess and to propose a lower price, as long as you do not change any of your requirements. To be clear, as I understand it the proposal meets all specified requirements, minimums and maximums, and is acceptable, but offers more than you want. I do not think you can get into trouble by establishing a competitive range of one and asking the offeror to remove the excess in its proposal and reduce its price. However, I suggest that you not refer to "tradeoffs." Just point out the excesses and ask that the offeror delete them and propose a lower price.

Thank you, Vern.

Yes, you have our situation paraphrased clearly and correctly. I have taken your information as very important guidance.

Question: is it even "cleaner" still if we award to technically-acceptable offeror as proposal is, and then do a within scope modification to remove items the Government does not need? I don't see an issue---- except maybe for the fact that we knew we did not need the extras it at the pre award stage but bought them anyway just to remove them via mod later...

any thoughts on this?

V/r--EB

Link to comment
Share on other sites

I don't disagree with anything Vern has said above, but let me argue the other side, in the hope that both will give a more complete picture than either side alone.

Determinations that result in a competitive range comprised of just one offeror are subject to close scrutiny. L-3 Communications EOTech, Inc. v. U.S., 87 Fed.Cl. 656 (2009). The fact that this is an LPTA makes me wonder how difficult it would be for the excluded offeror to become technically acceptable. Is this just an informational deficiency, or is the offeror really proposing an approach that fails to meet the minimum technical requirements of the RFP? You might want to take a look at Dynalantic Corp., B-274944.2, Feb. 25, 1997, 97-1 CPD ? 101, suggesting the GAO may be less deferential to an agency decision that the disappointed offeror was not reasonably susceptible of being made acceptable when the decision results in a competitive range of one. Second, make sure you think through whether you have adequate price competition now, and whether you will have adequate price competition at FPR, and who decides. See FAR 15.403-1?(1), especially the second prong. On the one hand, if the apparent successful offeror is presently awardable, do the potential benefits of discussion overcome the potential costs? On the other hand, if discussions are warranted, any doubts about whether an offeror should be included in the competitive range should be resolved in favor of inclusion. The presently unacceptable offeror can't successfully protest that you should have excluded it.

Link to comment
Share on other sites

Guest Vern Edwards
Thank you, Vern.

Question: is it even "cleaner" still if we award to technically-acceptable offeror as proposal is, and then do a within scope modification to remove items the Government does not need? I don't see an issue---- except maybe for the fact that we knew we did not need the extras it at the pre award stage but bought them anyway just to remove them via mod later...

any thoughts on this?

V/r--EB

No, it's not cleaner. It's improper. See ELEIT Technology, Inc., Comp. Gen. Dec. B-294193.2, 2004 CPD ? 203:

Similarly, with regard to the protester's argument that changes in the agency's requirements could be addressed through modification of the contract after award, it is improper for an agency to award a contract with the intent to materially alter the contract terms after award. PAI Corp; Viking Sys. Int'l; CER Corp.?Protests and Requests for Costs , B?244287.5 et al. , Nov. 29, 1991, 91?2 CPD 508 at 4.

If you want to negotiate with the acceptable offeror to cut excess from its proposal, do it before award.

I don't think you have anything to worry about with respect to adequate price competition. Jacques is right about "close scrutiny" of a competitive range of one by the Court of Federal Claims, but I would not be concerned about that based on what you have told us. In a decision of the same year as the one cited by Jacques, the GAO denied a protest when an agency received two proposals, both offerors were rated technically unacceptable, and the agency included only one of them in the competitive range. See Outdoor Venture Corp., Comp. Gen. Dec. B-401351.2, 2009 CPD P 194.

If you conducted the evaluation properly and if you use good judgement when excluding the unacceptable offeror from the competitive range, you will have nothing to worry about. Did you conduct the evaluation properly? Is the unacceptable proposal as bad as you say? If so, don't worry about a competitive range of one. It's wrong to include a proposal in the competitive range and invite the offeror to incur more bid and proposal expense if you evaluated them properly and don't think they can win.

Link to comment
Share on other sites

Vern, you write:

It's wrong to include a proposal in the competitive range and invite the offeror to incur more bid and proposal expense if you evaluated them properly and don't think they can win.

(emphasis added).

I would agree with you if the discussions were misleading or not meaningful, but I'm sure this offeror would be told that its technical proposal is deficient. I do not agree that it would be wrong to let the offeror decide whether or not it wanted to incur additional expense, if the government is candid during discussions.

I don't know how you can brush off the price reasonableness and adequate price competition issues so easily. While I hope you're right, I don't think there are enough facts in this thread to know.

There are basically only three choices here: (1) award without discussions; (2) enter discussions with both; or (3) competitive range of one. Each appears defensible based on the facts presented. Each has its own costs and benefits.

Link to comment
Share on other sites

Guest Vern Edwards

Jacques:

In case you didn't understand what I said the first time, let me say it again: It would be wrong to include a proposal in the competitive range and invite the offeror to incur more bid and proposal expense if you evaluated them properly and don't think they can win. You either understand that or you don't. I'm not seeking your agreement. Your agreement is your concern.

I didn't brush off price reasonableness. I didn't mention price reasonableness. Adequate price competition is based on the offerors' expectations. You can have adequate price competition even if you receive only one proposal. Based on what we've been told, adequate price competition is not a problem. As for you hoping that I'm right--well, your hopes are your concern, not mine.

Yes, there are three choices.

Link to comment
Share on other sites

Is adequate price competiton under the second prong based solely on offerors' expectations? The second prong seems to weave in reasonableness in determining the offeror's expectation. FAR 15.403-1©(1)(ii) reads:

(ii) There was a reasonable expectation, based on market research or other assessment, that two or more responsible offerors, competing independently, would submit priced offers in response to the solicitation?s expressed requirement, even though only one offer is received from a responsible offeror and if --

(A) Based on the offer received, the contracting officer can reasonably conclude that the offer was submitted with the expectation of competition, e.g., circumstances indicate that --

(1) The offeror believed that at least one other offeror was capable of submitting a meaningful offer; and

(2) The offeror had no reason to believe that other potential offerors did not intend to submit an offer; and

(B) The determination that the proposed price is based on adequate price competition, is reasonable, and is approved at a level above the contracting officer

I would offer that in looking at the offer received to ascertain the offeror's expectation (absent an admission, the best objective evidence of the offeror's subjective expectation), if the price is unreasonable, the CO could not conclude that the circumstances indicate the offeror had an expectation of competition. A second problem is whether price analysis is able to establish reasonableness here. If it cannot, then the second prong isn't available.

For me, the more challenging question is, is it so obvious that the first expectation, italicized above, is the offeror's, and not the government's? When the government creates a competitive range of one, it certainly does not have a reasonable expectation of receiving two final proposal revisions. If the expectation italicized above is the offeror's, then the language in the FAR is awfully repetitive, and the reference to market research makes no sense. The best argument I can come up with that allows the cases and the language in the FAR to be consistent is if the italicized expectation is measured only upon release of the RFP. Perhaps the reference to "in response to the solicitation" lends this interpretation some weight. I'm curious how others read this.

Link to comment
Share on other sites

Is adequate price competiton under the second prong based solely on offerors' expectations?

Since the contracting officer must reach a conclusion about competition and price reasonableness, I believe the critical issue is the contracting officer's perception about the existence of competition.

Quote

(ii) There was a reasonable expectation, based on market research or other assessment, that two or more responsible offerors, competing independently, would submit priced offers in response to the solicitation?s expressed requirement, even though only one offer is received from a responsible offeror ...

End Quote

If the contracting officer believed adequate price competition existed when releasing the solicitation, then he or she has a basis for concluding that prices are fair and reasonable.

Link to comment
Share on other sites

Guest Vern Edwards

Based on its plain language, FAR 15.403-1( c)(ii) requires two expectations, [1] and [2], both of which are essential.

(ii) [1] There was a reasonable expectation, based on market research or other assessment, that two or more responsible offerors, competing independently, would submit priced offers in response to the solicitation?s expressed requirement, even though only one offer is received from a responsible offeror and if?

[2]
(A) Based on the offer received, the contracting officer can reasonably conclude that the offer was submitted with the expectation of competition, e.g., circumstances indicate that?

(1) The offeror believed that at least one other offeror was capable of submitting a meaningful offer; and

(2) The offeror had no reason to believe that other potential offerors did not intend to submit an offer....

First, before the solicitation closing date the CO must have expected that: (a) at least two responsible offerors, (B) would compete independently, ( c) by submitting priced offers, (d) that would respond to the solicitation's expressed requirements.

Second, the offeror who submitted a proposal must have expected that at least one other responsible offeror could and would submit a meaningful proposal. The existence of this second expectation must be based upon the CO's valid, but not necessarily proven, inference, made after the closing date and time.

Without both the CO's actual expectation before closing and valid inference after closing about the offeror's expectation, then adequate price competition would not exist when only one offeror submits a proposal. It would not matter what the CO expected if, after receipt of the proposal, he or she could not validly infer that the offeror had expected another firm to respond.

The first expectation is necessary to ensure that the CO wrote the solicitation with competition in mind, so that it would likely prompt responses that would be influenced by competitive pressure. The second expectation is necessary to make it likely that the solicitation did, in fact, prompt a response influenced by competitive pressure.

According to FAR 15.403-3(B), the two expectations ordinarily would be sufficient to permit a determination of price reasonableness.

Link to comment
Share on other sites

According to FAR 15.403-3(B), the two expectations ordinarily would be sufficient to permit a determination of price reasonableness.

Vern, I hope that you didnt mean that the price is reasonable because the two expectations of competition were met. The reason that discussions are necessary in this case is because the proposer has included some excessive items in its proposal, which the government wants to negotiate out , thus reducing the cost. Hopefully, the lone remaining proposer will be reasonable and actually lower the price to reflect the reduced scope. If the final price is reasonable, then they have acheived success.

Link to comment
Share on other sites

The conclusion I'm drawing from this thread is that, regardless of whether or not discussions are conducted, the appropriate time to measure the CO's expectation is at the time the RFP is released. I presume that the appropriate time to measure the offeror's expectation is with submission of final proposal revision.

While not baierle's question, consider the following scenarios:

Scenario #1: CO reasonably expects to receive multiple proposals at time of RFP. Only one proposal is received. Government enters discussions. Result: Assuming the circumstances and the offer received don't suggest anything to the contrary, FPR may based on adequate price competition (APC) notwithstanding the CO had no expectation of competition at time it requested the FPR.

Scenario #2: Government is engaged in a downselect competition where offerors know the competition is limited to two even before release of the RFP. After receipt of proposals, one offeror is excluded from the competitive range, leaving one. The disappointed offeror announces to the world that it has been excluded before the deadline for receipt of the remaining offeror's FPR. Result: Absent the public announcement, APC was plausible. Given the announcement, reliance on the second prong doesn't seem reasonable.

Absent circumstances that give "reason to believe that other potential offerors did not intend to submit an offer," the CO's inference of the offer's expectation still has to consider the offer received, which I take to mean whether the offer received is reasonable based on price analysis. According to FAR 15.305(a)(1) & 15.404-1(B)(2)(i), competition normally establishes price reasonableness. I take this as an empirical observation, not a rule. FAR 15.404-1(a)(2) states, "Price analysis shall be used when cost or pricing data are not required." While perhaps an esoteric observation, what I am suggesting is that you cannot have a circumstance where the government has APC under the second prong and an unreasonable price. I'm not suggesting the price is per se reasonable, but that the second prong is not available.

Link to comment
Share on other sites

Guest Vern Edwards
Vern, I hope that you didnt mean that the price is reasonable because the two expectations of competition were met. The reason that discussions are necessary in this case is because the proposer has included some excessive items in its proposal, which the government wants to negotiate out , thus reducing the cost. Hopefully, the lone remaining proposer will be reasonable and actually lower the price to reflect the reduced scope. If the final price is reasonable, then they have acheived success.

Why do you hope that? (What is it with all the hoping going on in this thread?) Did I say that the price is reasonable because the two expectations were met? Buy reading glasses!

Link to comment
Share on other sites

Guest Vern Edwards
Absent circumstances that give "reason to believe that other potential offerors did not intend to submit an offer," the CO's inference of the offer's expectation still has to consider the offer received, which I take to mean whether the offer received is reasonable based on price analysis. According to FAR 15.305(a)(1) & 15.404-1(B)(2)(i), competition normally establishes price reasonableness. I take this as an empirical observation, not a rule. FAR 15.404-1(a)(2) states, "Price analysis shall be used when cost or pricing data are not required." While perhaps an esoteric observation, what I am suggesting is that you cannot have a circumstance where the government has APC under the second prong and an unreasonable price. I'm not suggesting the price is per se reasonable, but that the second prong is not available.

I'm not sure what procedure Jacques has in mind. It sounds like he wants to wait for the FPR to decide whether there was adequate price competition, but I'm not sure.

In baierie's case, any even half-competent CO would not wait for the submission of the final proposal revision to decide whether or not he needed cost or pricing data. What? The CO should conduct discussions, request and receive an FPR, and then decide whether there had been adequate price competition and, if not, then go back and ask for cost and pricing data? He must wait for actual receipt of the FPR to make an inference about the offeror's expectation of competition? That would be stupid.

baierie simply wants to ask for the removal of certain elements of the offeror's initial proposal and for a commensurate price reduction. The initial price was obtained competitively, so, assuming that the initial price is not unreasonable, the issue should be whether the reductions are commensurate with the value of the deleted elements and the new price fair and reasonable. During the discussions, the CO should demand any information necessary to determine price reasonableness. If he can determine price reasonableness without cost or pricing data, then he should. The CO should not conclude the discussions until he and the offeror have agreed upon (a) what is to be deleted from the proposal, (B) how much the price will be reduced, and ( c) the new price. Then and only then should the CO instruct the offeror to submit an FPR that confirms the deletions, reductions, and price agreed upon during discussions. The CO should instruct the offeror not to make any other changes to its initial proposal without first discussing them with the CO. This approach is well within the rules in FAR 15.306 and 15.307 and is especially appropriate when conducting discussions with only one offeror.

That's what a competent CO would do. He would not conduct discussions, then ask for a FPR, and then make inferences about the offeror's expectations so he can then decide whether there was adequate price competition and whether he must then go back to the offeror to request cost or pricing data. I would find other work for any CO who worked for me and undertook such a procedure.

How did this thread become a discussion about adequate price competition?

Link to comment
Share on other sites

Why do you hope that? (What is it with all the hoping going on in this thread?) Did I say Buy reading glasses!

OK, I'll rephrase it. You are wrong if you meant that the price is reasonable because the two expectations were met. However, I assume that you meant something different, even though your statement was unclear and ambiguous.

Link to comment
Share on other sites

Guest Vern Edwards
OK, I'll rephrase it. You are wrong if you meant that the price is reasonable because the two expectations were met. However, I assume that you meant something different, even though your statement was unclear and ambiguous.

Your assumption is correct, but my statement was not unclear and ambiguous. The key word was "permit," and my use of it was neither unclear nor ambiguous. Any ambiguity and lack of clarity is in your head. Was "permit" too subtle for you?

By the way, you didn't quote me correctly in your last post, which might explain your confusion. That damned Blackberry of yours is ruining your eyesight.

Link to comment
Share on other sites

Your assumption is correct. My statement was neither unclear nor ambiguous. That was in your head. You didn't quote me correctly, which might explain your confusion. That damned Blackberry of yours is ruining your eyesight.

I believe that you said:

"According to FAR 15.403-3(B), the two expectations ordinarily would be sufficient to permit a determination of price reasonableness."

OK, I'll rephrase it, again. You are wrong if you meant that if the two conditions are met that one could automatically determine that the price is reasonable. One must first determine if the price is reasonable or "determine the reasonableness of price".

Some people may think that a "determination of price reasonableness" is a term used to document that the price has been determined to be reasonable. Merely "meeting the two expectations" is not sufficient to render the price reasonable.

Perhaps you meant "According to FAR 15.403-3(B), the two expectations ordinarily would be sufficient to permit one to determine the reasonableness of price."

Inasmuch as many personnel don't have the knowledge or skills to "determine the reasonableness of price", they might well take the easy interpretation that "permit a determination of price reasonableness" means "the price is reasonable".

Saying "permit a determination of price reasonableness" is not necessarily the same as saying "to determine the reasonableness of price", as actually stated in 15.403-3 (B).

Link to comment
Share on other sites

Guest Vern Edwards
You are wrong if you meant that if the two conditions are met that one could automatically determine that the price is reasonable.

Okay. I didn't mean that. So I'm right.

Link to comment
Share on other sites

Okay. I didn't mean that. So I'm right.

Okay, good...except that you didn't say it very clearly the first time. :)

Link to comment
Share on other sites

Guest
This topic is now closed to further replies.
 Share

×
×
  • Create New...