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Myth-Information: Exchanges with Offerors

Posted by Don Mansfield, 23 January 2009 · 1,270 views

First, I'd like to thank everyone that contributed to my thread seeking myth-information in federal contracting. I culled another 20 pieces to add to the seven that I was able to come up with. If you come across any or are able to think of any more, please add to the thread or send me a message.

Second, I'd like to comment on something that Retreadfed wrote in the aforementioned thread:

QUOTE
I presume Don's point in starting this discussion was to demonstrate the many points of ignorance (not stupidity) that exist in the procurement world.


While I hadn't thought about it, I like the distinction that Retreadfed made. Myth-information exists due to ignorance of the rules. If you want to read about stupidity, there's an excellent compilation of it in DoD's Encyclopedia of Ethical Failures (don't miss the 2008 update).

Now, back to the point of this entry. Vern Edwards contributed the following nugget to the misinformation thread:

QUOTE
During a source selection, anything that you say to one offeror you must say to all other offerors.


No doubt this belief is the result of overlawyering and/or taking the "better safe than sorry" approach to source selection. Let's take a look at what the FAR says concerning this subject. FAR 15.201(f) states:

QUOTE
General information about agency mission needs and future requirements may be disclosed at any time. After release of the solicitation, the contracting officer must be the focal point of any exchange with potential offerors. When specific information about a proposed acquisition that would be necessary for the preparation of proposals is disclosed to one or more potential offerors, that information must be made available to the public as soon as practicable, but no later than the next general release of information, in order to avoid creating an unfair competitive advantage. Information provided to a potential offeror in response to its request must not be disclosed if doing so would reveal the potential offeror?s confidential business strategy, and is protected under 3.104 or Subpart 24.2. When conducting a presolicitation or preproposal conference, materials distributed at the conference should be made available to all potential offerors, upon request.


[Bold added].

As you can see, the scope of the information that must be shared with all offerors when it is shared with one offeror prior to receipt of proposals is much narrower than "anything that you say." However, it is common practice at some contracting activities to record every question received and answer provided regarding an RFP (no matter how mundane) in an amendment and issue to all prospective offerors (the better safe than sorry approach). While such an approach is compliant, it is not required and makes for long amendments and the excessive provision of information.

Regarding what can be said during discussions, FAR 15.306(d)(1) states:

QUOTE
Discussions are tailored to each offeror's proposal, and shall be conducted by the contracting officer with each offeror in the competitive range.


[Italics added].

Tailored. This necessarily means that you are not required to discuss the same areas with each offeror. In Trident Sys., Inc., Comp. Gen. Dec. B-243101, the rule was stated as follows:

QUOTE
[I]nsofar as Trident alleges the Navy did not hold equal discussions because the offerors were not asked the same questions, the only additional question Trident was asked concerned its relationship with its subcontractor; SPA was not asked this question because SPA did not propose to use a subcontractor. In any case, in order for discussions to be meaningful, contracting agencies must furnish information to all offerors in the competitive range as to the areas in which their proposals are believed to be deficient so that the offerors have a chance to revise their proposals to fully satisfy the agency requirements...In other words, since the number and type of proposal deficiencies will vary among offerors the agency should tailor the discussions for each offeror, based on the offerors' evaluated deficiencies.


Exchanging information with offerors involves thoughtful judgement and discretion. Unlike some other areas of contracting, it is not a mechanical exercise governed by a simple mandatory rule. Those who shy away from using their judgment and discretion (probably to avoid criticism) are always in search of mandatory rules (even if none exist) such as "During a source selection, anything that you say to one offeror you must say to all other offerors." This contributes to the persistence of myth-information. Don't be one of those people.




In addition, see FAR 1.102-2©(3): "The Government shall exercise discretion, use sound business judgment, and comply with applicable laws and regulations in dealing with contractors and prospective contractors. All contractors and prospective contractors shall be treated fairly and impartially but need not be treated the same."

See also, Bank Street College of Education, 63 Comp. Gen. 393 (1984), Comp. Gen. Dec. B-213209, 84-1 CPD ? 607. In that case the contracting officer included three firms in the competitive range. During discussions he disclosed the government estimate to two of the firm, but not to the protester. The GAO denied the protest with the following explanation:

QUOTE
The record shows that in the course of discussions the agency informed Harvard that the proposed cost in its initial proposal was approximately $2 million more than the government's estimate. It also appears that the agency did not believe it was necessary to discuss the government's cost estimate with Bank Street because Bank Street's proposed cost was below that estimate. The contracting officer admits that he failed to follow the agency's regulations regarding disclosure of the government's cost estimates. We believe, however, that those regulations are matters of internal policy guidance for the agency's personnel, and as such they do not create any legal rights or responsibilities such that actions taken in violation of their provisions would be subject to objection by our Office in protest cases. See Westinghouse Information Services, B-204225, March 17, 1982, 82-1 CPD 253; Timeplex, Inc., General Datacomm Systems and Bowman/ALI, Inc., B-197346; B-197346.2; B-197346.4, April 13, 1981, 81-1 CPD 280...

Moreover, it is not improper generally for an agency to disclose, during discussions with an offeror, the agency's cost goal as a negotiation tool for reaching a fair and reasonable contract price provided an offeror's standing with respect to its competitors is not divulged. Ikard Manufacturing Company, B-213891, March 5, 1984, 63 Comp. Gen. 239, 84-1 CPD 266; 52 Comp. Gen. 425 (1973). Bank Street has not alleged that the agency disclosed any offeror's standing.

We also do not believe that the agency's discussion of the government's cost estimate with Harvard without conducting similar discussions with Bank Street amounted to unequal treatment of offerors. An agency is not required to hold the same kind of detailed discussions with all offerors since the degree of weaknesses or deficiencies, if any, found in the acceptable proposals will obviously vary. Pope Maintenance Corporation, B-206143.3, September 9, 1982, 82-2 CPD 218. Thus, an agency can discuss costs with one offeror without conducting similar discussions with another offeror, where, as here, it does not appear that the agency considers the other offeror's cost proposal to be deficient. Tracor Jitco Inc. B-208476, January 31, 1983, 83-1 CPD 98.


Bank Street asked for reconsideration, which the GAO denied.
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