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FAR 15.206 (a):  Changed requirements and/or solicitation amendment

Comptroller General - Key Excerpts

New Finally, in addition to the matters discussed above, the protester raised a number of issues for which the agency requested dismissal, and we agreed with the agency. For example, the protester argues that the agency’s extension of the closing date for receipt of initial proposals was improper because it occurred after the initial closing date had passed. This assertion fails to state a valid basis for protest because there is no prohibition against a procuring agency issuing an amendment to extend the closing time for receipt of proposals after that time has passed to accommodate even one offeror, where the motivation for the extension is enhanced competition. Geo-Seis Helicopters, Inc., B-299175, B‑299175.2, Mar. 5, 2007, 2007 CPD ¶ 135 at 5. Similarly, the protester contends that the Social Security Administration failed to follow Congressional mandates regarding the award of this contract. We find this argument legally and factually unsupported. See 4 C.F.R. §§ 21.1(c)(4), 21.1(f). In any event, this concern is untimely as it relates to the stated evaluation scheme; protesters are required to raise challenges to the terms of a solicitation prior to the stated closing time for the receipt of proposals. 4 C.F.R. § 21.2(a)(1).  (National Disability Rights Network, Inc. B-413528: Nov 16, 2016)

The Competition in Contracting Act generally requires “full and open competition” in government procurements as obtained through the use of competitive procedures. 41 U.S.C. § 3301. Our Office generally will not review modifications to contracts, because such matters are related to contract administration and are beyond the scope of GAO’s bid protest function. 4 C.F.R. § 21.5(a); MCI Telecomms. Corp., B‑276659.2, Sept. 29, 1997, 97-2 CPD ¶ 90 at 7. However, the allegation that an agency awarded a contract with the intent to modify the scope of work concerns pre-contract award actions in violation of Federal Acquisition Regulation (FAR) § 15.206(a), which requires that the solicitation be amended, even after receipt of proposals, to reflect the agency’s actual requirements. The appropriate standard in reviewing these pre-contract actions is not whether the subsequent modification is within the scope of the original contract, but whether the changed work could significantly affect the competitive positions of offerors such that the RFP should have been amended. NV Servs., B-284119.2, Feb. 25, 2000, 2000 CPD ¶ 64 at 23.

As noted above, the value of the contract has increased, and that increase was driven by two significant changes in requirements. First, modifications 3 and 10 changed service levels from COL 4 to COL 3. AR, Exh. 3, Decl. of Supervisory Contract Specialist at 2. Second, one of the buildings under renovation at the time of contract award--building 174--was returned to use; modification 2 added that building to the contract requirements. Id. Together, those 3 modifications accounted for $1,821,538 of the $2,233,976.16 increase in contract value for the base year.

With respect to the change in COL levels, the agency explains that the level is dictated by the Commander, Naval Installations Command, and not the specific shipyard; therefore, the contracting activity had no prior knowledge that the service level would definitively change after award. AR at 8-9. Further, the RFP required offerors to submit fixed prices on both COLs 3 and 4, stated that the agency would evaluate the aggregate of the COLs 3 and 4 pricing, and reserved for the agency the right to award at either COL. Id. at 8. In addition, the agency argues that, based on the prices offered, even if the agency had evaluated offerors only on COL 3 prices for the fixed-price portion of the contract, Richen would still have not been the lowest-priced offeror. See AR, Exh. 3, Decl. of Supervisory Contract Specialist at 4. With respect to the addition of the renovated building to the contract, which also increased the value of the contract, the agency explains that this and other changes are the result of ongoing changes in government spaces that result in both deletion of some services and addition of others. AR at 7.

Here, the record shows that the solicitation adequately advised offerors of the potential for the type of changes that occurred during the course of contract performance (e.g., change from COL 4 to COL 3), and that in the context of the type of work at issue here, the modifications encompass changes which the field of competitors could reasonably have anticipated. The protester fails to provide evidence to support its assertion of any unfair dealing on the part of the agency.

Moreover, the protester asserts that, had it known that the value of the contract would increase, Richen would have lowered its rates and made a profit on the greater volume of work to be performed. Response to Agency Request for Dismissal, July 28, 2016, at 2. However, we generally do not view as persuasive generalized arguments that a protester’s price would have been more competitive under an increased requirement as amended, NV Servs., supra, and, absent some evidence in the record to indicate otherwise, in a case such as this where the value of the contract has increased, we may assume that the protester’s price would increase proportionately to the other offerors’ prices. See Central Texas Coll. Sys., B-215172, Feb. 7, 1985, 85-1 CPD ¶ 153 at 6 (finding no evidence of prejudice where contract increased in value by approximately 67 percent through modifications, because there was nothing in the record to suggest that offerors’ prices would have been disparately impacted). Therefore, the record in this case provides no basis on which to sustain this protest. NV Servs., supra.  (Richen Management, LLC B-409706.3: Oct 24, 2016)


As a general rule, an offeror's failure to acknowledge a material amendment renders the proposal unacceptable and such proposal may not form the basis for award. ECI Def. Group, B-400177; B-400177.2, July 25, 2008, 2008 CPD ¶ 141. While no precise rule exists as to whether a change required by an amendment is more than negligible, such that failure to acknowledge the amendment renders the proposal unacceptable, an amendment is material where it imposes legal obligations on a party that are different from those contained in the original solicitation, or if it would have more than a negligible impact on price, quantity, quality, or delivery. Id.

To the extent that TTCC argues that some aspects of amendment 3 (such as question 30) clarified the scope of work in ways that reduced the contractor’s obligations, or simply repeated them, we have held that failure to acknowledge an amendment may be waived where the amendment imposes insignificant obligations on the offeror, since acceptance of an offer premised on the requirements in the original solicitation would not prejudice any other competitor. See DBI Waste Sys., Inc., B‑400687, B-400687.2, Jan. 12, 2009, 2009 CPD ¶ 15 at 3-4 (agency properly waived awardee’s failure to acknowledge amendment that changed identification of item required by one contract line where record showed no effective price difference between the items). However, we need not address these aspects of amendment 3 because we conclude that the Air Force correctly concluded that the amendment also made a material change to the scope of work: that the 10,500 linear feet of new fencing lacked a gravel barrier/mowing strip.

TTCC does not meaningfully challenge the Air Force’s explanation of the amount of additional effort needed to perform the contract services along that fence line. We have no basis to conclude that the need to supply approximately 168 hours of additional effort each year could be considered negligible or insignificant to the offerors’ pricing. According, the Air Force’s decision to reject TTCC’s proposal for failure to acknowledge amendment 3 was reasonable.

The protest is denied.  (TTCC, Inc. B-412874: May 17, 2016)  (pdf)


CGI contends that the agency’s price evaluation methodology, which provided for comparing offerors’ prices at the maximum order level of 15 units, did not match the agency’s planned ordering needs as determined by the agency prior to award. Given this disconnect, the protester argues that the agency was required to amend the solicitation’s evaluation scheme to provide a reasonable basis for comparing offerors’ prices, one which matched the agency’s ordering needs. CGI further maintains that if the price analysis had been based on offerors’ NTE unit prices for quantities of 5 per delivery order, which is far more in line with the agency’s revised acquisition strategy, its evaluated price would have been [deleted], rather than highest, which would clearly have had an impact on the best value tradeoff decision. The protester supports its argument with computations, which do indeed show that when offerors’ prices are evaluated using the NTE prices for quantities of 5, as opposed to 15, per delivery order, its total evaluated price is lower than the total evaluated prices of several other offerors. Protester’s Comments, Oct. 30, 2014, Encl. 2 and Exh. E. We agree with the protester.

This case turns on two fundamental principles. One is that, while it is up to the agency to decide on some appropriate and reasonable method for evaluating offerors’ prices, an agency may not use an evaluation method that produces a misleading result. Raymond Express Int’l, B-409872.2, Nov. 6, 2014, 2014 CPD ¶ 317 at 6; Air Trak Travel et al., B-292101 et al., June 30, 2003, 2003 CPD ¶ 117 at 22. That is, the method chosen must include some reasonable basis for evaluating or comparing the relative costs of proposals, so as to establish whether one offeror’s proposal would be more or less costly than another’s. Id.

The other is that where an agency’s requirements materially change after a solicitation has been issued, it must issue an amendment to notify offerors of the changed requirements and afford them an opportunity to respond. Federal Acquisition Regulation (FAR) § 15.206(a); Murray-Benjamin Elec. Co., L.P., B‑400255, Aug. 7, 2008, 2008 CPD ¶ 155 at 3-4. For example, where an agency’s estimate for the amount of work to be ordered under an ID/IQ contract changes significantly, prior to award, the agency must amend the solicitation and provide offerors an opportunity to submit revised proposals. See Symetrics Indus., Inc., B‑274246.3 et al., Aug. 20, 1997, 97-2 CPD ¶ 59 at 6. In Symetrics, our Office concluded that the agency should have amended a solicitation for an ID/IQ contract because although the solicitation initially estimated the agency would require 3,755 sequencers, the agency subsequently learned--prior to award--that the agency no longer had a requirement for 3,219 of the sequencers. Id. Similarly, in Northrop Grumman Info. Tech., Inc., et al., B-295526 et al., Mar. 16, 2005, 2005 CPD ¶ 45 at 13, our Office sustained a protest where the Department of the Treasury, prior to award, negotiated a memorandum of understanding with OMB and the General Services Administration that significantly changed the approach set forth in the solicitation and the FAR for determining whether to exercise contract options, making it significantly less likely that the options, which were part of the evaluation, would be exercised.

The circumstances here are unusual in that the meaningfulness of the price evaluation scheme set forth in the RFP changed between the closing date for receipt of FPRs and the date of award. That is, the record reflects that it made perfect sense to evaluate on the basis of 15/each unit pricing when the agency intended to award three contracts and issue 3-4 delivery orders per year. Given the agency’s projection that it would acquire approximately 45-60 units annually in FYs 2014-2017, each order would necessarily need to be placed at the 15/each unit level based on the intended number of orders issued. Evaluating on the basis of 15/each unit pricing no longer provided a rational basis for comparison, however, when, during the source selection process, the agency decided to increase the number of awardees to five, and to alter its ordering strategy to significantly increase the number of delivery orders annually, thereby decreasing the number of units to be acquired per delivery order. Given this fundamental shift in the agency’s anticipated ordering plans, it was unreasonable for the agency to proceed with a price evaluation methodology that was divorced from these plans. Rather, the appropriate course of action was for the agency to amend the solicitation in a manner that would enable it to evaluate, and make a tradeoff decision based on, the offerors’ relative relevant prices.

The agency defends its actions on the basis that it followed the terms of the solicitation and that all offerors competed on an equal basis because the solicitation did not establish that the agency would, in fact, place orders at the 15/unit level. Regarding the latter point, the agency notes that offerors were to submit prices at each level and should have understood that orders could be placed at any of the 15 price levels. The agency’s arguments, however, miss the point. We agree that the agency followed the terms of the solicitation, and that the offerors submitted prices on an equal basis. The problem is that the price evaluation, and resulting selection decision under which CGI did not receive an award due to its high price, were based on comparing prices for quantities of units that the agency now knows it does not intend to order. We recognize that price evaluation in the context of an ID/IQ contract may be representative, and therefore something of a fiction; nevertheless, the fiction employed must bear some rational relationship to the agency’s needs. See CW Govt Travel, Inc.--Recon.; CW Gov’t Travel, Inc., et al., B-295330.2 et al., July 25, 2005, 2005 CPD ¶ 139 at 4-5. Where the agency’s intended ordering strategy does not anticipate placing orders at the 15 unit per order level, we fail to see how comparing prices at this level, and using such prices as the basis for a tradeoff decision, can be understood to be reasonable. As explained above, where the disconnect between the terms of the solicitation and the agency’s order needs became apparent prior to award, it was incumbent on the agency to instead amend the solicitation to correct the flaw in the solicitation.  (CGI Federal Inc., B-410330.2: Dec 10, 2014)  (pdf)
 


With respect to Platinum’s second argument, the Federal Acquisition Regulation does not prohibit auctions, and agencies are not otherwise prohibited from taking corrective action in the form of requesting revised price proposals, even where the original awardee’s price has been disclosed. Jackson Contractor Group, Inc., B-402348.2, May 10, 2010, 2010 CPD ¶ 154 at 3. Here, Platinum’s total evaluated price[4] was released in connection with the original award, while WIT’s total evaluated price was released in connection with the subsequent award to it (that is, after an earlier round of corrective action). Nevertheless, as discussed above, the Navy has now concluded that the solicitation established an unjustified (and possibly ambiguous), experience standard, which has thereby impaired competition.

Deletion of that requirement is within the agency’s discretion to take corrective action. It is a reasonable means to remedy a greater harm to the integrity of the competitive procurement system--especially since only two proposals have been received--than the risk that the disclosure of the award prices for both offerors might place either at a greater disadvantage in the reopened competition than the other firm. See id. In our view, since the agency has changed the evaluation criteria upon which it will make award, it has also properly informed the offerors of that change and requested final proposal revisions. In short, none of Platinum’s arguments demonstrate a valid basis of protest.

WIT’s protest argues that by deleting the corporate experience factor from the evaluation criteria, the Navy will fail to obtain a satisfactory contractor. WIT Opposition to Dismissal at 15-16; WIT Comments at 5. The Navy responds that it has amended the RFP because the Navy’s needs do not include requiring the contractor to have a minimum level of specific corporate experience, particularly because the agency will also be considering key personnel experience. WIT Dismissal Request at 7; WIT Agency Report (AR) at 8.

Generally, our Office will not consider contentions that specifications should be made more restrictive because our role in reviewing bid protests is to ensure that the statutory requirements for full and open competition are met, not to protect any interest a protester may have in limiting competition through more restrictive specifications. Simplix, B-274388, Dec. 6, 1996, 96-2 CPD ¶ 216 at 5-6. WIT’s protest does not include sufficient information to establish the likelihood that the agency in this case violated applicable procurement laws or regulations.

Nevertheless, WIT argues that since our Office has recognized that agencies have a legitimate interest in assessing the experience and past performance of prospective contractors, the Navy must impose the corporate experience subfactor in order to obtain minimally acceptable services. WIT Protest at 10-11. The Navy responds that it made a reasonable determination that corporate experience performing these same services in a remote location is not required for the Navy to obtain a contractor to perform the commercial services at issue here. WIT AR at 8. Further, the Navy argues, such a requirement would overly restrict the already-limited competition. Id. at 10.

An agency has the discretion to determine its needs and the best way to meet them. USA Fabrics, Inc., B-295737; B-295737.2, Apr. 19, 2005, 2005 CPD ¶ 82 at 4. This includes broad discretion in the selection of the evaluation criteria that will be used in an acquisition, and so, our Office will not object to the absence or presence of a particular evaluation criterion (or even the deletion of one), so long as the criteria used reasonably relate to the agency's needs in choosing a contractor that will best serve the government's interests. King Constr. Co., B-298276, July 17, 2006, 2006 CPD ¶ 110 at 3. Here, the Navy has provided a reasonable basis for its decision to delete the corporate experience subfactor and WIT has given us no reason to question the Navy’s actions.  (Platinum Services, Inc.; WIT Associates, Inc., B-409288.3, B-409288.4, B-409288.5: Aug 21, 2014)  (pdf)
 


S3 argues that the Army altered its requirements after making award of the contract to M1. S3 asserts that the change to the agency’s requirements is substantial, and that it would have altered its proposed staffing had it known about the agency’s revised requirements. S3 therefore contends that it was prejudiced by the agency’s failure to solicit its revised, actual, requirements once it became aware of those requirements.

The agency responds that the source selection authority/contracting officer (SSA) was unaware of the change to the agency’s requirements at the time she made her source selection and did not learn of the change until several days later. The agency therefore takes the position that it did not make award with a view to substantially altering the contract after award. See Business Computer Applications, Inc., B-406230.3, May 16, 2012, 2012 CPD ¶ 159 at 3 n.2 (agency may not properly award a contract with the intent to materially alter it after award). In the alternative, the agency argues that, because this is a requirements contract, there was no obligation on the part of the government to order the estimated quantities included in the RFP. The agency therefore reasons that any reduction in its actual requirement--as compared to the RFP’s estimates--was contemplated by the type of contract solicited.

As a general rule, agencies may not properly award a contract on a basis that is fundamentally different from the basis upon which the competition for the requirement was conducted. United Telephone Co. of the Northwest, B-246977, Apr. 20, 1992, 92-1 CPD ¶ 374 at 7-10, aff’d. Dept. of Energy--Recon.; Westinghouse Hanford Co.—Recon.; United Telephone Co. of the Northwest, B‑246977.2, et al. July 14, 1992, 92-2 CPD ¶ 20. Where, for example, there is a significant change in the government’s quantity requirements, the appropriate course of action is for the agency to apprise the offerors of its revised requirements, and afford them an opportunity to submit proposals responsive to those revised requirements, even where, as here, a source selection decision has been made. Id.

In addition, the fact that a requirements-type contract is being used does not relieve the agency of its fundamental obligation to conduct a competition on the basis of the most accurate or realistic estimates of the total quantity of goods or services likely to be ordered. Federal Acquisition Regulation (FAR) § 16.503(a)(1); Hoechst Marion Roussel, Inc., B-279073, May 4, 1998, 98-1 CPD ¶ 127 at 3. This is because, without such realistic estimated quantities, firms cannot prepare offers that reflect the agency’s actual, anticipated needs, and correspondingly, the agency cannot reasonably determine whether award to one firm versus another will result in the lowest possible cost to the government. Hoechst Marion Roussel, Inc., supra.

Here, the agency has determined that its actual requirements are significantly different from the requirements that it solicited, and for which the offerors competed. The record shows that agency’s original requirements, and its revised requirements, are as follows:

 

Airframe Original Number of Students Original Number of Instructors Revised Number of Students Revised Number of Instructors
UH-60
(Instructor Pilots)
72 36 0 0
UH-60 A/L
(Maintenance Examiners)
8 4 8 4
UH-60M
(Maintenance Examiners)
4 2 4 2
AH-64D
Instructor Pilots)
32 16 22 11
AH-64D
(Maintenance Examiners)
4 2 0 0
OH-58D
(Instructor Pilots)
6 3 0 0
CH-47F
(Maintenance Examiners)
0 0 2 1
Total 126 63 36 18


RFP at 51; AR, exh. 31, Memorandum from the Commanding Officer to the Installation Contracting Command.

This change represents a reduction in the agency’s overall anticipated requirements of more than 70 percent. It also reflects a significant change in the types of instructors and maintenance examiners required; of the originally-solicited six categories of instructors/examiners, the agency has eliminated three--or half--of all categories, and also has added a new category not contemplated under the original solicitation. The record therefore shows that the agency’s current requirements bear little relationship to the requirements that it solicited, and for which the offerors competed. It follows that the agency can have no reasonable assurance, based on the earlier competition, that award to M1 versus S3 is proper.

In responding to the protest, the Army essentially relies on the temporal lack of knowledge on the part of its SSA concerning the agency’s revised requirements. However, the agency’s reliance is misplaced, since the record shows that the organization as a whole--and more particularly, the agency’s cognizant commanding officer--had to have been aware of the Army’s changed requirements prior to the agency’s revised source selection decision.

We recognize--and the record reflects--that the SSA was contemporaneously unaware of the change to the agency’s requirements at the time she made the agency’s revised source selection decision. Contracting Officer’s Statement at 11-12; AR, exh. 33, E-mail to the Contracting Officer, Jan. 31, 2014. Nonetheless, the record compels the conclusion that the commanding officer was aware of the change to the agency’s requirements. As noted, the record includes his instruction to partially terminate the protester’s predecessor contract, which was executed on January 27, the same date on which the revised source selection decision was made. AR, exh. 30. As a practical matter, however, the agency’s commanding officer likely was aware that the agency would have a substantially reduced requirement for contractor-furnished flight instructors and examiners well before he issued his instruction to partially terminate S3’s predecessor contract.

As reflected in the change to the agency’s needs, the Army reduced its requirement by a total of 45 instructors/examiners. The record shows that these are highly skilled positions. For example, the RFP requires all of the instructor pilots to be qualified as instructor pilots for one or more of the airframes identified in the RFP; have a minimum of five years experience as an aviator on one or another of the specified airframes; and to have had their last flight within 24 months of being offered as a qualified instructor. RFP at 43. The maintenance examiner qualifications are even more stringent. For example, a maintenance examiner for an AH-64D helicopter (one of the maintenance examiner categories now being provided by in-house personnel) is required to have at least five years of experience as an aviator; to have had his or her last flight within 12 months of being offered as a qualified examiner; and to have logged at least 2,000 flight hours, 250 hours as a maintenance test pilot, and 200 hours as a maintenance examiner. Id.

It simply is not reasonable to suggest that 45 in-house Department of Defense personnel meeting these stringent qualifications simply materialized at the agency’s facility ready and available to go to work on the same day the commanding officer issued his instruction to partially terminate S3’s predecessor contract. Under the circumstances, the fact that the SSA was unaware of the agency’s changed requirements does not provide a reasonable basis to conclude that the organization was unaware of its changed requirements. It follows that the agency was required to revise its solicited requirements and afford the offerors an opportunity to submit proposals responsive to the agency’s actual requirements.

The agency also asserts, based on calculations it has performed, that S3 was not prejudiced by the agency’s failure to solicit its revised requirements because its price still would not have been low. The agency’s calculations are based on hourly rates proposed by the offerors in response to the earlier requirement. The protester maintains, however, that it would have changed its proposed staffing profile, as well as proposed personnel had it known of the agency’s actual requirements. For example, S3 represents that it would have offered [deleted]. Letter of Protest, Jan. 31, 2014, at 25.

The agency’s calculations provide no basis for our Office to conclude that the protester was not prejudiced. As correctly noted by the protester, those calculations are based on personnel that the offerors may, or may not, have proposed had the agency advised them of its actual requirements. In addition, the agency’s revised requirements include one category of personnel not contemplated by the original solicitation (the revised requirements include maintenance examiners for the CH-47F airframe, a category of maintenance examiners not included under the original RFP, and one which the protester asserts is particularly difficult to fulfill). Accordingly, there is no basis for our Office to conclude that the protester was not prejudiced by the agency’s failure to apprise the competitors of its actual requirements. Piquette & Howard Elec. Serv., Inc., B-408435.3, Dec. 16, 2013, 2014 CPD ¶ 8 at 9 (protest sustained where record showed reasonable possibility of prejudice to protester).

In sum, we conclude that the agency made award of the contract to M1 based on what ultimately was a significantly different requirement than the requirement the agency actually solicited. This was improper because the offerors were not afforded an opportunity to compete for the agency’s actual requirements, and there is no basis on the record before us to conclude how the competition would have ended had the offerors been aware of the agency’s actual requirements. We therefore sustain S3’s protest on this basis.  (System Studies & Simulation, Inc., B-409375.2, B-409375.3: May 12, 2014)  (pdf)


It is a fundamental principle of government procurement that competition must be conducted on an equal basis; that is, offerors must be treated equally and provided with a common basis for the preparation of their proposals. Systems Mgmt., Inc.; Qualimetrics, Inc., B-287032.3, B-287032.4, Apr. 16, 2001, 2001 CPD ¶ 85 at 8. When, either before or after receipt of proposals, the government changes or relaxes its requirements, it must issue an amendment to notify all offerors of the changed requirements and give them an opportunity to respond. Diebold, Inc., B-404823, June 2, 2011, 2011 CPD ¶ 117 at 4; Systems Mgmt., Inc.; Qualimetrics, Inc., supra; see Cardkey Sys., B-220660, Feb. 11, 1986, 86-1 CPD ¶ 154 at 2 (If it becomes apparent that the contract being negotiated differs significantly from the requirements stated in the RFP, the contracting agency must amend the RFP or, at the least, advise offerors of the change during discussions and seek new offers.) We will sustain a protest where an agency, without issuing a written amendment, materially alters the solicitation’s requirements to the protester’s prejudice. See Systems Mgmt., Inc.; Qualimetrics, Inc., supra.

Here, the record indicates that the modification of the RFP clause to the negotiated language materially reduced Amazon’s obligations from those imposed in the RFP. In this regard, the RFP clause required the offeror to certify its undertaking to ensure that “any software” provided will be virus free, while the modified language covered “only software developed and provided” by Amazon. This is significant because Amazon’s proposal contemplated the provision of third party and open-source software that is not developed by Amazon and thus would not fall within its modified certification. See, e.g., Amazon Proposal at 1-4,1-9 (“rich ecosystem of . . . third-party security tools”), and at 1-13, 1-23, 1-26, 2-38 (proposed use of “MySQL” and “Red Hat Enterprise Linux,” an open-source database and software product, respectively).

During the hearing before our Office, the agency admitted that, at the time of the post-selection negotiations, it did not consider the impact of the modified language; it understood that Amazon was certifying all software and did not realize that the change might be a restriction on the certification. Tr. at 486-88. Indeed, the contracting officer testified that had the agency focused more closely on the modification, it would have taken exception to the revision. Tr. at 502-03. Thus, the hearing testimony suggested that the new language represented a material change to the terms of the underlying competition.

Both at the hearing and in briefs filed after the hearing, however, the agency asserts that this change was not significant because Amazon is still required to comply with other provisions of its contract. For example, the agency points out that SRD § 3.13.2 required C2S infrastructure and services to be “assessed and authorized in accordance with Intelligence Community Directive (ICD) 503 (reference 3),” which provides for the agency to incorporate standards, policies, and guidelines issued by the National Institute of Standards and Technology and the Committee on National Security Systems (CNSS). Agency Post Hearing Comments at 20. One aspect of these standards includes “malicious code protection,” and Amazon’s detailed proposal to meet these requirements was incorporated into the contract. Tr. at 470-72; Amazon System Security Plan, Appendix B-91--B-93.

We see no basis in the contemporaneous record to support a conclusion that the agency made its decision to allow the modification based on these other provisions of the solicitation, or on Amazon’s agreement to them. In this regard, while we consider the entire record in resolving a protest, including statements and arguments in response to a protest, in determining whether an agency’s selection decision is supportable, we accord greater weight to contemporaneous evaluation and source selection materials than to new judgments made in response to protest contentions. Boeing Sikorsky Aircraft Support, B-277263.2, B-277263.3, Sept. 29, 1997, 97-2 CPD ¶ 91 at 15. We accord lesser weight to post hoc arguments or analyses because we are concerned that judgments made in the heat of an adversarial process may not represent the fair and considered judgment of the agency, which is a prerequisite of a rational evaluation and source selection process. Id. Here, given the contracting officer’s testimony that, had the agency focused on the modification requested by Amazon, it would have taken exception, we find no basis for accepting the agency’s current assertion that the modification was not material.

In any case, the agency’s current position does not show that the modification was not material. In this regard, the agency now contends that the only aspects not covered by Amazon’s agreement to the certification requirements were (1) the certification itself, which the agency believes would be satisfied by Amazon signing its contract; and (2) the requirement to immediately notify the contracting officer of an issue with malicious code. Agency Post Hearing Comments at 20. However, regardless of the agency’s position with respect to the certification, it is unclear why elimination of Amazon’s obligation to immediately notify the contracting officer about malicious code would not represent a change in a material requirement.

In sum, we find that the agency, without issuing a written amendment, materially relaxed the solicitation’s requirements for Amazon without affording the other offerors an opportunity to propose to the modified requirements. Accordingly, the protest is sustained on this basis as well. 
(IBM-U.S. Federal, B-407073.3, B-407073.4, B-407073.5, B-407073.6, Jun 6, 2013)  (pdf)


Infoshred contends that Amendment 1 is not material because all of the requirements imposed by Amendment 1 were encompassed or superseded by Amendment 2, which the firm acknowledged. Comments at 2. Infoshred further argues that, although it did not acknowledge Amendment 1, the firm’s quotation nevertheless committed to comply with the requirements announced in Amendment 1--specifically, the requirement for off-site shredding. Protest at 4.

Generally, a quotation may be rejected for failure to acknowledge a material amendment. In determining whether an amendment is material, we look at the facts of each case. While no precise rule exists as to whether a change required by an amendment is more than negligible, an amendment is material where it imposes legal obligations on the contractor that were not contained in the original solicitation or subsequent amendments acknowledged by the offeror. See MG Mako, Inc., B-404758, April 28, 2011, 2011 CPD ¶ 88 at 2; Skyline ULTD, Inc., B-297800.3, Aug. 22, 2006, 2006 CPD ¶ 128 at 3; Navistar Marine Instrument Corp., B-277143.2, Feb. 13, 1998, 98-1 CPD ¶ 53 at 2. We have also held that an amendment may be constructively acknowledged where the proposal includes the material items appearing only in the amendment. Kuhana-Spectrum Joint Venture, LLC, B-400803, B-400803.2, Jan. 29, 2009, 2009 CPD ¶ 36 at 9-10. Further, where a solicitation states that a quotation may be excluded from consideration for failing to meet a requirement, as is the case here, offerors are reasonably put on notice that rejection will not be automatic but instead will occur only if there is a reasonable basis for such action. See Macfadden & Assoc. Inc., B-275502, Feb. 27, 1997, 97-1 CPD ¶ 88 at 2-3.

When asked by GAO to identify obligations imposed by Amendment 1 that were not also imposed by Amendment 2, the agency initially stated that because the protester did not acknowledge Amendment 1, “Infoshred is not bound to perform off-site shredding.” VA Response to GAO’s Questions, Oct. 1, 2012, at 1. Further, the VA characterized Amendment 2 as non-substantive. Id. However, in response to further questions from GAO, the VA acknowledged that Amendment 2 contained a revised statement of work and also addressed the requirement for off-site shredding. VA Response to GAO’s Questions, Oct. 4, 2012. As noted above, Amendment 2 stated that it was “replacing” Amendment 1’s BPA and statement of work. RFQ amend. 2 at 109.

Here, we find that in light of Amendment 2, which was acknowledged by Infoshred, Amendment 1 was immaterial. Amendment 2 contained each of the substantive requirements that were contained in Amendment 1 and included a revised performance work statement that superseded the one attached to Amendment 1. Although Amendment 1 imposed legal obligations on the contractor that were not contained in the original solicitation--that is, the requirement for off-site shredding--Amendment 2, which Infoshred acknowldeged, also contained these requirements and provided even more detail regarding the requirements. Therefore, the agency’s rejection of the protester’s quote for failure to acknowledge Amendment 1 was unreasonable.  (Infoshred LLC, B-407086, Oct 26, 2012)  (pdf)
 


MG Mako contends that amendment 2 is not material because it merely clarified existing contract performance requirements and thus did not affect the legal relationship of the parties. The protester also states that it was the firm's intention to acknowledge amendment 2 and that it "always understood the fact that there were two amendments to the solicitation." Protester's Response to Dismissal Request at 1. However, the protester states that it inadvertently submitted the incorrect version of a form, which failed to acknowledge amendment 2. Id.

In determining whether an amendment is material, we look at the facts of each case. While no precise rule exists as to whether a change required by an amendment is more than negligible, such that the failure to acknowledge the amendment renders the proposal unacceptable, an amendment is material where it imposes legal obligations on the contractor that were not contained in the original solicitation. Skyline ULTD, Inc., B-297800.3, Aug. 22, 2006, 2006 CPD para. 128 at 3; Navistar Marine Instrument Corp., B-277143.2, Feb. 13, 1998, 98-1 CPD para. 53 at 2.

The agency explains, and we agree, that given the complexity of the electrical work involved in this procurement, the effort to plan for electrical outages can be complex and convoluted. Thus, unless the RFP imposed a requirement to coordinate outages with the local utility, the contractor and the local utility could schedule their outages independently of each other to maximize the efficiency of each one's work, which would not minimize the outages. Fax Confirmation of GAO Conference Call with the Parties at 1. The requirement added in paragraph A27 of amendment 2, requiring that the contractor coordinate with the local utility, recognizes that the project will necessarily involve some outages by the local utility and some outages by the contractor. In essence, this provision requires that the contractor work with the utility company to make those outages minimal, for example, by rescheduling its outage work to occur during an outage by the local utility, or requesting the local utility to reschedule an outage to a time that best suits the contractor.

Although the protester points to a number of other solicitation provisions that reference coordination with various entities prior to or during electrical work, none of these provisions required that the contractor coordinate with the utility company to minimize outages. See Protester's Response to GAO's Questions, March 9, 2011, at 1‑2.

In light of the amendment's addition of contractor obligations to coordinate with the utility company to minimize electrical outages, we conclude that the amendment affects the legal relationship of the parties and therefore is material. Consequently, the protester's failure to acknowledge it cannot, as the protester requests, be waived as a minor informality. Accordingly, we see no basis to object to the agency's rejection of the proposal for failure to acknowledge amendment 2.  (MG Mako, Inc., B-404758, April 28, 2011) (pdf)


On June 23, the apparent awardee was announced and the offerors were informed by the agency that any challenges concerning the small business size status of the apparent awardee must be filed by June 30. Two offerors, including Ocean, timely challenged the size status of the apparent awardee. On August 2, the agency requested that Ocean and the other offerors extend the acceptance period of their proposals. Agency Report (AR) at 3. On that same date, Ocean extended the acceptance period of its proposal to September 30. Id. On September 17, the Small Business Administration determined that the apparent awardee was other than small for purposes of this procurement. Id. On September 24, the agency again requested that Ocean and the other offerors extend the acceptance period of their proposals through November 14, and on that same date Ocean again provided the requested extension. Id. On September 30, the agency extended the incumbent's contract until February 12, 2011. Id. On November 8, 2010, the agency again requested the offerors to extend the acceptance period of their proposals through Saturday, December 18, and, on that same date the offerors, including Ocean, provided the requested extension. Id.

On December 10, the agency issued a market survey for the operation and maintenance of the OSV BOLD. The responses to the market survey were due on December 20. On Monday, December 13, the agency again requested the offerors, including Ocean, to extend the acceptance period of their proposals through February 12, 2011. AR, exh. 3, Email from MSC to Offerors. On that same date, Ocean sent the following question to the agency:

Can you give us an explanation what the extension is for? It appears that you are also going out to the market looking to re-compete this vessel management contract [without] a small business component? We have put considerable effort into this proposal as well as the components of small business vs. large business and respectfully request some clarification.

AR at 4. On Friday, December 17, Ocean received the following email from the agency:

This is just a reminder that your offer on the subject RFP is valid through 18 December 2010. If you wish to extend your offer please do so by email, stating the exact date in your email.

Id. On the following Monday, December 20, Ocean responded to the market survey, and at 10:34 a.m. that same day, Ocean extended its proposal through February 28, 2011. AR, exh. 5, Ocean Email Extending Offer. The other offerors extended their proposals prior to December 18, 2010. AR, exhs. 4 and 5, Emails dated December 13 and 14, 2010, from Offerors Extending Offers. On December 20, the agency sent the following email to Ocean:

I received notice of your proposal extension today. Your proposal was only valid through 18 December 2010. Your offer to extend your proposal was received on 20 December 2010 and is considered late. Your proposal will no longer be considered for award.

AR at 5. This protest to our Office followed.

The record establishes that Ocean's proposal expired because it did not extend the acceptance period of its proposal by December 18. See Trojan Indus. Inc., B‑220620, Feb. 10, 1986, 86-1 CPD para. 143 at 5. Nevertheless, Ocean contends that the agency should allow it to revive its offer because this would neither prejudice the other offerors nor compromise the integrity of the competitive process. Protester's Comments at 4.

Where a proposal or bid has expired, we have recognized that an offeror or bidder may extend its acceptance period and revive its proposal or bid if doing so would not compromise the integrity of the competitive bidding system. Id. Circumstances that compromise the system's integrity are where the bidder offered an acceptance period shorter than other bidders (if the solicitation afforded bidders or offerors the option to offer less than a standard time frame that otherwise would be presumed to apply), or where the bidder expressly or impliedly refused a request to extend its bid and later granted an extension as its own interests dictated; a bidder's or offeror's limitation of the government's legal ability to accept the bid or proposal in a manner at variance with the terms offered by other competitors limits the bidder's or offeror's exposure to marketplace uncertainties and reduces that bidder's risk. Id.; Camden Shipping Corp. v. United States, 89 Fed.Cl. 433 (2009).

In this case, Ocean did not decline to extend the acceptance period for its proposal, which expired on a Saturday, but extended it on the following Monday morning. We have recognized in such circumstances that even where other bidders or offerors had extended their proposals as required, there is no prejudice to the other bidders or offerors, or to the competitive system, by allowing the expired bid or proposal to be revived. Trojan Indus. Inc., supra, at 5-6 (bid which expired on Saturday revived by bidder's extension of bid period on the following Monday). Reviving the proposal on the morning of the first business day following its expiration negates any argument that Ocean compromised the procurement process by avoiding market fluctuations to which other offerors were exposed.[2] See id.; compare Discount Mach. & Equip,, Inc., B‑244392, Oct. 15, 1991, 91-2 CPD para. 334 at 4 (prejudice found and bid revival not permitted, where the bidder attempted to extend its bid more than a month after the expiration of the original bid acceptance period, where the other bidders had timely extended their bids); MKB Mfg. Corp., B‑208451, Mar. 1, 1983, 83-1 CPD para. 204 (same, where bidder attempted to extend bid 15 days after the expiration of bid acceptance period).

We recommend that the MSC accept the revival of Ocean's proposal. We further recommend that the agency reimburse the protester the costs of filing and pursuing its protest, including reasonable attorney's fees. 4 C.F.R. sect. 21.8(d)(1) (2010). The protester's certified claim for costs, detailing the time spent and the cost incurred, must be filed to the agency within 60 days after receiving this decision.

The protest is sustained.  (Ocean Services, LLC, B-404690, April 6, 2011)  (pdf)


GCE argues that DHS's award to CACI was improper because the agency knew, prior to award, that its intended approach to the TASC migration would depart from the assumptions set forth in the solicitation upon which offerors were required to submit their proposals. In this regard, GCE argues that the agency's announced approach for the FEMA migration departs from the solicitation's assumption that 20 percent of all DHS end-users would be migrated by the end of the second year of the contract. Moreover, GCE argues that the agency's approach to the FEMA migration was inconsistent with the RFP, which contemplated multiple, simultaneous migrations of DHS component agencies to TASC.

Where an agency's requirements materially change after a solicitation has been issued, it must issue an amendment to notify offerors of the changed requirements and afford them an opportunity to respond. Federal Acquisition Regulation (FAR) sect. 15.206(a); Murray-Benjamin Elec. Co., L.P., B-400255, Aug. 7, 2008, 2008 CPD para. 155 at 3-4. Amending the solicitation provides offerors an opportunity to submit revised proposals on a common basis that reflects the agency's actual needs. Multimax, Inc., et al., B-298249.6 et al., Oct. 24, 2006, 2006 CPD para. 165 at 6. Where an agency's estimates for the amount of work to be ordered under an ID/IQ contract changes significantly, prior to award, the agency must amend the solicitation and provide offerors an opportunity to submit revised proposals. Symetrics Indus., Inc., B‑274246, Aug. 20, 1997, 97-2 CPD para. 59 at 6. For example, in Symetrics, our Office concluded that the agency should have amended a solicitation for an ID/IQ contract because although the solicitation initially estimated the agency would require 3,755 sequencers, the agency subsequently learned--prior to award--that the agency no longer had a requirement for 3,219 of the sequencers. Id. Similarly, in Northrop Grumman Info. Tech., Inc., et al., B-295526 et al., Mar. 16, 2005, 2005 CPD para. 45 at 13, our Office sustained a protest where the Department of the Treasury, prior to award, negotiated a memorandum of understanding with OMB and the General Services Administration that significantly changed the approach set forth in the solicitation and the FAR for determining whether to exercise contract options, making it significantly less likely that the options, which were part of the evaluation, would be exercised.

As discussed above, the RFP stated that offerors were required to propose an integrated financial management, asset management and acquisition management solution for all DHS component agencies, and also propose for the transition of those component agencies to the new solution. RFP attach. J-1, SOO at 1-2; attach. J-2, TASC Solutions Process Overview, at 5-7. Section L of the RFP required offerors to base their price proposals on the assumptions set forth in the implementation plan in RFP section L, i.e., 20 percent of end-users must be migrated by the end of base year 2, with an additional 20 percent each year through the end of option year 1. RFP sect. L.7.2, Tab C.

DHS received and evaluated offerors' proposals, and selected CACI for award on June 22, 2010. AR, Tab 31, SSD, at 1. Subsequent to this decision, however, OMB issued guidance that required agencies to halt ongoing financial services procurements, and obtain OMB's approval to proceed with those projects. See AR, Tab 44, OMB Memorandum Re: Immediate Review of Financial Systems IT Projects (June 28, 2010), at 1. In accordance with OMB's guidance, DHS selected FEMA to be the first component agency to be migrated to TASC, with the understanding that the task order would take 24 months to complete and that no other DHS agency would be migrated until FEMA's migration was complete.[8] AR, Tab 53, TASC ESC Minutes (July 28, 2010), at 3; AR, Tab 62, TASC ESC Minutes (Nov. 18, 2010), Notional Milestone Schedule. Only then did DHS proceed to award.

GCE argues that DHS's decision to only migrate FEMA--which represents between 1.5 percent and 2.9 percent of DHS's end-users--during the first 2 years of contract performance is a material change to the RFP's assumption that 20 percent of DHS's end-users should be migrated during that period of time. GCE contends that the agency required offerors to base their proposals on the assumptions in RFP section L, but knew, prior to award, that it would not issue task orders in a manner consistent with those assumptions.

We agree with GCE that the reduced anticipated scope of work for the first 2 years of contract performance occasioned by only migrating FEMA during that period represents a material departure from the assumptions set forth in the solicitation. In this regard, the agency acknowledges that the FEMA task order will require migrating end-users who represent between 1.5 percent and 2.9 percent of all DHS end-users. Agency Response to GAO Questions (Feb. 14, 2011), at 1-2. Further, the agency acknowledges that if FEMA is the only agency component migrated during that period, the 20 percent assumption set forth in the solicitation would not be met. Id.

DHS argues, however, that the assumptions set forth in section L should not have been understood by offerors to reflect the agency's actual requirements for the migration of component agencies. We disagree. The RFP required offerors to base their proposals on the assumptions set forth in the implementation plan in RFP section L, i.e., that 20 percent of end‑users must be migrated by the end of the second base year, with an additional 20 percent each year through the end of the first option year. Offerors were required to use those assumptions in preparing their BOEs, which were required to "identify the solution price's limitations and assumptions." RFP sect. L.7.2, Tab C. The RFP further instructed that the "Solution Price and BOE shall be consistent with the offeror's proposed [performance work statement], [contract work breakdown structure] and data migration plan, and should include labor categories and hours by [work breakdown structure] element, for the base period and all option periods." Id.

In support of its position, DHS references language contained in the RFP pricing templates, which stated that "the assumed implementation schedule . . . was constructed to provide a standard for comparison purposes only." RFP attach. J-5, Pricing Templates-Contract Lifecycle Cost Summary Tab. Similarly, the agency notes that Q&A No. 89 stated that "[t]he assumptions in the implementation schedule provide a standard for proposal evaluation purposes only." RFP amend. 2, Q&A No. 89. The agency also references a statement contained in both Attachment J-5 and Q&A No. 89 that the "assumed implementation schedule . . . does not represent any preference on the part of the government for a particular implementation schedule." The agency contends that because the solicitation did not commit the agency to any particular migration schedule, the approach of migrating only FEMA and no other DHS agency during the first 2 years of the contract does not represent a departure from the terms of the RFP. See AR at 9, 11, 18.

This argument has no merit. While the agency focuses on the "comparison purposes only" language in Attachment J-5, the agency also confirmed in this Q&A that "RFP Section L.7.2 – Tab C provides assumptions for an implementation schedule offerors must use in proposal preparation." RFP amend. 2, Q&A No. 89 (emphasis added). Thus, the agency clearly advised offerors that the terms of the competition would be based on those assumptions.

Moreover, the agency's statement that the assumptions did not "represent any preference on the part of the government for a particular implementation schedule" was in provided response to a question posed by an offeror in Q&A No. 89, "will the Government disclose what agencies DHS will be focusing on first?" We think it is reasonably understood that this statement refers to the order, rather than the pace of migration, i.e., the anticipated number of end-users to be migrated. Thus, this statement provides no support for the agency's argument that the assumptions in the RFP are immaterial for purposes of determining whether the agency's requirements changed prior to award.

Additionally, DHS argues that the 20 percent assumptions in the RFP were "notional," and were merely intended to provide offerors with a common basis for submitting proposals. The agency thus contends that the assumptions set forth in the ID/IQ contract did not commit the agency to provide any level of orders above a guaranteed minimum amount. For this reason, the agency contends, any variance from those assumptions in the agency's issuance of task orders would not constitute a material change requiring reopening the competition.

We think that DHS's arguments conflate the agency's discretion to issue or not issue task orders during contract performance with its obligation to provide a meaningful basis to compare offerors' proposals. Although agencies have discretion in the issuance of orders under an ID/IQ contract, DHS's actions here relate to a pre-award change in its requirements. As discussed above, the agency required offerors to submit proposals based on a specific set of assumptions concerning the pace and volume of work to be performed. The agency then evaluated those proposals and selected CACI for award. Subsequent to that evaluation and award selection--but prior to the actual contract award--the agency's requirements for the pace and volume of work was reduced. Specifically, in response to OMB direction, DHS adopted a migration approach that was expected to take place over the first 2 years of the contract, and that required migration of a significantly smaller volume of end users as compared to the RFP assumptions upon which offerors were required to base their proposals. Thus, contrary to the agency's arguments, the material change arose here based on a pre-award change to the agency's requirements; the material change did not arise from the agency's exercise of its discretion to issue or not issue a task order during performance of an ID/IQ contract.

On this record, we think that DHS's proposed approach of migrating only FEMA over the course of a 24-month period is a material departure from the assumptions set forth in the RFP, upon which offerors were required to base their proposals, such that the agency was required to amend the solicitation and obtain revised proposals. See Symetrics, supra; Northrop Grumman Info. Tech., supra.

Moreover, the record evidences that the RFP could be reasonably read as contemplating that offerors would perform either multiple, simultaneous migrations of DHS component agencies, or, alternatively, serial migrations at a rapid pace in order to meet the assumptions set forth in section L of the RFP. As GCE notes, the RFP anticipated migrating all DHS component agencies to an enterprise-wide, integrated system, and offerors were required to address their "proposed approach for managing multiple task orders simultaneously." See RFP sect. L.7.1. The agency also advised that there was no "preference on the part of the government for a particular implementation schedule," and that offerors were free to propose migrations as they thought best. RFP amend. 2, Q&A No. 89. We note, however, that migrating 16 DHS components over the course of 6 years without any simultaneous migration efforts would require sequential migrations to be completed, on average, every 4.5 months. We also note that such a schedule stands in marked contrast to the 24-month schedule for the FEMA migration, which represents only 1.5 percent to 2.9 percent of DHS end-users. Thus, in our view, the solicitation invited offerors to propose migrations at a very different pace than DHS now envisions.

In sum, because the solicitation required offerors to submit proposals based on the assumptions set forth in RFP section L, because the selection decision relied on the agency's evaluation of the offerors proposed prices and technical solutions that were based on those assumptions, and because these assumptions were no longer valid at the time of award, we think that the agency's award to CACI was improper. See Symetrics, supra; Northrop Grumman Info. Tech., supra. Because of the significant changes to the RFP assumption, the agency was required to amend the solicitation to reflect the agency's revised requirements, and provide offerors with an opportunity to submit new proposals. See Symetrics, supra; Northrop Grumman Info. Tech., supra.

We further conclude that GCE was prejudiced by DHS's failure to amend the solicitation. GCE contends that it would have taken a different approach to its price and technical approach had it not been required to assume that 20 percent of all end‑users would be migrated by year 2 of the contract. GCE's Comments at 22; see GCE Protest, exh. 4, Decl. of GCE Chief Strategy Officer, at 4-7. Because the work contemplated for the first 2 years is materially different from that indicated by the assumptions on which offerors were required to prepare their proposals, we think that there was a reasonable possibility that GCE was prejudiced because it did not have an opportunity to revise its proposed technical approach and costs. We sustain GCE's protest on this basis.  (Global Computer Enterprises, Inc.; Savantage Financial Services, Inc., B-404597; B-404597.2; B-404597.3, March 9, 2011)  (pdf)


NNSA administers the Nevada Test Site (NTS), a 1,375 square mile restricted access site in Nevada. The NTS was the site of numerous explosives tests, including approximately 928 underground and atmospheric nuclear tests. In 1989, DOE established the Environmental Management Program, which is responsible for addressing the environmental effects of nuclear weapons tests at sites across the country, including the NTS.

In 1996, DOE, the Department of Defense, and the state of Nevada entered into the Federal Facilities Agreement and Consent Order (FFACO) to identify sites requiring environmental remediation, including the NTS, and to develop plans and procedures for the remediation work. As relevant here, the FFACO establishes procedures for “characterizing” the work required for a corrective action site (CAS) where evaluation and remediation services are to be performed. Agency Report (AR), Tab 13, FFACO, at 7. Under the terms of the FFACO, multiple CASs may be grouped into a corrective action unit (CAU) based on common conditions or other features which make treating the CASs as a single unit appropriate. Id. at 10.

(sections deleted)

Stoller first argues that NNSA improperly waived or relaxed a material solicitation requirement in the PWS that required offerors to prepare two documents for each of three soils sub-project CAUs. As discussed above, Navarro proposed, and the agency accepted, a technical approach whereby three soils sub-project CAUs--Johnny Boy, Area 20, and Sedan--were consolidated into a single CAU. As set forth in greater detail below, this protest ground essentially argues that the agency accepted a proposal that deviated from the requirements of the solicitation in such a way that other competitors, reasonably following the terms of the solicitation, could not have anticipated was permitted.

It is a fundamental principle of government procurement that competitions must be conducted on an equal basis, that is, offerors must be treated equally and be provided with a common basis for the preparation of their proposals. Continental RPVs, B-292768.2, B-292768.3, Dec. 11, 2003, 2004 CPD para. 56 at 8. Contracting officials may not announce in the solicitation that they will use one evaluation scheme and then follow another without informing offerors of the changed plan and providing them an opportunity to submit proposals on that basis. Fintrac, Inc., B-311462.2, B-311462.3, Oct. 14, 2008, 2008 CPD para. 191 at 6. Our Office will sustain a protest that an agency improperly waived or relaxed its requirements for the awardee where the protester establishes a reasonable possibility that it was prejudiced by the agency’s actions. Datastream Sys., Inc., B-291653, Jan. 24, 2003, 2003 CPD para. 30 at 6.

Stoller argues that the solicitation did not reasonably advise offerors that they could propose, and that NNSA would accept, a technical approach that consolidated the individual CAUs listed in the PWS. Instead, Stoller argues that offerors should have understood the plain language of the PWS to require offerors to submit technical proposals that addressed the activities as described in the PWS, i.e., addressed each CAU as stated. The protester therefore argues that the agency improperly accepted Navarro's proposal because it did not comply with the requirement to address the CAUs individually, as listed in the PWS. Stoller further contends that it was prejudiced by the agency's actions because it did not have an opportunity to submit a proposal that involved reorganization or consolidation of CAUs.

(sections deleted)

In his testimony, the SEB chair further elaborated that consolidating the three CAUs would result in cost savings during performance because instead of preparing three CAIP and three CADD/CR documents, Navarro's plan anticipated preparing one CAIP and one CADD/CR document for the consolidated CAU. Tr. at 330:22-331:5. The agency understood that the consolidation would result in reduced document preparation efforts, regulatory reviews, and would provide potential efficiencies in field activities. Id. at 330:3-21, 331:12-334:5. In its evaluation of Navarro's cost proposal, the agency noted that the proposed staffing and labor hours for the soils sub-project were realistic because, in part, the work schedule was accelerated and would be completed 1 year ahead of schedule. AR, Tab 11, Navarro Cost Realism Evaluation, at 2.

We think Stoller reasonably understood the solicitation to require offerors to propose technical solutions based on the CAUs as listed in the PWS. The agency acknowledges that although the list of CAUs had been updated in FFACO Appendix II prior to the issuance of the RFP, the PWS requirements reflect an older version of the appendix. Tr. at 344:10-15. In its proposal, Stoller stated that it was aware that the list of CAUs in the PWS was not current, but understood the solicitation to require offerors to propose the requirements as stated in the PWS: “While we have based our approach, cost estimate, and proposal discussions on the PWS and the ‘Description of Work' document presented on the web site, we know that changes [to Appendix II] have occurred.”AR, Tab 7A, Stoller Technical Proposal, at 1-8.

In our view, offerors were not reasonably on notice that they could propose, and the agency would accept, consolidating the CAUs listed in the PWS. We think the plain language of the PWS anticipated that each item, as listed, was a separate requirement. As a result, allowing Navarro to consolidate the CAUs was a material waiver or relaxation of the proposal-submission requirements of the solicitation because it allowed the awardee to propose reduced costs and accelerate its performance schedule--a feature which the agency recognized as a significant strength.

During the course of this protest, NNSA and Navarro raised three primary arguments in support of their view that the PWS permitted offerors to propose, and the agency to accept, a technical approach that consolidated individually-listed CAUs. As discussed below, we find each argument to be without merit.

First, the agency and intervenor argue that the PWS did not expressly prohibit offerors from consolidating the CAUs. As discussed above, however, we think the solicitation as written required offerors to separately address each of the requirements listed in the PWS. Under these circumstances, we do not think that offerors should have understood the absence of an explicit prohibition on consolidating the CAUs to be an authorization to deviate from the terms of the PWS.

Next, NNSA and Navarro argue that the Q&As issued by the agency indicate that offerors were allowed to propose consolidation of the CAUs. After the RFP was issued, the agency published the following solicitation Q&As on its website:

8. Question: “In the list of Pertinent Documents, DOE has provided the 2009-2013 schedules. Is DOE dictating that bidders follow the schedule given, or are bidders free to develop their own approach to meet the FFACO milestones?”

Response: The FFACO milestones are minimum milestones. Offerors may propose an approach to meet or accelerate these milestones consistent with the FFACO approved strategy while balancing the Offeror’s proposed approach to avoid or minimize any technical risk.

30. Question: “In the PWS, Section 3, Specific Requirements, a certain number of milestones have been defined. In particular, the milestones dictate the approach to be taken (CAIP, CADD or CADD/CR) for all the Projects. Can we use our own approach for the milestones that are not FFACO milestones? We respectfully suggest that allowing the bidders to bring their own approach would provide the government with a better understanding of the value that the bidders bring. So, we suggest that for the CAUs where a firm FFACO milestone is not fixed yet, the government uses as milestones the closure of the CAU by a given date and give the bidders flexibility on the approach to be taken.

Response: See response to Question 8.

Id., RFP-Related Q&As, Apr. 2, 2008, at 4, 9-10 (emphasis added).

The agency and intervenor argue that the phrase “may propose an approach to meet or accelerate these milestones consistent with the FFACO approved strategy” implies that offerors could propose any approach that was consistent with the FFACO--including consolidation of CAUs listed in Appendix II. As discussed above, the record shows that the agency has the discretion to reorganize CAUs listed under Appendix II of the FFACO. The Q&As cited above, however, clearly address accelerating the schedule for completing the various milestones for the activities listed in the PWS, and do not mention consolidation or reorganization of the CAUs. We do not think that the phrase “consistent with the FFACO approved strategy” reasonably advised offerors that they could also propose to consolidate the CAUs listed in the PWS, especially where the agency, and not the contractor, would have to determine whether such consolidation or reorganization was appropriate.

Finally, NNSA and Navarro argue that the PWS specifically permitted offerors to propose consolidation of the CAUs listed in the PWS. PWS sect. 3.1.1.8 states that “[t]he contractor shall provide planning and management services for the identification, grouping, and prioritization of CASs and CAUs.” The agency and intervenor contend that this section advised offerors that they were permitted during contract performance to propose reorganization or consolidation of any CAUs listed in Appendix II. We disagree.

This PWS section merely addresses the support services that the contractor must provide during contract performance--it does not clearly state, as the agency and intervenor suggest, that offerors are permitted to propose an alternative CAU organization from that listed in the PWS. Put differently, we do not think that the PWS requirement to provide “planning and management services for the identification, grouping, and prioritizing of CASs and CAUs” during contract performance reasonably advised offerors that they could propose to consolidate the CAUs in their proposals as part of their technical approach.

In sum, we think that offerors were not reasonably on notice that the agency would accept a proposal that consolidates the CAUs listed in the PWS. Accordingly, we conclude that NNSA improperly waived or relaxed the requirements of the PWS in its evaluation of Navarro's proposal. We also conclude that Stoller was prejudiced here because, but for the agency's improper action, Stoller would have had a substantial chance of receiving an award. See McDonald-Bradley, B-270126, Feb. 8, 1996, 96-1 CPD para. 54 at 3; Statistica, Inc. v. Christopher, 102 F.3d 1577, 1581 (Fed. Cir. 1996).  (The S.M. Stoller Corporation, B-400937; B-400937.3; B-400937.4, March 25, 2009) (pdf)


As indicated above, on September 26, VA amended CLIN 09 of the RFP, changing the phrase "4 CU YD compactor" to "4 CY CONTAINER." AR exh. 2 at 1. DBI maintains that the record shows that WMI did not acknowledge the amendment, that its offer thus should have been rejected, and that the requirement should be resolicited. VA advises that the contracting officer determined that the amendment was not material, and therefore waived the failure to acknowledge the amendment as a "minor informality." Id. The protester does not agree that the amendment was immaterial.

We find the waiver unobjectionable. In determining whether an amendment is material, we look at the facts of each case. While no precise rule exists as to whether a change required by an amendment is more than negligible, such that failure to acknowledge the amendment renders the proposal unacceptable, an amendment is material where it imposes legal obligations on a party that are different from those contained in the original solicitation, or if it would have more than a negligible impact on price, quantity, quality, or delivery. See Skyline ULTD, Inc., B-297800.3, Aug. 22, 2006, 2006 CPD para. 128 at 3. The mere fact that requirements have been changed by an amendment, however, does not render the amendment material. Doty Bros. Equip. Co., B-274634, Dec. 19, 1996, 96-2 CPD para. 234 at 3-5.

DBI asserts that the amendment was material because "a compactor, including its wiring and installation, is far more expensive than a mere container." Comments at 12. However, it appears from the record that there is no effective price difference between the two items. VA reports that all of the offerors submitted the same price for the compactor and the container CLINs, ASR exh. 1, and also has furnished an invoice indicating that DBI charges an identical rate for compactors and containers under its current contract. ASR exh. 3. We also note that the unacknowledged amendment related to only 1 of 35 CLINs. These considerations indicate that the change was not significant, and DBI has presented no evidence showing otherwise. Under these circumstances, we conclude that the amendment was not material and that the agency properly waived WMI's failure to acknowledge it. See, e.g., Lumus Constr., Inc., B-287480, June 25, 2001, 2001 CPD para. 108 at 3 (even where amendment arguably introduced new obligations in solicitation, any price difference attributable to amendment was negligible and amendment was not material); Microform, Inc.; Gov't Printing Office--Recon., B‑231411.2, B‑231411.3, Dec. 13, 1988, 88-2 CPD para. 587 at 2 (amendment decreasing estimated quantity not material where no evidence that change would have had more than trivial effect on prices). 
(DBI Waste Systems, Inc., B-400687; B-400687.2, January 12, 2009) (pdf) 


Even if Hart's protest were to be considered timely, it fails to state a valid basis for consideration. In this regard, Hart's protest to our Office asserts that the agency "issued a defective solicitation"; complains that, by failing to identify the facility clearance requirement until 6 weeks after the solicitation was first issued, the agency misled potential offerors and/or failed to engage in adequate advance planning; and seeks recovery of the costs Hart incurred in preparing its proposal. Protest, Nov. 17, 2008.

Procuring agencies have an obligation to draft solicitations that reflect their actual needs. Federal Acquisition Regulation (FAR) sect. 15.203(a). Further, this obligation is ongoing, and a solicitation must be amended where, as initially issued, it fails to reflect the agency's actual requirements. FAR sect. 15.206(a); Global Solutions Network, Inc., B‑298682.2, Dec. 10, 2007, 2007 CPD para. 223 at 3.

Here, nothing in Hart's protest suggests that the solicitation's inclusion of a facility clearance requirement is inconsistent with the agency's actual needs, or is otherwise contrary to applicable law or regulation. Accordingly, there is no basis for this Office to conclude that inclusion of this requirement rendered the solicitation "defective." Indeed, Hart's protest is based almost exclusively on the premise that the agency acted improperly in failing to identify the facility clearance requirement at an earlier point in the procurement process--specifically, before Hart had incurred proposal preparation costs.

Although agencies are obligated to engage in reasonable advance planning prior to conducting procurements, our Office has recognized that the specific activities associated with this requirement may vary from procurement to procurement, and that the obligation does not constitute a requirement that procurement planning be perfect, that is, completely error-free. See, e.g., New Breed Leasing Corp., B-274201, B‑274202, Nov. 26, 1996, 96-2 CPD para. 202 at 6; Sprint Communciations Co., LP, B‑262003.2, Jan. 25, 1996, 96-1 CPD para. 24 at 9. Further, we have noted that not every flaw or irregularity in a given procurement process entitles an offeror to recover the expenses incurred in submitting a proposal. See, e.g., New Breed Leasing Corp.--Recon., B-274201.2, B-274202.2, Apr. 7, 1998, 98-1 CPD para. 97 at 2; I.E. Levick and Assocs., B‑218294.2, Apr. 12, 1985, 85-1 CPD para. 424 at 2.

Here, even if Hart's protest were timely filed, and even if we were to accept Hart's proposition that the agency should have responded more clearly to questions regarding the facility clearance requirement at an earlier point in the procurement process, in these circumstances, we do not view the 6-week delay in identifying this requirement as a valid basis for protest. 
(Hart Security Limited, B-400796.2, December 16, 2008) (pdf)


MBE argues that UNICOR was required to amend the RFP and request revised proposals, rather than making an award based on prices calculated for the larger quantity of cable. MBE also argues that it was competitively prejudiced by the error because, if the competition had been reopened, MBE would have offered a lower price.

UNICOR responds that the offerors' total prices can be recalculated with certainty, using the quantities in the RFP, and that under this approach also, Allied proposed a lower total evaluated price than MBE. CO Statement at 4. UNICOR also argues that the difference in quantity was not significant enough to affect the offered prices.

MBE does not dispute that Allied's prices were lower under both calculations, but argues that it was prejudiced by the erroneous estimate because between the deadline for submission of offers (June 2) and award (June 4), the prices of copper and crude oil in commodities markets dropped. MBE argues that since copper is a raw material used in producing the cable, and oil is a component of the cost of delivery, if UNICOR had reopened the competition on June 4 to revise the quantities, MBE could have submitted a lower price than Allied. Protester's Comments at 2.

Generally, where an agency's requirements change after a solicitation has been issued, it must issue an amendment to notify offerors of the changed requirements and afford them an opportunity to respond. FAR sect. 15.206(a). The object of the requirement is to avoid award decisions not based on the agency's most current view of its minimum needs. One circumstance requiring the issuance of an amendment is a significant change in the government’s estimate of the quantity it expects to order. Symetrics Indus., Inc., B-274246.3 et al., Aug. 20, 1997, 97-2 CPD para. 59 at 6. In the context of a requirements contract, we have held that a change in the estimated quantity must be shown to have more than a trivial effect on the prices offered. See Microform, Inc.; Government Printing Office--Recons., B-231411.2; B-231411.3, Dec. 13, 1988, 88-2 CPD para. 587 at 2 (amendment decreasing estimated quantity in requirements contract was not material where there was no evidence that the change would have had more than a trivial effect on prices). Consistent with this, our Office will not sustain a protest unless the protester demonstrates a reasonable possibility that it was prejudiced by the agency’s actions, that is, unless the protester demonstrates that, but for the agency's actions, it would have had a substantial chance of receiving the award. McDonald‑Bradley, B‑270126, Feb. 8, 1996, 96‑1 CPD para. 54 at 3; see Statistica, Inc. v. Christopher, 102 F.3d 1577, 1581 (Fed. Cir. 1996).

Here, MBE does not attempt to quantify how much the decrease in the cost of copper would influence the cost of producing the cable, nor how much the decrease in the cost of crude oil would affect the cost of delivery. Nor has MBE shown that it was uniquely-positioned among the competitors to benefit from the fortuitous short-term movement of the commodities markets that it has identified. Moreover, MBE has offered no explanation of how these issues are at all related to the small change in the estimated maximum quantity for one of the locations. Taken together, MBE has not shown that it was competitively prejudiced by UNICOR's evaluation of proposals using a slightly greater quantity than the maximum estimate stated in the RFP in the context of a requirements contract.  (Murray-Benjamin Electric Company, L.P., B-400255, August 7, 2008) (pdf)


ECI protests the agency's determination that its proposal was unacceptable. Specifically, the protester argues that its proposal did in fact comply with the solicitation’s delivery schedule and represented the best value to the government based on its more favorable pricing. Protest, May 20, 2008, at 2-4. Additionally, ECI protests that DSCR employed unstated evaluation criteria in its evaluation of offerors’ proposals. Protest, June 30, 2008, at 2-4.

The agency argues that ECI's protest should be dismissed because ECI is not an interested party. The agency contends that ECI failed to timely acknowledge amendment No. 0005, a material amendment to the solicitation. Because ECI did not have a valid (i.e., timely submitted) proposal before the agency for consideration and thus is ineligible for award even if it prevails in its protest, DSCR argues, ECI is not an interested party to pursue its protest. Agency Dismissal Request, June 11, 2008, at 1-4.

ECI argues that its protest should not be dismissed on these grounds. The protester does not dispute that it failed to acknowledge and return amendment No. 0005 by the specified date. Rather, ECI argues that its late submission of amendment No. 0005 did not automatically mandate rejection of its proposal but instead made such action only discretionary on the agency’s part (and DSCR apparently elected to further consider ECI’s proposal). In support thereof, ECI points to the language of Standard Form (SF) 30, Amendment of Solicitation/Modification of Contract, which states in relevant part that “[f]ailure of your acknowledgement to be received at the place designated for the receipt of offers prior to the hour and date specified may result in rejection of your offer.”

We find that ECI failed to timely acknowledge a material amendment and, as a result, is not an interested party to challenge the agency's evaluation of proposals. As a general rule, an offeror’s failure to acknowledge a material amendment renders the proposal unacceptable and such proposal may not form the basis for award. Sterling Servs., Inc., B-291625, B-291626, Jan. 14, 2003, 2003 CPD para. 26 at 3; International Filter Mfg. Corp., B-235049, June 21, 1989, 89-1 CPD para. 586 at 3. In determining whether an amendment is material, we look at the facts of each case. While no precise rule exists as to whether a change required by an amendment is more than negligible, such that failure to acknowledge the amendment renders the proposal unacceptable, an amendment is material where it imposes legal obligations on a party that are different from those contained in the original solicitation, or if it would have more than a negligible impact on price, quantity, quality, or delivery. See Skyline ULTD, Inc., B-297800.3, Aug. 22, 2006 CPD para. 128 at 3; Navistar Marine Instrument Corp., B-277143.2, Feb. 13, 1998, 98-1 CPD para. 53 at 2.

Here, amendment No. 0005 significantly altered the guaranteed minimum quantity for the base year. Instead of a guaranteed minimum quantity of 63 assemblies as contained in the original RFP, the amendment changed the minimum quantity that DSCR was required to purchase to 250 assemblies, in comparison to the unchanged estimated quantity of 252 units. As expressed in percentage terms, amendment No. 0005 changed the RFP’s guaranteed minimum quantity for the base year from 25 percent (63 / 252 = .25) to 99 percent (250 / 252 = .99) of the estimated quantity. While the evaluation of proposals remained based on offerors' prices for the estimated quantities, offerors were able to, and did, propose different (i.e., tiered) pricing based on the number of units that the agency actually purchased. For example, ECI’s base year price for the guaranteed minimum quantity of 63 assemblies was $[DELETED] each, while its base year price for the estimated quantity of 252 assemblies was $[DELETED] each, a $[DELETED] difference per unit. AR, Tab 9, ECI Email to DSCR, Mar. 14, 2008, at 3. That ECI did not actually modify its proposed pricing as a result of amendment No. 0005 does not alter the fact that DSCR’s legal obligation as a result of such amendment was significantly greater than that contained in the original solicitation, and had the potential for more than a negligible impact on offerors’ prices. See Christolow Fire Prot. Sys., B-286585, Jan. 12, 2001, 2001 CPD para. 13 at 3-4. Accordingly, the amendment was material in nature.  (ECI Defense Group, B-400177; B-400177.2, July 25, 2008) (pdf)


During the course of the procurement, the agency twice extended the deadline for FPRs in order that Presidential's FPR could be considered. In this regard, initial FPR's were due on March 22, 2006, at 2 p.m. EST, but Presidential's FPR was not received until 2:33 p.m. At 2:36 p.m., the contracting officer extended the deadline to March 23 at 11 a.m. A second round of FPR's was due August 15 at 2 p.m., and Presidential’s FPR was received at 2:30 p.m. At 2:29 p.m., after becoming aware that Presidential would miss the deadline, the contracting officer issued an amendment changing the deadline to 4 p.m. Geo‑Seis argues that extending the closing times was improper and that MSC instead should have rejected the FPRs and eliminated Presidential from the competition.  This argument is without merit. The record shows that the agency's motivation in extending the deadlines was to enhance competition by keeping Presidential's proposal in the competition. There is no prohibition against a procuring agency issuing an amendment to extend the closing time for receipt of proposals after that time has passed in order to accommodate even one offeror, where the motivation for the extension is enhanced competition. Varicon Int'l, Inc.; MVM, Inc., B-255808, B‑255808.2, Apr. 6, 1994, 94-1 CPD para. 240 at 4. Geo-Seis attempts to distinguish our prior decisions from the case here on the facts. However, we find that the essential facts from our prior cases are present here--the agency issued an amendment extending the closing time after the expiration of the original closing time in order to keep an offeror in the competition, and thereby enhance competition. Again, extending the closing time for this purpose is unobjectionable. See Institute for Advanced Safety Studies--Recon., B-221330.2, July 25, 1986, 86‑2 CPD para. 110 at 2 (it was not improper for agency to issue an amendment extending the closing time 3 days after expiration of the original closing time); Fort Biscuit Co., B-247319, May 12, 1992, 92-1 CPD para. 440 at 4 (it was not improper for agency to extend closing time to permit one of four offerors more time to submit its best and final offer).  (Geo-Seis Helicopters, Inc., B-299175; B-299175.2, March 5, 2007) (pdf)

Note:  This Court of Federal Claims ruled differently.  See Geo-Seis Helicopters., v. U. S. and Presidential Airways, Inc., No. 07-155C, July 13, 2007, below.


DRS complains that this relaxation of the fuel efficiency requirements is inconsistent with section 317 of the National Defense Authorization Act (NDAA) for Fiscal Year 2002, 10 U.S.C. sect. 2865, note (Supp. II 2002), Federal Acquisition Regulation (FAR) sect. 11.101, and Executive Order (E.O.) No. 13,423, 72 Fed. Reg. 3919 (Jan. 24, 2007). According to the protester, the relaxation of the efficiency standards is inconsistent with these authorities, all of which require agencies to acquire energy efficient products "to the maximum extent practicable." The protester maintains that the agency's relaxation of the fuel efficiency requirements here is especially unreasonable because it has been working to design its generators to meet the earlier, more stringent, requirements for the past 2 years. In any event, there is no indication in the NDAA (or the E.O. or the FAR) that the energy efficiency requirements were intended to override the requirement for full and open competition articulated in the Competition in Contracting Act (CICA), 10 U.S.C. sect. 2302 et seq. (2000), or otherwise to take precedence over an agency's other legitimate needs. Rather, agencies are required to meet the efficiency requirement only "to the maximum extent practicable." Here, the agency determined that neither DRS nor Onan can meet the original fuel efficiency requirements, and that the requirement therefore had to be relaxed in order for the competition to proceed. There is nothing in the NDAA to suggest that relaxing a fuel efficiency requirement for this reason is impermissible. Moreover, even if the evidence is as the protester claims, we think the agency nevertheless could properly relax the requirement in order to ensure that there would be more than a single potential source; again, there is nothing in the NDAA providing that agencies must apply stringent fuel efficiency standards at the expense of competition. In this regard, where, as here, an agency determines that a relaxed specification will both meet its needs and afford enhanced competition for the goods or services being acquired, we will not object to the relaxation. See Virginia Elec. and Power Co; Baltimore Gas & Elec. Co., B‑285209, B-285209.2, Aug. 2, 2000, 2000 CPD para. 134 at 7-8 (the role of our Office in reviewing bid protests is to ensure that the statutory requirements for full and open competition are met, not to protect any interest a protester may have in more restrictive specifications). Thus, even if, as the protester alleges, its generator design is able to meet the earlier, more stringent fuel efficiency requirements, the agency’s decision to relax the specification in order to include Onan in the competition is unobjectionable. (Engineered Electric Company d/b/a DRS Fermont, B-295126.4, June 14, 2007) (pdf)


Here, the protester contends that amendment No. 6 is not material because it merely clarified existing contract performance requirements and thus did not affect the legal relationship of the parties. Specifically, the protester asserts that, despite its failure to acknowledge the amendment, it would be obliged to monitor foreign travel danger area status changes, since its proposal generally offers to review policies affecting contract performance. We disagree. As the agency points out, prior to issuance of amendment No. 6, there was no specific requirement in the RFP obligating the contractor to affirmatively monitor foreign travel danger status changes and to promptly coordinate any such change with the contracting agency. Since there was no such requirement in the RFP, Skyline’s offer to generally review policies regarding contract peformance does not constitute an agreement to the specific obligations imposed by amendment No. 6. Consequently, we cannot agree with the protester that amendment No. 6 did no more than clarify existing obligations of the contractor. In light of the amendment’s addition of contractor obligations to monitor and coordinate action regarding changes in foreign travel danger area status, and the agency’s additional rights derived from those requirements, we conclude that the amendment affects the legal relationship of the parties and therefore is material. See Federal Constr., Inc., B-279638, B‑279638.2, July 2, 1998, 98-2 CPD para. 5 at 4-5. Consequently, the protester’s failure to acknowledge it cannot, as Skyline requests, be waived as a minor informality. See T&S Maint. Servs., B-278598, Feb. 18, 1998, 98‑1 CPD para. 54 at 2-3. Accordingly, we see no basis to object to the agency’s rejection of the proposal for failure to acknowledge amendment No. 6.  (Skyline ULTD, Inc., B-297800.3, August 22, 2006) (pdf)


Space-Lok principally questions the agency’s use of the 210-day delivery requirement as a basis for issuing the purchase order to UFC, asserting that the 210-day requirement was not stated in the solicitation and, in any case, did not represent the agency’s needs, as evidenced by the agency’s delays in evaluating the quotations and issuing the purchase order. In this latter regard, the protester stated a 150-day delivery in its initial quotation and contends that, had the agency timely evaluated the initial quotations, it would have been issued the purchase order. Although the protester is correct that the 210-day delivery requirement was not stated in the solicitation, it was set forth in the August 10 synopsis issued following the change from the original simplified acquisition. Information disseminated during the course of a procurement that is in writing, signed by the contracting officer and provided to all vendors, meets all the essential elements of an amendment and--even where not designated as an amendment--is sufficient to operate as such. Linguistic Sys., Inc., B-296221, June 1, 2005, 2005 CPD para. 104 at 2. The August 10 synopsis met this standard, since it was issued in writing and posted and available to all vendors on the Federal Business Opportunities website. The synopsis thus became part of the solicitation, and it follows that the information in the synopsis was sufficient to establish, and to put Space-Lok on notice of, the 210-day delivery requirement. Id. (Space-Lok, Inc., B-297516, January 25, 2006) (pdf)


Based on the record before us, we agree with the protester that MGT’s proposal failed to address material solicitation requirements and, as a consequence, did not provide a proper basis for award. In this connection, any proposal that fails to conform to material terms and conditions of an RFP should be considered unacceptable and may not form the basis for an award. SWR, Inc., B-284075, B‑284075.2, Feb. 16, 2000, 2000 CPD para. 43 at 3. While MGT’s proposal contained more information than Wiltex’s, it still did not address a number of the RFP’s material requirements, including the requirement for proof of ability to furnish 24-hour on-site warranty service within 2 hours of notice and the requirement for a guarantee from the manufacturer that replacement parts would be available for a minimum of 10 years from the date of installation.[2] The contracting officer acknowledges that the awardee’s proposal did not address the latter requirement. With regard to the former requirement, the contracting officer argues that MGT demonstrated its ability to respond to service calls within the required timeframe by including in its proposal literature from Powerex, the manufacturer of its proposed air compressor system, that stated as follows:

Powerex also has over 200 trained and authorized service centers in the U.S. These local distributors have parts and service available normally 24 hours a day 7 days per week.

Since there is no indication in MGT’s proposal that either it or its installer is a Powerex authorized service center, we are not persuaded by the contracting officer’s argument. Moreover, MGT did not otherwise address the requirement. We also think that the evaluators unreasonably determined that MGT had demonstrated acceptable experience. As previously noted, the RFP instructed offerors “to describe the past experience of the company in providing maintenance on the equipment specified in this solicitation within the past three (3) years.” While MGT’s proposal described the company’s experience in selling air processing systems and the experience of its installer in installing them, MGT’s proposal furnished no description of experience on the part of either in providing maintenance on the systems once installed. Despite MGT’s failure to furnish evidence of the type of experience specifically required by the RFP, the technical evaluators rated its proposal as acceptable under the experience evaluation factor. This, we think, was unreasonable. In sum, because we conclude that the VA could not reasonably have determined MGT’s proposal, as submitted, to be technically acceptable, MGT’s proposal could not form the basis for award. Further, while both Wiltex and MGT submitted technically unacceptable offers, the agency essentially overlooked the deficiencies in MGT’s proposal while rejecting Wiltex’s proposal for similar deficiencies. This disparate treatment was inconsistent with the agency’s duty to treat offerors equally, and thus was improper. See Infrared Tech. Corp.--Recon., B-255709.2, Sept. 14, 1995, 95-2 CPD para. 132 at 4-5. (Wiltex Inc., B-297234.2; B-297234.3, December 27, 2005) (pdf)


It is a fundamental principle of government procurement that competition must be conducted on an equal basis, that is, offerors must be treated equally and be provided with a common basis for the preparation of their proposals. Continental RPVs, B-292768.2, B-292768.3, Dec. 11, 2003, 2004 CPD para. 56 at 8; Systems Mgmt., Inc.; Qualimetrics, Inc., B-287032.3, B-287032.4, Apr. 16, 2001, 2001 CPD para. 85 at 8. Our Office will sustain a protest that an agency improperly relaxed its requirements for the awardee where the protester establishes a reasonable possibility that it was prejudiced by the agency’s actions. Datastream Sys., Inc. B-291653, Jan. 24, 2003, 2003 CPD para. 30 at 6. We find that the Army did not improperly relax the solicitation requirements for the benefit of Wright. We find Lifecare’s argument that the agency improperly relaxed material solicitation requirements for the awardee to be without merit. First, as the protester itself acknowledges, the solicitation did not require that the successful offeror have all of its employees on hand prior to contract award, Lifecare’s Comments, Oct. 3, 2005, at 5; rather, the RFP requirements mandated only that the awardee have sufficient accredited medical coding personnel to begin performance by the contract start date. Second, the record reflects that the agency had a valid reason for altering the August 15 contract start date, namely, delays in the contract award process. As set forth above, given that it was required to reevaluate offerors’ clarified prices and resolve Lifecare’s agency-level protest, the Army did not make its final award decision until August 18 and did not issue a contract to Wright until August 19. In light thereof, we fail to see, and the protester fails to explain, how Wright or any other offeror could have begun contract performance on August 15. Moreover, notwithstanding the agency’s statement that the start date would be “on or about” September 1, the actual contract start date was August 22, the first business day after the Army issued the contract to Wright--a fact which Lifecare ignores. In sum, we find that there was a reasonable basis for the agency’s decision to extend the start date for commencement of contract performance; it was not done to improperly relax the requirements for the awardee. See Military Waste Mgmt., Inc., B-240769.3, Feb. 7, 1991, 91-1 CPD para. 135 at 3. Lifecare, the incumbent contractor, cannot protest the solicitation, delay the agency’s ability to award a contract, and then reasonably argue that any alteration of the planned contract start date constitutes a relaxation of the requirements in favor of the new awardee. (Lifecare Management Partners, B-297078; B-297078.2, November 21, 2005) (pdf)


It is a fundamental principle of government procurement that competition must be conducted on an equal basis, that is, offerors must be treated equally and be provided with a common basis for the preparation of their proposals. Systems Mgmt., Inc.; Qualimetrics, Inc. , B-287032.3, B-287032.4, Apr. 16, 2001, 2001 CPD 85 at 8. When, either before or after receipt of proposals, the government changes or relaxes its requirements, it must issue an amendment to notify all offerors of the changed requirements and give them an opportunity to respond. Federal Acquisition Regulation (FAR) 15.206(a). If time is of the essence, however, the contracting officer may make an oral notice of the amendment. FAR 15.206(f). While the contracting officer must then document the file and formalize the notice with an amendment, id. , where the agency has adequately advised the offerors of its changed requirements, the failure to formally amend the solicitation is not significant. Ram Enters., Inc. , B-221924, June 24, 1986, 86-1 CPD 581 at 3. Here, although AVL Books asserts generally that the agency's telephone inquiry did not adequately communicate that online claims processing was an agency requirement, we find its assertion unpersuasive. As noted above, AVL Books was one of three firms that the contracting officer questioned about its online claims processing capabilities. Both of the other two firms understood the question to mean that online claims processing capability was now an evaluation factor. Both firms, apparently of their own accord, followed up the telephone call from the contracting officer with a written confirmation to the contracting officer of their ability to provide that additional contract service. Under these circumstances, we conclude that the telephone call from the contracting officer and the medical librarian was adequate notice to all offerors that online claims processing capability had been added as a requirement to the solicitation. (AVL Books.Com, Inc., B-295780, March 28, 2005) (pdf)


On December 2, the day before the award to AT&T, the Chief Information Officer for Treasury (Treasury CIO), the Commissioner of the General Services Administration's (GSA) Federal Technology Service (FTS), the Administrator of the Office of Management and Budget's (OMB) Office of Federal Procurement Policy (OFPP), and the Administrator of OMB's Office of Electronic Government (E-Government) signed a memorandum of understanding (MOU) regarding the possible migration of Treasury's TCE requirements to the forthcoming GSA FTS-Networx telecommunications services contract at the expiration of the 3-year TCE base period. The protesters assert that the MOU represented a fundamental and material change in the manner in which the determination whether to exercise the options would be made, and that it was unreasonable to require offerors to prepare their proposals without disclosing this information. We agree with the protesters. Here, the MOU significantly changed the approach to determining whether to exercise the TCE options in ways that, in total, made it significantly less likely that the TCE options would be exercised. In fact, in light of all of the information in the record indicating that all of the other government entities that would be involved in the option exercise decision believed that Treasury's requirement should transition to the GSA Networx contract, it appears that the MOU made it more likely that the options would not be exercised than that they would. This represented a material change to the basis upon which offerors prepared their proposals. Treasury thus was required to advise offerors of the new approach to determining whether to exercise the TCE options and provide them an opportunity to submit revised proposals on a common basis that reflects the agency's actual needs. Accordingly, we sustain the protest on this basis. (Northrop Grumman Information Technology, Inc.; Broadwing, B-295526; B-295526.2; B-295526.3; B-295526.4; B-295526.5; B-295526.6;, March 16, 2005) (pdf)


While, as the protester asserts, there may be little difference between the maintenance to be performed on the printers already covered by the requirement and that required for the additional printers, the agency's actions were proper based on the significant change in its quantity requirements. As noted above, under the original RFP, offerors submitted proposals to maintain an estimated 2,557 computers and 3,148 printers. The amended RFP added an estimated 2,439 impact printers, an increase of approximately 77 percent in the number of printers, and a more than 40 percent increase in the total equipment to be maintained. Quantity estimates in a solicitation establish the general framework for the governments anticipated purchases under the contract, and thus provide the basis for offerors to determine their pricing. Consequently, when an agency knows that there is a serious discrepancy between a solicitation estimate and actual anticipated needs, it should not make award on the basis of the stated estimate but, rather, should revise the solicitation to provide offerors with the most accurate information available. United Tel. Co. of the Northwest , supra , at 9, quoting N.V. Philips Gloellampenfabriken , B-207485.3, May 3, 1983, 83-1 CPD 467 at 12. Given the significant change in the quantities of equipment to be maintained under the contract, amending the solicitation and seeking revised proposals on that basis was reasonable. The addition of Guam as a performance site further supports the agency's actions. While there is only a limited amount of equipment on Guam--a midrange computer and two printers--the remote location and 18-hour response time for maintenance would appear to be potentially significant factors that each offeror is entitled to take into consideration in calculating its pricing. (Digital Technologies, Inc., B-291657.3, November 18, 2004) (pdf)


The RFP referred to the Archives II parking lot as an area that must be maintained by the contractor, even though it was incomplete when proposals were submitted. RFP at 1.3, 35, 38, 60. The RFP also noted that shuttle service provided by the contractor to off-site parking could be deleted in the base year. RFP at 146. With regard to the Archives I building, prospective offerors had access to the building drawings, including the planned renovations, and were provided detailed information on major systems in both the pre- and post-renovation configurations. RFP, amend. 02; AR at 8. In addition, when an offeror questioned whether the RFP would be amended to phase in service at Archives I, the agency answered that offerors were "to propose 100% service on day one of the contract," with adjustments to be negotiated upon award. RFP amend.04. CESI acknowledges that the future construction and renovations were identified in the RFP, but maintains that offerors were required to speculate as to the costs. However, while some degree of speculation obviously was necessary, CESI has not shown that completion of the work on the Archives I building and the parking lot resulted in material changes to the assumptions on which offerors were to base their original proposals. Thus, since the original proposals were to be based on the ultimate completion of the work in question, the agency could reasonably conclude that there was no need to allow offerors to revise this aspect of their proposals. (Consolidated Engineering Services, Inc., B-293864.2, October 25, 2004) (pdf)


Because AMFUEL was clearly put on notice during discussions that its proposed delivery schedules were unacceptable, and because the agency informed AMFUEL, also during discussions, of what delivery schedules the agency would find acceptable, we think that formal amendments to the same effect were not necessary. See Avitech, Inc., B-214749, Sept. 17, 1984, 84-2 CPD ¶ 297 at 2-3. While AMFUEL characterizes the delivery schedules identified by the agency during discussions as merely negotiating positions, the discussions letters clearly advised that the specified delivery schedules were minimum requirements. It simply was not reasonable for AMFUEL to assume that it could submit what it characterized as counter-offers, which again did not comply with the delivery schedules that the agency clearly identified as acceptable, without risking that its proposals would be regarded as unacceptable. Delivery is a material term of a solicitation and award generally cannot be made on the basis of a proposal that takes exception to a required delivery schedule. Logitek, Inc., B-238773, July 6, 1990, 90-2 CPD ¶ 16 at 3-4, recon. denied, B-238773.2, Nov. 19, 1990, 90-2 CPD ¶ 401. Because AMFUEL's revised proposals failed to include delivery schedules that satisfied the government's minimum requirements, the agency properly found AMFUEL's proposals unacceptable. (American Fuel Cell & Coated Fabrics Company, B-293001; B-293020, January 12, 2004) (pdf)


With regard to the water purification systems, the record shows that award was made to Phenix for a purification system not including a first step based on water distillation or reverse osmosis despite the fact that all vendors were notified, via e-mail requests for clarification, that such a step was required. To the extent that Phenix believes that compliance with the requirement was not necessary because it was not formally made a part of the solicitation through amendment, where a contracting officer advises all vendors of a solicitation requirement in writing, the essential elements of an amendment are present whether or not the communication is designated as a formal amendment. Realty Ventures/Idaho, B-226167, May 18, 1987, 87-1 CPD ¶ 523 at 4; see also Federal Elec. Int'l, Inc., B-232295.2, Dec. 21, 1988, 88-2 CPD ¶ 610 at 10 (furnishing of copy of written question and response places offeror on notice of government requirements even though they are not reflected in formal amendment). (Phenix Research Products, B-292184.2, August 8, 2003)  (pdf)


While an ID/IQ contract does give the government flexibility when it cannot determine its needs above a minimum quantity in advance of contracting, the use of such a contract does not excuse the government from actually identifying its needs. Where an agency's requirements change after a solicitation has been issued--even after the submission of best and final offers and up until the time of award--it is required to issue an amendment to notify offerors of the changed requirements and afford them an opportunity to respond. Federal Acquisition Regulation (FAR) § 15.206(a); NV Servs., B‑284119.2, Feb. 25, 2000, 2000 CPD ¶ 64 at 17; Symetrics Indus., Inc., B-274246.3 et al., Aug. 20, 1997, 97-2 CPD ¶ 59 at 6. This requirement ensures that award decisions are based on the agency's most current view of its needs, Symetrics Indus., Inc., supra, and that proposals will be prepared on a common basis that reflects the agency's actual needs. Dairy Maid Dairy, Inc., B‑251758.3 et al., May 24, 1993, 93-1 CPD ¶ 404 at 7-9. As noted above, the record shows that the agency's funding philosophy concerning box drain repair had changed prior to issuance of the RFP, and that it was aware after issuance of the RFP that, if funding could be obtained, it would order the work under the contract awarded under the RFP. Under these circumstances, the quantity changes should have been communicated to all offerors through an RFP amendment. This is particularly the case under the circumstances here, since Pembroke had been made aware of the increased box drain quantities through the agency's attempt to include that work under its prior contract. Although Pembroke perhaps could not be certain that the additional work ultimately would be funded, Taylor should have been furnished with equivalent information, so that it would have had the same opportunity Pembroke had to factor this risk into its prices. It is undisputed by the agency that the quantity changes at issue were significant. (M.K. Taylor, Jr. Contractors, Inc., B-291730.2, April 23, 2003) (pdf)

Comptroller General - Listing of Decisions

For the Government For the Protester
New National Disability Rights Network, Inc. B-413528: Nov 16, 2016 CGI Federal Inc., B-410330.2: Dec 10, 2014  (pdf)
Richen Management, LLC B-409706.3: Oct 24, 2016 System Studies & Simulation, Inc., B-409375.2, B-409375.3: May 12, 2014  (pdf)
TTCC, Inc. B-412874: May 17, 2016  (pdf) IBM-U.S. Federal, B-407073.3, B-407073.4, B-407073.5, B-407073.6, Jun 6, 2013  (pdf)
Platinum Services, Inc.; WIT Associates, Inc., B-409288.3, B-409288.4, B-409288.5: Aug 21, 2014  (pdf) Infoshred LLC, B-407086, Oct 26, 2012  (pdf)
MG Mako, Inc., B-404758, April 28, 2011 (pdf) Ocean Services, LLC, B-404690, April 6, 2011 (pdf)
DBI Waste Systems, Inc., B-400687; B-400687.2, January 12, 2009 (pdf) Global Computer Enterprises, Inc.; Savantage Financial Services, Inc., B-404597; B-404597.2; B-404597.3, March 9, 2011  (pdf)
Hart Security Limited, B-400796.2, December 16, 2008 (pdf) The S.M. Stoller Corporation, B-400937; B-400937.3; B-400937.4, March 25, 2009 (pdf)
Murray-Benjamin Electric Company, L.P., B-400255, August 7, 2008 (pdf) Wiltex Inc., B-297234.2; B-297234.3, December 27, 2005 (pdf)
ECI Defense Group, B-400177; B-400177.2, July 25, 2008 (pdf) Northrop Grumman Information Technology, Inc.; Broadwing, B-295526; B-295526.2; B-295526.3; B-295526.4; B-295526.5; B-295526.6;, March 16, 2005 (pdf)
Geo-Seis Helicopters, Inc., B-299175; B-299175.2, March 5, 2007 (pdf) 

Note:  This opinion was not agreed to by the Court of Federal Claims.  See Geo-Seis Helicopters., v. U. S. and Presidential Airways, Inc., No. 07-155C, July 13, 2007, below.

 
Engineered Electric Company d/b/a DRS Fermont, B-295126.4, June 14, 2007 (pdf)  
Skyline ULTD, Inc., B-297800.3, August 22, 2006 (pdf)  
Space-Lok, Inc., B-297516, January 25, 2006 (pdf)  
Lifecare Management Partners, B-297078; B-297078.2, November 21, 2005 (pdf)  
AVL Books.Com, Inc., B-295780, March 28, 2005 (pdf)  
Digital Technologies, Inc., B-291657.3, November 18, 2004 (pdf)  
Consolidated Engineering Services, Inc., B-293864.2, October 25, 2004 (pdf)  
American Fuel Cell & Coated Fabrics Company, B-293001; B-293020, January 12, 2004 (pdf)  
Phenix Research Products, B-292184.2, August 8, 2003 (pdf)  
M.K. Taylor, Jr. Contractors, Inc., B-291730.2, April 23, 2003 (pdf)  

U. S. Court of Federal Claims - Key Excerpts

In this protest Applied Business Management Solutions, Inc. (“ABMSI”) challenges corrective action the General Services Administration (“GSA”) took in response to two Government Accountability Office (“GAO”) protests by Moody’s Consulting Services, Inc, (“Moody’s). In response to Moody’s first protest against an award to ABMSI, GSA represented to GAO that it was taking corrective action by having offerors realign their pricing, and by GSA revising its price analysis report, reevaluating and documenting past performance and making a new best value award determination, if necessary. GSA undertook this corrective action and almost finished it, when approximately nine months later, Moody’s filed a second GAO protest claiming GSA failed to complete its corrective action in timely fashion. In fact, GSA had completed much of its corrective action; it had revised its pricing analysis and past performance analyses a month before the second protest was filed, and these re-evaluations did not suggest any error with the original award to ABMSI. Nonetheless, rather than simply present the revised pricing and past performance analyses to the Source Selection Authority to make a best value determination, GSA claimed a budget cut necessitated such a sweeping reduction in requirements that ABMSI’s contract no longer met agency needs, thus warranting termination of ABMSI’s contract and a sole-source reprocurement [to Premier Management Corporation (“Premier”)].

(sections deleted)

The Government cites a reduction in budget as the justification for GSA’s determination that ABMSI’s contract no longer met its requirements, thus prompting its termination of ABMSI’s contract for convenience and subsequent award of a sole-source contract for these services to Premier. Even accepting that there was a budget cut that applied to ABMSI’s contract—a fact Defendant failed to establish—the agency did not have to terminate ABMSI’s contract and reprocure the services on a sole-source basis. AR Tab 47 at 857. As the Government acknowledged, ABMSI’s contract could have been modified to reduce the quantity of services being procured. Tr. 101-02, June 11, 2014. The amended solicitation had a clause reserving to GSA the right to “award for all or fewer than all of the number of positions designated on the contract line items in the pricing tables.” AR Tab 10 at 134. Specifically, the “Terms That Affect Price” paragraph provided:

The Government is in the process of re-organizing its resources. As a result, the actual number of positions may change prior to award of the contract. Thus, the Government reserves the right to award for all or fewer than all of the number of positions designated on the contract line items in the pricing tables. The Government reserves the right to reallocate Contractor resources within the specified number per labor category from one organization to another. Any reallocation does not change the total number of hours or the total number of positions.

AR Tab 10 at 134.

Agency action is arbitrary and capricious when the agency “entirely failed to consider an important aspect of the problem, offered an explanation for its decision that runs counter to the evidence before the agency or [the decision] is so implausible that it could not be ascribed to a difference in view or the product of agency expertise.” Ala. Aircraft Indus., 586 F.3d at 1375 (alteration in original) (quotation marks omitted) (quoting Motor Vehicle Mfrs. Ass’n, 463 U.S. at 43). An “agency must examine the relevant data and articulate a satisfactory explanation for its action including a rational connection between the facts found and the choice made.” Sang-Su Lee, 277 F.3d at 1344 (quotation marks omitted) (quoting Motor Vehicle Mfrs. Ass’n, 463 U.S. at 43); see also Burlington Truck Lines v. United States, 371 U.S. 156, 168 (1962).

Here, GSA failed to articulate a rational connection between the facts found—its need to reduce personnel performing ABMSI’s contract—and its choice of terminating that contract and undertaking a new procurement action requiring SBA’s evaluation, review, and approval and ultimately fashioning a more expensive, non-competitive sole-source award. The Government acknowledged that ABMSI’s contract could have accommodated a reduction in services. Tr. 101-02, June 14, 2011 (conceding the agency could have obtained 43 personnel under ABMSI’s contract). Rather than exercise its express contractual right to reduce the number of personnel on ABMSI’s contract, GSA, for reasons unexplained in the Administrative Record, terminated ABMSI’s contract for convenience and made a sole-source award of the services to Premier at a higher price.

Defendant points to an additional reason that GSA’s decision to terminate the ABMSI contract for convenience was justified, citing the agency’s concern about the integrity of the award to ABMSI in light of Moody’s first protest. The Administrative Record, however, demonstrates that the agency’s corrective action addressed the issues in Moody’s protest.

In its first protest, Moody’s challenged GSA’s price adjustments to the contractors’ proposals and evaluation of past performance. GSA requested that GAO dismiss Moody’s protest, because it was undertaking corrective action, i.e. that it would properly document the past performance evaluation results, request that the contractors realign their pricing, and then revise its price analysis and best value determination in light of the information received.

In taking corrective action, GSA first requested that ABMSI and Moody’s submit realigned pricing to reflect the updated contract performance periods. Both contractors promptly submitted realigned pricing. On August 28, 2013, three months later, the Contracting Officer submitted to agency counsel the revised price analysis, stating:

[…]

AR Tab 35 at 678. GSA’s analysis of the contractors’ realigned pricing submissions and the agency’s revised price analysis addressed and satisfied the first ground of Moody’s protest.

In the second facet of the corrective action, GSA completed three analyses of the agency’s past performance evaluations between August 28, 2013 and December 12, 2013, and submitted its conclusions to agency counsel for review. Each submission provided more detail that explained the evaluation team’s conclusions as well as a rationale for the final assessment ratings, in response to the concerns of agency counsel. In each additional past performance analysis, GSA […]. ABMSI was given a rating of […] and Moody’s was given a rating of […]. There is no indication in the record that any further action needed to be taken regarding past performance.

After the adjustment for realigned pricing and the submission of the final past performance evaluation report, all that was left for GSA to do to complete the corrective action was make an award. There is no indication in the record that the award to ABMSI should have been upset based on Moody’s protests. The pricing was realigned satisfactorily, and the past performance evaluation was redone twice again, with no suggestion that there was anything infirm in the agency’s assessment. See Plasan N. America, Inc. v. United States, 109 Fed. Cl. 561, 572 (2013) (quoting Gulf Grp. Inc. v. United States, 61 Fed. Cl. 338, 351 (2004) (holding that when a court considers a challenge to a past performance evaluation “the greatest deference possible is given to the agency”)). In short, GSA has articulated no legitimate reason for failing to finish corrective action that was very close to completion and instead start over and go to the lengths it did to make a sole-source award to Premier. AR Tab 40 at 834. Nonetheless, after nine months, the agency did not complete what should have been a straightforward corrective action.

As a result of the delay, Moody’s filed a second GAO protest claiming that GSA failed to complete its corrective action in a reasonable and timely manner. In response, instead of completing the corrective action and mooting Moody’s protest, GSA attempted to settle with Moody’s, and, for reasons that are indiscernible on this record, offered to pay Moody’s protest costs. Then, claiming it needed to avoid a gap in service, GSA decided to award a sole source contract for a nine-month period.

Effecting a sole-source award is no easy feat. In order to promote competition in the procurement process, sole source procurements are subject to a number of restrictions. Innovation Dev. Enter. of Am., Inc.v. United States, 108 Fed. Cl. 711 (2013). A sole source-award could not exceed the threshold in 13 C.F.R. 124.506(a)(2)(ii) (“A procurement offered and accepted for the 8(a) [Business Development] Program must be competed among eligible participants if: the anticipated award price of the contract, including any options will exceed $6.5 million for contracts assigned with NAICS codes and $4 million for all other contracts.”) GSA had to reduce both personnel and the contract duration for a nine-and-half-month period (March 21, 2014-December 31, 2014) to meet this threshold, and estimated the cost of procuring this requirement would be $[…]. AR Tab 81 at 1129; Id. at 1117.

In addition, on February 27, 2014, pursuant to FAR Part 10, which requires agencies to conduct market research to arrive at the most suitable approach to acquiring services GSA researched 30 vendors, and determined Premier was the most capable of responding in a short period of time. AR Tab 67 at 956-61. GSA then put together a Request for Proposal that it sent to Premier on March 6, 2014. AR Tab 70 at 989. Premier submitted its offer to GSA on March 11, 2014, and GSA conducted a past performance evaluation. AR Tab 73 at 1053-59; AR Tab 75 at 1098-1100. On March 13, 2014, GSA completed a price analysis of Premier’s proposal. AR Tab 80 at 1117-21.

Additionally, FAR 19.804 required GSA to determine “the extent to which a requirement should be offered in support of the 8(a) Program” by evaluating six factors, including “[w]hether the items or work have previously been acquired using small business set-asides and then offering the requirement to SBA providing information, such as “the names and addresses of any small business contractors that have performed this requirement in the previous 24 months.” FAR 19.804-2. SBA regulations prohibit SBA from accepting a procurement for award as an 8(a) contract if the procurement will adversely impact an individual small business. 13 C.F.R. 124.504. Upon the determination that there is not an adverse impact, SBA may accept the agency’s offer via a letter. FAR 19.804-3; AR 1103. Here, both GSA and SBA in endeavoring to comply with the regulations had to invest significant time and effort to effect this sole-source award—an onerous and unnecessary response to Moody’s protests.

The Government argued that GSA’s action in terminating ABMSI’s contract displacing it with a more expensive sole-source award was “reasonable,” and within GSA’s discretion. This conduct, however, went beyond the parameters of agency discretion in the procurement setting. It is well established that although procurement officials possess considerable discretion, that discretion is not unfettered. E.g., T &M Distribs., Inc. v. United States, 185 F.3d 1279, 1283 (Fed. Cir. 1999). The sole justifications articulated by GSA for its termination and reprocurement were invalid; the budgetary cuts and reduced personnel could have been accomplished under ABMSI’s contract and concerns about Moody’s protest were satisfactorily resolved by GSA’s revised pricing and past performance analyses. Because Plaintiff has demonstrated that GSA’s actions in terminating ABMSI’s contract and awarding a sole-source contract to Premier lacked a rational basis and were arbitrary and capricious, Plaintiff has succeeded on the merits of the protest.

(sections deleted)

2. The Court GRANTS Plaintiff’s request for a declaratory judgment and motion for a permanent injunction as follows:

a. The Court declares that General Services Administration’s selection of Premier Management Solutions under Solicitation No. GS-11P-14-YA-C-0018 is null and void, and sets aside the March 13, 2014 selection of Premier.

b. The General Services Administration, its officers, agents, servants, employees and representatives, and all persons acting in concert and participating with them respecting the subject procurement and Premier Management Solutions, its subsidiaries, agents and assigns are hereby PERMANENTLY RESTRAINED AND ENJOINED from expending funds on and performing the sole-source award, Contract 0018.

c. The General Services Administration, its officers, agents, servants, employees and representatives, and all persons acting in concert and participating with them respecting the subject procurement, are ordered to proceed in accordance with statute and regulation to fulfill GSA’s requirement for services currently being provided by ABMSI under Contract 0017.14 GSA shall complete forthwith its corrective action taken in response to Moody’s protests and make a best value determination and award. In the interim until corrective action is completed, GSA shall keep in place ABMSI’s current contract at a personnel level GSA deems appropriate. In any award resulting from the corrective action/best value determination, GSA may reduce the services procured consistent with its legitimate and documented need to reduce its budget on this procurement.

(Applied Business Management Solutions, Inc. v. U. S. and Premier Management Corporation, No. 14-214C, August 13, 2014)


The plaintiffs filed their “pre-award bid protest” complaint in this court on June 20, 2008, claiming that the agency’s decision to cancel the original solicitation on the grounds that none of the SDVOSB offerors had relevant past performance was arbitrary, capricious, and not in accordance with the FAR or the solicitation terms. Compl. ¶ 1; Am. Compl. ¶ 10. The plaintiffs seek injunctive relief directing “DHS to review the SDVOSB[s’] proposals in accordance with the requirements of the [canceled] SOLICITATION and existing law and award to one of the SDVOSB[]s submitting a proposal.”19 Am. Compl. at 5. On July 21, 2008, the plaintiffs filed their motions for judgment on the administrative record and for an order directing the government to refer the SDVOSB proposers to the SBA for a COC. In the latter motion, the plaintiffs argued that DHS lacked the authority to reject the bids based on the past performance of the offerors because those rejections constituted “responsibility determinations” which could only be made by the SBA. On August 22, 2008, the government filed a cross-motion for judgment on the administrative record, asserting that the agency was entitled to cancel the solicitation on the grounds that it did not result in proposals that best met its needs in terms of relevant past performance of prime offerors. Oral argument was heard on September 25, 2008, and supplemental briefing was completed on September 29, 2008.  

(Sections deleted)

B. Cancellation Standards

In a negotiated procurement, the contracting agency’s decision to cancel a solicitation is governed by FAR 15.305(b), 48 C.F.R. § 15.305(b) (2005), which states in its entirety: “The source selection authority [‘SSA’] may reject all proposals received in response to a solicitation, if doing so is in the best interest of the government.” (emphasis added). Although the FAR does not provide details regarding the application of the “best interest” standard, this court has found that “the cancellation of an RFP is . . . given a great degree of discretion, especially where . . . the solicitation explicitly permits the agency to make no award at all.” Cygnus Corp. v. United States, 72 Fed. Cl. 380, 385 (2006) (citing a clause in the solicitation to the effect that “[t]he Government may reject any or all proposals if such action is in the Government's interest”); see also Keco Indus., Inc. v. United States, 492 F.2d 1200, 1205 (Ct. Cl. 1977) (“[T]here is no assurance that any bidder would have obtained the award since the Government retains, in its discretion, the right to reject all bids without any liability.”). “Given the great degree of discretion afforded [an agency] in its decision to cancel [an] RFP,” this court has held that it “must merely find that the ‘agency provide[d] a coherent and reasonable explanation of its exercise of discretion.’” Cygnus Corp., 72 Fed. Cl. at 385 (quoting Impresa, 238 F.3d at 1332) (“The APA requires the agency to consider all relevant factors and articulate ‘a rational connection between the facts found and the choice made,’ hardly an onerous burden.” (quoting Great Lakes Dredge & Dock Co. v. United States, 60 Fed. Cl. 350, 358 (2004))).

In contrast to sealed bidding, in a negotiated procurement such as the one at issue here, General Accounting Office (“GAO”) decisions have found that “the contracting officer need only have a reasonable basis for cancellation after receipt of proposals, as opposed to the ‘cogent and compelling’ reason required for cancellation of a solicitation after sealed bids have been opened[,] . . . because in sealed bidding competitive positions are publicly exposed as a result of the public opening of bids, while in negotiated procurements there is no public opening.” Cantu Servs., Inc., B-219998.9, 1989 WL 240549, *1 (Comp. Gen. 1989) (citing Cadre Technical, Inc., et al., B-221430 et al., 1986 WL 63252 (Comp. Gen. 1986); Allied Repair Serv., Inc., B-207629, 1982 WL 26715 (Comp. Gen. 1982)); see also Steven W. Feldman, Government Contract Guidebook § 6:8 (4th ed. Jan. 2008) (“Generally, the cancellation of an RFP is difficult to challenge because cancellation is a matter of Contracting Officer discretion. Unlike rejection of all bids after bid opening in a sealed bid procurement, offers in a negotiated procurement have not been publicly exposed. For this reason, no requirement exists for a compelling reason to justify RFP cancellation as opposed to an [Invitation for Bids] cancellation.” (footnotes omitted)).

B. Analysis

The court finds that the plaintiffs have failed to demonstrate that the agency violated any statute or regulation or acted arbitrarily, capriciously, or without a rational basis in connection with its decision to cancel the solicitation after the agency determined that the acquisition strategy had failed to result in proposals that met the government’s needs for the project. To the contrary, the court finds that the agency’s actions conformed with its obligations under the FAR in connection with cancellations of solicitations involving SDVOSBs.

Specifically, as noted above, FAR 15.305(b) provides that “[t]he [SSA] may reject all proposals received in response to a solicitation, if doing so is in the best interest of the Government.” (emphasis added). Accordingly, cancellation of a solicitation in a negotiated procurement is “given a great degree of discretion, especially where, as in this case, the solicitation explicitly permits the agency to make no award at all.” Cygnus Corp., 72 Fed. Cl. at 385; see also Keco, 492 F.2d at 1205. In this case, the solicitation expressly and repeatedly advised proposers that “this [RFP] in no manner obligates the Government regarding award of a contract, task order or modification that results from the issuance of this RFP.” AR 7, 170-G. Accordingly, where, as here, the agency “provide[d] a coherent and reasonable explanation of its exercise of discretion,” Cygnus Corp., 72 Fed. Cl. at 385 (quoting Impresa, 238 F.3d at 1332), articulating “a rational connection between the facts found and the choice made,” the cancellation decision must be found to have been proper. Id. (quoting Great Lakes, 60 Fed. Cl. at 358).

In this case, Ms. Weindel, as the SSA, determined that cancellation of the solicitation would be in the best interest of FPS because the acquisition strategy failed to elicit any SDVOSB prime contractors with relevant past performance. In its Determination and Findings, FPS explained that, given the requirement in FAR 52.219-27 that an SDVOSB concern “must agree that in performance of the contract, at least 50% of the cost of personnel for contract performance will be spent for employees of the concern[,] . . . fully attributing the experience of subcontractors to a prime with little or no experience that is responsible for the majority effort, is an extreme risk to FPS.” AR 1844 (emphasis added). In light of the discretion given to cancellation decisions in negotiated procurements, as set forth above, see FAR 15.305(b); Cygnus Corp., 72 Fed. Cl. at 385, the court finds that it was not irrational for FPS to decide that it was necessary for the SDVOSB prime contractors in this case to demonstrate that they would be able to shoulder the responsibilities of this large, complex security contract by submitting their own relevant past performance. As the government correctly notes, FAR 9.604(e), 48 C.F.R. § 9.604(e) (2004), provides that the government may “[h]old the prime contractor fully responsible for contract performance, regardless of any team arrangement between the prime contractor and its subcontractors.” Given that the SDVOSB primes were to be the ultimate guarantors of performance of the contract, it was not irrational for the government to decide that it was too risky to depend on SDVOSB primes with no relevant past performance to be in charge of the contract, nor was it irrational to conclude that the solicitation should be canceled on that basis.

This conclusion is reinforced by various GAO decisions in which the GAO has rejected protests from small business offerors on the grounds that they did not have sufficient past experience without relying on subcontractors and held that it was reasonable to conclude that the primes themselves must have adequate relevant experience. See North State Res., B-282140, 1999 WL 812500 (Comp. Gen. 1999); USATREX Int'l, Inc., B- 275592, 1997 WL 868302 (Comp. Gen. 1997); Innovative Tech. Sys., Inc., B-260074, 1995 WL 317615 (Comp. Gen. 1995). For example, in Innovative, the GAO determined that the United States Department of the Navy was “clearly reasonable” in deciding that

an offeror under a services contract may not rely entirely on its subcontractor's experience when, given the restriction on subcontractor participation in performance of the contract under FAR § 52.219-14[, 48 C.F.R. § 52.219-14 (2006)],26 the offeror itself will be required to expend at least 50 percent of the labor costs under the contract for its own employees.

Innovative, 1995 WL 317615 at *5 (emphasis added). The GAO in Innovative continued,

Even without regard to FAR § 52.219-14, where, as here, the procuring agency is requiring the successful offeror to operate and maintain a computer network, and otherwise assume ultimate responsibility for the management and performance of an entire computer system, we think it is reasonable for the agency to require the successful offeror to possess its own, in-house corporate experience instead of relying on its subcontractor’s experience to prove its ability under a corporate experience technical factor.

Id. (emphasis added). Accordingly, just as this court now finds in the SDVOSB context in the instant case, the GAO has found that it is not unreasonable for an agency to conclude, given the requirements of the FAR regarding personnel costs under small business set-asides, that prime contractors must demonstrate relevant past performance of their own. Id.; see also North State Res., 1999 WL 812500 at *5 (“[A]n agency need not consider subcontractor experience where the solicitation contemplates award of a service contract to a section 8(a) firm, and includes the provision at [FAR] 52.219-14 . . . . In such cases, the agency properly may determine that only the offerors[’] own capabilities are relevant for purposes of discriminating among the proposals. . . . [The agency] properly could limit its evaluation to the prime contractors[’] capabilities.” (emphasis added) (citing USATREX, 1997 WL 868302)).

The fact that the TET arrived at a different conclusion does not change the analysis. The agency found that the TET did not consider a factor (relevant experience of the SDVOSB primes) which the agency determined was crucial to meeting its goals for the SDVOSB set-aside, justifying the agency’s decision not to rely on the TET’s findings. Specifically, Ms. Weindel determined that the TET’s evaluation of the proposals did not take into account the prime/subcontractor arrangements in evaluating past performance, AR 1840, and accordingly, when applying that different criterion to each of the proposals, Ms. Weindel came to different conclusions than those reached by the TET. See id. 1829- 38, 1841-43. Ms. Weindel’s authority to negate the TET’s findings is fully supported by FAR 15.308, which states: “While the [SSA] may use reports and analyses prepared by others, the source selection decision shall represent the SSA’s independent judgment.” (emphasis added). This court has held that FAR 15.308 “permits the SSA to test and disagree with the evaluators’ conclusions.” L-3 Commc’ns Integrated Sys. v. United States, 79 Fed. Cl. 453, 462 (2007) (“‘Source selection officials are not bound by the recommendations of lower-level evaluators, and as a general rule, we will not object to the higher-level official’s judgment, absent unreasonable or improper action, even when the official disagrees with an assessment made by a working-level evaluation board or individuals who normally may be expected to have the technical expertise required for such evaluations.’” (quoting Speedy Food Serv. Inc., B-258537, 1995 WL 317603 (Comp. Gen. 1995))). Accordingly, Ms. Weindel as the SSA was well within her authority to exercise her independent judgment and disagree with the TET’s conclusions.

In addition, in the case of SDVOSB set-asides in particular, the FAR provides that, “[i]f the contracting officer receives no acceptable offers from [SDVOSB] concerns, the [SDVOSB] set-aside shall be withdrawn and the requirement, if still valid, set aside for small business concerns, as appropriate.” FAR 19.1405(c) (emphasis added). Here, Ms. Weindel determined that no offers were received from SDVOSB prime contractors with relevant past performance, and based on that lack of acceptable offers from SDVOSB concerns, she determined that the solicitation should be withdrawn and resolicited using a different acquisition strategy, designed to give small businesses a competitive advantage. As such, her decision to withdraw the SDVOSB set-aside was in compliance with FAR 19.1405(c).

Ms. Weindel’s actions also conformed with FAR 15.206(e), 48 C.F.R. § 15.206(e) (2005), which provides:

If, in the judgment of the contracting officer, based on market research or otherwise, an amendment proposed for issuance after offers have been received is so substantial as to exceed what prospective offerors reasonably could have anticipated, so that additional sources likely would have submitted offers had the substance of the amendment been known to them, the contracting officer shall cancel the original solicitation and issue a new one, regardless of the stage of the acquisition.

(emphasis added). In this case, Ms. Weindel concluded that the solicitation as written did not succeed in eliciting proposals from SDVOSB concerns with relevant past performance, despite the Q&As referring proposers to the FAR provisions regarding SDVOSB ownership and personnel costs, and that awarding to an SDVOSB concern without relevant experience posed an unacceptable risk to the government. As noted above, since none of the SDVOSB offerors were deemed acceptable, FAR 19.1405(c) required the agency to withdraw the SDVOSB set-aside status. The agency’s Determination and Findings found that changing the set-aside status of the solicitation would “drastically change the requirement in terms of acquisition strategy,” and therefore, “[i]n accordance with FAR 15.206(e),” “cancellation and re-issuance of the solicitation [was] appropriate.” AR 1845. Expanding the solicitation to include concerns other than SDVOSBs involved a change “so substantial” that additional sources most certainly> would have submitted offers, as contemplated by FAR 15.206(e). Accordingly, the agency’s decision to cancel the solicitation and open the project to concerns other than SDVOSBs rather than simply amending it was appropriate under FAR 15.206(e).

Thus, the court finds that the government was within its rights to cancel the solicitation and resolicit using a different acquisition strategy once it determined that the original solicitation had failed to result in any proposals that met the agency’s needs. Where, as here, the government is entitled to a great degree of deference, the court will not force the government to accept the services of contractors that the government has determined will not meet its needs. Where the government has made such a determination, it must be allowed to call an end to a negotiated solicitation, rather than being required to push forward and select an awardee.

The plaintiffs have not pointed to any statute, regulation, or provision of the solicitation requiring the agency to go through a longer process before arriving at its decision to cancel; to the contrary, as noted above, the regulations pertaining to cancellation of a negotiated procurement expressly allow for cancellation “regardless of the stage of the acquisition.” FAR 15.206(e). Moreover, having concluded that the cancellation of the solicitation was not improper, the court has no occasion to reach the plaintiffs’ arguments that the agency should have taken additional or different steps in evaluating the proposals – the proper cancellation essentially mooted those claims. See CCL Serv. Corp., 43 Fed. Cl. at 690 (“In light of [the agency’s] decision to cancel the solicitation, any decision on the merits of the award would not affect plaintiffs in any respect – none of the plaintiffs will be eligible for award, as no award can be made under a canceled solicitation. The mere fact that plaintiffs may have been entitled to more relief than they received had there been a decision on the merits is insufficient to permit continued litigation in light of [the agency’s] actions, which have rendered the underlying issue moot.” Thus, the agency “has precluded the court from making a finding regarding the . . . question” of “whether error occurred in the procurement process[.]”); see also S.K.J. & Assocs., Inc. v. United States, 67 Fed. Cl. 218, 228 (2005) (finding “no matter before the court for resolution upon which [the plaintiff could] base its claim for bid preparation and proposal costs” arising out of the agency’s “failure to evaluate [the plaintiff’s] original bid properly,” “because the original contract and solicitation at issue . . . were cancelled,” and declaring the claim moot on that basis). Stated another way, the violations alleged by the plaintiffs to the effect that the proper procedures for evaluating proposals were improperly short-circuited would only have been reviewable if there had not been an intervening, proper cancellation in this case.  (DCMS-ISA, Inc., The Whitestone Group, inc., and R&D Training and Technical Services, Inc., v. U. S., No. 08-456c, November 14, 2008.) (pdf)


B. Effect of Post-hoc Amendments to the Solicitation on the “Late is Late” Rule

In support of their view that Amendments 9 and 12 justified the Sealift Command’s acceptance of Presidential’s revised proposals, the government and Presidential rely principally on a set of GAO precedents that permit the issuance of post-expiration amendments to a solicitation extending the closing dates. See Matter of Ivey Mech. Co., No. B-272764, 1996 WL 478103, at *1 (G.A.O. Aug. 23, 1996) (“[W]e have repeatedly approved of the issuance of amendments extending closing dates after the expiration of the original closing date when the result is enhanced competition.”); Matter of Varicon Int’l, Inc.; No. B-255808, 1994 WL 125250, at *3 (G.A.O. Apr. 6, 1994) (“the [FAR] does not prohibit the issuance of amendments extending the closing date for proposals after that date has passed.”); Matter of Fort Biscuit Co., 71 Comp. Gen. 392, 394 (G.A.O. May 12, 1992) (“[W]e have held that issuance of an amendment extending the time for bid opening even after the deadline has passed is proper where its intent is to enhance competition by permitting an offeror sufficient time to prepare an offer.”); Matter of Institute for Advanced Safety Studies, No. B-221330, 1986 WL 63783, at *2 (G.A.O. July 25, 1986) (“While [the FAR] . . . contemplates the issuance of solicitation amendments prior to the closing date, it does not specifically prohibit the issuance of amendments extending the closing date after the closing date.”).

The government and Presidential cite Professor Ralph Nash’s criticism of the “late is late” rule emphasizing his opinion that the rule is contrary to the government’s interest in enhancing competition. Def.’s Cross-Mot. at 15-16 n.3; Intervenor’s Reply at 5-6. They refer to Professor Nash’s comment that the FAR’s “‘late-is-late’ rule” is “dumb” and that a way to circumvent the rule, consistent with GAO precedent, is to issue a post-hoc amendment to the solicitation extending the deadline for submission. Ralph C. Nash & John Cibinic, Dateline: January 2007, Nash & Cibinic Report, Vol. 21, No. 1 (2007) (citing Ivey Mech., 1996 WL 478103). Geo-Seis challenges the application of these precedents and arguments on the grounds that they contravene the text of the FAR provisions and are negated by the regulatory history of pertinent amendments to the FAR.

1. Regulatory history of FAR § 52.215-1(c)(3)(ii)(A).

Specifically, Geo-Seis argues that the regulatory history of proposed changes to the “late is late” rule that were rejected in 1997 refutes the government’s argument that Amendments 9 and 12, in effect, trumped the “late is late” rule. Pl.’s Cross-Mot. at 18-19; Pl.’s Resp. at 6-9.

As part of a larger effort to revise the FAR’s Part 15, Contracting by Negotiation, the FAR Council issued proposed rules that would have amended the “late is late” rule. Federal Acquisition Regulation; Part 15 Rewrite—Phase I, 61 Fed. Reg. 48,380, 48,380-81 (Sept. 12, 1996). The FAR Council explained that the proposed rule changes involved “[m]ajor policy shifts,” including “[r]evision of the rules governing late proposals for negotiated acquisitions to make the offeror responsible for timely delivery of its offer, and to allow late offers to be considered if doing so is in the best interests of the Government.” Id. at 48,380-81. As proposed, the “late is late” rule would have stated in relevant part: “Offers, and requested revisions to them, that are received in the designated office after the time for receipt are ‘late’ and shall be considered at the Source Selection Authority’s discretion.” Id. at 48,392 (emphasis added). Moreover, the analogous provision in the proposed FAR § 15.207(b) would have provided: “Proposals, modifications, and revisions received in the designated Government office after the exact time specified are ‘late’ but may be considered if doing so is in the best interests of the government.” 61 Fed. Reg. at 48,386 (emphasis added).

On September 30, 1997, the Civilian Agency Acquisition Council and the Defense Acquisition Regulations Council (“the Councils”) issued a final rule revising FAR Part 15. See Federal Acquisition Regulation; Part 15 Rewrite; Contracting by Negotiation and Competitive Range Determination, 62 Fed. Reg. 51,224 (Sept. 30, 1997). Both proposals for modifying the “late is late” rule – proposed FAR § 52.215-1(c)(3) and proposed FAR § 15.207(b) – were rejected in the final version of the FAR revisions. Id. at § 51,235, § 51,259.22 The Councils explained that the final rule reflected a decision to “[r]eestablish . . . the ‘late is late’ rule for receipt of proposals, responses to requests for information, and modifications.” Id. at 51,224. In rejecting the proposed rules, which would have given government agencies broad discretion to consider late proposals and revisions, the Councils essentially reverted to the language of the former FAR §§ 15.412(c), 52.215-10 by repromulgating the “late is late” rules in FAR §§ 15.208(b)(1), 52.215-1(c)(3)(ii)(A). Compare FAR §§ 15.412(c), 52.215-10 (1997), with 62 Fed. Reg. at 51,235, 51,259.23 With only minor amendments, see, e.g., Federal Acquisition Regulation; Conforming Late Offer Treatment, 64 Fed. Reg. 51,837, 51,841 (Sept. 24, 1999), the version of FAR 52.215-1(c)(3)(ii)(A) currently in force reflects the final rule adopted in September 1997. Compare FAR § 52.215-1(c)(3)(ii)(A), with 62 Fed. Reg. at 51,259.

In light of this regulatory history, reading FAR § 52.215-1(c)(3)(ii)(A) – by omission – to permit the Military Sealift Command’s issuance of Amendments 9 and 12 is unwarranted. As Geo-Seis points out, Pl.’s Reply at 7, a standard rule of statutory construction – and one equally applicable to interpreting regulations – is that a court must not give an enactment a construction that has been specifically considered and rejected. See Immigration & Naturalization Serv. v. Cardoza-Fonseca, 480 U.S. 421, 442-443 (1987) (“Few principles of statutory construction are more compelling than the proposition that Congress does not intend sub silentio to enact statutory language that it has earlier discarded in favor of other language.”) (quoting Nachman Corp. v. Pension Benefit Guar. Corp., 446 U.S. 359, 392-393 (1980) (Stewart, J., dissenting)).

Finally, the government argues that the Military Sealift Command’s post-hoc issuance of Amendments 9 and 12 was within the contracting officer’s discretion. Def.’s Cross-Mot. at 13; Def.’s Reply at 2. But the very rationale cited by the Command’s Contracting Officer at the time she issued those amendments – that changing the closing date and time for submission of the first and second revised proposals was “in the best interest of the government,” AR 342 (Mem. to File from Stangler and Kimm (Mar. 22, 2006)), 349 (Mem. to File from Stangler and Little (Aug. 15, 2006)) – was considered in the proposed FAR § 15.207(b) and ultimately rejected. Compare 61 Fed. Reg. at 48,386, with 62 Fed. Reg. at 51,235. Similarly, the Councils rejected the proposed version of § 52.215-1(c)(3)(ii)(A) that stated that late revisions “shall be considered at the Source Selection Authority’s discretion.” Compare 61 Fed. Reg. at 48,392, with 62 Fed. Reg. at 51,259. The rejection of the proposed revisions to the “late is late” rule apparently resulted from public comments that those proposals “gave too much discretion to [contracting officers].” Ralph C. Nash & John Cibinic, The FAR Part 15 Rewrite: A Final Scorecard, Nash & Cibinic Report, Vol. 11, No. 12, ¶ 63 (1997). Consequently, the Councils reverted to the previous “late is late” rule under the former FAR §§ 15.412(c), 52.215-10, with its stricter rule placing minimal discretion in the hands of the contracting officer. 62 Fed. Reg. at 51,224; Nash & Cibinic, The FAR Part 15 Rewrite: A Final Scorecard, ¶ 63. This regulatory history amply demonstrates that the government’s and Presidential’s argument that agencies may circumvent that “late is late” rule by issuing post-hoc amendments to the solicitation to extend the closing date or time is unavailing.

2. Changes in the FAR Provisions Governing Amendments to a Solicitation.

In the major revision of FAR Part 15 in 1997, changes were made to the rules governing amendments to solicitations. Geo-Seis argues that those changes render inapplicable the GAO decisions upon which the government and Presidential rely. See Pl.’s Cross-Mot. at 15-17. The former FAR § 15.410(a) read:

After issuance of a solicitation, but before the date set for receipt of proposals, it may be necessary to (1) make changes to the solicitation, including, but not limited to, significant changes in quantity, specifications, or delivery schedules, (2) correct defects or ambiguities, or (3) change the closing date for receipt of proposals.

FAR § 15.410(a) (1997). The current provision governing solicitation amendments, FAR §15.206(c), states that “[a]mendments issued after the established time and date for receipt of proposals shall be issued to all offerors that have not been eliminated from the competition.” FAR §15.206(c) (emphasis added).

As Presidential concedes, because the former FAR § 15.410(a)(3) provided that an agency could change the closing date for receipt of proposals “[a]fter issuance of a solicitation, but before the date set for receipt of proposals,” FAR § 15.410(a)(3) (1997) (emphasis added), it “envisioned amendments occurring prior to [the] closing date.” Intervenor’s Reply at 6. Geo- Seis claims that the current FAR § 15.206(c) “closed [the] loophole [of former FAR § 15.410(a)] and permits the issuance of amendments after the deadline for proposal submittals has passed only to ‘offerors that have not been eliminated from the competition.’” Pl.’s Cross-Mot. at 16. Geo-Seis argues that Presidential was an offeror that had “been eliminated from the competition” because FAR § 52.215-1(c)(3)(ii)(A) dictates that once a proposal is late, it “will not be considered”– meaning that at the time the Military Sealift Command issued Amendments 9 and 12, Presidential was no longer in the competition and thus was ineligible for award under FAR § 15.206(c). Pl.’s Cross-Mot. at 16-17; Pl.’s Resp. at 5.24 Presidential responds that FAR § 15.206(c) does not require a contracting officer to make an affirmative “eligibility” determination when amending the solicitation and that a contracting officer has discretion to extend the deadline for receipt of proposals. Intervenor’s Mot. at 12-13. Therefore, Presidential asserts, offerors whose revised proposals were submitted prior to the new deadlines established under Amendments 9 and 12 had not been “eliminated from the competition.” Id.25

The meaning of the phrase “offerors that have not been eliminated from the competition,” FAR § 15.206(c), has not been addressed by prior precedents nor is it explained by the regulatory history of the provision.26 More importantly, the question of whether Presidential was “eliminated” under FAR § 15.206(c) simply begs the ultimate question in this case: whether FAR § 52.215-1(c)(3)(ii)(A) precluded the Military Sealift Command from accepting Presidential’s first and second revised proposals.

C. The Contracting Officer’s Contravention of Legal Requirements

By issuing Amendments 9 and 12 to the solicitation and thus accepting Presidential’s first and second revised proposals, the Contracting Officer contravened the “late is late” rule under FAR § 52.215-1(c)(3)(ii)(A). First, the plain language of FAR § 52.215-1(c)(3)(ii)(A) precluded the Sealift Command’s consideration of Presidential’s revised proposals, and Presidential did not satisfy any of the exceptions contained in that rule. See FAR § 52.215-1(c)(3)(ii)(A) (late proposals “will not be considered” unless the exceptions noted are met). Second, the government and Presidential have failed to demonstrate that post-hoc solicitation amendments extending the closing date or time trump the “late is late” rule. See supra at 14-17 & n.27. There is simply no basis in the FAR for the view that the Contracting Officer had discretion to render the “late is late” rule a nullity. Although GAO decisions support the government’s position as to the nunc pro tunc effect of post-hoc amendments, see supra at 12, those GAO precedents reflect “one of those Comptroller-General-created rules that is not reflected in the FAR,” as conceded by Professor Nash, a harsh critic of the “late is late” rule. Ralph C. Nash & John Cibinic, Late Final Proposal Revisions: The Final Straw!, Nash & Cibinic Report, Vol. 18, No. 4, ¶ 16 (1997). Those GAO decisions are not persuasive and they will not be adopted.

More broadly, adopting the government’s construction of the “late is late” rule would allow the government arbitrarily to claim in some circumstances that the rule precludes it from considering a late proposal and in other circumstances to assert that the rule is not a bar to issuing amendments to the solicitation that would permit such consideration. The plain language of FAR § 52.215-1(c)(3)(ii)(A) does not support the government’s interpretation that the “late is late” rule is a sort of one-way ratchet, always operating in the government’s favor. See United States v. Verduchi, 434 F.3d 17, 24 (1st Cir. 2006) (“The statutory authorization in the [act] for equitable adjustment does not say it is a one-way ratchet.”); Falconwood Corp. v. United States, 422 F.3d 1339, 1352 n.6 (Fed. Cir. 2005) (in tax case, rejecting government’s argument that “Commissioner of Internal Revenue enjoys what amounts to unfettered discretion to apply the step transaction doctrine in those cases where its application would benefit the government – a one-way ratchet of sorts. . . . Treasury cannot with one hand promulgate consolidated return regulations that have the force and effect of statutory law, and, with the other, require a taxpayer under the guise of the step transaction doctrine to proceed contrary to the regulations but only when to the government’s benefit.”); Association of Am. R.R. v. Surface Transp. Bd., 161 F.3d 58, 63 (D.C. Cir. 1998) (“We do not find in [the statute] a clear expression of congressional intent to create a one-way ratchet, permitting deregulation only, without subsequent adjustment.”). The late-bid rule “may seem harsh, [but] it alleviates confusion, ensures equal treatment of all offerors, and prevents an offeror from obtaining a competitive advantage that may accrue where an offeror is permitted to submit a proposal later than the deadline set for all competitors.” Argencord, 68 Fed. Cl. at 173 (quoting Matter of PMTech, Inc., No. B-291082, 2002 WL 31303100, at *2 (G.A.O. Oct. 11, 2002)).

In the final analysis, the policy reasons for or against the “late is late” rule are matters within the purview of the FAR Councils, not this court. The FAR Councils specifically addressed and resolved those policy issues in the 1997 reconsideration of the FAR, and this court should not undercut that resolution by a contrary decision in this case. In short, the court will apply the FAR as written, not as the government and Presidential urge that it should have been written. The refusal of the Military Sealift Command’s Contracting Officer to adhere to the categorical reality of the “late is late” rule renders arbitrary her decision to accept Presidential’s first and second revised proposals.  (Geo-Seis Helicopters., v. U. S. and Presidential Airways, Inc., No. 07-155C, July 13, 2007) (pdf)


Plaintiff understandably is frustrated that the amendment here allowed others to remain in the competition, ultimately leading to another firm being selected for the award. But, the types of concerns it raises are subsumed and fully addressed in the context of the standard the courts have employed in reviewing proposed amendments under section 15.206(a), to wit, whether the action is taken “in good faith, without the specific intent of changing a particular offeror’s technical ranking or avoiding an award to a particular offeror.” Federal Sec. Sys., Inc., B-281745.2, 99-1 C.P.D. ¶ 86, at 5, 1999 WL 292729 (Comp. Gen. 1999). In ManTech, for example, this court faced a protester’s claim that allowing the Army to revise the technical requirements of the solicitation would unfairly allow a competitor to submit a revised proposal curing deficiencies in its original submission. Applying the aforementioned “good faith” standard, this court upheld the amendment, reasoning –

At the core of this standard are essentially the same types of fairness concerns that [the protester] raises, in particular, the concern that an amendment not be used as a vehicle to steer a contract toward or away from a particular contractor. These fairness concerns are neither implicated nor offended to the extent such an amendment is designed, instead, merely to ensure that the United States receives the best possible value at the lowest cost – indeed, such is the essence of a best value procurement.

ManTech, 49 Fed. Cl. at 75; see also ViroMed Labs., Inc. v. United States, 62 Fed. Cl. 206, 218 (2004). It observed that the result reached comported with decisions holding that where, in a negotiated procurement, an offeror’s proposal does not comply with the solicitation’s requirements, “‘an agency is not required to eliminate the awardee from the competition, but may permit it to correct its proposal.’” ManTech, 49 Fed. Cl. at 71 (quoting D&M Gen. Contracting, Inc, B-252282, B-252282.4, 1993 WL 325094, at *2 (Comp. Gen. Aug. 19, 1993); see also SMS Data Prods. Group, Inc. v. Austin, 940 F. 2d 1514, 1517 (Fed. Cir. 1991). The various principles governing amendments are essentially corollaries of a basic rule designed to promote fair competition, particularly in the context of negotiated, best value procurements. Indeed, while FAR section 15.206 specifies situations in which an agency must amend a solicitation, it does not purport to cabin an agency’s discretion to amend a solicitation to ensure full competition and thus “to permit the government to obtain its minimum requirements at the most favorable price.” ManTech, 49 Fed. Cl. at 73; see also Bethlehem Steel Corp., B- 231923, B-231923.2, 88-2 CPD ¶ 438, at 6, 1988 WL 228164 (Comp. Gen. 1988). By comparison, the rigid rule that plaintiff espouses here would leave the government at the mercy of a single contractor – even one that has deficiencies in its proposal – if, as the result of the application of certain mandatory requirements, every other competitor in a negotiated, best value procurement were initially disqualified. That result is illogical and finds no support in the law.  (EP Productions, Inc. v. U. S., No. 04-1428C, January 3, 2005) (pdf)

U. S. Court of Federal Claims - Listing of Decisions
For the Government For the Protester
DCMS-ISA, Inc., The Whitestone Group, inc., and R&D Training and Technical Services, Inc., v. U. S., No. 08-456c, November 14, 2008. (pdf) Applied Business Management Solutions, Inc. v. U. S. and Premier Management Corporation, No. 14-214C, August 13, 2014  (pdf)
EP Productions, Inc. v. U. S., No. 04-1428C, January 3, 2005 (pdf) Geo-Seis Helicopters., v. U. S. and Presidential Airways, Inc., No. 07-155C, July 13, 2007 (pdf)
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