Under FAR sect. 16.504(c)(1)(i),
a contracting officer must, to the maximum extent practicable, "give preference
to making multiple awards of indefinite quantity contracts under a single
solicitation for the same or similar supplies or services to two or more
sources." The FAR also sets out a number of conditions under which the multiple
award approach is not to be used, two of which are relevant to the protest here:
where the expected cost of administration of multiple contracts outweighs the
expected benefits of making multiple awards, or where multiple awards would not
be in the best interests of the government. FAR sect. 16.504(c)(1)(ii)(B)(3),
(6). The contracting officer is required to document the basis for the decision
to use (or not use) multiple awards, FAR sect. 16.504(c)(1)(ii)(C), and we will
review the contracting officer's determination for reasonableness. One Source
Mechanical Servs., Inc.; Kane Constr., B-293692, B‑293802, June 1, 2004, 2004
CPD para. 112 at 5. Where we conclude that the rationale advanced by the
contracting officer is not sufficient to overcome the preference for multiple
awards, we will sustain the protest. Id.
Here, the contracting officer, in reliance on the two exceptions to the use of
multiple contracts referenced above, determined that award of multiple contracts
was not appropriate because (1) the cost of administering multiple contracts
outweighed the expected benefits of making multiple awards, and (2) multiple
awards would not be in the government's best interest. Contracting Officer's
Determination, June 26, 2010, AR, Tab 5.4. We do not think that the record
supports these conclusions.
The agency explains that the current solicitation is a follow-on to four
predecessor contracts that spanned approximately 20 years, first issued in
response to the 1986 enactment of legislation requiring the preparation of
toxicological profiles of hazardous substances. According to the agency, it
awarded a total of five contracts under the first solicitation in 1988, and many
of the toxicological profiles produced under the contracts were unacceptable.
The agency attributed the unacceptable quality of the profiles to problems
stemming from the use of multiple contractors, specifically, inaccurate
scientific evaluations, differing interpretations of the specifications by the
different contractors, and inconsistency in the levels of experience and
sophistication among the individuals performing similar tasks for different
contractors. Agency Memorandum of Law at 3-4. The agency noted that the
performance quality issues had resulted in significant delay and had required
significant additional efforts by the agency to correct problems. Specifically,
the agency's Division of Toxicology had found it necessary to create a separate
quality assurance branch, consisting of approximately 12 employees and four
contract staffers, to review and evaluate the profiles for accuracy and
consistency. During this first 5-year procurement cycle, the agency concluded
that the award of multiple contracts was not an appropriate acquisition vehicle
for the requirement; as a result, in the second 5-year cycle, the agency awarded
only a single contract and disbanded its internal quality assurance branch.
Thereafter, the agency awarded single contracts for the third and fourth
procurement cycles as well.
The agency's argument in support of the decision to make a single award under
the RFP here, as we understand it, is that the award of multiple contracts will
require it to reestablish a quality assurance branch to ensure the consistency
and accuracy of the profiles submitted by the various contractors; thus, in the
agency's view, the expected costs of administering multiple contracts will
outweigh the expected benefits. We are not persuaded by the agency's argument.
First, it simply is not clear from the record that the problems that the agency
encountered during the first procurement cycle (and which it has relied on as
its basis for awarding only a single contract during every subsequent 5-year
procurement cycle) were a result of its decision to award multiple contracts, as
opposed to problems attributable to the novelty and complexity of the
requirement when the first awards were made--that is, problems that it might
well have encountered even if only a single contract had been awarded. Second,
we see no basis to conclude that, as result of its experience in administering
contracts for preparation of the profiles over the course of the past 20 years,
the agency is not now in a position to define the technical requirements for the
profiles with sufficient precision to eliminate the issues of inconsistency
stemming from differing interpretations of the specifications by different
contractors that it encountered under the 1988 procurement.
While the agency cites inaccurate scientific evaluations and differing levels of
training and experience among staffers performing similar tasks for different
contractors as two of the three factors contributing to the submission of
unacceptable profiles during the first procurement cycle, it has failed to
establish a correlation between the number of contractors and the likelihood of
an inaccurate scientific evaluation. Moreover, we see no reason to think that
there could not be as much variability in terms of training and experience among
staffers working for a particular contractor as among staffers working for
different contractors--and to the extent that contractor reliance upon
underqualified staffers is a matter of concern to the agency, this is a matter
that can be addressed by including personnel qualification requirements in the
RFP.
In sum, we conclude that the rationale advanced by the agency lacks adequate
support to overcome the preference for multiple awards. Accordingly, we sustain
the protest. We recommend that the agency reconsider whether, in accordance with
FAR sect. 16.504(c)(1)(ii)(B), the RFP here should be competed on a
multiple-award basis, and that the agency document a well-supported rationale
for its conclusion. We also recommend that the protester be reimbursed the
reasonable costs of filing and pursuing the protest, including reasonable
attorneys' fees. 4 C.F.R. sect. 21.8(d)(1) (2010). The protester's certified
claim for costs, detailing the time spent and the costs incurred, must be
submitted to the agency within 60 days after receipt of this decision. (Information
Ventures, Inc., B-403321, September 27, 2010) (pdf)
In summary, we conclude that the contracting officer’s rationale for employing
the exceptions under FAR § 16.504(c)(1)(B) is not adequately supported.
Therefore, our Office concludes that the Corps failed to comply with the FAR in
determining whether these solicitations should have been issued on a
multiple-award basis. (One Source Mechanical
Services, Inc.; Kane Construction, B-293692; B-293802, June 1, 2004) (pdf)
Finally, even if the CO's failure to consider the
benefits of multiple awards does not contravene the applicable provisions of FAR
16.504(c)(1), it renders the analysis unreasonable, especially in light of the
dubious findings regarding the supposed benefits of a single award. According to
the CO, multiple awards are not in the government's best interests because a
single award will: 1) ensure that the contractor receives a substantial line
commitment and revenue guarantee which is necessary to offset investment risks
and attract competitors; 2) reduce usage charges; 3) bring greater economies of
scale; and 4) reduce coordination difficulties and administration costs
associated with multiple awards.
In summary, by failing to consider the benefits
of multiple awards, the CO's analysis violates applicable provisions of FAR
16.504(c)(1). The government's contention that the single-award structure of the
New York MAA will achieve the same benefits as multiple awards without the costs
is unreasonable and does not excuse the CO's violation. Finally, the CO's
conclusion that a single award is in the best interests of the government is
also unreasonable, irrespective of the non-compliance with FAR 16.504(c)(1).
(Winstar Communications, Inc., v.
U.S., No. 98-480C, September 9, 1998) |
