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GAO Grants Reimbursement of Costs

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 Spry Methods, Inc., of McLean, Virginia, requested that the U.S. Government Accountability Office (GAO) recommend that it be reimbursed for the costs of filing and pursuing its protest challenging the issuance of a task order to Customer Value Partners, Inc. (CVP), of Fairfax, Virginia, under request for quotations (RFQ) No. 140D0419Q0011, issued by the Department of the Interior (DOI) for information management and assurance program support services.

The GAO initially dismissed the protest after the DOI assured the GAO that it would take corrective action by reevaluating vendors’ quotations and making a new award decision. Spry argued that its protest was clearly meritorious and the agency’s corrective action unduly delayed. On February 14, 2020, the GAO ultimately granted Spry’s request.

RFQ BACKGROUND

 The RFQ was first issued on October 15, 2018, to holders of General Services Administration 8(a) Streamlined Technology Acquisition Resources for Services (STARS) II contracts, which are multiple-award, indefinite-delivery, indefinite-quantity (IDIQ) contracts for various information technology services and service-based solutions, pursuant to the procedures of Federal Acquisition Regulation (FAR) subpart 16.5.

The RFQ presented an award of a time-and-materials task order for a base year with four 1-year options. The RFQ required each contractor to provide qualified personnel to successfully perform the stated performance work statement (PWS) requirements in three task areas: (1) risk management and information security continuous monitoring; (2) information system security officers and system security; and (3) privacy.

The RFQ stated that the task order award would be made on a best-value tradeoff basis, based on two evaluation factors of equal importance: (1) technical approach and (2) price. The technical approach factor consisted of four subfactors: (1) understanding of PWS requirements; (2) quality control plan; (3) staffing plan; and (4) key personnel.

Twenty vendors, including Spry and CVP, submitted quotations by the closing date of December 28, 2018. An agency technical evaluation committee (TEC) evaluated the vendors’ technical quotations, assigning ratings to the technical subfactors, as well as making findings regarding whether the quotations adequately addressed PWS requirements in 90 different areas. After completing its initial evaluation, the TEC found that 15 vendors had failed to adequately address the technical approach factor and, on April 10, 2019, these vendors were notified of their elimination from the competition.

However, on April 18, 2019, the DOI’s contracting officer sent CVP an email requesting it submit a revised technical quotation, which it did. The DOI didn’t afford any of the other vendors the opportunity to submit a revised quote.

SPRY FILES INITIAL PROTEST

On July 29, 2019, Spry, after receiving notice of the task order award to CVP and a debriefing, filed its protest with the GAO and raised the following arguments: (1) the agency unreasonably evaluated Spry’s technical approach; (2) the agency unreasonably and unequally evaluated CVP’s technical approach, including holding unequal discussions; (3) the evaluation of CVP’s key personnel and staffing plan were unreasonable; and (4) the agency’s resulting best-value determination was unreasonable.

On August 29, 2019, DOI filed its agency report and argued that the evaluation of vendors’ quotations and resulting award decision was reasonable and consistent with the stated evaluation criteria. With regards to Spry’s assertion concerning disparate treatment and unequal discussions, the agency stated that the same standards had been applied to both vendors’ quotations and that no discussions had occurred.

On September 9, 2019, Spry filed its comments on the agency report. While continuing to protest that DOI’s evaluation was unreasonable in several regards, the focus of Spry’s comments was that the agency had conducted unequal discussions with CVP as evidenced by the contracting officer’s April 18 email to CVP.

On October 9, 2019, the DOI submitted a letter to the GAO, assuring the office that the agency would be taking corrective measures in its award of this particular task order.

SPRY REQUESTS REIMBURSEMENT

Spry requested that the GAO recommend that the DOI reimburse Spry’s costs of filing and pursuing its underlying protest. Spry argued that the agency unduly delayed taking corrective action and that its protest of the agency’s disparate treatment/unequal discussions was clearly meritorious. The DOI countered by arguing that Spry’s protest with regards to unequal discussions was not clearly meritorious, and therefore isn’t entitled to reimbursement of protest costs.

In issuing its decision, the GAO explained that when a contracting agency takes corrective action in response to a protest, the GAO may recommend reimbursement of protest costs if the GAO determines that the agency unduly delayed taking corrective action in the face of a clearly meritorious protest, thereby causing the protester to expend unnecessary time and resources to make further use of the protest process in order to obtain relief.

Typically, so long as an agency takes corrective action in response to a protest by the due date of its protest report, the GAO regards such action as prompt and declines to fulfill a request to recommend reimbursement of protest costs. Here, the DOI didn’t dispute that its corrective action occurred after the filing of the agency report and the protester’s comments. Instead, the DOI argued that “[i]f the protest is not clearly meritorious[,] it is irrelevant whether the agency ‘unduly delayed’ taking corrective action.”

GAO CONCLUDES SPRY’S PROTEST IS MERITORIOUS

The GAO found that Spry’s protest that DOI conducted unequal discussions with CVP was clearly meritorious.

The DOI didn’t dispute that it conducted exchanges only with CVP, and in fact, even defended its decision to conduct exchanges with CVP and not Spry as reasonable. The DOI further tried to argue that the exchanges with CVP didn’t amount to discussions, or even if they were discussions, that the agency’s actions were “fair and equitable,” and without prejudice to Spry. The GAO found the DOI “to be mistaken in all regards, and that its present assertions are, in fact, contradicted by its prior representations to [the GAO].”

First, the GAO concluded that the record demonstrated that the DOI’s exchange with CVP amounted to discussions. The GAO has consistently ruled that discussions occur when an agency communicates with a vendor for the purpose of obtaining information essential to determine the acceptability of a quotation, or provides the vendor with an opportunity to revise or modify its quotation in some material respect. This mirrors the contents of the DOI’s April 18 email to CVP.

Second, the GAO determined that because the DOI didn’t conduct discussions or exchanges with any other vendor, including Spry, its actions were unequal and favored one vendor over another. Therefore, there is no basis to the DOI’s assertion that its conduct was “fair and equitable” when the contracting officer clearly favored one vendor over all others in the evaluation process.

Third, the DOI previously admitted that it conducted discussions with CVP and that such discussions were unequal. As part of its notice of corrective action to the GAO, the DOI stated “the agency is unable to support [the] rationale in the award summary where only one [vendor] was given the opportunity to engage in discussions/negotiations with the Government.” Given this explicit admission, the GAO easily found that Spry’s protest was clearly meritorious.

Finally, the DOI argued that even if it had engaged in unequal discussions, Spry was not prejudiced by the unequal discussions because “the record shows that both proposals were considered acceptable, and that the [award] decision, while close, came down to the better written proposal.” The GAO concluded that this argument also failed because CVP was afforded the opportunity submit a revised quote for the task order, giving CVP a substantially higher chance of receiving the award.

GAO RECOMMENDS SPRY RECEIVES REIMBURSEMENT FOR COSTS

Because the DOI didn’t dispute Spry’s assertion that the unequal discussions challenge was part of the larger issue of the agency’s unreasonable technical evaluation generally or challenge the non-severability of these issues, the GAO concluded that Spry’s clearly meritorious challenge to the unequal discussions is subsumed within the larger issue of an unreasonable evaluation of vendors’ technical quotations generally, such that Spry is entitled to the reimbursement of its protest costs for each ground raised.

About the AuthorChloe Vickers

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