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Procurement Integrity Act Violation Impact

Posted by Joseph Whitcomb on Jul 10, 2017 11:19:59 AM
Joseph Whitcomb

Procurement integrity act violation

Matter of: Dell Services Federal Government, Inc.

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The Department of Education recently decided to change how it acquires IT services. Rather than using a single overarching contract, the agency began acquiring segments of its IT requirements using multiple task or delivery orders. The solicitation that is the subject of this protest as part of what is referred to as the PIVOT program. The solicitation sought to acquire IT integrator and end-user experience services, which was referred to as the PIVOT I solicitation. The solicitation was an indefinite-delivery, indefinite-quantity (IDIQ) administered by the National Institutes of Health Information Technology Acquisition and Assessment Center. Dell Services Federal Government, Inc. (DSFG) was originally awarded this contract and 2007 for a 10 year period of performance.

On February 16, 2017, one of Dell’s competitors, SRA, notified the contracting officer that it had come in possession of two of Dell’s original proposals from 2007 and 2011. The 2007 proposal resulted in DFSG resulted in an award in the 2011 proposal resulted in modification of the contract. Apparently, an unnamed employee of one of SRA’s teaming partners had obtained the proposals by virtue of an earlier relationship with DFSG and had passed them along to SRA. Unsurprisingly, DSFG wrote the Department of Education asserting its position that there was a potential violation of the Procurement Integrity Act.

On the same day, the contracting officer prepared a document titled “Procurement Impact Determination,” concluding that the release of DSFG proposals would have no adverse impact on the procurement at issue or any future PIVOT acquisitions. The document was signed by both the contracting officer and the chief of the agency’s contracting office within one day of DSFG providing the notice. Two days later, the Department of Education sent an email to DSFG, stating that it had made its determination “some time ago.”

DSFG protested with the GAO alleging that the agency had not adequately considered the impact that the release of the proposals to SRA may have had on the procurement. The agency’s report stated that the contracting officer was unable to determine (in one day) how the unnamed employee had obtained the proposals directly from DSFG “while working as a subcontractor to the firm on an unrelated contract.” The Contracting Officer further stated that no agency employees had been involved with giving the unnamed employee the DSFG proposals. 

DSFG responded by arguing that in addition to the violation of the Procurement Integrity Act, SRA also had organizational conflicts of interest regarding the PIVOT acquisitions. DSFG also pointed out that in September 2011, the agency awarded a contract to Bowhead Systems Management, Inc. to analyze the DSFG EDUCATE contract that was the subject of the 2007 and 2011 proposals. It turns out that the unnamed employee worked for Bowhead at the time and the agency provided him copies of the DSFG proposals, along with other sensitive materials. The GAO found this explanation plausible, especially given the fact that the Department of Education did not attempt to rebut this explanation.

The Procurement Integrity Act provides in its relevant section “except as provided by law, a person shall not knowingly obtain contractor bid or proposal information or source selection information before the award of a federal agency procurement contract to which the information relates.” 41 U.S.C. section 2102 (b). The FAR further provides that the contracting officer who learns of a violation of the Procurement Integrity Act must determine the impact on the Inc. procurement and must forward the information concerning the possible violation along with documentation to an individual designated in accordance with the agency procedures. FAR §3.104-781(a)(1). The record shows that the contracting officer did all of these things.

However, the record also demonstrates that the contracting officer confined his comparison to the differences between how the agency previously satisfied its IT requirements versus how we would meet those requirements in the future. The contracting officer noted that the PIVOT I contract was meaningfully different from the EDUCATE contract. DSFG pointed out that there was nothing in the agency report to indicate that it gave any consideration to the fact that the 2007 proposal gave detailed information about pricing including labor rates for a 10 year period of time. The proposal also included information that went through November 2017, which is a period under consideration in the current procurement. The proposal also detailed DSFG’s staffing strategies and other business approaches. The GAO found this significant and issues that should have been considered in the Agency’s Procurement Impact Determination.

The GAO also sustained DSFG's protest that SRA had an organizational conflict of interest. That protest will be discussed in a different blog post.

Topics: Government Contracting