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Introduction
General Counsel, P.C.'s Government Contracts Practice Group is pleased to provide you with the Bid Protest Weekly. Researched, written and distributed by the attorneys of General Counsel, P.C., the Bid Protest Weekly allows the Government Contract community to stay on top of the latest developments involving bid protests by providing weekly summaries of recent bid protest decisions, highlighting key areas of law, agencies, and analyses of the protest process in general.
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1. Lani Eko & Company, CPAs, PLLC, B-404863, June 6, 2011
Link: GAO Opinion
Agency: Department of Homeland Security
Disposition: Protest denied.
Keywords: Late Proposal
General Counsel P.C. Highlight: A late hand-carried proposal may be considered for award, however, if improper government action was the paramount cause of the late delivery. Even in cases where the late receipt may have been caused, in part, by erroneous government action, a late proposal should not be considered if the offeror significantly contributed to the late receipt by not doing all it could or should have done to fulfill its responsibility to deliver a hand-carried proposal to the specified place by the specified time.
Lani Eko & Company, CPAs, PLLC (Lani Eko) protests the rejection of its proposal as late under a request for proposals (RFP), issued by the Department of Homeland Security, for technical, acquisition, and business support services.
The amended solicitation informed potential offerors that hand delivery of initial proposals was permitted and indicated that they were to be submitted to the Jemal Building, 1900 Half Street SW, Washington, DC, 3 p.m. eastern standard time (EST), March 2, 2011. The solicitation further instructed that offerors should use a loading dock on the Southwest side of the building, go through a gate, and climb the stairs to the guard desk. Offerors were advised to plan ahead because the agency was expecting many proposals and there was limited parking. Offerors were also advised that if they did not receive a confirmation receipt or if they did not arrive by 3 p.m. the proposal would be considered late.
The solicitation included the standard late proposal clause for commercial items, Federal Acquisition Regulation (FAR) sect. 52.212-1(f), which generally states that any offer received at the place designated in the solicitation after the exact time specified for receipt will not be considered.
Lani Eko asserts that its representative left the firm's offices in Virginia to deliver the firm's proposal package to the Jemal Building in Washington, DC at "about 2:30 p.m." The representative indicates that she arrived at the gate closest to the loading dock's guard desk shortly before 3 p.m. The agency official, who was waiting at the desk, refused to accept the proposal package because Lani Eko's representative "had missed the 3:00 p.m. deadline." The agency official then referred Lani Eko's representative to the security guard desk telephone, which reflected a time of "3:02 p.m." Despite her requests, the agency official refused to time stamp, or otherwise accept, the protester's proposal package.
Lani Eko contends that its representative arrived at the Jemal Building with its proposal package prior to the closing time on March 2, and that the agency improperly refused to accept its proposal. GAO states that it is an offeror's responsibility to deliver its proposal to the place designated in the solicitation by the time specified, and late receipt generally requires rejection of the proposal. Unless a preponderance of the evidence demonstrates that the proposal was at the designated location for receipt prior to the time set for closing, the proposal may not be considered for award. A late hand-carried proposal may be considered for award, however, if improper government action was the paramount cause of the late delivery and consideration of the proposal would not compromise the integrity of the competitive procurement process. Improper government action in this context is affirmative action that makes it impossible for the offeror to deliver the proposal on time. Even in cases where the late receipt may have been caused, in part, by erroneous government action, a late proposal should not be considered if the offeror significantly contributed to the late receipt by not doing all it could or should have done to fulfill its responsibility to deliver a hand-carried proposal to the specified place by the specified time.
GAO finds no basis to conclude that Lani Eko timely delivered its proposal or that improper government action was the paramount cause for the late submission of its proposal. The agency reports that on March 2, three contract specialists were present at various times throughout the day at the loading dock in the Jemal Building to receive proposal packages. At approximately 2:58 p.m., one of the contract specialists declares that she began processing a hand-carried proposal package from another vendor which she completed just after 3 p.m. According to this individual, at 3:01 p.m., after acknowledging that the closing time had passed, a third contract specialist stepped out of the door to the loading dock. The second contract specialist declares that no offerors were waiting at the security desk at 3 p.m. When the security desk phone registered 3:01 p.m., the contract specialists concluded that the submission deadline had passed, and the third contract specialist went to the top of the loading dock stairs to inform all offerors that the submission deadline had expired. The third contract specialist, who in fact engaged Lani Eko's representative outside the loading dock, declares that no offerors were waiting inside or outside of the loading dock at 3:01 p.m.
GAO concludes that the protester has failed to demonstrate by a preponderance of evidence that it arrived at the place designated for delivery of proposals by the 3 p.m. deadline established by the RFP. The protest is denied.
2. Diebold, Inc., B-404823, June 2, 2011
Link: GAO Opinion
Agency: Department of the Treasury
Disposition: Protest sustained.
Keywords: Post-Award Changes to the Contract
General Counsel P.C. Highlight: A contracting officer exercising the authority to change the terms and conditions must do so in a manner that gives all offerors an equal opportunity to compete by either publishing the tailored clauses in the initial solicitation's addenda or by providing an amendment to the solicitation to include the revised terms and conditions.
Diebold, Inc. protests the award of a contract, by the Department of the Treasury, Office of the Comptroller of the Currency (OCC) under a request for proposals (RFP) for interim security and compliance services in support of OCC's physical security program.
OCC issued the RFP under Federal Acquisition Regulation (FAR) part 12 commercial item procedures. The RFP contemplated the award of a one‑year fixed-price contract. The solicitation was provided via email and advised that award would be made on a best value basis based upon two equally weighted evaluation factors: past performance and price. OCC received two proposals by the January 28 deadline, including Diebold Inc.'s. While Diebold offered a lower price, the other offeror was chosen where its past performance was considered to be better than Diebold's.
Diebold's alleges that OCC unreasonably evaluated its past performance and failed to conduct a proper trade-off analysis between price and past performance in determining the best value. In a supplemental protest, Diebold argued that OCC made changes to the RFP after selecting the awardee without permitting Diebold an opportunity to compete on the altered solicitation. GAO states that 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. When, either before or after receipt of quotations, 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. GAO will sustain a protest where an agency, without issuing a written amendment, materially alters the solicitation's requirements to the protester's prejudice.
Here, the RFP incorporated by reference the standard commercial clauses in accordance with FAR subpart 12.3. FAR subpart 12.3 requires that solicitations for commercial items include the provisions at FAR sect. 52.212-1 (Instructions to Offerors-Commercial Items), 52.212-3 (Offeror Representations and Certifications-Commercial Items), 52.212-4 (Contract Terms and Conditions-Commercial Items), and 52.212-5 (Contract Terms and Conditions Required to Implement Statutes or Executive Orders-Commercial Items). After OCC selected ADT for award, it sent a draft contract for ADT's review. The draft contract included numerous provisions, specifically those included in section H, which had not previously been included in the solicitation. As relevant here, section H of the draft contract included section H.7-Reimbursement of Travel Costs, section H.18-Standard Commercial Warranty, and section H.21-Harmless from Liability. In response, the awardee submitted an email requesting various changes to section H of the draft contract. After a review, OCC decided to permit certain of ADT's requested modifications to the draft contract. Section H.21-Harmless from Liability was included in the draft contract and generally provides for the contractor to hold and save the government harmless from liability for suits or damages based on the contractor's negligent or wrongful actions. The agency also agreed to insert into Section H two new liability clauses. Section H.22-Safety Act Waiver waived claims against ADT arising from Qualified Anti-Terrorism Technologies (QATT) systems or services and Section H.23-Mutual Limitation of Liability, which provided that neither party would be liable to the other for any special, indirect, consequential or incidental damages arising out of any performance of the contract. As to the section H.18-Standard Commercial Warranty, the agency agreed to add a new section H.18.1-Equipment Warranty to permit the awardee to include its standard commercial warranty.
GAO agrees with OCC that contracting officers are permitted under FAR part 12 to tailor the provisions of FAR sect. 52.212-4 to the market practices and conditions for each acquisition. However, this section makes clear that any tailoring to the provisions and clauses can only be done "after conducting appropriate market research," id., and "shall be by addenda to the solicitation and contract." Consequently, under commercial item acquisitions, a contracting officer exercising the authority to change the terms and conditions must do so in a manner that gives all offerors an equal opportunity to compete by either publishing the tailored clauses in the initial solicitation's addenda or by providing an amendment to the solicitation to include the revised terms and conditions. GAO finds that the agency altered materially the terms and conditions of the solicitation when it modified the draft contract at the awardee's request. For example, the modified section H.21 eliminated the awardee's obligation to indemnify the government for suits or damages based upon "detection events." The awardee's email to the agency during the negotiations of the contract terms and conditions demonstrates how the modified section H.21 limited the awardee's liability/risk beyond that provided for in the RFP. Thus, the record shows that the changed language of section H.21 was a material change to the RFP because it greatly reduced the liability of ADT by absolving it from the results of "detection events."
Additionally, section H.23 materially reduced the awardee's liability compared to that set forth in solicitation provision FAR sect. 52.212-4(p) by allowing the awardee to limit its liability with respect to consequential damages. The solicitation's limitation of liability provision stated, "Except as otherwise provided by an express warranty, the Contractor will not be liable to the Government for consequential damages resulting from any defect or deficiencies in accepted items." Again, the awardee's email to the agency during negotiations of the contract terms and conditions illustrates why this change is material. GAO finds that the agency was required to issue an amendment to the solicitation upon the addition and acceptance of these material changes and because the agency did not issue the required amendment permitting all offerors to respond on the altered requirements, GAO finds the agency's actions resulted in unequal treatment of Diebold.
GAO further finds that Diebold was prejudiced by the agency's actions. GAO states that it 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. Here, Diebold asserts that the changes in liability could significantly impact an offeror's price. Given that were only two evaluation factors that were of equal importance (price and past performance), and that Diebold was the low offeror, GAO does not know, and will not speculate, how this matter would have affected the source selection decision. In such circumstances, GAO will resolve any doubts regarding prejudice in favor of a protester since
a reasonable possibility of prejudice is a sufficient basis for sustaining a protest. Accordingly GAO concludes that Diebold has established the requisite competitive prejudice to prevail in a bid protest.
GAO recommends that OCC amend the solicitation to reflect the changes made to the terms and conditions of the RFP, request and evaluate proposal revisions, and make a new award determination. The protest is sustained.
3. Career Innovations, LLC, B-404377.4, May 24, 2011
Link: GAO Opinion
Agency: Department of Labor
Disposition: Protest denied.
Keywords: Evaluation Strengths and Weaknesses
General Counsel P.C. Highlight: There is no legal requirement that an agency must award the highest possible rating, or the maximum point score, under an evaluation factor simply because the proposal contains strengths and/or is not evaluated as having any weaknesses.
Career Innovations, LLC (CI) protests the award of a contract under a request for proposals (RFP), issued by the Department of Labor, for Job Corps outreach and admissions services.
The RFP, issued as a small business set-aside, provided for the award of a cost‑plus incentive‑fee contract for outreach and admissions services to enroll youth at Job Corps Centers. Offerors were informed that award would be made on a cost/technical tradeoff basis considering the following factors and associated maximum point scores: technical proposal; staffing resources proposal; past performance and experience; and cost justification. The RFP also identified subfactors and associated maximum point scores under certain of the evaluation factors.
With regard to the technical proposal evaluation factor, the RFP identified two subfactors: outreach and admissions. Under these subfactors, offerors were instructed to respond to a list of questions by describing, among other things, their proposed outreach plans and admissions methods, as well as their understanding of the work and their approach to meeting outcomes and quality indicators. Offerors were also required to describe in detail how they would provide innovative outreach to Native American and other populations.
With regard to the staffing resources proposal evaluation factor, the RFP identified the following five subfactors (each worth four points): staffing level and adequacy; staffing qualifications; project director's credentials and experience; adequacy of staff development, retention, and incentives; and management/corporate contract support and oversight. Offerors were instructed to provide, among other things, a detailed organizational chart showing all staff working on the project, including subcontractor staff, a resume for the proposed project director, position descriptions, and a list of all proposed key personnel.
With regard to the past performance and experience evaluation factor, the RFP required different submissions depending upon whether the offeror was an experienced Job Corps outreach/admissions or career transition services contractor; a new firm with relevant experience; or a new firm without relevant experience.
With regard to the cost justification evaluation factor, the RFP instructed offerors to propose fees for outreach/admissions and career transition services operations and submit a business management proposal showing proposed costs. The RFP stated that the agency would evaluate proposed costs under the following five subfactors: adherence to the RFP requirements; explanation and support of all proposed costs; general and administrative costs; consistency of costs with technical proposal; and total staff compensation. Offerors were advised that the agency would assess whether an offeror's proposed costs supported its technical proposal and the extent to which its cost allocations and supporting explanations assured a reasonable and prudent expenditure of federal program funds. The RFP also advised offerors that, under the cost factor, the agency would evaluate offerors' proposed costs and fixed fees for reasonableness and realism. Another offeror was eventually awarded the contract based on its higher technical score and lower evaluated costs.
CI protested, challenging the evaluation of its proposal under each of the evaluation factors. In particular, with respect to the evaluation of the firm's past performance and experience, CI complained that CI should have been considered a new firm with relevant experience, and not an experienced Job Corps outreach/admissions or career transition services contractor. Prior to submitting a report in response to the protest, the agency advised GAO that it would take corrective action by suspending contract performance and reevaluating CI's past performance. The protest was dismissed.
The Contracting Officer (CO) reevaluated CI's past performance and experience, considering the joint venture to be a new firm with relevant experience. CI's total point score increased by 3.33 points. As a result of the reevaluation, CI's overall point score became 75.67, which is 1.96 points higher than the awardee's overall score of 73.71. The CO concluded that CI's and the awardee's proposals were technically equal and that the awardee's remained entitled to award on the basis of its lower evaluated costs.
CI challenges its evaluation under the technical proposal, staff resources proposal, and cost justification factors, and contends that it should have received higher point scores under each factor. GAO states that in reviewing protests challenging the evaluation of proposals, it will not conduct a new evaluation or substitute its judgment for that of the agency but will examine the record to determine whether the agency's judgment was reasonable and in accord with the RFP evaluation criteria. A protester's mere disagreement with the agency's evaluation provides no basis to question the reasonableness of the evaluators' judgments.
CI complains that the agency unreasonably assessed a weakness in its proposal under the technical proposal factor by viewing CI's lack of an agreement with one party to be a weakness. CI contends that the RFP did not state that the agency would evaluate, or require offerors to submit, such agreements. However, contrary to CI's arguments, the record shows that the technical evaluation panel's (TEP) concern with CI's relationship with one party was not based upon CI's failure to provide an agreement memorializing that relationship. Rather, the assessed weakness reflected the TEP's concern that CI had failed to provide any details discussing that party's acceptance of the responsibilities that CI identified in its proposal, despite the agency's specific discussions request for such details. GAO finds that assessing a weakness in this regard was reasonable given that offerors were required to provide detailed, complete, concrete, and feasible approaches and strategies to achieve the specified outcomes.
CI also disputes the agency's assessed weaknesses with regard to its determination of student arrival rates and its proposed management positions under the staff resources proposal factor. CI contends that its proposal stated that it intended to continue the incumbent's procedures which, according to the protester, have often exceeded current Job Corps admissions capacity over the past two years. Although the protester disagrees with the agency's evaluation of CI's staff resources proposal, the protester provides no basis to question the reasonableness of the evaluators' judgments in this regard. The record shows that CI did not substantively respond to the agency's request but largely repeated its earlier estimate.
CI also complains that it should have received a higher score under the cost justification factor, because the agency identified a number of strengths and no weaknesses under that factor. GAO finds that this argument is without merit. There is no legal requirement that an agency must award the highest possible rating, or the maximum point score, under an evaluation factor simply because the proposal contains strengths and/or is not evaluated as having any weaknesses.
CI also protests the CO's determination that the protester's and awardee's proposals were technically equal, contending that this determination reflects bias in favor of the awardee. Specifically, CI complains that the initial selection decision to the awardee was based upon the fact that the CO had found that the awardee's proposal had a 1.37 higher overall point score than CI's. CI contends that, because its proposal had the highest overall point score (by 1.96 points) following the reevaluation of the firm's past performance/experience, the agency was required to find that CI's proposal was technically superior to the awardee's. GAO states that it is well established that ratings, be they numerical, adjectival, or color, are merely guides for intelligent decision making in the procurement process. In this respect, the RFP advised offerors that point scores were advisory only and were not binding on the source selection official. Here, the TEP's assignment of point scores was supported by narrative discussions of the offerors' respective strengths and weaknesses. CI does not identify any aspect of its proposal that establishes that its proposal should have been found technically superior to the awardee's. Rather, CI's arguments reflect nothing more than mere disagreement with the CO's selection decision, which does not demonstrate that the CO's judgment was unreasonable. The protest is denied.
4. Active Deployment Systems, Inc., B-404875, May 25, 2011
Link: GAO Opinion
Agency: Department of the Army
Disposition: Request granted.
Keywords: Debarred or Suspended Contractors
General Counsel P.C. Highlight: Agencies may not award contracts to contractors that are debarred, suspended, or proposed for debarment, nor may they award contracts to firms that are affiliated with firms that are debarred, suspended, or proposed for debarment.
Active Deployment Systems, Inc. (ADS) protests the award of a contract, by the Department of the Army, under a request for proposals (RFP), for the lease of shower and sink trailers.
The RFP sought proposals to provide shower and sink trailers. The competition was set aside for small business firms. The RFP stated that award would be made to the offeror that submitted the lowest-priced, technically acceptable proposal.
The Army received proposals from five offerors, including ADS and the eventual awardee. The agency concluded that the awardee's proposal was technically acceptable and offered the lowest price. As relevant here, the contracting officer (CO) reviewed the following sources of information when evaluating the awardee's responsibility: the Central Contractor Registry; the awardee's entries in the Online Representations and Certifications Application; the Excluded Parties List System (EPLS); and the Past Performance Information Retrieval System. The CO also consulted another CO who had prior experience with the awardee. Based on her review, the CO concluded that the awardee was not debarred, suspended, or proposed for debarment, and was a responsible contractor.
The Army notified ADS of the award and ADS contacted the CO and expressed its belief that the awardee intended to subcontract with firms that were proposed for debarment. In response to ADS's contentions, the CO contacted the awardee and asked the awardee to identify the subcontractors it intended to use in performing the contract. The CO determined that none of the firms identified by the awardee were on the EPLS, and advised ADS that the agency intended to proceed with the award.
ADS argues that the Army failed to reasonably evaluate the awardee's responsibility because, the protester contends, the awardee intends to subcontract with, and is otherwise affiliated with, three firms proposed for debarment. GAO states that agencies may not award contracts to contractors that are debarred, suspended, or proposed for debarment, nor may they award contracts to firms that are affiliated with firms that are debarred, suspended, or proposed for debarment. Additionally, agencies may not consent to a subcontract with a firm that is debarred or proposed for debarment, unless the agency head states in writing the compelling reasons for this approval action. GAO views an agency's determination of whether an offeror is affiliated with or is subcontracting to, a firm that is debarred, suspended or proposed for debarment to be matters of offeror responsibility. As a general matter, GAO does not review a CO's affirmative determination of responsibility. GAO will, however, consider a challenge to a CO's affirmative determination of responsibility where it is alleged that definitive responsibility criteria in the solicitation were not met, or where the protester identifies evidence raising serious concerns that, in reaching the responsibility determination, the CO unreasonably failed to consider available relevant information or otherwise violated statute or regulation.
Here, GAO concludes that the protest is within its jurisdiction to consider because ADS has argued that the CO unreasonably failed to consider available relevant information regarding the awardee's relationships with firms proposed for debarment.
In response to allegations raised by ADS prior to filing its protest with GAO, the CO obtained from the awardee a list of all of its proposed subcontractors, and was able to verify that none of them were debarred or proposed for debarment. While the awardee acknowledged that it had planned to purchase certain assets to be used in performing this contract from a contractor--which was proposed for debarment--during that firm's bankruptcy proceeding, the CO reasonably concluded that the awardee would not be subcontracting with a debarred firm to perform this contract. Thus, the protest ground provides no basis to challenge the agency's determination that the awardee was responsible.
ADS also argues that the awardee is affiliated with the three firms proposed for debarment, and is therefore ineligible for award. GAO states that the Small Business Administration (SBA) has determined that the awardee is not affiliated with these firms, in connection with a size-status protest. GAO states that because the analysis of a firm's affiliation for purposes of debarment under FAR subpart 9.4 addresses the same considerations as the SBA's affiliation analysis under the SBA's size status regulations, GAO thinks that the SBA's ruling here supports the agency's affirmative responsibility determination, even though the CO did not review this matter at the time of award. In this regard, the FAR states that firms are affiliates of each other for purposes of debarment if "directly or indirectly, (1) either one controls or has the power to control the other, or (2) a third party controls or has the power to control both." Similarly, the SBA regulations concerning affiliation for purposes of determining a firm's size state that firms are affiliates "when one controls or has the power to control the other, or a third party or parties controls or has the power to control both." Indicia of control common to both regulatory provisions, and addressed by the SBA in its decision, include common management, ownership, key employees. Thus, the record provides no basis to find that the awardee was affiliated with firms that were proposed for debarment. The protest is denied.
5. AC4S, Inc., B-404811.2, May 25, 2011
Link: GAO Opinion
Agency: Department of the Army
Disposition: Protest denied.
Keywords: Material Terms of an RFP
General Counsel P.C. Highlight: Clearly stated RFP requirements are considered material to the needs of the government, and a proposal that fails to conform to such material terms is unacceptable and may not form the basis for award. It is a fundamental principle in a negotiated procurement that a proposal that fails to conform to a material solicitation requirement is unacceptable
AC4S, Inc., a small business, protests the elimination of its proposal from consideration for award under a request for proposals (RFP), issued by the Department of the Army for information technology services.
The RFP was issued as a total set-aside for small business, to establish a multiple award indefinite-delivery/indefinite-quantity (ID/IQ) contract for a range of services and solutions necessary to implement the agency's enterprise infrastructure and infostructure goals. To achieve this end, the RFP sought to enter into "performance-based" arrangements with successful offerors. The RFP noted that establishing performance based arrangements introduced several changes from traditional procurement approaches, including the use of a statement of objectives (SOO) rather than a statement of work (SOW). Under a SOO, the government describes its requirements in terms of desired objectives, and offerors are free to propose solutions that they believe will best meet or exceed those objectives. After award, the agency monitors and evaluates contractor performance using performance metrics established by the contract. These metrics gauge a contractor's level of success in meeting SOO objectives, and provide for performance-related incentives and disincentives. The RFP also advised that the agency contemplated making award without discussions. According to the RFP, the awards would be made to offerors with proposals determined to be the most beneficial, considering three evaluation factors: mission support, performance risk, and price.
The agency made award without discussions, and AC4S received its debriefing. During the debriefing, AC4S learned that its proposal had received a red/unacceptable rating under the management approach subfactor, which resulted in a red/unacceptable rating for the entire mission support evaluation factor, and a determination that AC4S's proposal was unacceptable overall. Specifically, AC4S had improperly modified a metric of Table 1 by omitting the phrase "in subcontracting" from the government-specified metric "usage of SBS [small businesses] in subcontracting." The agency determined that this omission materially altered the government-specified performance metric and that the proposal therefore failed to conform to a material term of the RFP.
AC4S protests that the agency's assessment of a deficiency under the mission support subfactor was improper because the "inadvertent omission" of the phrase "in subcontracting" from one metric did not change AC4S's intent to meet the SOO's objective to increase small business subcontracting. AC4S argues that its intent to meet the objective was apparent from Table 1 and from its proposal throughout, in which AC4S repeatedly discussed its intent to subcontract 30% of the work to other small business subcontractors. GAO states that clearly stated RFP requirements are considered material to the needs of the government, and a proposal that fails to conform to such material terms is unacceptable and may not form the basis for award. It is a fundamental principle in a negotiated procurement that a proposal that fails to conform to a material solicitation requirement is unacceptable.
Under a performance based contracting arrangement, performance metrics are more than mere proposal evaluation tools. Rather, the metrics become the measurable performance standards used to assess the contractor during performance, and to determine the application of performance incentives and disincentives. Indeed, the measures, metrics, ALQ, and incentives/disincentives establish the performance levels that are required to meet the objectives specified by the SOO, and are critical aspects of the resulting performance-based contract. In this case, the agency provided certain government-specified performance metrics reflecting the level of performance that the government required, and the agency repeatedly cautioned the offerors that these metrics were not to be revised in any way. Such clearly stated RFP terms are undoubtedly material to the needs of the government, and failure to conform to such terms renders a proposal unacceptable. Moreover, based on a review of the RFP and AC4S's proposal, GAO finds that it is readily apparent that AC4S's modification of the performance metric at issue did, in fact, materially alter the metric's meaning.
The applicable government-provided performance metric, "usage of SBs in subcontracting," was specified to provide a common, clearly understandable and measurable basis for monitoring awardee's success in meeting the above objective during performance. The metric, "usage of SBs," as modified by AC4S, however, fails to reflect the intent of the SOO objective to assure achievement of subcontracting targets and allow for mentorship of small businesses, or the intent of the provided metrics, because it captures AC4S's own efforts as a small business along with those of its small business subcontractors. The extent to which AC4S's modified performance metric deviated from the SOO objective and government-specified metric is apparent when it is considered that AC4S also included its own efforts as a small business in its proposed percentage small business usage in ALQ 1.d, contrary to the RFP's instructions. In Volume IV of its proposal, AC4S stated that "AC4S is retaining 80% of the contract towards small businesses. The 80% includes 50% for AC4S." On the same page of the proposal, in Table 3 - Subcontracting Participation Goals, AC4S confirms that 30% of the contract will be subcontracted to small businesses. However, rather than enter the 30% figure from Table 3 into ALQ 1.d, as instructed, AC4S entered "80 percent." The Agency was aware that awardee's under this contract would likely outgrow their small business status and were prevented from including themselves in this calculation.
The overall effect is that, by including its own efforts in the small business utilization percentage of ALQ 1.d, and by omitting the phrase "in subcontracting" from metric 1.d, AC4S made it possible to compensate for failure to meet its subcontracting objective by increasing its own share of contract performance. Therefore, the omission of the phrase "in subcontracting" had a material effect on AC4S's commitment to conform to the specified small business usage metric required by the RFP. The protest is denied.
