Let’s review: the two top lessons about contract protests

Let’s review: the two top lessons about contract protests

There are two recommendations I’ve made repeatedly in this column: Show in your proposal how your company will do the work better than the competition, and know when to walk away. This recent decision by the Government Accountability Office shows that the contractor did neither of those things.

Protesting contractor: Enterprise Information Services Inc., Vienna

Contracting agency: Defense Intelligence Agency

Protest issue: I told you so

Decision: Protest denied by GAO June 10, 2013

Post-mortem: First, some background. In November of last year I wrote in Battle Lines about a Science Applications International Corp. protest of a DIA procurement for intelligence analysis support, which was awarded to Computer Sciences Corp. of Falls Church. My message in that article was that although shrinking budgets are a driving factor in government procurement, the government can’t simply ignore the proposed technical solution in favor of price unless it is a lowest-price technically acceptable solicitation. DIA awarded to CSC, the lowest offeror, ignoring the method that CSC employed to achieve the lowest price GAO sustained SAIC’s protest and recommended that DIA reevaluate proposals consistent with the terms of the solicitation.

That brings us to this latest protest decision. In response to the GAO, DIA did more than just reevaluate, it revised its solicitation and removed any indication that it intended to conduct a price realism analysis. Offerors were offered the opportunity to resubmit proposals, and both EIS and CSC complied. In the first protest CSC offered a price of $111 million, which was $35-$45 million less than the government estimate. In its revised proposal, CSC slightly increased its price to $120 million. EIS on the other hand offered a revised price of $58 million. That is $60 million less than CSC and nearly $100 million less than the upper range of the government estimate. Not surprising, DIA found that technical solution unacceptable and again awarded the work to CSC.

EIS protested using an interesting argument. According to the GAO opinion “EIS [did] not challenge the substance of the agency’s findings, but only the agency’s ability to make those findings in light of the elimination of price realism from the evaluation scheme.” EIS achieved its extremely low price by slashing its staffing proposal by more than 60 percent from its first proposal and then arguing that DAI could not find its staffing proposal unacceptable because DIA had removed the price realism analysis from the solicitation. The GAO did not find this argument persuasive.

At the risk of repeating myself, the lesson is twofold. First, unless it’s a strictly LPTA contract award, proposing to do the work better than the competition continues to be my advice. EIS cut their staffing by more than half and then tried to argue a loophole rather than proposing a competitive technical solution. That rarely works. Second, the unfortunate reality is that the government will often determine early on who it wants to get certain work. There is little that can be done to change that.