Discussions: Who Needs ‘Em?

The Canadian band Barenaked Ladies (if my blog readership spikes today, I will suspect it’s from folks seeking something else by Googling that term) have a song called “Who Needs Sleep?”  As the father of a 10-month old, the chorus–“Who needs sleep?  Well you’re never gonna get it”–describes my life pretty accurately.

If BNL had been singing about federal procurements instead of slumber, the band might have used a similar chorus: “Who needs discussions?  Well you’re never gonna get ’em.”  As a pair of recent GAO bid protest decisions demonstrate, there is generally no requirement that a procuring agency engage in discussions with offerors, and it’s evident why many agencies avoid them: discussions remain fertile ground for sustained GAO bid protests.

The first GAO decision in today’s “discussions” doubleheader is GAO Protest of L-3 Services, Inc., B-406292 (Apr. 2, 2012).  The L-3 Services case involved a NASA procurement for software systems support.  After NASA made award to TASC, Inc., L-3 filed a GAO protest, alleging, among other things, that NASA improperly failed to conduct discussions with offerors.

The GAO rejected this basis of protest.  It wrote that “[t]he contracting officer’s discretion in deciding not to hold discussions is quite broad.”  The GAO explained, “there are no statutory or regulatory criteria specifying when an agency should or should not initiate discussions, and there is also no requirement that an agency document its decision not to initiate discussions.”  As a result, the GAO stated, “an agency’s decision not to initiate discussions is a matter that we generally will not review.”  The GAO also rejected L-3’s other bases of protest, and denied the bid protest.

In contrast, in GAO Protest of KPMG LLP, B-406409 et al. (May 21, 2012), the agency held discussions–and it backfired in the form of a sustained GAO bid protest.

The KPMG protest involved a CIA procurement for accounting and financial services.  The solicitation instructed offerors to submit resumes for all proposed personnel.  In discussions, the CIA informed KPMG that it “should” provide resumes for all personnel proposed to perform over the lifespan of the contract, not just the base year.  However, the CIA allowed a competitor, Deloitte & Touche LLP, to provide a single “representative resume” for each of the three labor categories in the contract, rather than providing resumes for all personnel.

After the CIA made award to Deloitte, KPMG filed a GAO bid protest.  In response to the protest, the CIA took the position that–despite its statement to KPMG in discussions–offerors were not required to provide resumes for all personnel performing over the lifespan of the contract.

Noting that the CIA “clearly advised” KPMG that it “should” provide resumes for all personnel proposed to perform over the lifespan of the contract, the GAO wrote that “[i]n the context of the CIA’s current position that the RFP did not require submission of resumes for personnel that were proposed to perform beyond the initial performance period, the agency’s discussions with KPMG were clearly misleading.”  The GAO sustained KPMG’s bid protest.

The KPMG decision is not an outlier.  In fact, in a Congressional Research Service report, the GAO named “errors in how agency officials conduct discussions with offerors” as one of four “most common” reasons the GAO sustains bid protests.  The CRS report seems to confirm my own unscientific belief that misleading and/or unequal discussions are one of the most fertile grounds for sustained bid protests.

When the government conducts discussions, be on the lookout for potential errors in the event you later believe a bid protest is warranted.  But don’t be surprised if the government decides not to conduct discussions.  With the increased risk of a sustained GAO protest, combined with GAO case law holding that agencies have broad discretion to decline to conduct discussions, you can hardly blame an agency for thinking, “discussions?  Who needs ’em?”

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