GAO Affirms Broad Corrective Action Authority for Agencies

As we have previously noted on the blog, a substantial number of protests filed before GAO end in voluntary corrective action taken by the protested agency. In recent decision, GAO addressed just how much discretion agencies have in designing corrective actions.

Spoiler alert: it’s a lot.

RTW Management, B-416786.2 (Comp. Gen. Dec. 17, 2018) involved a VA procurement for shuttle transportation services around its healthcare facilities in Maryland. As relevant here, the solicitation provided two different award methodologies. On one hand, the solicitation instructed offerors that award would be made on a best value basis. On the other hand, the solicitation also stated: “award will be made to the responsible offeror who submits an acceptable proposal, as determined by a technical evaluation, and has [the] lowest price for satisfactory completion of all contract requirements.” The solicitation did not clarify how these two competing evaluation methodologies could coexist.

Proposals were due on August 22, 2018. Six days later, on August 28, an offeror, Taylor Made Transportation Services, Inc., filed an agency-level protest with the VA challenging the evaluation terms of the solicitation. The VA subsequently denied Taylor Made’s protest.

While Taylor Made’s protest was being considered, the VA moved forward with the procurement and named RTW Management as the awardee.

After having its agency-level protest denied, Taylor Made took its challenge of the solicitation’s terms to GAO. In response, the VA elected to take voluntary corrective action, which included wiping out the award to RTW Management, and re-issuing the solicitation with clarification as to its intended evaluation scheme. GAO subsequently dismissed Taylor Made’s protest as academic.

With its award cancelled, RTW protested the VA’s proposed corrective action. According to RTW, the VA’s corrective action was unreasonable because Taylor Made’s original agency-level protest was untimely. Consequently, RTW argued, the VA’s decision to take corrective action was not necessary, and was designed to benefit Taylor Made. Alternatively, RTW argued that even if there were an ambiguity in the Solicitation, it was not prejudicial because multiple offers were able to submit competitive proposals. For this reason, RTW said, there was no basis to sustain Taylor Made’s protest (and thus no reason to take corrective action).

In response, the VA argued that it had broad discretion to take any corrective action it believed necessary. The VA explained its reasoning as follows: “amending and re-posting the solicitation, in this instance, is reasonable and within its broad discretion to ensure fair and impartial competition, as it is designed to ensure that the solicitation includes a clearly defined method of evaluation.”

GAO agreed with the VA that its corrective action was reasonable. GAO began its analysis by noting that agencies have broad discretion to take corrective action as they see fit. GAO then addressed the specific challenges raised by RTW:

Even if Taylor Made’s protest was untimely or premature, such a fact is not indicative of the reasonableness of the agency’s proposed corrective action. Indeed, as our Office has explained, it is not necessary for an agency to conclude that the protest is certain to be sustained before it may take corrective action; where the agency has reasonable concerns that there were errors in the procurement, even if the protest could be denied, we view it as within the agency’s discretion to take corrective action.

Given the clear ambiguity in the solicitation’s evaluation criteria, GAO concluded the VA’s proposed corrective action was reasonable.

RTW Management demonstrates the extreme deference GAO gives to agencies to undertake and design corrective action. Despite a potentially fatal protest error, GAO nevertheless condoned the VA’s proposed corrective action. In so doing, GAO reaffirmed the tough climb protesters face to challenge the terms of a corrective action before GAO.