GAO: Incumbent Contractor Not Entitled To Past Performance “Extra Credit”

An incumbent contractor was not entitled to receive a higher past performance score than its competitor simply by virtue of having performed the incumbent contract, according to the GAO.

In a recent bid protest decision, the GAO held that the procuring agency reasonably assigned the incumbent contractor the same past performance score as its competitor, and was not required to give the incumbent additional credit under the solicitation’s past performance evaluation factor.

The GAO’s bid protest decision in ABSG Consulting Inc., B-407956, B-407956.2 (Apr. 18, 2013) involved a Coast Guard solicitation for systems engineering and technical assistance services.  The solicitation called for competitive proposals to be evaluated under five factors: technical understanding and management approach, staffing, corporate experience, past performance, and price.

For the past performance factor, the solicitation directed offerors to submit completed performance evaluations.  The solicitation stated that the past performance evaluation would consider the offeror’s ability to successfully perform the contract based on the offeror’s past performance, as described in its references.

ABSG Consulting, Inc., the incumbent contractor, submitted a proposal.  Booz Allen Hamilton, Inc., or BAH, also submitted a proposal.

After evaluating competitive proposals, the Coast Guard awarded ABSG “Superior” ratings, the highest possible score, for its management approach and corporate experience.  ABSG was given “Excellent” ratings, the next-highest score, for its staffing and past performance.  BAH also received a “Superior” management approach score, and was given “Excellent” scores for the three other non-price factors, including past performance.  Despite ABSG’s higher corporate experience score, the Coast Guard awarded the contract to BAH on the basis of BAH’s lower evaluated price.

ABSG filed a GAO bid protest challenging the award to BAH.  Among its complaints, ABSG argued that the Coast Guard should have assigned it a “Superior” past performance score because of ABSG’s experience as the incumbent contractor.  ABSG apparently contended that because it had performed the incumbent contract, it should not have received the same “Excellent” past performance score as BAH.

The GAO disagreed.  After reviewing the past performance references for both companies, the GAO wrote that “both firms had been rated very similarly” and that “[t]he Coast Guard identified no weaknesses or deficiencies for either firm.”  Contrary to ABSG’s position, “the record does not show that ABSG’s performance was materially superior to BAH’s performance . . .”

Moreover, “[w]hile an agency may provide for evaluation of relevance, the agency is not required to evaluate the past performance of the incumbent contractor as superior to its competitors simply because the incumbent has the most relevant past performance.”  In this case, “[s]ince both firms received uniformly high ratings, and since the Coast Guard was not required to give ABSG a higher rating based only on its status as an incumbent, we have no basis to question the assignment of the same past performance rating to both firms.”  The GAO denied the bid protest.

There is no question that successful performance of the incumbent contract can often be an important advantage when it comes time to compete for a follow-on contract.  However, the ABSG Consulting case demonstrates that incumbent contractors cannot take this advantage for granted, because a procuring agency is not required to award past performance “extra credit” to the incumbent contractor.

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