NHO Prime Gets “Experience” Weakness Despite Experienced Affiliate

An agency was allowed to assign a Native Hawaiian-owned prime contractor a weakness for its experience because the NHO prime lacked relevant experience–even though the prime’s proposal indicated that it would rely in part on the resources of an experienced NHO sister company.

A recent GAO bid decision demonstrates that while a procuring agency is entitled to consider the experience and past performance of a prime contractor’s affiliates under certain circumstances, the agency is not precluded from considering the prime’s own experience (or lack thereof).

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Evaluation Of Subcontractor Past Performance Not Required For FSS Procurements

For Federal Supply Schedule procurements, agencies are not required to evaluate past performance references of subcontractors, unless the solicitation provides otherwise.

As one offeror recently discovered in Atlantic Systems Group, Inc., B-413901 (Jan. 9, 2017), unlike negotiated procurements, where agencies “should” evaluate the past performance of subcontractors that will perform major or critical aspects of the contract, offerors bidding under FSS solicitations should not assume that a subcontractor’s past performance will be considered.

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Insufficient Experience Information Sinks Offeror’s Proposal

An offeror’s failure to provide the type of past performance information mandated by a solicitation led to the offeror’s elimination from consideration for a  major GSA contract.

A recent GAO bid protest decision highlights the importance of fully reading and adhering to a solicitation’s requirements–including those involving the type of past performance or experience information required.

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GAO: Agency Reasonably Considered Subcontractor’s Experience

Absent an express prohibition in the solicitation, the experience of a proposed subcontractor may be considered by an agency in determining whether an offeror meets the solicitation’s experience requirements.

In a recent bid protest decision, the GAO confirmed that the experience of a proposed subcontractor could be considered in an agency’s evaluation because the solicitation did not prohibit the agency from considering the subcontractor’s experience.

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Affiliates’ Past Performance: Solicitation Terms Control

Although an agency may consider the past performance of an offeror’s affiliates under certain circumstances, the extent of the agency’s past performance review is governed by the terms of the solicitation.

In a recent bid protest decision, the GAO held that an agency properly refused to consider the past performance of the offeror’s parent company because the solicitation restricted the scope of the agency’s past performance review.

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Solicitation Improperly Excluded Affiliates’ Past Performance, Says GAO

According to the GAO, a solicitation was unduly restrictive because it prohibited the consideration of the past performance of an offeror’s affiliates–even when the affiliates would contribute to performance of the contract.

The GAO’s bid protest decision in Iyabak Construction, LLC, B-409196 (Feb. 6, 2014) demonstrates that agency restrictions on the consideration of past performance must be reasonable.  However, the Iyabak Construction decision should not be interpreted as standing for the principle than an agency can never exclude the past performance of an offeror’s affiliates if those affiliates will contribute to contract performance.  Rather, the case suggests that it was the government’s failure to offer a good explanation–not the underlying restriction itself–that led to the “sustain” decision.

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Past Performance: When Does An Affiliate’s Performance Count?

A bidder on a government contract opportunity may rely on the past performance of an affiliated company–but only when the bidder’s proposal demonstrates that the resources of the affiliate will be provided or relied upon for contract performance.

This rule was recently at issue in a GAO bid protest decision, in which the GAO held that the agency improperly credited a joint venture with the past performance of affiliated companies, even though the joint venture’s proposal did not indicate that those companies would play a role in contract performance.

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