Even if we don’t want to admit it, we all simply click “accept” on all those different terms and conditions for software, despite not actually reading the actual terms. GAO in a recent decision reminded agencies and contractors to not let that habit happen when you read the terms of a procurement. In that recent GAO decision, there was a long history of protests, which resulted in an amendment to the solicitation. At first glance, the amendment and proposal revision restrictions tied to it may have made sense, but upon protest, GAO found the limitations on proposal revisions were improper, due to the amendment impacting more than the one factor which was open for revisions.
Owl International Inc., B-423281.4 (April 24, 2026) has quite the procedural history, and contains three different protest grounds. There were multiple protests and corrective actions around the solicitation taken prior to this protest, but this specific protest focused on an amendment made by the Navy. The amendment made by the Navy to this solicitation removed FAR 52.222-46 (we discussed that clause here) from the solicitation and provided for limited proposal revisions to only the price portion of proposals. After having an agency level protest regarding this amendment and proposal revision limitation denied, Owl filed this protest at GAO. Owl alleged: (1) that removing that FAR provision from the solicitation was improper; (2) that if its removal was proper then limitations on proposal revisions was improper; and (3) that the solicitation was defective due to ambiguities. GAO sustained only on the second ground, which is that the proposal revisions allowed by the Navy were far too limited. We will focus on that protest ground here as it provides a good lesson for contractors.
FAR 52.222-46 mainly focuses on compensation for “Professional Employees.” That provision states, among other things: “The compensation levels proposed should reflect a clear understanding of work to be performed and should indicate the capability of the proposed compensation structure to obtain and keep suitably qualified personnel to meet mission objectives. The salary rates or ranges must take into account differences in skills, the complexity of various disciplines, and professional job difficulty.”
So, basically, this FAR provision focuses on compensation and whether prices are too low, but could call for technical and performance elements to be considered. It is tempting to say that this FAR provision would only effect price, but as the FAR implicates technical performance elements and the solicitation at issue called for compensation evaluations to interact with technical evaluations, Owl argued that this term’s removal necessitated revisions to both price and technical portions of the proposals. GAO agreed.
When removing FAR 52.222-46 from the Solicitation, the Navy told offerors that they would only be permitted to revise their cost/price proposal. But as shown, the FAR itself actually may call for interaction with technical elements. Owl argued that the FAR and solicitation terms “directed offerors to focus resources . . . in order to maintain a stable professional workforce” and led to them proposing certain features in their technical proposal which furthered workforce stability. Owl explained that if that FAR wasn’t present in the solicitation, its technical approach would have changed, and thus all offerors should have been allowed to update their technical proposal along with the price proposal.
GAO explained that under the solicitation: “FAR provision 52.222-46 directs offerors to submit with their proposals a total compensation plan . . . which the agency would evaluate to determine whether the offeror had proposed professional compensation that showed sound management and understanding of the contract requirements, whether the professional compensation would affect recruiting and retention, whether it was both realistic and consistent, and whether the proposed compensation levels were lower than those under the incumbent contract, and determine whether, ultimately, the agency will receive uninterrupted high-quality work.” Basically, that FAR provision and the solicitation’s structure made it to where that FAR provision hit on both technical and price elements of proposals.
GAO went on to clarify (emphasis added): “In effect, the change allows an offeror additional options to propose a technical approach that the firm believes would make its proposal more competitive. An offeror could change aspects of its proposed professional compensation or staffing approach to be materially different from those used under the incumbent contract if the offeror believes doing so will achieve a more favorable technical evaluation and still provide a workforce with required professional and technical skills. While it is possible that an offeror would make no changes in response, Owl has submitted credible claims in arguing that, if permitted, it would have considered making several specific technical proposal revisions for that purpose.” Due to this, the Navy should have allowed revisions to both the price proposal and the technical proposal.
GAO did clarify that, in the past, FAR 52.222-46’s removal did not always require an agency to allow technical proposal revisions, especially when the solicitation continues to provide for price realism evaluation. But while this solicitation had price realism in certain situations, it also had certain terms stating additional levels of evaluation, such as rates being fully burdened and the Navy would “evaluate the proposed scheduled labor rates for reasonableness and material balance.”
If you do a deep read of this case, it can get quite technical as to the solicitation’s specifics and why GAO sustained the protest. But at its core, it has a clear message: if there is an amendment to a solicitation and proposal revisions, make sure the revisions match up with the extent of the impact of the amendment. In Owl, the Navy removed a term which on its face seemed focused on simply price, so they only allowed revisions to price. But Owl and the GAO noted that this FAR term’s removal from the solicitation had effects that reached other elements of a proposal which could not be revised under the Navy’s amendment. Thus, make sure you don’t just gloss over amendments to solicitations when they come out. Take the time to consider what impact an amendment could make on proposals. There could be grounds for a protest (for more on solicitation term protests, check out our blog here), or reason to reach out to your contracting officer for clarification. Of course, when trying to navigate the tricky waters of the FAR, solicitations, and protests, don’t hesitate to reach out to federal contracting lawyers, like us, for assistance before a protest deadline or opportunity passes you by.
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