5 Things You Should Know: Bid Protests

You’ve poured precious time and resources into a proposal, only to lose out on the award. Making matters worse, the agency’s explanation of the award shows that it didn’t reasonably evaluate your proposal. What can you do?

Here are five things you should know about bid protests.

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Past Performance: Does Duration Matter?

Past performance evaluations normally consider two aspects of an offeror’s prior work: whether that performance was recent and relevant. But in making its best value determination, must an agency also consider the duration of an offeror’s past performance?

A recent GAO bid protest decision answered this question, at least under the rules established in the solicitation at hand. In Technica LLC, B-413546.4 et al. (July 10, 2017), GAO denied a protest challenging the sufficiency of an awardee’s past performance even though the awardee’s past performance was much shorter than the protester’s.

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Recent SBA OIG Report Reveals Continuing Concerns With 8(a) Approvals

To be eligible to participate in the 8(a) Business Development Program, an applicant firm must be a small business that is at least 51% owned and controlled by a socially- and economically-disadvantaged individual (or individuals) who are of good character and citizen(s) of the United States. The firm, moreover, must show a potential for success.

The Small Business Administration’s internal watchdog (the Office of Inspector General, or OIG) recently raised its continuing concerns regarding the admission of several entities to the 8(a) Program. The OIG’s report is worth reading, as it may lead to changes in the 8(a) Program’s eligibility criteria.

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GAO: SBA’s Class Waiver Supported VA SDVOSB Set-Aside Decision

Last month, Steve wrote about a new Class Deviation rule adopted by the VA that, in effect, would limit the VA’s use of class waivers as part of its decision to restrict competition to SDVOSBs (or otherwise issue solicitations as sole source awards). But in an apparent contradiction to this Class Deviation rule, GAO recently denied a challenge to an SDVOSB set-aside decision for a manufacturing solicitation, based in large part on SBA’s adoption of a class waiver for the particular NAICS code.

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Trump: DoD Contracts Should Be Fixed-Price

We previously have written about the trending preference toward fixed-price contracts, and away from cost reimbursement contracts, in defense procurements.  The Defense Department’s supplement to the FAR (known as DFARS), in fact, already includes restrictions on using cost-reimbursement or time and materials contracts.

Now the President has come out in favor of fixed-price defense contracting. In a Time Magazine article published today, President Trump signaled strong support for the fixed-price contracting preference, going so far as to “talk of his plans to renegotiate any future military contracts to make sure they have fixed prices.”

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Board: Contractor On Hook For Incumbent Employees’ Vacation Time

The Service Contract Act requires contractors to pay certain provide no less than certain prevailing wages and fringe benefits (including vacation) to its service employees. The amount of vacation ordinarily is based on an employee’s years of service—and service with a predecessor contractor counts. The FAR’s Nondisplacement of Qualified Workers provision, in turn, requires follow-on contractors to offer a “right of first refusal” to many of those same incumbent employees.

A follow-on contractor is to be given a list of incumbent service personnel, but that information ordinarily isn’t available at the proposal stage. So what happens when a follow-on contractor unknowingly underbids because it isn’t aware how much vacation is owed to incumbent service personnel? The answer, at least in a fixed-price contract, is “too bad for the contractor.”

So it was in SecTek, Inc., CBCA 5036 (May 3, 2017)—there, the Civilian Board of Contract appeals held that a contractor must pay employees retained from the incumbent nearly $170,000 in wage and benefit costs based on its underestimate of those costs in its proposal.

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Joint Venture Affiliation Exception Isn’t Unlimited, OHA Says

To encourage joint venturing, the SBA’s size regulations provide a limited exception from affiliation for certain joint venturers: a joint venture qualifies for award of a set-aside contract so long as each venturer, individually, is below the size standard associated with the contract (or one venturer is below the size standard and the other is an SBA-approved mentor, and they have a compliant joint venture agreement). In other words, the SBA ordinarily won’t “affiliate” the joint venturers—that is, add their sizes together—if the joint venture meets the affiliation exception.

Because of this special treatment, it can be easy for the venturers to assume that they are completely exempt from any kind of affiliation. But as the SBA Office of Hearings and Appeals recently confirmed, however, the exception isn’t nearly so broad.

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