Author Archives: SmallGovCon Contributor

GAO: Awardee’s Low Price Isn’t Too Low, Absent a Price Realism Evaluation

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In a fixed-price procurement, an agency cannot reject an offeror for proposing a “too low” price unless the solicitation specifically contemplates a price realism evaluation.

This point is one of several interesting issues recently addressed by GAO in URS Federal Services, Inc., B-412580 et al. (Mar. 31, 2016). Another interesting issue—pertaining to an offeror’s protest of the awardee’s subcontractors’ size—will be addressed in a forthcoming post. But this post serves as a reminder of an important limitation to a protester’s ability to challenge an awardee’s price.

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SBA OHA Reaffirms 70% Threshold For Economic Dependence Affiliation

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Under the SBA’s affiliation rules, one of the many ways a small business can be deemed affiliated with another is through the economic dependence rule: where a small business derives 70% or more of its revenues from another entity, the SBA ordinarily considers it to be economically dependent upon—and thus subject to the control of—that other entity.

So it was in a recent decision from the SBA’s Office of Hearings and Appeals (“OHA”), which confirmed the so-called “70% rule” for economic dependence.

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GAO: Protester Must Show Awardee’s “Specific Exception” to Subcontracting Limitation

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A protester challenging an awardee’s compliance with the FAR’s limitation on subcontracting faces an uphill battle.

As explained in a recent GAO bid protest decision, an offeror’s compliance with the limitation on subcontracting is presumed; a protester, therefore, must present specific evidence demonstrating that the awardee will not comply with the limitation. In many cases–especially when the solicitation does not require offerors to provide a breakdown of costs of the work performed by the prime and its subcontractors–such evidence may be next to impossible to obtain.

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Exercised Options May Be Protested At GAO–But Agency Discretion Is Broad

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Contrary to a common misconception, GAO has jurisdiction to consider a protester’s challenge to the exercise of an option in a competitor’s contract. But GAO’s review is largely deferential to the agency: it will uphold the exercise of an option unless a protester is able to show the agency failed to follow applicable regulations or otherwise should have conducted a new procurement.

A recent bid protest illustrates this deferential review, as GAO denied a protest challenging the exercise of an option where the agency considered pricing and other factors before exercising its option.

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GAO Considers “Intertwined” Protest of Task Order Valued Below Jurisdictional Threshold

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GAO’s bid protest jurisdiction is defined—and limited—by both statute and its regulations. As part of these jurisdictional limits, GAO ordinarily may only consider protests relating to task order procurements if those orders are valued in excess of $10 million.

But despite this rule, GAO recently considered a protester’s challenge to a task order valued at only $8.7 million. It did so after deciding that the challenge was “intertwined” with the protester’s challenge to its own termination for convenience–another matter the GAO only considers in unusual circumstances.

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GAO: Protest of Exclusion From Competitive Range Untimely After Award

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A protester’s failure to timely file its bid protest at GAO is almost always certain to lead to the dismissal of its protest. But knowing when the clock starts running for an offeror to file its protest isn’t always clear.

This uncertainty recently tripped up a would-be protester seeking to challenge its exclusion from the competitive range—because that offeror failed to request a pre-award debriefing, its attempt to protest its exclusion following the award and a post-award debriefing was untimely.

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GAO: VA’s Rule of Two Applies to Multiple-Award IDIQs

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Good news for veteran-owned contractors: the VA’s SDVOSB and VOSB “Rule of Two” applies even when the VA issues a solicitation for a multiple-award IDIQ contract.

A recent GAO decision represents the latest instance where the VA’s failure to apply the Rule of Two and set-aside a procurement for SDVOSBs has been found to be unreasonable. In Spur Design, LLC, B-412245.3 (Feb. 24, 2016)*, GAO determined that the Rule of Two required the VA to set-aside a solicitation to award several multiple award indefinite-delivery/indefinite-quantity (“IDIQ”) contracts for SDVOSBs.

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