Agency Properly Awarded Contract to Company with Nine Negative CPARs

Among some contractors, it’s taken as an article of faith that even a single negative Contractor Performance Assessment Report will effectively preclude the contractor from winning new government work.

While it’s undoubtedly true, in my opinion, that some Contracting Officers place too much emphasis on a single less-than-perfect CPAR, it’s also true that a contractor with multiple negative CPARs can still win government contracts, so long as the government reasonably believes that the contractor can successfully perform the new work. Case in point: a recent GAO bid protest decision upholding an award to a company with nine (count ’em!) recent, relevant and negative CPARs.

GAO’s decision in Aviation Ground Equipment Corporation, B-417711.2, B-417711.3 (May 3, 2021) involved a Naval Air Systems Command solicitation seeking land-based mobile electric power plants. The solicitation was a small business set-aside and contemplated the award of a single IDIQ contract.

The solicitation established a “best value” evaluation, encompassing three factors: technical approach, past performance, and price. For the past performance factor, offerors would be assigned one of five confidence ratings, ranging from the highest, Substantial Confidence, to Satisfactory Confidence, Neutral Confidence, Limited Confidence, and No Confidence.

After evaluating competitive proposals, the Navy announced that it would award the contract to Essex Electro Engineers Inc. Essex received the highest possible rating, “Outstanding,” on the technical factor and a “Satisfactory Confidence” past performance rating. Essex proposal a total price of approximately $46.6 million.

An unsuccessful competitor, Aviation Ground Equipment Corporation, filed a GAO bid protest. AGEC had also received an “Outstanding” technical rating. AGEC’s past performance confidence rating was “Substantial Confidence,” a higher rating than Essex’s. But AGEC proposed a total price of approximately $62.6 million, significantly higher than Essex’s.

In its bid protest, AGEC contended, in part, that the agency’s evaluation of Essex’s past performance was flawed. AGEC pointed out that, of Essex’s 14 recent, relevant CPARs, “9 reflected less than satisfactory performance.” In those nine CPARs, Essex received “12 marginal ratings and 5 unsatisfactory ratings.” Additionally, “for six of the CPARs, the assessing official stated that they would not recommend Essex for similar work in the future.”

GAO wrote that “the contemporary record shows the Navy considered the past performance information discussed by the protester.” While the Navy’s evaluators noted the negative CPARs, “the agency also noted that Essex assigned a new engineering team in 2016 that has significantly improved its performance on Navy contracts, including a very relevant Navy contract for similar mobile electric power plants.” The evaluators also found that Essex’s Navy CPARs since 2017 “have been uniformly satisfactory” and that Essex “proposed the same engineering team for this procurement.”

GAO continued:

While the agency could have reasonably come to a different conclusion on these facts, the agency did not ignore or overlook the awardee’s negative past performance. Rather the agency considered all of Essex’s past performance information and decided to give greater weight to its own recent experiences with Essex on very similar requirements. Our decisions have consistently concluded that it is reasonable for an agency to give differing weight to an offeror’s prior contracts based on their similarity or relevance to the required effort.

Writing that it had “no basis to find the agency’s evaluation unreasonable,” the GAO rejected this ground of protest, and denied the remainder of AGEC’s arguments, as well.

The Aviation Ground Equipment Corporation case is a good reminder that negative CPARs are not necessarily a death knell for a contractor. While some agency officials might give a negative CPAR undue weight, others–like the Navy’s evaluators here–will look beyond the scores. Corrective measures, like the new engineering team Essex assigned, may help demonstrate that the issues behind a negative CPAR are unlikely to reoccur.

That said, it’s important not to read too much into GAO’s decision. It seems likely that, had the agency assigned Essex a Limited Confidence or even a No Confidence past performance score, GAO would have upheld those results as reasonable, too. Aviation Ground Equipment Corporation doesn’t mean that an agency is required to give a satisfactory past performance score to an offeror with negative CPARs–just that an agency has the discretion to do so when the facts warrant.

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