A procuring agency properly considered the past performance of a joint venture’s two partners, even though the solicitation prohibited the consideration of subcontractors’ past performance.

In a recent bid protest decision, the GAO held that where a solicitation only allowed past performance references for the “prime offeror,” the agency was permitted to consider the past performance of two joint venture partners–the entities comprising a “prime offeror.”

The GAO’s decision in System Integration and Development, Inc., B-408865.2, B-408865.3 (July 10, 2014) involved a Department of Labor solicitation for information technology systems operation and maintenance.  The solicitation provided for award on a best value basis, including consideration of offerors’ past performance.

With respect to the past performance factor, the solicitation called for offerors to submit up to five references for contracts completed in the last five years.  The solicitation stated that DOL would evaluate past performance “for the prime offeror only” and that “past performance for any proposed subcontractor will not be evaluated.”

Advanced Quality Alliance submitted a proposal.  AQA was a joint venture comprised of two entities: ECS Federal and Strongbridge Corporation.  AQA’s proposal included past performance references for the joint venture partner.  The DOL considered those references, and assigned AQA a “Satisfactory” past performance score.  The DOL awarded the contract to AQA as the best value offeror.

An unsuccessful competitor, System Integration and Development, Inc., filed a GAO bid protest.  SID argued, in part, that the DOL was required to consider only the past performance of AQA itself, and was precluded from considering the past performance of Strongbridge and ECS.  SID argued that the DOL should have assigned a “Neutral” past performance score to AQA.

The GAO wrote that “ECS and Strongbridge are not subcontractors to the joint venture AQA.”  Rather, “ECS and Strongbridge together are the joint venture partners comprising AQA, the offeror.”  The GAO concluded, “[h]ere, since the solicitation did not preclude the agency from considering the past performance of the component companies of a joint venture, the agency could properly consider the past performance of Strongbridge and ECS in evaluating the past performance of the joint venture AQA.”  The GAO denied SID’s bid protest.

The System Integration & Development bid protest demonstrates how savvy offerors may be able to structure their teaming arrangements to allow for the consideration of both teammates’ past performance, even where (as in this case), a solicitation contains restrictive past performance evaluation terms.  Under the terms of the DOL solicitation, had ECS and Strongbridge bid as a prime/subcontractor team, only the prime’s experience would have been considered.  But because the solicitation did not preclude the evaluation of joint venture partners, using a joint venture allowed for the consideration of both partners’ past performance.