For small businesses, the SBA’s Certificate of Competency process can offer a powerful “second bite at the apple,” essentially allowing a small business to appeal to the SBA if a procuring agency finds the small business non-responsible.
But the SBA CoC process is limited to findings of non-responsibility under FAR Part 9. As GAO recently held, there is no right to appeal to SBA if the proposal was rejected for failing to adequately explain the small business’s technical approach.
GAO’s decision in Barquin Solutions, B-419315.2, B-419315.3 (Jan. 19, 2021) involved a DoD procurement for domain name system resolver services. The RFQ provided for a three-phase competition, with each phase focusing on a different evaluation factor.
In the first phase, vendors would submit proposed technical solutions. Those vendors submitting technical solutions meeting the RFQ’s minimum requirements would be invited to the second phase, where they would provide a live technical usability demonstration. During the usability demonstration, vendors would be required to demonstrate their ability to meet each of seven tasks within their proposed technical solution. Finally, “viable competitors” from the first two phases would be invited to the third phase, in which they would submit pricing.
Barquin Solutions, a small business, submitted a quotation. On the basis of its written technical solution in Phase 1, Barquin was invited to give a Phase 2 usability demonstration.
After Barquin’s presentation, the agency concluded that Barquin “did not propose a viable solution, primarily based on usability factors and the fact that certain parts of [Barquin’s] proposal were not demonstrated because they were incomplete.” The agency did not invite Barquin to participate in Phase 3.
Barquin filed a GAO bid protest, alleging that the agency had wrongly excluded Barquin from the competition. Among its arguments, Barquin contended that the agency’s elimination of Barquin was a de facto responsibility determination and should have been referred to the SBA for a Certificate of Competency review.
GAO explained that the COC process applies to determinations of nonresponsibility:
Where an agency finds the proposal of a small business to be unacceptable under a responsibility-related factor, that is, a factor pertaining to its ability to perform, such as whether it has adequate corporate experience or production equipment and facilities, the determination is essentially one of nonresponsibility, meaning that referral to the SBA, which has the ultimate authority to determine the responsibility of small business concerns, is required.
In this case, though, GAO said, “the agency’s negative technical findings were based on the protester’s failure to adequately demonstrate a user interface for non-technical users or on features of the protester’s proposed solution that were not actually demonstrated during its presentation.”
Our decisions have made clear that evaluation judgments based on a failure to adequately explain or demonstrate a technical approach is not a responsibility determination. While a determination that a vendor is not a viable competitor may, in certain instances, be a responsibility determination, the agency here clearly evaluated the protester’s technical approach, not its ability to perform, and a referral to the SBA was not required.
GAO denied the protest.
The SBA’s Certificate of Competency process gives small businesses an important and powerful right–but COCs are limited to agency determinations of non-responsibility. As the Barquin Solutions case demonstrates, failing to adequately explain the technical approach is not a matter of responsibility, and no COC is required.
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