GAO Upholds Low Agency Bar to Waive OCI

The FAR requires offerors, in most situations, to disclose any actual or potential organizational conflicts of interest (OCI) that exist when submitting an offer or proposal in response to a solicitation. While it is rare that an offeror will be excluded from competition solely due to the existence or potential of an OCI, offerors who do not disclose as required will most likely be excluded, making this a situation where you generally want to disclose the existence of an OCI up front, not explain after the agency’s discovery through other means. Offerors may choose to avoid, mitigate, or neutralize an OCI by putting up a organizational barrier between the individual creating the OCI and the perceived or actual conflict. However, in some situations, avoiding, mitigating, or neutralizing the OCI may not be in the agency’s best interest. In that case, and as happened in Accenture Federal Services, LLC, agencies are given the option to waive the requirements of FAR subpart 9.5, thereby making award regardless of the existence or potential of an OCI.

What is an OCI?

Many readers likely already know what an OCI is, especially if you have ever submitted an offer for a federal government contract. But, for those that don’t, so I’ll start with a very quick review of OCIs.

“Organizational Conflict of Interest means that because of other activities or relationships with other persons, a person is unable or potentially unable to render impartial assistance or advice to the Government, or the person’s objectivity in performing the contract work is or might be otherwise impaired, or a person has an unfair competitive advantage.” FAR 2.101.

Said plainly, OCIs are situations that lead to an offeror having an unfair competitive advantage, most often via access to proprietary information. There are three types of OCIs including unequal access to information, biased ground rules, and impaired objectivity. It is ultimately the contracting officer’s responsibility to identify and resolve potential conflicts, and the FAR requires the contracting officer to award the contract to an apparent successful offeror unless an identified conflict exists and cannot be avoided or mitigated. FAR 9.504.

Accenture Federal Services, LLC

In Accenture Federal Services, LLC, Accenture filed a protest questioning TSA’s award of a task order under a General Services Administration (GSA) indefinite-delivery, indefinite quantity (IDIQ) contract to Deloitte, claiming that TSA failed to reasonably consider and improperly waived an OCI identified by Deloitte in its proposal. Accenture and Deloitte both held contracts under the GSA IDIQ, and both were performing on task orders under the IDIQ. Accenture was performing personnel, payroll, and benefits services for TSA and Deloitte was performing recruiting and hiring services for TSA. Both parties were performing IT services under separate task orders; Accenture via FAST TO2 and Deloitte via FAST TO 6.

TSA issued an RFP for a task order with a one-year base period and four options to perform human capital support services for “the full lifecycle of a TSA employee, including recruitment, onboarding, development, retention and separation.” The RFP stated that evaluations would utilize a best-value tradeoff analysis using various factors and phases, and offerors were required to identify potential OCIs and submit an OCI mitigation plan if applicable.

Both parties were successful with their Phase 1 proposals and were asked by TSA to participate in Phase 2. In its Phase 2 proposal, Deloitte identified multiple potential OCIs and included an OCI mitigation plan, noting that, in performing the FAST TO6 requirements, “it is possible that certain personnel could be provided information that would be relevant to this procurement.” Accordingly, Deloitte’s mitigation plan identified several of its employees who had been firewalled from participating in the preparation of Deloitte’s proposal.

Subsequently, TSA awarded the task order to Deloitte. Following its debriefing, Accenture filed a protest with GAO asserting that the agency had failed to reasonably consider two OCIs that Deloitte had: “unequal access to information” and “impaired objectivity.” Following its notice of the protest and alleged OCIs, TSA decided to take corrective action, “stating that it would perform an additional OCI review, document its findings, and make a new source selection decision.” Following the notice of TSA’s intent to take corrective action, the protest was dismissed.

The contracting officer then completed her OCI review and concluded there were no conflicts of interest. This was, in part, because the requirements of Deloitte’s FAST TO6 contract were different from the requirements of the task order in question, with the former being “strictly technology enhancements” and the latter being “strictly services.” The contracting officer acknowledged that the awardee of the task order in question would be permitted to make recommendations for technology changes, which would be implemented by Deloitte under its FAST TO6 contract. But TSA ultimately concluded that, as the awardee, Deloitte’s objectivity in making such recommendations would not be impaired because TSA would review the recommendations, making the ultimate decision regarding whether or not to adopt the changes proposed by the awardee. Thereafter, Deloitte was again selected for award.

Accenture then filed another protest with GAO asserting the same arguments as it did in its first protest, which was then followed by three supplemental protests adding support to its initial protest. Accenture’s second protest asserted that Deloitte had access to non-public information when performing on its FAST TO6 contract and, in performance of its IT support services contract, Deloitte had unequal access to information that gave Deloitte an unfair competitive advantage in preparing its proposal.

Following a discussion held with GAO’s attorneys and representatives from both parties, TSA executed an OCI waiver pursuant to the authority of FAR 9.503, which permits a contracting officer to request a waiver of an OCI if it determines that the application in a particular situation would not be in the Government’s interest. Any such request must be in writing, setting forth the extent of the conflict, and must be approved by the agency hear or designee. Accordingly, the waiver contained the required information and stated:  

[This] award is the backbone of the infrastructure for TSA’s ability to meet its mission. . . . The inability to proceed with this award will restrict the opportunities to provide continuing improvement and efficiencies for the TSA workforce, including those that have been priorities for the Administrator. Furthermore, the time and cost to delay or put aside this award will be detrimental to the agency and it’s in the best interest of the agency for this waiver to exist.

It is understandable that an OCI could cause concerns within such a large requirement to the mission of TSA as any agency. However, any potential concern does not outweigh the magnitude to which this contract impacts the agency and is considered [moot] at this time.

As stated and demonstrated above, to the extent any residual OCIs might exist in the areas of impaired objectivity, biased ground rules, or unequal access to nonpublic information, the application of the rules and procedures of FAR 9.5 to those OCIs is waived.

Accenture then filed its third supplemental protest, challenging the validity of the  OCI waiver, claiming that the waiver did not discuss the extent of the conflict, as required.

However, in the end, GAO determined that the waiver did, in fact, satisfy the requirements of FAR 9.503. The waiver was in writing, it set forth the extent of the conflict, addressing each assertion raised by Accenture regarding current or potential OCIs, and was approved by the appropriate individual within the agency, leaving no basis to sustain the protest of the alleged OCIs.


Ultimately, this decision left me wanting for more. While it thoroughly discussed OCI waivers and gave insight on their use, something that many may not even realize was a possibility, it left me with one big question that is not answered in the decision or the OCI regulations:

What does it take to be considered “in the best interest of the government,” and, therefore, waive an OCI?


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