A large incumbent contractor was properly assigned a mere “satisfactory confidence” past performance rating because the large business failed to meet its small business subcontracting goals under four of the five contracts it submitted for evaluation.
In a recent bid protest decision, the GAO upheld the agency’s assignment of a satisfactory confidence score to the large incumbent–despite the incumbent’s strong performance in many areas–because of the incumbent’s failure to satisfy its subcontracting goals.
In Science Applications International Corp., B-408690.2, B-408690.3 (Dec. 17, 2014), the Defense Logistics Agency issued a solicitation to provide supplies and services pursuant to DLA’s tailored logistics support prime vendor program in the Southeast Region of the United States. The solicitation provided that each contract would be awarded on a best value basis, considering three evaluation factors: past performance, technical merit, and price.
The most important evaluation factor was past performance. Offerors were directed to submit information regarding up to six prior contracts for evaluation. The solicitation stated that “[b]oth relevancy and contractor performance will be evaluated.” Additionally, the solicitation stated that the past performance evaluation would include consideration of “the degree to which the offeror met . . . socio-economic goals” and “how well the offeror met its subcontracting goals.”
DLA received proposals from eight offerors, including Science Applications International Corporation, the incumbent contractor. In evaluating SAIC’s past performance proposal, the agency assigned weaknesses based on SAIC’s failure to meet socio-economic and/or subcontracting goals under four of the five contracts SAIC submitted for evaluation. DLA assigned an overall rating of “satisfactory confidence” to SAIC for its past performance.
After the DLA awarded the contract to two competitors, SAIC filed a GAO bid protest. Among its based of protest, SAID challenged the agency’s assignment of a “satisfactory confidence” past performance rating. SAIC contended that the DLA “appears to have disregarded” what SAIC characterized as its “across-the-board” ratings of “exceptional” for many of its prior contracts.
The DLA responded by stating that SAIC’s past performance ratings had not been ignored, but that SAIC’s failure to meet its subcontracting goals justified the lower past performance rating. The DLA noted that SAIC had missed its subcontracting goals on four of five contracts submitted for evaluation.
The GAO wrote that the solicitation had clearly put offerors on notice that the past performance evaluation would include consideration of the degree to which the offeror met socio-economic and/or subcontracting goals. The GAO continued:
Based on our review of the evaluation record, we find no basis to question the agency’s determination that SAIC’s failure to meet its socio-economic and/or subcontracting aosl in four of the five prior contracts constituted weaknesses, nor do we question the agency’s overall rating of satisfactory confidence. As discussed above, the agency’s assessments were consistent with the solicitation’s stated evaluation criteria, supported by the evaluation record, and reasonable.
The GAO denied SAIC’s protest.
For small business subcontractors, it is heartening to see procuring agencies hold large primes’ feet to the fire with respect to subcontracting goals. If more solicitations were written like the DLA’s solicitation in this case, it seems very likely that many large primes’ subcontracting plan achievements would quickly begin to improve.