Without wanting to make the audience feel too old, I was not yet born when Transformers was a pop culture phenomenon. Still, it’s a simple but fun concept: robots that transform to and from cool vehicles. Regardless of what form they take, they are still the same character.
The same cannot be said of government contractors submitting an initial bid for the first phase of a solicitation as a prime contractor and a bid as a member of a contractor teaming agreement (CTA) for the second phase of said solicitation. While the same company is involved, the bids are treated as being from different entities. Such was the case in the GAO matter of Softrams, LLC, B-419927.4 (Feb. 7, 2022).
In this case, the Department of Health and Human Services (DHHS) issued the solicitation via the GSA’s federal supply schedule for operations and management of the agency’s identity management system. Award was to be made on a best-value tradeoff basis considering corporate experience, performance work statement response, a challenge exercise, and section 508 compliance. Evaluation of quotes was to be made in two phases. During the first phase, vendors were to submit quotations covering corporate experience only. During the second phase, the other factors and price would be considered.
OmniFed LLC (Omni), a small business, submitted a quote for phase one. For this phase, Omni submitted its quote as the prime contractor quoting the use of a second vendor, Bana Solutions (Bana), as a subcontractor. However, for phase two, Omni asked if it could submit its quotation as a Contractor Team Arrangement (CTA) with Bana. Note, GSA CTAs are different than other CTAs, these CTAs are not a separate legal entity. See more information here. The agency approved, and so Omni and Bana (for clarity we will call the CTA OB) submitted their phase two quotation with Bana as the team leader and Omni as a team member. The agency based its evaluation of OB off the original Omni quote for phase one and the OB quote for phase two, and awarded OB.
A protest followed in which the agency said it would take corrective action as Bana did not have a valid FSS contract at the time Omni submitted its phase one quotation. OB was excluded as was Omni. However, after another dispute, Omni was allowed to continue in the competition as the prime. Omni correctly noted to the agency that the original arrangement had Omni as prime, and primes can use subcontractors not on the FSS.
The offerors again made their submissions. Curiously, in the subsequent evaluations, the agency evaluated Omni’s quote for three of the four factors and pricing but evaluated the old OB quote for the final factor. The agency then awarded Omni the contract, and this protest followed.
The agency responded that because Omni “did not form a separate legal entity when entering into the GSA CTA with Bana, nothing under the GSA rules or the solicitation prohibited them from changing their formation under the same quotation.” GAO rejected this argument, noting:
“In allowing the Omni-Prime vendor to submit a revised quotation to replace the phase two quotation submitted by the eliminated Bana-Omni CTA vendor, the agency failed to obtain a complete replacement quotation from Omni-Prime by not conducting or allowing for a new factor 3 oral presentation. In sum, the agency based its selection decision on a quotation that was composed of submissions from two different vendors. This…is squarely at odds with the agency’s contemporaneous finding in response to Omni’s agency-level protest challenging the elimination of the Bana‑Omni CTA vendor from the competition. There, the agency recognized that the two vendor configurations were separate respondents to the solicitation.”
The protest was sustained as a result.
This is an unusual case as the DHHS, even after excluding a quotation, nonetheless used information from that quotation as part of its evaluation. It sort of makes sense: In the original phase two solicitation, Omni and Bana were the companies working together. The same went for the evaluation that was protested in this matter. It goes to show that the form does matter, and that simply rearranging into a CTA after the fact can completely disrupt an offeror’s chances if they are not careful.
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