SBA Requires Consideration of Some Subcontractors’ Capabilities, Experience & Past Performance

It’s commonly misunderstood that the FAR requires procuring agencies to consider the capabilities, past performance and experience of an offeror’s proposed subcontractors. Unfortunately, that’s just not true.

But now, as part of a comprehensive new final rule, the SBA will require agencies to consider the capabilities, past performance and experience of small business subcontractors in certain cases.

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GAO: Evaluation of Affiliate’s Past Performance is Optional

In its past performance evaluation, an agency typically can consider the past performance of an offeror’s affiliate, so long as the offeror’s proposal demonstrates that the resources of the affiliate will affect contract performance.

But, as demonstrated in a recent GAO decision involving an Alaska Native Corporation subsidiary, ordinarily there is no requirement that an agency consider an affiliate’s past performance.  In other words, unless the solicitation speaks to the issue, the agency’s consideration of an affiliate’s past performance is optional.

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NHO Prime Gets “Experience” Weakness Despite Experienced Affiliate

An agency was allowed to assign a Native Hawaiian-owned prime contractor a weakness for its experience because the NHO prime lacked relevant experience–even though the prime’s proposal indicated that it would rely in part on the resources of an experienced NHO sister company.

A recent GAO bid decision demonstrates that while a procuring agency is entitled to consider the experience and past performance of a prime contractor’s affiliates under certain circumstances, the agency is not precluded from considering the prime’s own experience (or lack thereof).

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Evaluation Of Subcontractor Past Performance Not Required For FSS Procurements

For Federal Supply Schedule procurements, agencies are not required to evaluate past performance references of subcontractors, unless the solicitation provides otherwise.

As one offeror recently discovered in Atlantic Systems Group, Inc., B-413901 (Jan. 9, 2017), unlike negotiated procurements, where agencies “should” evaluate the past performance of subcontractors that will perform major or critical aspects of the contract, offerors bidding under FSS solicitations should not assume that a subcontractor’s past performance will be considered.

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Insufficient Experience Information Sinks Offeror’s Proposal

An offeror’s failure to provide the type of past performance information mandated by a solicitation led to the offeror’s elimination from consideration for a  major GSA contract.

A recent GAO bid protest decision highlights the importance of fully reading and adhering to a solicitation’s requirements–including those involving the type of past performance or experience information required.

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GAO: Agency Reasonably Considered Subcontractor’s Experience

Absent an express prohibition in the solicitation, the experience of a proposed subcontractor may be considered by an agency in determining whether an offeror meets the solicitation’s experience requirements.

In a recent bid protest decision, the GAO confirmed that the experience of a proposed subcontractor could be considered in an agency’s evaluation because the solicitation did not prohibit the agency from considering the subcontractor’s experience.

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Affiliates’ Past Performance: Solicitation Terms Control

Although an agency may consider the past performance of an offeror’s affiliates under certain circumstances, the extent of the agency’s past performance review is governed by the terms of the solicitation.

In a recent bid protest decision, the GAO held that an agency properly refused to consider the past performance of the offeror’s parent company because the solicitation restricted the scope of the agency’s past performance review.

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