Congress Requires Large Primes to Provide Past Performance Reviews to Small Subcontractors–And Agencies to Consider Them

Breaking into the federal government contracting marketplace can be challenging, and many small businesses choose to start as subcontractors. But when those companies later bid on prime contracts, they sometimes find that they cannot get past performance reviews for their subcontract work, or that the government won’t consider such reviews.

Now, Congress has stepped in. A provision in the 2021 National Defense Authorization Act will require large prime contractors to provide small businesses with past performance reviews in certain cases, and will require agencies to consider them.

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Congress Says Small Businesses Without Past Performance Can Submit Joint Venture Experience Instead

Per the 2021 NDAA that was recently approved by Congress, small business offerors without their own past performance experience can now submit experience earned as part of a joint venture–and the procuring agency must consider it. This change will significantly benefit newer companies that do not yet have the individual experience to successfully compete for government contracts (that is, assuming the President signs the NDAA). It will also add an incentive for start-up companies to take advantage of SBA’s joint venture opportunities.

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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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Subcontractor Experience Irrelevant Where Subcontractor Won’t Perform Similar Tasks, Says GAO

Prime and subcontractor teaming is a common way for contractors to leverage the experience of the team’s anticipated subcontractors to make proposals more attractive to federal clients, particularly when past performance is a substantial evaluation consideration.

This approach, however, recently ran into a snag when the proposed subcontractor was not going to perform the discrete work areas that its past performance experience supported, which lowered the past performance score of the bid. In the resulting protest, GAO concluded the agency got the evaluation right, and was not required to credit all of the subcontractor’s experience.

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GAO Green Lights Use of IGCE in Past Performance Evaluation

Internal Government Cost Estimates (IGCEs) are frequently used to gauge the reasonableness of contractor prices during proposal evaluation. But can these internal estimates also impact other evaluation factors? GAO was recently asked to resolve this question in the context of past performance evaluations, and the answer was essentially “you sure can!”

Alright, GAO wasn’t that enthusiastic, but it did condone the use of IGCEs when evaluating past performance.

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GAO to Agency: Offerors are More than Just a CPARS-Generated Rating Percentage

GAO recently sustained protest to an agency’s FAR Part 13 procurement that relied exclusively on CPARS-generated assessment chart rating percentages to evaluate vendors’ past performance. The agency’s goal was to “maximize competition” by considering all past work, rather than just relevant work.

While there is no FAR Part 13 regulatory prohibition on doing so, GAO found the CPARS charts incomplete and misleading and the evaluation inconsistent with the terms of the solicitation.

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2020 NDAA to Add Cybersecurity Training, Additional SBA Annual Reporting, and Promote Workforce Development

The draft 2020 National Defense Authorization Act includes a number of provisions that will affect government contractors, especially small business contractors, including the three provisions featured in this post.

Read on for how the 2020 draft NDAA impacts annual small business reporting by the SBA, cybersecurity training for small businesses, and evaluation of past performance to focus on workforce development.

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