Protest challenging the agency’s technical and past performance evaluations is denied. The protester alleged the agency disparately evaluated technical proposals, but GAO found that the different ratings offerors received stemmed from differences in their proposals. The protester also objected to the agency’s past performance evaluation, contending that the agency had focused too much on its negative past performance and was impermissibly biased against the protester. GAO, however, found that the protester had a history of subpar performance on the incumbent contract. In light of these problems, the agency’s focus on the protester’s negative performance had been reasonable and not indicative of bias.
The Department of Veterans Affairs issued a solicitation for the operation of a community-based outpatient clinic. Four offerors, including the incumbent, Sterling Medical Associates, submitted proposals. As part of its evaluation, the VA noted significant concerns with Sterling’s performance on the incumbent contract—e.g., staff attendance issues, unscheduled clinic closures, lack of permanent physician. Indeed, at one point, the contracting officer for Sterling’s contract had contemplated a termination for cause. Due in part to these performance issues, Sterling was not selected for award. Instead, the VA awarded the contract to Valor Healthcare, Inc. Sterling protested.
Sterling alleged that the VA disparately evaluated its proposal. When a protester alleges disparate treatment in a technical evaluation, it must show that the differences in the evaluation did not stem from differences between proposals. Here, GAO found that Sterling’s argument relied on proposal features that were not, in fact, the same or even nearly the same.
For instance, Sterling argued that Valor had been assigned a strength for using locum tenens—i.e., temporary or substitute—staff as a backup. But, Sterling complained, its own technical approach, which included a lengthy discussion of locum tenens staff, did not receive a similar strength. GAO found that that Sterling had misread the evaluation. Valor received a strength for using locum tenens staff as a final backup. In other words, it was not assigned a strength for using locum tenens staff but rather for its minimization of locum tenens staff. Indeed, one of the contributing factors to Sterling’s performance problems had been its overreliance on locum tenens staff.
Sterling also alleged that the VA failed to acknowledge strengths of its technical proposal. As an example, Sterling contended that its transition plan should have received a strength because as the incumbent contractor, its transition-in would be less risky. But GAO noted that there is no requirement that in incumbent be given credit for its status as the incumbent. What’s more, the VA had significant ongoing concerns about the performance of incumbent staff who were also proposed for the follow-on procurement.
Next, Sterling complained about the VA’s past performance evaluation. Sterling noted that the solicitation provided that the past performance evaluation would focus on information that demonstrated the quality of past performance relative to size and complexity. Sterling alleged that instead of considering the relevancy of offerors’ references, the VA over-relied on a statistical analysis of past performance.
GAO, however, noted that the CPARS the VA considered were all for the same NAICS code as the procurement, and that they all involved the operation of community-based outpatient clinics. Accordingly, the VA viewed them as all relevant. The fact that the agency did not elect to focus its review to only those efforts that Sterling found most similar did not render the evaluation unreasonable. In any event, GAO continued, despite Sterling’s protestations about the failure to consider relevance, the source selection decision actually considered the specifics of that ways in which certain past efforts that were similar to the procurement.
Sterling also argued that past performance evaluation was unequal. Sterling contended that in evaluating Valor, the VA focused only on its positive past performance, but when evaluating Sterling, the VA focused on its negative past performance history.
GAO agreed that the analysis focused on Sterling’s negative performance, but this was because Sterling received significantly more negative past performance ratings than Valor. Valor received no ratings of unsatisfactory performance while Sterling had received three. Sterling also received seven times as many marginal ratings as Valor. What’s more, Valor had more than double the number of exceptional and very good ratings. The VA’s evaluation merely reflected trends in the underlying data.
Finally, Sterling asserted the contracting was biased against it. Sterling posited that the contractor officer on the incumbent contract, who also served as the source selection authority in this procurement, was simply incapable of being impartial. In particular, Sterling contended because the contracting officer had been advocating for the termination of Sterling’s contract, they could not even-handedly consider Sterling’s proposal in the new procurement.
GAO rejected this argument, reasoning that the fact that an SSA was involved in documenting negative information about performance problems on an incumbent contract cannot be proof of impermissible bias. Many of Sterling’s performance issues on the incumbent contract related directly to aspects of performance under the procurement. It was unclear how a contracting officer with firsthand knowledge of these issues was supposed to ignore them. This is not evidence of bias. Indeed, given Sterling’s performance record, it was entirely reasonable for the contracting officer to reluctant in making an award to Sterling.
Sterling is represented by Barbara A. Duncombe, Suzanne Sumner, Brandon E. Dobyns, Erin R. Davis, and Sean A. Graves of Taft Stettinius & Hollister LLP. The intervenor, Valor, is represented by Stuart B. Nibley, Amy Conant Hoang, Erica L. Bakies, and Sarah F. Burgart of K&L Gates LLP. The agency is represented by Deborah K. Morrell and Donald C. Mobly of the Department of Veterans Affairs. GAO attorneys Michael Willems and Edward Goldstein participated in the preparation of the decision.