Protest challenging agency’s technical and past performance evaluation is sustained in part. GAO found that the agency unreasonably ignored information that contradicted the awardee’s representations that it had complied with the solicitation’s requirements. GAO also found the agency’s past performance evaluation of the awardee unreasonable. An agency may consider the past perfornace of an offeror’s subsidiaries if the subsidiaries will have some role in the in the present contract. Here, however, the awardee failed to connect the past performance of its subsidiaries to performance in the present contract. GAO denied the protester’s other arguments concerning the awardee’s satisfaction of the solicitation’s ownership requirement and the agency’s responsibility determination.
The U.S. Transportation Command published a solicitation seeking a contractor to deliver fuel by barge between ports on the Atlantic and Gulf Coasts. The agency received proposals from Vane Line Bunkering and Harley Marine Services. The agency found that the companies had similar technical ratings, but that Vane had a slightly higher past performance rating. Vane, however, also had a much higher price. The agency awarded the contract to Harley, reasoning that Vane’s higher past performance rating did not justify its higher price. Vane protested.
Vane first argued that Harley had not provided documentation required by the solicitiation — specifically, a U.S. Coast Guard Certificate of Inspection to demonstrate their ownership of each vessel they were proposing. Because Harley’s subsidiaries were the owners of its vessels, Harley submitted a letter that identified Harley as the owner or 12 subsidiaries. Vane argued that nothing in the letter demonstrated that Harley actually owned and controlled the vessels.
GAO found this argument underwhelming. If an offeror’s vessels were owned by the offeror’s subsidiary, the RFP required that the offeror submit a signed letter describing the relationship between the subsidiary and the offeror. Harley satisfied this requirement, and the agency reasonably found this letter sufficient to demonstrate that Harley would have control of vessel performance.
Vane next argued, however, that one of Harley’s barges exceeded the soliciaiton’s barge capacity requirements. The solicitation provided that barges could not exceed a 20,000 barrel capacity. Harely’s technical narrative stated that one of its barges had a capacity of 19,465 barrels. But the Certificate on Inspection that Harley provided for that barge stated that the barge could hold 22,600 barrels.
The agency contended that it reasonably found Harley compliant because the Certificates of Inspection were only required to show ownership of the vessel, not capacity. Thus, the agency argued, it would have been improper to evaluate capacity based on the Certificate of Capacity.
GAO found that the agency acted unreasonably. An agency may not accept representations in a proposal at face value when there is significant countervailing evidence that creates doubt as to whether those representations were accurate. Thus, the agency was not in any way precluded from considering information in the Certificates of Inspection when evaluating Harely’s capacity. A reasonable review of that information should have created doubt as to whether Harley had complied with the solicitation’s requirements. What’s more, the agency had not proffered any explanation as to why the capacity information in the Certificates would have been otherwise unreliable.
Vane also challenged the agency’s past performance evaluation of Harley. Harley submitted past performance questionnaires from three customers. Van noted, however, that those contracts were actually performed by Harley’s subsidiaries. Vane contended that the agency should not have credited the past performance of those entities where there was no evidence those subsidiaries would be involved in performance of the contract.
GAO agreed with Vane. While it is appropriate to consider a subsidiary’s past performance when it will be involved in the contract, it is inappropriate to consider that performance when there is no evidence the subsidiary will be involved in the new contact. Here, Harley’s past performance proposal did not explain the roles the subsidiaries had in the past contracts. Harley failed to connect the performance described in the questionnaires to the performance of the subsidiaries it planned to rely on this procurement. Absent a clearer indication of which subsidiaries contributed to the effort, the agency’s evaluation of past performance was unreasonable.
Finally, Vane argued that the agency unreasonably found Harley to be responsible because it ignored information that Harley had sold some of its vessels to remain fiscally solvent. GAO, however, found that the agency engaged in a thorough review of Harley’s responsibility, analyzing the company’s Dun & Bradstreet reports. While those reports indicated some level of risk, the agency reasonably found the risk acceptable.
Vane is represented by Jayna Marie Rust, Katherine S. Nucci, Scott F. Lane, and Timothy Sullivan of Thompson Coburn LLP. The intervenor, Harley, is represented by
Bryant E. Gardner and Allison Skopec of Winston & Strawn LLP. The agency is represented by Colonel Patricia S. Wiegman-Lenz, Lieutenant Colonel John C. Degnan, and Lawrence M. Anderson of the Air Force. GAO attorneys Joshua R. Gillerman and Peter H. Tran participated in the preparation of the decision.
