Protest challenging an award is sustained. The awardee had initially submitted its quotation as a prime contractor. But during the second phase of the evaluation, the awardee changed its configuration; it was no longer the but instead a member in a contractor teaming arrangement. GAO determined that this change in configuration invalidated the award because the awardee’s quotation was composed of a submission from two different vendors—i.e., the awardee’s written quotation, and the teaming arrangement’s oral presentation.
Background
The Centers for Medicare and Medicaid Services (CMS) posted an RFQ for operations of the agency’s identity management system. The RFQ established a two-phase evaluation. In the first phase, CMS would evaluate corporate experience and then conduct a down select, inviting highly-rated vendors to participate in Phase II. During phase II, offerors would participate in an oral presentation, and CMS would evaluate other non-price factors.
CMS received phase I quotations from, among others, Softrams, LLC, Chags Health Information Technology, and Omni Federal. CMS invited Softrams, Chags, and Omni to continue to phase II.
Omni had submitted its phase I quotation as prime contractor with a subcontractor, Bana Solutions. But Omni underwent a “vendor configuration change” before submitting its phase II proposal. The phase II quotation was submitted by a contracting teaming arrangement of Omni and Bana with Bana as the team leader and Omni as a team member.
CMS awarded the contract to Bana-Omni. Softrams and Chags protested. CMS took corrective action to reevaluate. As part of the corrective action, CMS eliminated Omni because Bana did not have a valid FSS contract.
Omni then filed an agency protest, challenging the elimination decision. CMS determined that Omni should not have been eliminated. But the agency reasoned that because Omni had submitted the phase I quotation, only Omni—not the Bana-Omni CTA—could participate in phase II. So CMS ended up excluding Bana-Omni from the competition, but it allowed Omni to submit a revised proposal and continue in the competition.
CMS ended up awarding the contract to Omni. Softrams and Chags protested, arguing that CMS had improperly relied on the oral presentation made by Bana-Omni in selecting Omni for award.
Legal Analysis
GAO sided with the protesters. CMS’s award decision was based on (1) Omni’s revised quotation, and (2) Bana-Omni’s oral presentation. Thus, the agency based its selection decision on a quotation composed of submissions from two different vendors.
CMS argued that this wasn’t a big deal because Omni had not formed a separate entity when entering the CTA with Bana. The companies just changed the configuration of their teaming arrangement but nothing substantive changed in the offer.
GAO found that this argument was belied by CMS’s decision in the agency protest. In that protest, CMS recognized that the two vendor configurations were separate respondents to the solicitation. Indeed, the agency had eliminated Bana-Omni because that configuration had not submitted the phase I quotation.
GAO recommended that CMS reopen the competition for vendors that participate in phase I or eliminate Omni from the competition.
Softrams is represented by Amy L. O’Sullivan and Zachary H. Schroeder of Crowell & Moring LLP. Chags is represented by David B. Dixon, Robert C. Starling, and Toghrul M. Shukurlu of PIllsbury Winthrop Shaw Pittman LLP. The intervenor, Omni, is represented by Elizabeth Jochm and Oliver E. Jury of Blank Rome. The agency is represented by Martin McEnrue of the Department of Health and Human Services. GAO attorneys Heather Self and Peter H. Tran participated in the preparation of the decision.
