Protest alleging that awardee failed to comply with solicitation’s terms is sustained. In response to offerors’ questions, the agency proclaimed the incumbent contractor should not have a price advantage and thus required the incumbent to include all transition costs in its proposal. The incumbent did not include all transition costs, but the agency selected the incumbent for award anyway. The agency attempted to justify its decision by arguing that its response to the offeror question was unreasonable; it should not have incorporated incumbent-specific criteria into the solicitation. But GAO held the agency to the terms of the solicitation. Having decided to equalize competition, the agency was required to assess the incumbent against the stated requirements.
The Centers for Medicare & Medicaid Services issued a solicitation to holders of the agency’s Strategic Partner Acquisition Readiness IDIQ contract. The solicitation contemplated award of a task order for information technology services to modernize CMS’s federally facilitated exchange.
Before the proposal deadline, CMS responded to offeror questions. One offeror was concerned about the advantage the incumbent contractor would have under a transition CLIN. The offeror asked whether CMS would remove the transition CLIN so the price evaluation would not unfairly advantage the incumbent. In response, CMS agreed that the incumbent “should not be advantaged.” To mitigate this advantage, CMS stated that the incumbent, like the other offerors, would be required to proposal transition costs for all PWS tasks.
CMS received proposals from the incumbent, Accenture Federal Services, and Deloitte Consulting. CMS twice awarded the contract to Deloitte. Each time, however, Accenture protested, and the agency took corrective action. Following the second corrective action, CMS awarded the contract to Accenture, finding that the its slightly superior technical proposal outweighed, Deloitte’s small price advantage. Deloitte protested.
Deloitte argued that Accenture failed comply with solicitation requirements regarding the transition period. In response to an offeror question, CMS had stated that the incumbent would be required to propose all transition costs. Accenture’s proposal did not include all the required transition costs. Thus, Deloitte contended, Accenture’s proposal should have been found technically unacceptable.
CMS attempted to argue the its response regarding transition costs was ambiguous. GAO quickly dispatched this argument. CMS sought questions from offerors and incorporated its responses into the solicitation. The agency was no obliged to eliminate an incumbent, but that was clearly what it tried to do in response to the offeror questions. Indeed, the agency’s response stated “the incumbent should not be advantaged.” It was difficult for GAO to imagine how the agency could have more clearly stated its intent. Stated simply, there was no ambiguity.
CMA tried to back away from it response, contending that its answer to the offeror question was unreasonable because incumbent-specific criteria are improper. GAO, however, reasoned that it was clearly permissible for CMS to level the playing field to ensure that it obtained competition.
CMS alleged that Deloitte’s protest was untimely because the company should have raised this issue during the prior protests. GAO found this argument unavailing. Deloitte had been the awardee in the prior protests. There was no reason for Deloitte to challenge the acceptability of Accenture’s proposal in the previous protests.
GAO concluded that Deloitte had been prejudiced by the agency’s acceptance of Accenture’s incomplete proposal. Had Accenture complied with the solicitation and included transition costs, it would have increased Accenture’s price and likely resulted in a different best-value tradeoff.
Deloitte also argued that the CMS erred in improperly crediting Accenture with the experience of a corporate parent when there was no indication that parent would perform a meaningful role on the task order. GAO noted that an agency may properly attribute the experience of an affiliated company to an offeror when the proposal demonstrates that the resources of the affiliate will affect contract performance. Here, Accenture’s proposal contained multiple references to its intended reliance on the parent company. GAO found no merit to Deloitte’s argument.
Deloitte also asserted that the cost realism evaluation of Accenture’s labor rates was unreasonable because CMS improperly relied on historical rather than current payroll data. GAO rejected this argument, reasoning that the solicitation permitted offerors to submit a broad range of cost information.
Deloitte is represented by Keith R. Szeliga, Katie A. Calogero, and Adam A. Bartolanzo of Sheppard Mullin Richter & Hampton LLP. The intervenor, Accenture, is represented by Amy L. O’Sullivan, Anuj Vohra, Olivia L. Lunch, William B. O’Reilly, and Zachary H. Schroeder of Crowell & Moring LLP. The agency is represented by Erin V. Podolny, Karyne C. Achtar, Douglas Korneich, and Krystal Jordan of the Department of Health and Human Services. GAO attorneys Glenn G. Wolcott and Christina Sklarew participated in the preparation of the decision.
