Awardee Knew Its Key Program Manager was Unavailable But Wrongly Decided to Let It Slide; M.C. Dean, Inc, GAO B-418553, B-418553.2

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Protest alleging that awardee improperly failed to notify the agency about the unavailability of a key person is sustained. When an offeror has actual knowledge that its proposed key personnel will not be available to perform, it is obligated to inform the agency. Here, two months after it submitted its proposal, the awardee learned that its proposed program manager had been denied security clearance required for the contract. GAO found that the awardee had actual knowledge of unavailability and yet it failed to notify the agency. The fact that the program manager had a right to appeal the denial of security clearance did not affect the awardee’s obligation to notify the agency.

The National Security Agency posted a solicitation seeking maintenance and installation services for the agency’s enterprise class physical security system. The solicitation required offerors to propose a key program manager position. The program manager had to have top secret/sensitive compartmented information security clearance.

NSA awarded the contract to PTSI Managed Services, Inc. An unsuccessful offeror, M.C. Dean, Inc. protested. M.C. Dean contended, among other arguments, that PTSI knew its proposed program manager was unavailable prior to award and thus its proposal was unacceptable.

An offeror is generally required to advise an agency when it knows that a key employee has become unavailable after the submission of proposals. An offeror is not obligated to inform the agency, however, if it does not have actual knowledge of the employee’s unavailability. When an agency is notified of the unavailability of a key person it can either (1) evaluate the proposal as submitted (which will likely be rejected as unacceptable), or (2) open discussion to allow an offeror to amend its proposal.

Here, PTSI submitted its final proposal in November 2019, In January 2020, PTSI’s program manager received notice that the NSA had denied him security clearance. GAO reasoned that as a result of the denial, PTSI had actual knowledge that its program manager would be unable to perform. PTSI was therefore obligated to inform NSA of the program manager’s unavailability, which it failed to do.

NSA argued that  that the program manager still had two months in which to appeal his denial. The company asserted that it could not be charged with actual knowledge of unavailability until the program manager had exhausted his appeal rights. GAO rejected this argument, noting that PTSI had merely understood that the program manager would appeal. There was nothing in the records addressing whether or why PTSI believed an appeal would be successful or even that an appeal would be successful before contract award. As a matter for fact, the program manager had never actually appealed the denial.

NSA also contended that the program manager’s unavailability was irrelevant because the manager’s resume was not material to its evaluation. GAO found that NSA was conflating whether a “bait and switch” occurred with the requirement that offerors notify an agency when a key person is unavailable. When an offeror has actual knowledge of unavailability, they are required to notify the agency. That the agency does not find the resume material to the evaluation is beside the point.

M.C. Dean is represented by John R. Prairie, Samantha S. Lee, J. Ryan Frazee, Moshe B. Broder, Sarah B. Hansen, and Adam R. Briscoe of Wiley Rein LLP. The intervenor, PTSI is represented by Richard B. Oliver and J. Matthew Carter of Pillsbury Winthrop Shaw Pittman LLP. The agency is represented by Laura A. Wallace and Kathryn B. Codd of the National Security Agency. GAO attorneys John Sorrenti and Christina Sklarew participated in the preparation of the decision.

GAO - M.C. Dean, Inc.