At the request of the Court of Federal Claims, GAO issued an advisory opinion on a protest that had been dismissed after related protests were filed with the court. GAO opined that it had no basis to object to the agency’s actions. GAO found that the agency’s evaluation of offerors’ Labor Staffing Models was reasonable because the protester’s challenge to the evaluation was based on a flawed understanding of the data required for the models. The cost realism analysis was also reasonable even though the agency did not adjust offerors proposed costs. The agency did not need to adjust costs when all its costs-related concerns were resolved during discussions. Additionally, the protester’s satisfactory past performance rating was appropriate where the protester had a history of safety-related problems.
The Army issued an RFP seeking global logistical support for its various Geographical Combatant Commands (GCC)—e.g., Northern Command, Central Command, Pacific Command, etc. The Army planned to award multiple IDIQ contracts. In addition to the IDIQs, the RFP contemplated the award of task orders for each of the GCC’s plus Afghanistan. Awardees of the IDIQ would receive one or more task orders for each GCC.
The Army received six proposals. It awarded four IDIQ contracts to (1) Kellogg Brown & Root Services, Inc. (KBR), (2) Vectrus Systems Corporation, (3) Fluor Intercontinental, Inc., and (4) PAE-Parsons Global Logistics Services, LLC. The Army also issued seven task order to one of more of these awardees. AECOM Management Services, which did not receive an IDIQ, filed a protest with GAO, challenging the awards. But after another disappointed bidder protested the awards with the COFC, GAO dismissed AECOM’s protest. The COFC, however, asked GAO to issue an advisory opinion on its views concerning AECOM’s protest.
AECOM alleged that the Army had misevaluated some of the awardee’s proposed Labor Staffing Models (LSM). The LSMs were mechanisms designed to predict and track the costs associated with contract performance. AECOM alleged that some of the awardees’ LSMs did not have all the possible labor categories, labor types, job titles, and staffing mix formulae for calculating estimated labor hours.
But GAO reasoned that this argument was based on a faulty premise—namely, that the LSMs had to be pre-populated with the entire universe of all possible inputs from the performance work statement. The RFP, however, required that LSMs merely be “consistent, scalable, and adjustable.” Thus, the base LSMs could use varying—as opposed to all—data inputs depending on the particular requirements being procured. Put differently, the LSM was essentially a generator for more specific labor staffing approaches. As a result, contrary to AECOM’s contentions, the LSMs were not supposed to include all possible inputs.
Moreover, GAO did not see how AECOM had been prejudiced by the awardees not using all the available inputs in their LSMs. AECOM had not shown how not including all the inputs gave the awardees a competitive advantage.
AECOM also contended that the Army’s cost realism analysis was flawed. AECOM reasoned that there was a wide disparity among the offerors’ proposed costs, so the Army should have made cost adjustments to some of the proposals.
GAO noted that the RFP gave offerors wide latitude in choosing the data they would use for the LSMs. Because firms were permitted to use their own business judgment in deciding what data to include, it made sense that there would be a wide range of costs.
What’s more, GAO continued, the Army actually identified problems with the offerors’ costs proposals. Nevertheless, as a result of extensive discussions, the Army’s cost-related concerns were resolved. Offerors had either increased their proposed costs, changed their estimating methodologies, or provided additional supporting data.
GAO concluded that AECOM essentially wanted to adjust costs simply because the offerors proposed different technical approaches and costs. But any such cost adjustment, in the absence of deficiencies or weaknesses in offerors’ technical proposals, would have amounted to the agency making improper changes to technical proposals.
AECOM asserted other, more specific challenges to the cost realism analysis, but GAO summarily disposed of them. For instance, AECOM contended that KBR’s costs proposal included an incorrect formula. But if KBR had used the allegedly correct formula, it would have lowered KBR’s price and actually improved its competitive position. AECOM could not have been prejudiced by this error.
AECOM asserted that Fluor and PAE-Parsons used inconsistent multipliers for their LSM. But these alleged errors related to tasks orders that these companies did not receive.
AECOM further alleged that Vectrus had proposed incorrect personnel at a certain location. But even if this was an error, AECOM’s price was $500 million higher than Vectrus’s. Even if Vectrus had proposed the correct personnel, it would not have bridged that $500 million gap in prices.
Next, AECOM alleged that the Army flubbed the past performance evaluation by finding that AECOM had a trend of safety-related concerns in its past contracts. AECOM contended that information in its proposal demonstrated that these concerns were exaggerated.
GAO did not find this compelling. It noted that AECOM actually had several incidents of safety-related issues in its past contracts. AECOM did not dispute the accuracy of these incidents. While it was possible that AECOM could have demonstrated a better safety record with carefully-curated data points, the agency had not erred in assigning AECOM a satisfactory past performance rating.
AECOM further alleged that the Army disparately evaluated past performance because it was penalized for receiving non-conformance reports while Vectrus was not similarly penalized. But GAO found that there was a qualitative difference between the firms’ non-conformance reports. AECOMs’ non-conformance reports involved significant safety issues; Vectrus’s did not.
AECOM also challenged the technical evaluation, complaining that in an early evaluation, the Army did not assign strengths to offerors but then assigned strengths in the final evaluation even though those portions of the proposals had not been significantly revised. But GAO found that the change in ratings simply reflected the evaluators’ careful reconsideration of their earlier findings.
Finally, AECOM asserted that the Army failed to evaluate whether proposed costs/prices were unbalanced. But GAO noted that AECOM proposed the highest prices for four of the six GCC’s. To the extent that any firm benefited from unbalanced prices, it was AECOM. AECOM could not have been prejudiced by any purported failure to evaluate for unbalanced pricing.
AECOM is represented by Jeffery M. Chiow, Neil H. O’Donnell, Lucas T. Hanback, Emily A. Wieser, and Cassidy Kim of Rogers Joseph O’Donnell, PC. Intervenor KBR is represented by Lee P. Curtis, Seth H. Locke, David E. Fletcher, Eric A. Aaserud, Alexander O. Canizares, Julia M. Fox, and Brenna D. Duncan of Perkins Coie, LLP. Intervenor Vectrus is represented by Kevin P. Mullen, J. Alex Ward, James A. Tucker, Sandeep N. Nandivada, R. Locke Bell, Lauren J. Horneffer, and Caitlin A. Crujido of Morrison & Foerster LLP. Intervenor Fluor is represented by Andrew Shipley, Stephen W. Preston, Philip E. Beshara, Souvik Saha, Matthew F. Ferraro, Elizabeth J. D’Aunno, and Chanda L. Brown of Wilmer Cutler Pickering Hale and Dorr, LLP. Intervenor PAE-Parsons is represented by Anuj Vohra, Christian N. Curran, Olivia L. Lynch, Zachary H. Schroeder, and Lauren H. Williams of Crowell & Moring LLP. The agency is represented by Scott A. Johnson, Alex M. Cahill, and Matthew R. Wilson of the U.S. Army. GAO attorneys Scott H. Riback, Evan D. Wesser, Edward Goldstein, and Tania Calhoun participated in the preparation of this advisory opinion.
