Protest challenging the agency’s past performance evaluation is denied, where the agency reasonably credited the protester with only a portion of the performance on a contract for which it was a minority joint venture member and reasonably ignored adverse past performance information about the awardee which occurred prior to the cut-off date for consideration. GAO denied protest grounds challenging the technical evaluation under the management approach factor, where the protester’s final proposal revision did not address all the agency’s concerns about its proposed compensation and benefits. Finally, GAO denied a protest challenging the agency’s discussions, finding that the agency was not obligated to raise any issues with the protester’s past performance or price, because evaluators did not consider its price too high, nor identify any significant weaknesses, deficiencies, or adverse past performance information.
Gonzales Consulting Service Inc. protested the Department of Homeland Security Federal Protective Service’s award a contract for dispatch and alarm monitoring services to Triple Canopy Inc., challenging the technical and past performance evaluation and the agency’s discussions.
First, Gonzales argued that it should have been rated as highly acceptable under the past performance factor because it has been performing the requirements since 2008, either as a prime contractor or joint venture member, and the agency failed to properly credit Gonzales for its performance as an incumbent. Gonzales also argued that Triple Canopy had no relevant experience performing the requirements and had very public adverse past performance that the agency failed to consider, and thus should not have received an acceptable rating.
In its proposal, Gonzales identified three task orders performed by incumbent RDG/GCS Joint Venture III, of which Gonzales is a joint venture member. The agency concluded that although this experience and past performance was most similar and relevant to the current requirement, Gonzales’ role as a joint venture member was limited to 49 percent of the labor portions of the contract and RDG, not Gonzales, had primary contractual and operational responsibility for contract performance. Thus, while the agency acknowledged that the feedback provided in the past performance questionnaires and CPARS reports was largely positive, Gonzales’ limited role in performance diluted the relevance of its past performance record.
Further, the contracting officer and source selection authority for this procurement were responsible for administering the incumbent contract performed by RDG/GCS, and were both aware that Gonzales is the mentor in the mentor-protégé arrangement between the joint venture members. Given the evaluation record and the agency’s familiarity with Gonzales’ performance on the incumbent contract, GAO found the evaluation reasonable.
In its proposal, Triple Canopy provided (1) a contract with the Department of Energy performed by a joint venture in which Triple Canopy was a majority partner with 70 percent ownership of the joint venture; (2) a contract with FPS in which Triple Canopy served as the prime contractor; and (3) a contract, also with DOE, performed by Triple Canopy’s affiliate, Centerra Group LLC.
In its initial evaluation, the agency questioned the relevance of some of the past performance, and did not consider the third contract because there was no evidence in the proposal that Centerra would have any meaningful involvement in performance. The agency rated Triple Canopy as acceptable because, for the two projects considered, Triple Canopy had received mostly very good ratings and positive comments, and demonstrated experience that in the aggregate was similar to or greater in magnitude than the requirements of the procurement. GAO found this reasonable. GAO also found the agency reasonably declined to consider the adverse past performance information cited by Gonzales, as it had occurred before the three-year cut-off stated in the RFP.
Next, Gonzales challenged the evaluation under the management approach factor, arguing that the agency failed to consider that Triple Canopy’s proposal to reduce salaries would significantly and adversely affect performance because it would decrease employee retention and make it difficult to recruit experienced personnel. Gonzales also argued that the agency evaluated proposals disparately in this area.
In response, the agency argued that Gonzales appeared to argue that offerors were required to propose a tiered pay structure as had been required under the prior procurement. The agency noted, however, that this requirement was removed from the RFP.
During the evaluation, the agency concluded that Gonzales’ proposal lacked enough information to support its tiered approach to staffing and pay, including details about specific pay levels and how staff would be rewarded and promoted. In each of the three rounds of discussions, the agency requested additional detail regarding Gonzales’ four-tiered pay structure. Gonzales incorporated some of its responses to the agency’s discussions questions into its final proposal revision.
In its evaluation of Gonzales’ final proposal revision, the agency concluded that the additional information had increased its understanding of and improved Gonzales’ proposal. However, the agency concluded that some of the additional benefits were already required by the wage determination, and others that exceeded the wage determination requirements would not serve to retain employees. The agency also concluded that nothing in Gonzales’ management approach, which was to be incorporated into the contract upon award, obligated Gonzales to pay its level 2 through 4 alarm monitors the “estimated costs” included in its price proposal, and that Gonzales had otherwise not fully responded to the discussion questions. GAO found this reasonable.
Regarding its allegation of disparate treatment, Gonzales argued that the agency gave Triple Canopy the benefit of the doubt that it would pay discretionary bonuses, while it assumed that Gonzales would decline to pay discretionary amounts and receive a windfall. Gonzales also argued that the agency did not identify as a risk to morale that Triple Canopy employees would receive different bonuses, as it did with Gonzales’ tiered pay structure.
GAO found that Triple Canopy proposed both monetary and nonmonetary retention techniques, as well as a series of performance recognition bonuses and work life balance incentives. The agency recognized the benefits and limitations of the proposed Triple Canopy recruitment and retention plan and concluded that overall it presented a strength in the proposal because it would enhance the company’s ability to recruit and retain qualified employees. GAO found this conclusion reasonable.
Further, GAO Triple Canopy’s highly acceptable rating was based largely on the strength of other aspects of its management approach, not its recruitment and retention economic bonus plan. Overall, GAO concluded that the different evaluation outcomes were attributable to differences in the offerors’ proposals, not to agency error.
Finally, Gonzales argued that the agency’s discussions were inadequate and unequal. For example, Gonzales argued that the agency failed to discuss its role as a joint venture partner on the incumbent contract, yet provided Triple Canopy the opportunity to explain the relevance of its past performance as a joint venture member and the past performance of an affiliate. Gonzales also argued that the agency advised Triple Canopy that its price was too high, yet failed to raise the issue with Gonzales, whose price was higher than Triple Canopy’s price.
First, GAO noted that the agency rated Gonzales’ past performance acceptable, without any significant weaknesses, deficiencies, or adverse information. Therefore, the contracting officer was not obligated to raise any issues with past performance during discussions. In contrast, the agency had questions about the role, if any, Centerra Group would play in performance, given that Triple Canopy had submitted a past performance reference for a contract performed by Centerra. In addition, in its second round of discussions, the agency questioned what aspects of performance were attributable to Triple Canopy in its role as a 70 percent majority joint venture partner. While the information provided by Triple Canopy improved the agency’s understanding, it did not result in a change to the rating. Accordingly, GAO found no evidence of disparate treatment during discussions.
GAO also found the agency did not advise Triple Canopy that its overall price was too high. Rather, the agency identified three positions not subject to the wage determination for which it believed Triple Canopy’s proposed labor rates were “unusually high when compared to the function they are expected to perform. The agency addressed this during discussions. Because the agency did not have similar concerns in relation to Gonzales’ price, nor conclude that the protester’s price was too high, the agency was not required to raise these issues during discussions.
Gonzales Consulting Services Inc. is represented by Joseph G. Martinez III, Mark J. Meagher, and Gale R. Monahan of Dentons US LLP. Triple Canopy Inc. is represented by David S. Cohen, John J. O’Brien, and Daniel J. Strouse of Cordatis LLP. The government is represented by Timothy J. Lorenzi, Department of Homeland Security. GAO attorneys Charmaine A. Stevenson and Laura Eyester participated in the preparation of the decision.
