On April 26, 2021 the Government Accountability Office (GAO) issued a decision in the matter of Innovate Now, LLC. B-419546, Apr, 26, 2021 sustaining a pre-award protest challenging the solicitation terms of a cost-plus-fixed-fee type task order. Specifically, GAO sustained the protest on two grounds finding:

  1. the Air Force’s requirement that protégé members of a mentor-protégé joint venture have the same experience level as other offerors violates an express prohibition contained in the Small Business Administration (SBA) regulation; and
  2. the Air Force’s requirement that offerors demonstrate the staffing used on a prior contract at “a single point in time” is ambiguous when the solicitation fails to define the “single point in time” requirement.

The protester also argued that the Air Force’s requirement for each joint venture member to submit at least one work sample that has been performed on a cost-reimbursement basis was unduly restrictive. The GAO dismissed this argument as premature.

The solicitation

The task order was issued under the General Services Administration’s One Acquisition Solution for Integrated Services small business multiple award indefinite-delivery, indefinite-quantity contract program. The GAO had jurisdiction because the estimated value of the task order was over $50 million dollars. The solicitation contemplated the issuance of a cost-plus-fixed-fee type task order with a one-year base period and four one-year option periods. Uniquely, the solicitation provided that the Air Force would make award to the highest two technically capable offerors with realistic, balanced, and reasonable pricing.

Protégé-specific solicitation requirements

The protester first challenged the solicitation provision requiring protégés of joint venture offerors to submit at least one work sample that meets the following requirements:

  1. The work sample must have been a contract (or task order) performed for the federal government;
  2. The work sample must have been performed by the entity as a prime contractor;
  3. The work sample must have been performed on a non-fixed price basis;
  4. The work sample must have been performed for at least six months within the last five years; and
  5. The most recent past performance or contractor performance assessment reporting system report for the work sample must reflect a satisfactory or above rating in the categories of quality, schedule, cost control, and management.

Specifically, the protester argued that requiring protégé firms to meet the same experience requirements as all other offerors violates the applicable SBA regulations. The SBA regulations provide for the establishment of joint ventures between a mentor firm (which can be either a small or large business) and a small business protégé firm. See 13 C.F.R. § 125.9. Such a joint venture would assist the protégé firm with successfully competing for a federal contract. Id. The SBA regulations explicitly state that “[a] procuring activity may not require the protégé firm to individually meet the same evaluation or responsibility criteria as that required of other offerors generally.” 13 C.F.R. § 125.8(e) (emphasis added).

Pursuant to this regulation, to SBA’s comments on the regulation, and to the SBA’s comments on the solicitation at issue; the GAO found that the solicitation violated an express prohibition in the SBA regulation, and sustained this protest ground accordingly. The GAO recommended that the Air Force revise the solicitation criteria relating to protégé member experience.

The “single point in time” requirement

The protester also challenged the solicitation’s requirements for offerors to demonstrate staffing (“position count”) used on a prior contract at “a single point in time.” Specifically, the protester argued that the solicitation was ambiguous because it did not define what constituted “a single point in time,” thereby preventing offerors from competing intelligently and on a relatively equal and common basis. The protester argued that based on this ambiguity, offerors might reach different conclusion about what the Air Force was ultimately seeking. Further, the protester contended that there was no underlying rationale for including this requirement in the solicitation.

The GAO agreed, finding that the Air Force’s solicitation was ambiguous because the phrase “a single point in time” was not defined in the RFP in a manner that demonstrates the interval of time intended. The GAO also noted that, in its agency report, the Air Force offered differing rationales for the “single point in time” requirement, but that upon a thorough review of the record, the Air Force’s rationales did not withstand logical scrutiny. In sustaining this protest ground, the GAO recommended that the Air Force revise its solicitation by clarifying the phrase “single point in time” to ensure that all offerors have a common understanding of its meaning.

Takeaways

This GAO decision is an important reminder that companies participating in source selections have a powerful tool in the ability to protest ambiguous solicitation terms and solicitation terms that contradict statutory and regulatory requirements. In this case, the GAO relied on the plain language of the applicable SBA regulation and a plain reading of the solicitation’s terms to determine that the protestor’s claims had merit. The GAO confirmed that an agency’s solicitation must be drafted in a way that permits offerors to compete intelligently and on a relatively equal and common basis, and must not contain provisions that violate law or statute. Offerors responding to solicitations that do not meet these criteria should avail themselves of the protest process to ensure that their evaluation will be fair and in accordance with applicable procurement regulations.