MATOC – IDIQ – “Best Value” – BRAC
These are the terms that contractors are hearing more and more and they are part of the rapidly changing world of construction contracting with the federal government. It is no longer enough to simply be the low bidder; now, in many federal procurements, it is the “best
On December 1, 2006, amendments to the Federal Rules of Civil Procedure became effective and made something that had already been established by court decisions very clear – that virtually every kind of electronically stored information (“ESI”) is discoverable in litigation. Government construction contractors, and their attorneys, need to be concerned about the preservation and disclosure of electronic information, including e-mail messages, voicemail messages, and any kind of a file stored on a computer. Unfortunately, as the information age makes an exponentially greater volume of information available, the seemingly easy storage of that information may actually be creating a vast minefield for the unwary.
Contractors need to be aware that even computer files that have been intentionally or inadvertently deleted are potentially discoverable. (Simply because data has been “deleted” from a hard drive does not necessarily mean that it cannot be retrieved). Courts may no longer accept the excuse that “the files were erased” if there was an obligation to preserve the data, or if the company failed to have an established ESI retention policy to assure the reasonable retention of electronic information. The new rules provide guidance and clarification on a number of topics related to electronic discovery (e-discovery), including the discoverability of data that is difficult to access, such as back-up tapes, the form in which electronically stored information should be produced, and how to deal with the inadvertent production of privileged information when large amounts of electronic data are produced.
One of the difficulties with the production of electronic data is that it is often harder to review than paper documentation because it involves the examination of large amounts of data stored on CDs, DVDs, floppy disks, hard drives, backup tapes, network servers, Internet backup services, and other storage devices. A company often finds it to be an overwhelming task to gather the data, and an equally daunting and costly task to electronically produce it. Electronic information on a complex matter involving technical data can occupy hundreds or even thousands of CDs (we are currently involved in exactly such a case).
It is important to recognize that the content of electronic information can be very different, and far less formal, than paper documentation. We have noticed that there is often a tendency to be careless when writing an e-mail message because of the informality, as compared to a letter. Contractor personnel are frequently very candid in e-mail messages and they may make off-the-cuff remarks that give the other side “ammunition” to discredit the contractor’s position. In addition, electronic information often contains “metadata” (underlying data that states when a document was created, modified, accessed, etc.). Without realizing it, or intending to do so, an electronic file may provide much more information than the author or the company ever intended, or was required, to preserve and that information may be a goldmine for the other side in litigation.Continue Reading Important New Rules on Electronically Stored Information
As we have mentioned previously, the growing use of multiple award task order contracts in federal construction contracting, as can be seen in much of the disaster recovery work in New Orleans, is limiting the competitive opportunities for small and mid-sized construction contractors. Unless a contractor is the recipient of one of the major task order contract awards, there is no opportunity for a contractor to compete for upcoming individual task orders and the contractor is effectively precluded from competing for potentially millions of dollars of work to be awarded over a period of years. In the past, when there were more single award contracts, if a contractor lost out to a competitor, there was always another solicitation on the horizon. If a contractor fails to become one of those selected to compete under a multiple award task order contract, there may be no, or very little, work “waiting in the wings.”
It follows that it is important to monitor the decisions of the GAO and the courts to see what is being done to protect the rights of contractors, and we will continue to do so. In a newly issued GAO decision, Palmetto GBA, LLC, B-299154, December 19, 2006, the Comptroller General stated that according to the legislative history of the Federal Acquisition Streamlining Act (FASA), task and delivery-order contracts were intended to encourage the use of multiple-award, rather than single-award contracts, in order to promote an ongoing competitive environment in which each awardee would be fairly considered for each order issued. H.R. Conf. Rep. No. 103-712, at 178 (1994), reprinted in 1994 U.S.C.C.A.N. 2607, 2608; S. Rep. No.103258, at 15-16 (1994), reprinted in 1994 U.S.C.C.A.N. 2561, 2575-76. In this regard, the Federal Acquisition Regulation (FAR) requires agencies to provide all awardees “fair opportunity to be considered for each order exceeding $3,000 issued under multiple delivery-order contracts or multiple task-order contracts.” FAR sect. 16.505(b)(1)(i).
An interesting aspect of the Palmetto case is that the GAO reiterated that a task or delivery order that precludes competition for future task or delivery orders for the duration of the contract performance period may constitute a “downselection.” The GAO has recognized downselections in circumstances not only where all work under a contract will be foreclosed from future competition, but also where specific categories of work will be similarly foreclosed for the duration of the contract. While the GAO did not find that “downselection” occurred in the Palmetto case, it is important for contractors to recognize that a task order award that eliminates competition for future work can be successfully protested.
Continue Reading Task Order Contractors Must be Given a Fair Opportunity to Compete for Individual Task Orders
In yet another example of one of my long-standing complaints about the GAO’s interpretation of the “Procurement by Negotiation” process specified in FAR, Part 15, the GAO has reiterated its long-standing policy that “there is generally no obligation that a contracting agency conduct discussions where the RFP specifically instructed offerors of the agency’s intent
A disappointed bidder (on an Invitation for Bids), or an offeror (on a Request for Proposals), has the option to file a protest to the agency, to the General Accountability Office (GAO), or to the United States Court of Federal Claims. It is not always easy to decide where, and whether, to file a protest and contractors need to be aware of the pitfalls. One thing is certain, it is not easy to win a protest and a great deal of deference is given to contracting officers by the GAO and by the Court of Federal Claims. It is incumbent upon a contractor to be certain that the issue raised is not frivolous, and that prior decisions of the courts or the GAO have not already established the correctness of the government’s position.
It has been my experience that if a protest involves agency policy, it is usually a good idea to file a protest with the agency to give the Contracting Officer the opportunity to take corrective action. (See FAR 33.103 for the rules on Protests to the Agency). If a protester is dissatisfied with the result of an agency protest, the protester is still permitted to take the protest to the GAO or to the United States Court of Federal Claims. As far as taking a protest directly to the GAO is concerned, unless prior GAO decisions have shown a likelihood that the GAO will agree with your position, a GAO protest is not usually a very satisfying experience. (See FAR 33.104 for the rules on Protests to the GAO, and also see the Bid Protest Regulations issued by the GAO). (Another useful resource is the GAO’s Descriptive Guide on Bid Protests).
The statistics made available by the GAO demonstrate how difficult it is for a protester to win. In the period from 2001 through 2005, 6,543 protests were filed (an average of about 1,300 protests per year). See the 2005 GAO report to Congress. Of these, only 1,528 resulted in a decision and in 303 of the decided cases the protester’s position was sustained. The way the GAO sees it, this means that protesters experience a 20% success rate. Of course, 20% is not very encouraging and, in reality, the way that the GAO calculates the percentage of sustained protests is misleading. By simply comparing the number of “sustains” to the number of decided cases during the period, the GAO ignores the 5,000 cases that were not decided for one reason or another. Some of those cases were probably dismissed summarily by the GAO, others were withdrawn only to be re-filed in the Court of Claims, and some of the protesters may have simply “thrown in the towel” as a result of frustration with the process. In any event, if you compare the number of “sustains” to the number of cases filed (303 out of 6,543), the protester prevailed in less than 5% of the protests. Take your pick, 20% or 5%, neither one is very good. (In 2006, there have been 1,327 protests filed to date, and 72 have been sustained). See the 2006 GAO report to Congress.
Continue Reading Where and Whether to File a Bid Protest
This recent Court of Federal Claims decision involves a USDA contract for the construction of a vegetable laboratory in Charleston, South Carolina. The contractor was terminated for default and the bonding company, Travelers Casualty and Surety of America, took over under the terms of the performance bond.
While there is nothing particularly noteworthy about the Court’s lengthy recitation of the facts, the Court did restate some important rules governing the determination of defective specifications. The Court referred to one of the landmark cases in federal government contracting, Spearin v. U.S., where Justice Brandeis wrote the Supreme Court opinion that established the “Spearin Doctrine’ (a contractor will not be liable to an owner for loss or damage which results solely from insufficiencies or defects in plans and specifications). As the Supreme Court explained:
[I]f the contractor is bound to build according to plans and specifications prepared by the owner, the contractor will not be responsible for the consequences of defects in the plans and specifications. This responsibility of the owner is not overcome by the usual clauses requiring builders to visit the site, to check the plans, and to inform themselves of the requirements of the work . . . . In Spearin, the Supreme Court held that contract provisions “prescribing the character, dimensions and location of” a structure to be constructed “imported a warranty that, if the specifications were complied with, the [structure] would be adequate.”
Continue Reading A Contractor is Not Liable for the Consequences of Defective Specifications
This article describes a GAO decision that highlights how difficult it is to prevail on a protest that challenges an agency’s rating of a proposal where the protest is not supported by anything more than a difference of opinion as to how much weight, or what score, should be assigned to a particular evaluation factor. Absent a showing that there was no rational basis for an agency’s evaluation, contractors should not expect the GAO to overturn an evaluation.
The GAO published a decision today that was originally issued on July 19, 2006, but delayed in being made public because of the need for redactions. The case involved a protest by East-West Industries, Inc. against the award of a contract to Regent Manufacturing, Inc. The solicitation was issued under request for proposals (RFP) No. FA8518-04-R-70801, advertised by the Department of the Air Force for multi-aircraft canopy cranes (MACC). East-West challenged the past performance and risk evaluations of its and Regent’s proposals. The protest was denied.
In its decision, East-West Industries, Inc. , B-297391.2; B-297391.3, the GAO stated that in reviewing a protest of an agency’s proposal evaluation, “our review is confined to determining whether the evaluation was reasonable and consistent with the terms of the solicitation and applicable statutes and regulations.” The GAO found that the evaluation of protester’s proposal under the past performance evaluation factor was unobjectionable where the agency reasonably concluded that only one of four prior contracts was of a magnitude and complexity essentially the same as the solicitation’s, and thus met the solicitation’s definition of very relevant. Since only one contract was rated very relevant and the protester received exceptional performance ratings under only two of its three relevant contracts, the GAO determined that the agency reasonably concluded that East-West’s performance record warranted assigning the firm a very good/significant confidence rating based on there being little doubt–rather than no doubt–as to its successful performance.Continue Reading It is Difficult to Successfully Challenge an Agency's Past Performance and Risk Evaluation
A GAO decision released today, but dated November 15, 2006, reported that Advanced Federal Services Corp. protested the award of a contract to Eastek, Inc. under request for proposals (RFP) No. W9128Z-06-R-0001, issued by the Department of the Army Communications-Electronics Life Cycle Management Command for business administrative support services (BASS). The protester contended that
The GAO published a decision today in the Matter of SunEdison, LLC, B-298583; B-298583.2, dated October 30, 2006, involving SunEdison’s protest of an award to PowerLight Corporation under request for proposals (RFP) No. FA4861-06-R-B501, issued by the Department of the Air Force for the construction and operation of a photovoltaic array to supply solar power to Nellis Air Force Base (AFB) in Nevada. The protester contended that the agency’s evaluation of offerors’ prices was flawed and the GAO sustained the protest.
The protester argued that the agency’s evaluation of the offerors’ prices was flawed in that it failed to take into consideration that PowerLight’s price was offered contingent upon “successful completion of an REC purchase agreement with Nevada Power,” whereas its own price was offered on an unconditional basis. The GAO agreed that the agency’s price evaluation was flawed and found hat PowerLight’s inclusion of a contingency in its pricing rendered the proposal ineligible for award. Where a solicitation requests offers on a fixed-price basis, an offer that is conditional and not firm cannot be considered for award. Omega World Travel, Inc.; Sato/Travel, Inc., B-288861.5 et al., Aug. 21, 2002, 2002 CPD para. 149 at 6. Here, not only did PowerLight make its offer conditional upon successful completion of an REC purchase agreement, but further, it acknowledged the uncertainty of such an agreement being reached.
Government contractors need to keep in mind, when responding to a sealed bid invitation or to a request for proposals, that conditional pricing is an almost certain way to have your bid, or offer, rejected. Of course, this procurement seems to have been yet another of those all too frequent “negotiated” procurements were actual discussions, or negotiations, did not occur. The Contracting Officer simply furnished each of the offerors with “evaluation notices” describing required information that had not been fully addressed in the proposal or that required clarification. Apparently the uncertainty in PowerLight’s proposal was not addressed, and there were no discussions during which additional issues could have been raised. (Unlike sealed bidding, where a bid cannot be revised after bid opening, offers submitted in response to a Request for Proposals can be revised after offers are submitted if the government conducts discussions, or negotiations, and gives the offerors in the competitive range an opportunity to submit best and final offers. The regulations regarding Contracting by Negotiation are found in FAR, Part 15).Continue Reading Protest of Agency’s Flawed Evaluation of Awardee’s Conditional Pricing Sustained by the GAO
The Office of Federal Contract Compliance Programs (OFCCP) has published a Technical Assistance Guide designed to help federal government construction contractors and subcontractors comply with the federal laws and regulations that prohibit government contractors from discriminating in employment, and require that they undertake affirmative action to ensure equal employment opportunity in their workforces. It is intended for government contractors who have construction contracts and/or subcontracts. The obligations of government contractors and subcontractors who hold non-construction contracts differ in significant ways and are covered in a separate guide.
This Guide does not create new legal requirements or change current legal requirements. Instead, it reflects the views of OFCCP and is intended to serve as a basic resource document on OFCCP-administered laws. The legal requirements related to equal employment opportunity that apply to Federal supply and service contractors are contained in the statutes, executive orders, and regulations cited in the Guide. Every effort has been made to insure that the information contained in the Guide is accurate and up to date.Continue Reading Technical Assistance Guide for Federal Construction Contractors