Breakout Session # 801 John Rush, Vice President, TRC Inc Date Monday, April 23 Time 10:45 – 11:45 am

2. Source Selection Under Federal Acquisition Regulations Part 15 Breakout Session # 801 John Rush, Vice President, TRC Inc Date Monday, April 23 Time 10:45 – 11:45 am

3. SOURCE SELECTION Using FAR Part 15 – Contracting by Negotiation AN OVERVIEW & LESSONS LEARNED jrush@acqtrain.com “With every mistake we must surely be learning.” - G. Harrison

4. Presentation Agenda • Overview of FAR Part 15 • Competitive Negotiated Contracts • Discussion of generic source selection process • Section C, Section M, Section L, and the Source Selection Plan • Various Evaluation Processes • Evaluation Factors • Competitive Range and Award Decisions • Debriefings • Common Failures leading to Sustained Protests • Inconsistent Evaluation of Offers • Failure to Conduct Meaningful Discussions • Failure to award consistent with section M of RFP • Avoiding the sustained protest • Conclusion and Q & A

5. What do we mean “trade-off” process (Best Value) • Factors other than price play a significant role in the execution of the contract. • Tradeoffs among cost factors and non-cost factors can be made in the source selection • The Government is allowed to accept other than the lowest priced proposal. • Perceived benefits to government must merit additional costs. (FAR 15.101-1)

6. Trade-off Process – FAR 15.101-1 • Best Value tradeoffs • All evaluation factors and sub-factors and their relative importance shall be clearly stated in the RFP • RFP shall include a clear indication of the relative weight of non-cost factors/sub-factors to cost factors • Tradeoffs and benefits to Government must be documented and consistent with RFP

7. Competitive Negotiated Acquisition Process Determine Acquisition Strategy Define Requirement Develop Acquisition Plan Evaluate Offers, Clarification Issues, Past Performance, Brief SSA Issue RFP/draft RFP Develop RFP &SSP Establish Competitive Range Conduct Meaningful discussions with all in Competitive Range Award w/o discuss Debrief Offerors

8. Competitive NegotiatedAcquisitionProcess Request Final Revised Proposals Evaluate FRP in accordance with RFP and SSP, Further Communications & Discussions. Brief SSA of Strengths & Weakness of Offers in Competitive Range Debrief Offerors Award Best Value Contract SSA selects Best Value offer

9. Source Selection Organization Source Selection Authority Source Selection Advisory Council Source Selection Evaluation Board Price/Cost Analysis Past Performance Evaluation Business Management Evaluation Technical Evaluation

10. Source Selection Authority Responsibilities • Establish an evaluation team tailored for the instant acquisition • Approve source selection plan before RFP release • Ensure consistency between RFP, SSP, and evaluation • Ensure evaluation only as stated in RFP • Consider recommendations of SSAC • Independently select the source(s) whose proposal is the best value to the government

11. Adequate SSD Documentation • SSAs have broad discretion in determining how they will make use of evaluation findings • Tradeoffs and the extent of how the tradeoffs are made are governed only by rationality and the established evaluation criteria

12. Adequate SSD Documentation • The propriety of tradeoffs will depend not on the difference in technical scores, but on whether the SSA’s judgment concerning the significance of the difference between proposals is reasonable and adequately justified when compared to the evaluation scheme stated in the RFP

13. If this process is so simple, why do contractors continue to protest government’s “best value” trade-off award decisions?

14. Bid Protests Statistics for FY 2004-2006

15. Bid Protests Statistics for FY 2001-2003

16. Common Reasons for GAO Sustaining Protests • Agency performs inconsistent evaluations • Agency fails to conduct meaningful discussions • Inconsistent or inadequate documentation of source selection decision

17. Common Reasons for GAO Sustaining Protests • Unreasonable evaluation of offeror’s past performance • Unreasonable cost/price analysis, including cost realism analysis • Inadequate documentation of evaluation findings

18. Inconsistent Evaluations • The evaluation must be sufficiently documented to demonstrate a rational relationship to the announced evaluation factors • Government must demonstrate that evaluations and decisions based on those evaluations are logical and consistent with the RFP

19. Inconsistent Evaluations • An offer that does not meet the minimum requirements can not serve as the basis for a contract • All offerors must be treated fairly, not necessarily treated equally • Among many see • Universal Yacht Services B-287071, B-287071.2 April 4, 2001 • Wiltex Inc B297234.2; B-297234.3 December 27, 2005

20. Universal Yacht Services B-287071, B-287071.2 April 4, 2001 • RFP for fixed price task order to provide Personal Transfer Vessel • Evaluation factors: price, technical characteristics of vessel, past performance • A performance requirement of the vessel: maintain 9 kts of speed in moderate weather at 80% of rated horsepower

21. Universal Yacht Services • Petchem was the incumbent and offered to use the same vessel • Petchem’s price offer was slightly higher than UYS’ • Petchem had outstanding past performance while UYS was a relatively new company with little past performance

22. Universal Yacht Services • UYS’s vessel hadn’t been used since 1996, but met all of the vessel characteristic requirements • Contracting Officer had concerns that vessel might need a ‘break-in’ period • SSA’s decision: award to Petchem based upon Petchem’s score in non-cost factors

23. Universal Yacht Service • Problem: • Petchem’s offer stated the vessel could maintain 9 kts of speed in moderate weather • Omitted was the requirement to maintain the speed at 80% of rated horsepower • Agency stated that Petchem’s vessel had proven it was capable of performing, and that the 80% requirement was a minor issue when everything is considered

24. Universal Yacht Services • GAO’s view: • a requirement is a requirement • Petchem’s vessel did not meet the requirements of the RFP and therefore cannot serve as the basis for award • This agency had to back up and do it again, as well as paying UYS’s legal costs

25. “Meaningful Discussions” • Contracting Officers shall discuss • significant weaknesses • Deficiencies • Adverse past performance • any other aspect of the offeror’s proposal that the Contracting Officer believes can be revised to enhance the proposal’s potential for award (FAR 15.306) • Among many see • TDS Inc. B-292674 November 12, 2003 • Checchi and Company B-28577 October 10 2000 • Multimax, Inc.; NCI Information Systems, Inc.; BAE Systems Information Technology LLC; Northrop Grumman Information Technology, Inc.; Pragmatics, Inc., October 24, 2006

26. TDS Inc. B-292674 November 12, 2003 • Solicitation for help desk operations and IT system administration and engineering • Three offerors • Oral presentations • Offerors invited to revise offers based on issues raised during oral presentations • The evaluation of offers led to a long list of TDS weaknesses • None of which were raised during oral presentations • Award made on initial offers

27. TDS Inc. • TDS argued • Agency had an obligation to conduct meaningful discussions but failed to do so • None of the noted weaknesses were identified to TDS • Agency entered discussions by allowing offerors to revise offers after oral presentation • Agency argued • Conducted oral presentations properly • Did not open discussions • No obligation to conduct meaningful discussions

28. TDS Inc. • GAO found in oral proposals • FAR anticipates “dialogue among parties” • Nothing wrong with agency personnel expressing their opinions • When agency personnel begin asking questions rather than listening discussions may take place • Acid Test: has the agency provided an opportunity for offers to be revised • Reopen the acquisition, engage in meaningful discussions, request new FPR and re-evaluate for new decision

29. Inconsistent Undocumented Evaluations • Evaluations of price and any other evaluation factor must be meaningful • The documented record must show that the agency acted reasonably and consistently with the stated evaluation factors and applicable statutes and regulations • Source Selection decisions are required to be documented • See • Satellite Services B-286508/ .2, January 18, 2001 • York Building Services, B296948.2/ .3/ .4 November 3, 2005

30. Satellite Services, Inc.B-286508, B-286508.2 January 18,2001 • RFP for Fixed price and IDIQ facilities support services • Evaluation Factors: • Price and four technical factors • Past performance • Experience • Methods and procedures • Corporate resources & management) • Methods & procedures had 8 sub factors • including Rationale to support proposed FTEs

31. Satellite Services, Inc. • RFP stated: • Tech proposals will be evaluated to ensure the offeror understands the requirements • Three offerors submitted offers with dramatically different staffing levels • Resulted in dramatically differing price proposals

32. Satellite Services, Inc • The record shows that the PET evaluated the proposals only to ensure the accuracy of the offerors’ calculations and spreadsheets • PET did not address whether or not the offerors proposed an appropriate number of FTEs • PET report stated it did not have an accurate or complete government estimate to determine reasonableness

33. Satellite Services, Inc. • The SSA asked an evaluator on the TET to assess whether or not Satellites’ higher rated technical proposal warranted their higher price • The evaluator’s assessment claimed to perform an ‘in-depth’ analysis but provided file contained no details • Evaluator concluded incumbent Satellite was too high • When asked how the analysis was performed the TET chair stated that they had no guidelines and used his experience with the current contract

34. Satellite Services, Inc. • For the recommended offeror (NVT) the TET used a different standard, the Navy EPS manual • The record contained no documentation of the Government’s assessment of the offeror’s proposed methods of accomplishing the work • In addition, the SSA appears to have relied solely upon the recommendation of the TET in awarding to NVT • Source Selection Decision: “TET provided a Best Value/Trade –OFF review and determined Satellite Services…”

35. Satellite Services, Inc. • GAO sustained Satellites’ protest: documentation did not demonstrate the evaluation was reasonable or consistent with the RFP and, • The SSA must reach an independent decision after making a comparative analysis of the proposals, and that didn’t happen here.

36. Suggestions for Survival of Acquisition Process • If you fail to plan, then you plan to fail • Develop Acquisition Plan • Address significant issues and considerations that may influence the acquisition • Risk management is part of source selection • Business, management, technical, supply chain, logistics, and any other risks identified and addressed in plan • Overview of source selection evaluation strategy is included in Acquisition Plan

37. Suggestions for Survival of Acquisition Process • Don’t “boilerplate” evaluation factors and sub factors • They should be tailored for the current state of nature • Develop Source Selection Plan, Section M, Section L as SOW is defined • Resource the Evaluation Team adequately • Right people with the right experience and the right skills • Train the Evaluation Team • Team training • Close to evaluation time frame

38. Suggestions for Survival of Acquisition Process • In discussions: • Identify strengths, weaknesses, and deficiencies • Give the offerors the truth and they’ll give you what you want • Document the record to demonstrate your logical, reasonable, and consistent findings and decisions • BE CONSISTENT WITH THE RFP • You don’t have to treat all offerors the same, but you do have to treat all offerors fairly

39. Questions Answers

40. Back-up Slides

41. Summary of Acquisition Process • Define the requirements • Market research • Funding • Draft SOO, SOW, PWS, or Specification • Determine Acquisition Strategy • Continued market research • How will we satisfy customer’s requirement? • Continued refinement of requirement

42. Summary of Acquisition Process • Develop Acquisition Plan • Addresses all significant issues and considerations that may influence the acquisition • Business, management, technical, logistics, and any other risks identified and addressed in plan • Overview of source selection evaluation strategy is included in AP

43. Summary of Acquisition Process • Develop RFP and SSP • RFP establishes terms and conditions of contract, work requirements, instructions to offerors, and the basis for award. • RFP often issued to industry in draft form soliciting comments prior to formal issuance • SSP developed concurrently with RFP • SSP establishes Government’s plan for evaluating proposals

44. Summary of Acquisition Process • Develop RFP & SSP • SSP contains who, what, where, when, and how of evaluation process • SSP and RFP both contain evaluation factors, sub-factors, and relative order of importance of factors and sub-factors • SSP and RFP must be consistent • SSP must be approved by SSA prior to formal issuance of RFP

45. Summary of Acquisition Process • Formal Issuance of RFP • Consistent with Acquisition Plan • Serves as the basis for offerors’ proposals • Must provide adequate time for offerors to prepare proposal • Common cut-off date for all offerors • Government personnel enter “period of silence.” All communication conducted by Contracting Officer

46. Summary of Acquisition Process • Evaluate offers iaw RFP & SSP • SEB must evaluate all offers completely and consistently with RFP and SSP only • Each proposal is evaluated on its merits against the evaluation factors • Only SSAC or SSA make comparative evaluations • Strengths, weaknesses, and deficiencies are documented for each proposal by SEB

47. Summary of Acquisition Process • Award without discussions • Generally Govt’s preference is to award w/o discussion • Cannot award contract to offeror with deficiencies in proposal • As long as there is 1 offer that meets requirements and the offeror has acceptable past performance, Govt can award

48. Summary of Acquisition Process • Establish Competitive Range • Contracting Officer establishes competitive range • Comprised of all of the most highly rated proposals, unless the range is further reduced for purposes of efficiency • Notify eliminated offerors • Conduct timely requested pre-award debriefs

49. Conduct Meaningful Discussions • The intent of discussions is to allow the offeror to revise its proposal • Discussions are tailored for each offeror • Conducted by the Contracting Officer with each offeror in the competitive range • The government’s objective is to maximize the ability to obtain “best value” in terms of the requirement and evaluation factors

50. Summary of Acquisition Process • Request Final Revised Proposals • Notification that discussions are concluded and FRP shall be in writing • All offerors in competitive range may revise offeror as the result of discussions • Notification that Government intends to award without further revisions • Common cutoff date