Past Performance

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Every government contractor that begins performance on a new engagement has the same basic goal – superior performance that bolsters the company’s bottom line and garners excellent past performance ratings from the agency.

But, when the contract ends, will your company’s status as a successful incumbent contractor increase the odds of winning future follow-on work from the agency?  While it never hurts to have exemplary past performance, GAO recently cautioned that nothing is guaranteed.

The protest in question (filed by the incumbent contractor) challenged the agency’s best value award decision on a contract to provide security services at a nuclear facility.  Specifically, the contractor argued that the agency’s evaluation of its technical proposal and staffing approach were unreasonable (and, in fact, “inconceivable”).

The agency rated these factors as merely “Good.”  However, based on its past performance as the incumbent, the contractor maintained it deserved “Excellent” ratings.  GAO disagreed, holding that the contractor’s protest lacked merit and was based on a selective reading of the RFP and the agency’s evaluation record.

GAO’s decision provides incumbent contractors with a clear path forward when approaching a proposal for follow-on work.  In a nutshell, highlight your outstanding past performance, but don’t rest on your laurels.  The agency will approach evaluations for the new award with a clean slate, and so should your business.

This lesson learned is particularly significant with respect to a best value competition.  As I’ve discussed previously, contractors approaching a best value procurements have to strike a balance between technical superiority and price.  Here, the contractor appears to have hung its hat too much on the technical side (and, even more narrowly, on its past performance as the incumbent) and, as a result, lost out on the contract.

For federal contractors, it is not an exaggeration to say that performance evaluations are the lifeblood of the business.  A less-than-satisfactory evaluation in the Contractor Performance Assessment Reporting System (CPARS) affects far more than just the agency’s assessment of performance on a particular project.  A negative evaluation follows a contractor around – impacting the ability to obtain future contracts due to the specter negative past performance ratings.

The good news for contractors is that the ability to challenge and – if successful – reverse negative CPARS evaluations is a quickly developing area of government contracting law.

The first step in any successful CPARS challenge involves meaningful participation in the evaluation process.  The Federal Acquisition Regulation (FAR) Part 42.15 entitles contractors to submit comments and receive an agency review of a disputed performance evaluation.  Specifically, contractors are entitled to submit comments, rebuttal statements, and/or other information in response to the agency’s evaluation.  The agency must then review those comments at a level above the contracting officer and update the evaluation, if necessary.

If the review and comment process is unsuccessful in resolving the issues, both the U.S. Court of Federal Claims and Boards of Contract Appeals recognize that contractors may bring a lawsuit to address performance evaluation disputes.  Generally speaking, in order to advance a performance evaluation dispute to the next level, the contractor must be prepared to prove that the agency’s evaluation is arbitrary, capricious, and contrary to law.

Although litigation over a performance evaluation dispute is a relatively new development – the law is now clear that a condition precedent to litigating the issue before a Court or Board is a certified claim.  That is – just like a claim for damages based on (for example) delay or a differing site condition – the contractor must file a written claim in accordance with the Contract Disputes Act (CDA) and receive a denial or “deemed denial” of that claim in order to move forward.

In a recent decision, the Court of Federal Claims reinforced the notion that there is no substitute for a CDA claim.  The case originated with a complaint filed by a contractor concerning an allegedly unreasonable negative performance evaluation issued by the United States Transportation Command.  The contractor sought a declaratory judgment vacating the evaluation.

Before the contractor could even begin to prove its case, the government filed a motion to dismiss, arguing that the contractor did not submit a CDA claim to the contracting officer.  Without a claim (the government argued), the Court lacks jurisdiction to hear the case.  In response, the contractor asserted that it engaged in a series of communications with the agency regarding the CPARS evaluation, but the agency would not change its allegedly improper position.

On review, the Court sided with the government and dismissed the contractor’s complaint.  In this instance – far from proving a legitimate dispute that could substitute for a CDA claim – the Court relied on the contractor’s communications with the government as evidence its the lack of jurisdiction.  The Court held that the on-going nature of the parties’ negotiations showed that the contracting officer had no notice that the contractor sought a “final decision” of any kind.

The takeaway for contractors is very simple – engage in the process and follow the required steps when disputing a CPARS evaluation.  The contractor must participate in the review and comment procedure articulated in FAR 42.15 – but if that fails, the next logical step is to proceed with a CDA claim (or, perhaps as an intermediate step, a request for equitable adjustment).  Before a performance evaluation dispute can escalate to litigation, the contractor must be armed with a denial or deemed denial of that claim.

 

A response to an RFP is the government contractor’s chance to put its best foot forward and stand out from the crowd.  Particularly when it comes to best value procurements, this is your chance to tell the contracting officer that your company does it best (whatever it is).

But, a recent bid protest decision reminds us that contractors must carefully walk the line between well-deserved boasting and playing make-believe.

The protest concerns a U.S. Department of the Navy IDIQ contract.  The RFP required contractors to submit detailed information documenting their relevant depth and breadth of experience on similar contracts.  In other words, the agency wanted the ultimate awardee to prove it has the chops to do the work required under the contract.

The agency rejected one contractor’s proposal as technically unacceptable because it lacked specific details concerning prior projects.  Instead, the contractor submitted only general information about its past work – and instead focused on hypothesizing about the stellar work that it could perform, if given the opportunity.

On review, the Court of Federal Claims sided with the Navy.  It is reasonable, the Court concluded, for an agency to require contractors to submit satisfactory evidence of qualifying past performance experience.  The contractor’s decision to submit general (not specific) information concerning its prior contract performance and focus on hypothetical statements of future potential did not meet the RFP’s requirements.

For contractors – and especially greener contractors – the Court’s decision presents and chicken-and-egg scenario.  It is difficult to win a contract award including a past performance element when your firm has limited experience.  But how can you get the experience without the award?

Two thoughts:  First, as this case demonstrates, this is one area where you can’t “fake it till you make it.”  Focus on actual, supportable experience.  Second, if your firm’s past performance is really holding you back, consider teaming options for situations where the RFP allows you to lean on the past performance experience of a partner or subcontractor.

Contractors that want to improve their proposal drafting skills (and win more contract awards) should always keep an eye on the news and learn from others’ mistakes.  Understanding an agency’s award rationale can provide a competitive advantage and keep you well-positioned to receive the next contract.

And, sometimes, simply following instructions and staying within the lines can make the difference between winning and losing.

lose

Take, for example, a recent GAO decision discussing the merits of an agency’s technical evaluation.  The protest argued that the agency unreasonably overlooked technical details included in the “past performance” and “personal experience” sections of the contractor’s proposal.

The problem with this argument is that the details in question should have been included in the “technical approach” section of the proposal — as indicated in the RFP.  According to the GAO, there is “no merit in the [argument] that the agency should have looked to other proposal sections for information regarding the firm’s technical approach.”

The takeaway here is an easy one – read the RFP instructions carefully and follow them closely.  If technical data or other information is requested by one section of an RFP, provide that specific data in the corresponding section of your proposal.  Don’t assume that – just because you’ve already included the information elsewhere – the agency will take the time and effort to track it down (even if it appeared just a few pages or even paragraphs earlier in the proposal).

The general rule is that you want to make life as easy as possible for the person evaluating your proposal.  Make it a routine best practice to check each proposal for the key elements required by the RFP before hitting send.