Government Contracts Monitor

Agency Waiver of Solicitation Requirement - Fatal or Non-Prejudicial?

March 6, 2019

A recent protest demonstrates why it is not sufficient for a disappointed offeror to challenge an agency’s award as improper solely because the agency relaxed or waived a material solicitation requirement in evaluating the awardee’s proposal and thus the awardee’s proposal was deficient. Such a challenge, in order to succeed, must include another key element: demonstrated prejudice to the protester. The absence of the latter element caused Miltope’s recent protest to fail. [here].

Miltope asserted that the Army should have assessed a deficiency to the awardee’s proposal for its failure to propose “two spare fuses per active fuse” as required by the solicitation. According to Miltope, this deficiency rendered the awardee’s proposal ineligible for award.

The Army, on the other hand, contended that it acted reasonably in assessing the failure to propose two spare fuses as a weakness, rather than a deficiency. GAO disagreed, siding with Miltope in its position that the awardee’s proposal failed to comply with the RFP requirement for two spare fuses. End of story? No. GAO went on to conclude that the Army’s action did not prejudice Miltope and, accordingly, found no basis to sustain the protest.

In deciding this protest GAO cited to the longstanding principle of government procurement that “competitions must be conducted on an equal basis, that is, offerors must be treated equally and be provided with a common basis for the preparation of their proposals”. In this regard, contracting officials “may not announce in the solicitation that they will use one evaluation scheme and then follow another without informing offerors of the changed plan and providing them an opportunity to submit proposals on that basis”. That said, an agency may waive compliance with a material solicitation requirement in awarding a contract if the award will both meet the agency’s actual needs and not prejudice other offerors.

Here there was no question that the awardee failed to propose a material requirement: two fuses. The question was whether Miltope could show it was prejudiced by the Army’s waiver of this requirement.

Rather than relying on what it would have done differently had it known the Army would waive the requirement for “two spare fuses per active fuse” – that is, arguing that it was prejudiced and how – Miltope only argued that the awardee’s failure to provide the spare fuses made its proposal ineligible for award. Miltope did not argue, nor did GAO find any evidence in the record, that but for the agency’s actions, Mitope would have had a substantial chance of receiving the award – that removal of the spare fuse requirement would have altered the Army’s award decision. Because Miltope failed to provide any basis for the GAO to find competitive prejudice, even though the Army essentially waived a material solicitation requirement, GAO would not sustain the protest.

Protesters beware: you must allege and establish prejudice in order succeed with a protest.

Attorneys

Lindsay Simmons