Government Contracts Monitor

An Agency’s Superficial Evaluation Can Be Fruitful Protest Fodder

August 19, 2014

By: Eric Whytsell

A recent protest before the Government Accountability Office (GAO) highlights a red flag to watch for when considering whether to protest an unfavorable award: If you believe the agency’s evaluation of your proposed staffing plan was superficial or failed to consider the actual number of employees assigned to various labor categories, you may have strong grounds for a protest. Native Resource Development Company, B-409617.3 (NDRC).

NDRC involved a contract award by the Federal Emergency Management Agency (FEMA) for building maintenance and repair, janitorial, and lodging (i.e., desk clerk and housekeeping) services for the Center for Domestic Preparedness in Anniston, Alabama. The underlying solicitation included a detailed Performance Work Statement (PWS) explaining the areas of work to be performed and provided for award to the offeror whose proposal represented the best value to the government, with technical factors approximately equal in weight to price.

The technical evaluation factors included, among others, staffing plan/key personnel. The solicitation provided for an evaluation of this factor based on the sufficiency of the offeror’s proposed staffing for addressing the tasks identified in the PWS, the merits and realism of the proposed labor mix, the qualifications of the proposed key personnel, and the offeror’s approach to recruiting, retaining, training, supervising, and coordinating its staff. The agency used an internally-prepared, undisclosed staffing estimate when evaluating offers. In addition to an overall number of FTEs, the agency’s estimate specified full-time equivalents (FTEs) for each of the required types of work.

NDRC was among the four offerors FEMA selected for the competitive range after initial proposal evaluation. Its proposal had been rated as good under two technical factors and as satisfactory under three others, including staffing plan/key personnel. Under the staffing plan/key personnel factor, despite identifying several strengths in the protester’s proposal, the evaluators also pointed out a significant weakness in NRDC’s proposed staffing plan, stating that the “proposed staffing levels . . . [for critical functions such as lodging housekeeping, laundry services, and mail] appear to be low to meet the requirements of the PWS.” After discussions and in response to these identified weakness pertaining to its proposed staffing, NRDC increased its staffing for each of the positions specified.

However, those changes proved insufficient to sway the evaluators. In their final evaluation, they noted that while NRDC proposed to increase staffing by 4 FTEs, NRDC’s overall staffing remained a weakness because its total proposed FTEs still remained well below the agency’s estimate and represented a “shortage of staff that would potentially cause delays in responding to work orders and issues with overall quality of work performed.” This significant weakness translated into a performance risk that outweighed NRDC’s price advantage in the best value trade-off and FEMA ultimately awarded a contract to Bestway Services, Inc. (Bestway).

NRDC protested, arguing that FEMA had improperly evaluated the adequacy of its proposed staffing based on a comparison of the overall number of FTEs proposed to an undisclosed government estimate, which resulted in a downgrading of the proposal’s rating under the staffing plan/key personnel factor. The GAO agreed, noting that, while an agency may certainly use its own staffing estimate in its evaluation of proposals, “it is improper for an agency to downgrade a proposal simply because the offeror’s overall proposed FTEs differ from the government’s estimate, where the government’s estimate was not disclosed to the offerors, the agency failed to conduct discussions with the offeror concerning the discrepancy, and the agency did not look beyond the bottom line numbers to determine whether there were specific areas in which the offeror’s proposed staffing was inadequate.”

Based on its review of the record, the GAO found that this is precisely what happened in this case: FEMA concluded that NRDC’s proposed staffing presented a performance risk based on its overall number of FTEs and had failed to conduct discussions providing adequate notice of the agency’s concerns or to provide any analysis of whether the proposed staffing in specific areas was sufficient. For these reasons, the GAO held that the agency had acted unreasonably and sustained the protest.

This decision does not mean that every dispute concerning an agency’s evaluation of staffing will provide fertile grounds for a protest. But it does provide a helpful description of circumstances that may add up to a successful protest.

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