Failure to Comply with Solicitation Results in Lost Opportunity

In 2016, GSA issued an RFP (Request for Proposal) for up to 70 IDIQ (Indefinite-delivery, indefinite-quantity) contracts to provide information technology (IT) services.

The RFP required offerors to assign themselves points in several categories. One of those categories concerned the offerors cost accounting system. In order to establish that an offeror was entitled to the points, the RFP stated that an offeror's supporting documents must include verification from the Defense Contract Audit Agency (DCAA), Defense Contract Management Agency (DCMA) or any Cognizant Federal Agency (CFA) of an acceptable accounting system that had been audited and determined adequate for determining costs applicable to the contract. Offerors were also required to provide contact information for the DCAA or DCMA and if available, a copy of the audit report. If not available, offerors were required to submit a letter from the auditing agency, on auditing agency letterhead, indicating unequivocally that the offerors' accounting system was audited and determined to be adequate for cost-reimbursement contracting. With respect to joint ventures, the RFP required documentation of a cost accounting system audit in the name of the joint venture itself or documentation in the name of each member of the joint venture.

SysVets, LLC, a service-disabled veteran-owned business (SDVOSB) joint venture comprised of Acquisition, Research and Logistics (ALR), Inc (the majority member), Information Management Resources (IMR), and Conception Solutions (CS) submitted a proposal in response to the solicitation and assigned itself the maximum number of points for having an audited accounting system. SysVets submitted a copy of the DCAA report that found the accounting system for its majority partner, ALR, to be adequate but did not provide any such documentation for the joint venture itself or the other two joint venture partners. So GSA deducted the points from SysVets score which lowered its overall score and consequently removed it from award consideration.

SysVets challenged GSA's evaluation to the Comptroller General (i.e. GAO). SysVets argued that GSA's deduction under the cost accounting system element was unreasonable. SysVets alleged that GSA should have concluded that ARL's audit documentation was sufficient because ARL is the majority member of the joint venture and is solely responsible for making all management and executive decisions. SysVets further argued that while it did not provide documentation for each of the joint venture partners, each partner did indeed have audited cost accounting systems.

The GAO did not sustain the protest. The RFP required offerors to submit specific documentation with their proposals. With respect to the cost accounting system audit, the solicitation required that the documentation be provided in the name of the joint venture or each joint venture member. SysVets failed to provide that documentation so GSA reasonably deducted the points from its evaluation. Documentation for just the majority joint venture member was not sufficient to comply with the clear and unambiguous terms of the solicitation.

You can read the full decision here.