As reported by Jared Serbu of Federal News Radio:
The Defense Department will likely have to make significant changes to a much-anticipated IT services contract known as ENCORE III following a legal decision that upheld challenges by two prospective bidders.
The Defense Information Systems Agency said it would update the RFP to fix some of the problems pointed out by protestors Booz Allen Hamilton and CACI.
We believe that the ENCORE III acquisition can be successfully revised to align with GAO recommendations and Department of Defense acquisition strategy targeted at innovative IT.
Additionally, the pool of prospective bidders for a revised opportunity should be restricted to those bidders from the original opportunity whose proposals were compliant with the original submission requirements.
The ENCORE III acquisition strategy has been challenged from the start, from industry associations including the Professional Services Council and the IT Alliance for Public Sector (ITAPS). These challenges focused on the use of a Lowest-Price, Technically-Acceptable (LPTA) evaluation criteria for industry proposals.
These challenges supposed that government has difficulty defining “technically acceptable” proposals to perform the innovation-driven work that ENCORE III intends to fund, especially in an IDIQ-type contract(which does not contract for actual work to be performed but rather serve as a “hunting license” for future Task Orders that serve as contracts for real work.) The ENCORE III RFP did not inform bidders of the amount of services the contract would require under predefined categories of work, rather, the government chose to withhold that information to be used to evaluate submitted price proposals.
GAO agrees with this premise, as well as the protestation of the method by which DISA planned to determine the lowest-cost, technically acceptable proposals among the submitted bids.
The agency planned to calculate a trimmed mean by excluding the bottom and top 10% bidders’ rates from the calculation of the mean, then eliminate any bidders whose average rate was more than 50% off the post-trim calculated median. A pre-determined number of winners would have been selected from the remaining pool of bidders.
GAO’s decision to uphold the protest is likely to have a significant impact on small businesses that support the Defense Information Systems Agency (DISA), the sponsor of the Indefinite-Delivery, Indefinite-Quantity (IDIQ) contract.
Responding to these “once-every-ten-years” requests for proposals (RFPs) is very expensive, as there is no less expected of a proposal from a 10-employee small business than a 100K-plus employee defense corporation. The cancellation of an acquisition of this size would wipe out millions in sunk costs across industry, and could have a very real impact on the confidence of future bidders when deciding to pursue innovation-focused acquisition opportunities.
By Davey Ahearn
Thanks to Aric Miller and Joe McCormick