The U.S. Navy was looking for a contractor to perform base support services on the island of Guam, here:

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What it got instead was a bid protest. And, a decision from the Government Accountability Office (GAO) sustaining the protest, here: CFS-KBR Marianas Support Services, LLC; Fluor Federal Solutions LLC, B-410486, et al., Jan. 2, 2015, 2015 CPD ¶ 22.

Then, in December 2015, the Navy got to live it all over again when GAO cited that decision in its annual report to Congress, here: GAO’s Bid Protest Annual Report to Congress for Fiscal Year 2015

GAO used the CFS-KBR Marianas decision as one example on its list of most prevalent grounds of bid protests. GAO listed “inadequate documentation of the record” as no. 4 on its list. Here’s what GAO said about the Navy: “the agency failed to document why it changed its ratings when the offerors did not increase proposed staffing levels commensurate with the agency’s discussion questions.”

What happened? And, what can government contractors learn from this?

What happened?

The Navy issued an RFP for award of a cost reimbursement contract and made award based on a best value analysis to a local Guam contractor at an evaluated cost of more than $530 million. In this procurement, the Navy conducted an initial evaluation, conducted discussions with offerors and then obtained final proposal revisions that were evaluated before the selection decision was made.

In its initial evaluation of staffing and resources, the Navy found the staffing levels in the awardee’s and the two protesters’ proposals to be “inadequate.” In discussions, the Navy advised each offeror that its staffing lacked a certain number of full time equivalent staff (FTEs). One protester revised its proposal by increasing staffing to add the number of FTEs identified by the Navy. But the other protester and the awardee increased their staffing by adding fewer FTEs. In the final evaluation, the Navy found all offerors’ staffing was “adequate.”

GAO had a problem with that because the Navy evaluators “articulated no reasoned analysis for why, despite the fact that these firms did not propose the staffing initially identified by the agency as inadequate, the firms nonetheless merited these better ratings.” GAO surmised that the Navy’s evaluators “abandoned the initial government estimates, as well as their evaluation findings based upon those estimates.” In sustaining the protest, GAO held:

… since the evaluators did not explain why they considered the offerors’ revised staffing adequate in light of their respective technical approaches, we have no basis to find the agency’s reevaluation of proposals reasonable.

GAO also noted that there was no “critical analysis or description” of proposed staffing or unique technical approaches that led to the Navy’s conclusory findings.

What can government contractors learn from this?

The key takeaway for contractors is that government agencies must document their evaluation findings. In the absence of documentation, agencies are at risk of a protest being sustained if GAO cannot understand the agency’s evaluation conclusions. That was the case in CFS-KBR Marianas. The Navy’s findings that revised staffing levels were adequate may have been perfectly reasonable. Unfortunately for the Navy, however, there was no documentation to show GAO how the evaluators got from point A to point B.

In 2015, GAO placed “inadequate documentation of the record” at no. 4 on its list of top protest grounds. Contractors should be on the lookout for that in debriefings—especially in staffing and similar evaluation criteria and particularly in the face of discussion questions on point. Counsel also should be tuned in to that in reviewing the Agency Report and the record.

See our previous posts about GAO’s list of most prevalent protest grounds no. 1 (unreasonable cost or price evaluation) here and no. 2 (unreasonable past performance evaluation) here.