IN BEST VALUE DETERMINATION AGENCY IS NOT REQUIRED TO QUANTIFY BENEFITS OF HIGHER PRICED, HIGHER TECHNICALLY RATED PROPOSAL

Factor Jacobs InDyne

MISSION SUPPORT Acceptable Acceptable

Sample WBS PWS Acceptable Acceptable

Phase-In Good Good

Property Management Pass Pass

STAFFING APPROACH Acceptable Outstanding

Staffing Approach and

Structure Acceptable Outstanding

Retention & Recruitment Good Outstanding

FINANCIAL SYSTEM Acceptable Outstanding

Financial System

Capability Acceptable Outstanding

PAST PERFORMANCE

Relevancy Very Very

Confidence Substantial Substantial

SMALL BUSINESS PARTICIPATION

Acceptable Acceptable

COST $115,836,653. $152,888,900.

The agency selected InDyne’s proposal as offering best value to the government. Jacobs protested that the agency had failed to reasonably justify the award at a $37 million (32 percent) price premium. Jacobs alleged that the agency did not quantify the benefits in InDyne’s proposal, or the performance risk in the two weaknesses that were apparently identified in InDyne’s proposal.

The GAO denied the protest, holding that the function of a price/technical tradeoff is to determine if one proposal’s technical superiority is worth the higher price, and “the extent to which one is sacrificed for the other is governed only by the rest of rationality and consistency with the stated evaluation criteria.” The GAO noted that the rationale for the agency’s source selection must be documented “but that documentation need not quantify the tradeoffs that led to the decision,” They simply must be reasonable, and it is the reasonableness that the GAO will consider.

This follows a line of GAO cases such as:

• [T]here is no requirement that the agency’s selection decision quantify the best value tradeoff. See FAR 15.308. TeKONTROL, Inc. B-290270, June 10, 2002

• [N]o requirement than an agency quantify the value of technical superiority in relation to low cost to determine best value. Bulova Techs, LLC, B-281384, Feb. 3, 1999.

There is no indication just how much of a price premium might be acceptable to the GAO in this type of best value procurement.

Takeaway: A disappointed protester may ask for a quantification justifying selection of a higher priced, higher technically rated proposal, however, the GAO does not normally insist upon that—only a reasonable justification and consistency with the evaluation factors.

For other helpful suggestions on government contracting, visit:

Richard D. Lieberman’s FAR Consulting & Training at https://www.richarddlieberman.com/, and Mistakes in Government Contracting at https://richarddlieberman.wixsite.com/mistakes.