• R.D. Lieberman,Consultant

Unreasonable Restrictions on Quotation or Proposal Revisions

Federal Acquisition Regulation (“FAR”) 15.307 states that “[a]t the conclusion of discussions, each offeror still in the competitive range shall be given an opportunity to submit a final proposal revision….” This same requirement for fairness applies to negotiated procurements that seek proposals as well as quotations from offerors. Recently, the Government Accountability Office (“GAO”) reminded agencies that when they seek a final offer, they cannot restrict a contractor’s ability to make amendments in areas where there have been amendments that materially impact those areas.

In Castro & Co., B-415508.4, Feb. 13, 2018, the Department of Homeland Security (“DHS”) issued an amendment to a solicitation for financial statement audit and internal control support services. After DHS selected the awardee, it received post-award protests, and decided to take corrective action to clarify that it required quotes to offer three full-time individuals to perform the scope of Optional Task 3. However, the corrective action amendment issued by DHS prohibited offerors from changing anything but Task 3, stating that “[a]ny revisions outside of Task 3 will not be evaluated.” Castro protested that this prohibition prejudiced the procurement against any offeror whose strategy took advantage of perceived efficiencies in Tasks 1 and 2 to address the potential needs of Task 3.

In considering the protest, the GAO noted that it generally does not object to specific amendatory corrective action, as long as it is appropriate to remedy the concern that caused the corrective action. However, even where an agency might be justified in restricting revisions in connective action, an agency may not prohibit offerors from revising related areas of their quotation which are “materially impacted” by the amendment. Therefore, GAO considers the extent to which an amendment, and the permitted changes in response to it, materially impact or are inextricably linked with other aspects of a vendor’s quotation.

GAO noted that Castro included the use of personnel and labor hours outside of the number of personnel specifically proposed for Optional Task 3, and that at least two personnel were proposed by Castro to perform across all three tasks. The DHS corrective action amendment materially impacted aspects of Castro’s quotation outside of the areas that the agency permitted for revision of the quotations, and the limitation on quotation revisions was therefore unreasonable.

The takeaway: Agencies sometimes limit changes to one section of a proposal or a quotation in an amendment or corrective action. In other situations, agencies may permit technical or language changes, but prohibit pricing changes in contractor’s proposals or quotes. A contractor should carefully evaluate any amendment that limits proposal or quotation revisions. If the revisions materially impact areas where revisions are prohibited, the contractor should consider submitting a protest against the limitation.

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/.

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The website of Richard Donald Lieberman, a government contracts consultant and retired attorney who is the author of both "The 100 Worst Mistakes in Government Contracting" (with Jason Morgan) and "The 100 Worst Government Mistakes in Government Contracting." Richard Lieberman concentrates on Federal Acquisition Regulation (FAR) consulting and training, including  commercial item contracting (FAR Part 12), compliance with proposal requirements (FAR Part 15 negotiated procurement), sealed bidding (FAR Part 14), compliance with solicitation requirements, contract administration (FAR Part 42), contract modifications and changes (FAR Part 43), subcontracting and flowdown requirements (FAR Part 44), government property (FAR Part 45), quality assurance (FAR Part 46), obtaining invoiced payments owed to contractors,  and other compliance with the FAR. Mr.Lieberman is also involved in numerous community service activities.  See LinkedIn profile at https://www.linkedin.com/in/richard-d-lieberman-3a25257a/.This website and blog are for educational and information purposes only.  Nothing posted on this website constitutes legal advice, which can only be obtained from a qualified attorney. Website Owner/Consultant does not engage in the practice of law and will not provide legal advice or legal services based on competence and standing in the law. Legal filings and other aspects of a legal practice must be performed by an appropriate attorney. Using this website does not establish an attorney-client relationship. Although the author strives to present accurate information, the information provided on this site is not guaranteed to be complete, correct or up-to-date.  The views expressed on this blog are solely those of the author. FAR Consulting & Training, Bethesda, Maryland, Tel. 202-520-5780, rliebermanconsultant@gmail.com

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