Source: http://wifcon.com/pd15306a2.htm
Timestamp: 2018-04-22 14:32:00
Document Index: 673747324

Matched Legal Cases: ['§ 15', '§ 15', '§ 15', 'art 15', 'art 14', 'art 15', 'art 15', 'art 14', 'art 14', 'art 15', '§ 14', '§ 15', 'art 14', '§ 14', '§ 15', '§ 15', 'art 15', 'art] 15', 'art 14', 'art 15', 'art 15', 'art 14', '§ 14', 'art 14', 'art 14', 'art 15', 'art 14', '§ 14', '§ 14', 'art 14', '§ 52', '§ 52', '§ 52', '§ 52', '§ 15', '§ 4', '§ 706']

FAR 15.306 (a)(2): Clarification - Government's duty to inquire
New The protester also contends that the Secret Service abused its discretion by not seeking clarifications or conducting discussions with FFA regarding its PII procedures. Protest at 10-13.
Thus, FFA's contention that the Secret Service was obligated to conduct discussions or seek clarifications regarding FFA's PII procedures, lacks merit. See Alares, LLC, B-407124, Nov. 7, 2012, 2012 CPD ¶ 316 at 4-5 (denying challenge to agency's evaluation where the protester's proposal failed to address compliance with infection control procedures and provide a construction safety plan, as required by the solicitation, and the agency was not required to seek clarifications in this respect). (First Financial Associates, Inc. B-415713, B-415713.2: Feb 16, 2018)
In sum, we find no basis to question the Air Force's evaluation of Geotech's technical proposal and the protester's allegations to the contrary only reflect its disagreement with the agency's evaluations, which, without more, provides no basis to question the reasonableness of the agency's judgments. See Citywide Managing Servs. of Port Washington, Inc., B-281287.12, B-281287.13, Nov. 15, 2000, 2001 CPD ¶ 6 at 10-11. (Geotech Environmental Services, Inc. B-415035: Nov 8, 2017)
Valkyrie contends that the agency's decision not to seek clarifications concerning the SAM's resume was unreasonable and contrary to law, regulation, and the terms of the solicitation. Protest at 7. Specifically, Valkyrie argues that several factors both intrinsic and extrinsic to its proposal should have alerted the evaluators to Valkyrie's clerical error, and that the agency therefore erred in not seeking such clarifications. Protester's Comments on the Agency Report at 5. Based on our review of the record, we find no basis on which to sustain the protest.
Valkyrie argues that the agency abused its discretion by not seeking clarifications in this case because the factual context made the need for clarifications clear. Comments at 5. For example, Valkyrie notes that other parts of its proposal were inconsistent with the resume in question, which should have alerted the agency to the need for clarifications. Id. Specifically, Valkyrie argues that its staffing plan noted that the SAM had 31 years of related professional experience, which was inconsistent with the 11 years of acquisition management experience displayed on the truncated resume. Protest at 4. Additionally, Valkyrie argues that its SAM currently works in an acquisition management capacity on the incumbent contract, has done so since November of 2004, and thus is well-known to the agency. Comments at 5, n.6. Furthermore, Valkyrie argues that its certification (made as part of submitting its proposal) that all key personnel identified in its proposal met the required qualifications should also have alerted the agency to the necessity of clarifications. Comments at 5. Finally, Valkyrie contends that when viewed in the context of these circumstances, the agency's refusal to seek clarification was unreasonable. Id.
Additionally, the Federal Acquisition Regulation (FAR) describes a spectrum of exchanges that may take place between a contracting agency and an offeror during negotiated procurements. See FAR § 15.306. Clarifications are limited exchanges between the agency and offerors that may occur when contract award without discussions is contemplated. FAR § 15.306(a). As a baseline matter, our cases have generally concluded that agencies may, but are not required to, engage in clarifications that give offerors an opportunity to clarify certain aspects of proposals or to resolve minor or clerical errors. See e.g. Satellite Servs., Inc., B-295866, B-295866.2, Apr. 20, 2005, 2005 CPD ¶ 84 at 2 n.2.
Valkyrie's argument that the agency impermissibly ignored information allegedly in its possession concerning their SAM's relevant experience is similarly groundless. Valkyrie is correct that our Office has recognized that in certain limited circumstances, an agency evaluating a proposal has an obligation to consider certain information that is "too close at hand" to ignore. See, e.g., International Bus. Sys., Inc., B-275554, Mar. 3, 1997, 97-1 CPD ¶ 114 at 5. This doctrine, however, is not intended to remedy an offeror's failure to include information in its proposal. Great Lakes Towing Co. dba Great Lakes Shipyard, B-408210, June 26, 2013, 2013 CPD ¶ 151 at 8; FN Mfg. LLC, B-407936 et al., Apr. 19, 2013, 2013 CPD ¶ 105 at 3. Additionally, our decisions on this point have been limited to consideration of past performance information known to the agency; we have generally declined to extend the doctrine to include information related to the qualifications of key personnel because they relate to technical acceptability rather than past performance. See, e.g. Consummate Computer Consultants Sys., B-410566.2, June 8, 2015, 2015 CPD ¶ 176 at 6 n.6; Enterprise Solutions Realized, Inc.; Unissant, Inc., B-409642, B-409642.2, June 23, 2014, 2014 CPD ¶ 201 at 9.
Finally, protester contends that, while any of these elements individually may not have made the agency's refusal to seek clarifications unreasonable, the circumstances, when taken together, should have compelled the agency to seek clarifications. Agencies have broad discretion as to whether to seek clarifications from offerors, and offerors have no automatic right to clarifications regarding proposals. Alltech Engineering Corp., B-414002.2, Feb. 6, 2017, 2017 CPD ¶ 49 at 6. We see no basis in the protester's arguments, singly or in combination, to conclude that the agency acted unreasonably by failing to seek clarifications in this case. (Valkyrie Enterprises, LLC B-414516: Jun 30, 2017)
Here, to become acceptable, Alltech’s offer would have required submission of a revised technical proposal to provide the missing narrative explanation of the proposed plans required by the solicitation. Providing an offeror the opportunity to revise its proposal and cure a deficiency would constitute discussions, not clarifications, because that would require the submission of information necessary to make the proposal acceptable. FAR § 15.306(d). Further, agencies are not required to conduct discussions when, as here, the solicitation advises of the agency’s intent to award a contract or task order on the basis of initial proposals. Id. Thus, although the protester views its omission to be minor or clerical, correction of the omission would have required the agency to conduct discussions.
Therefore, Alltech’s contention that the Corps was obligated to seek clarifications regarding its omission and permit the protester to submit the missing narrative, lacks merit. See, e.g., Alares, LLC, B-407124, Nov. 7, 2012, 2012 CPD ¶ 316 at 4‑5 (Protest of agency’s evaluation of protester’s proposal is denied where the proposal failed to address compliance with infection control procedures and provide a construction safety plan, as required by the solicitation, and agency was not required to seek clarification or infer or piece together such information from the protester’s proposal.).
In sum, we find no basis to question the agency’s evaluation of Alltech’s technical proposal and the protester’s allegations to the contrary only reflect its disagreement with the agency’s evaluations, which provides no basis to question the reasonableness of the agency’s judgments. See Citywide Managing Servs. of Port Washington, Inc., B‑281287.12, B‑281287.13, Nov. 15, 2000, 2001 CPD ¶ 6 at 10‑11; see, e.g., Mike Kesler Enters., B‑401633, Oct. 23, 2009, 2009 CPD ¶ 205 at 3‑4 (agency reasonably determined that protester’s proposal did not provide sufficient detail and was technically unacceptable where proposal lacked clear and consistent language and information necessary to determine if the proposal would function as proposed). (Alltech Engineering Corp. B-414002.2: Feb 6, 2017)
Here, we agree with the Air Force that the inconsistencies in SMS’s final proposal were not minor clerical errors that could simply be remedied through clarifications. Instead, the record supports the agency’s position that SMS’s errors “demonstrated a consistent failure to understand the requirements or the ability to properly propose in a manner that clearly demonstrated otherwise.” SMS COS at 18. In this regard, the agency explains that the evaluators were perplexed that the staffing tables included in SMS’s final proposal were inconsistent with what the protester submitted in response to the evaluation notices; in fact, the contracting officer initially thought that SMS erred in transposing the information from the evaluation notice response. SMS COS at 19. Therefore, he instructed the evaluation team to investigate the history of the tables SMS submitted that outlined the firm’s security clearance distributions to determine whether there was a clerical error. Id.
The evaluation team also compared SMS’s final staffing matrix against related labor categories in the firm’s labor summary (exhibit D) to further determine whether there was a clerical error in transposing information. SMS COS at 20. The evaluators observed that the security clearance column in the staffing matrix and the related cells in the labor summary both contained the same references to top secret clearances in the respective labor categories (rather than the anticipated TS/SCI clearances). Id. Given this, the Air Force reasonably ruled out that any clerical error resulted in the agency’s concerns with SMS’s security clearance distribution. Thus, because offerors have no automatic right to clarifications, and because SMS’s final proposal contained more than a minor clerical error and would have required substantial rework to revise the inconsistencies (i.e., discussions), we find unavailing the protester’s contention that the agency erred by not seeking clarifications. See Manthos Eng’g, LLC, B‑401751, Oct. 16, 2009, 2009 CPD ¶ 216 at 2 (failure to submit option year pricing not a mistake that could be addressed through clarifications).
In sum, we find unobjectionable the Air Force’s evaluation of the protesters’ proposals under the enterprise IT support factor. The protesters’ complaints reflect their disagreement with the agency’s assessments, but do not demonstrate an unreasonable evaluation. (Abacus Technology Corporation; SMS Data Products Group, Inc. B-413421, B-413421.3, B-413421.5, B-413421.6: Oct 28, 2016)
The solicitation included the following contract line item numbers (CLINs): CLIN No. 0001, one-time transition-in costs to be incurred in the base year; CLIN No. 0002, labor costs and fixed fees for mission and support; CLIN No. 0003, labor costs and fixed fees for oversized and outsized support; and CLIN No. 0004, a plug number of $13,201,051 supplied by the agency for other direct costs (ODC). AR, Tab 4e, RFP Attach. 5, Cost/Price Matrix. The RFP required offerors to complete various solicitation attachments, including, as relevant here, attachment 5, the Cost/Price Matrix, and attachment 10, the Teaming Matrix.
Although SRI contends that the two figures would have matched if the agency had added the ODC plug number to the “Total Estimated dollar value” in the protester’s attachment 10, an agency is not required to adapt its evaluation to comply with an offeror’s submissions--the question is not what an agency could possibly do to cure a noncompliant submission, but, rather, what it is required to do. American Sys. Corp., B‑409632, June 23, 2014, 2014 CPD ¶ 188 at 4 (rejecting protester’s argument that omission was a “minor formal defect” and finding that agency reasonably found proposal unacceptable where proposal required agency to perform calculations in order to determine whether proposal was compliant); Herman Constr. Group, Inc., B-408018.2, B-408018.3, May 31, 2013, 2013 CPD ¶ 139 at 3. Moreover, where, as here, proposal submission requirements are clear, an agency is not required to assume the risks of potential disruption to its procurement to permit an offeror to cure a defect in its proposal submission caused by the offeror’s failure to comply with a mandatory solicitation requirement. American Systems Corp., supra. Therefore, we find the agency reasonably found SRI’s proposal to be noncompliant and ineligible for award. (Strategic Resources, Inc. B-411024.2: Apr 29, 2015) (pdf)
Similarly, we have no basis to question the agency’s finding that Dellew failed to staff the [ammunition supply point] ASP supervisor key position for the Joint Base Langley-Eustis installation. The record shows that Dellew provided the labor category “JBLE-Story [Joint Base Langley-Eustis] ASP Supervisor,” on its Attachment 0002, but the protester did not propose any FTEs for that labor category. Id. exh. 12b, Dellew’s Attachment 0002, at 3-4. While the agency reports that during a review of the protester’s organizational diagram, the evaluators noted that Dellew had allocated 1.0 FTE for the ASP supervisor position, see COSF/MOL at 21, this was insufficient to cure the above failure since the RFP specifically advised that the agency would evaluate offerors’ staffing approaches based on the information furnished in Attachment 0002. Because the protester did not include any FTEs for the ASP supervisor position in its Attachment 0002, the evaluators reasonably assigned a deficiency under the staffing and management plan subfactor. In this regard, it is the offeror’s responsibility to submit an adequately written proposal for the agency to evaluate, SC&A, Inc., B-270160.2, Apr. 10, 1996, 96-1 CPD ¶ 197 at 5, and agencies are not required to adapt their evaluations to comply with an offeror’s submission, or otherwise go in search of information that an offeror has omitted or adequately failed to present. LS3 Inc., B-401948.11, July 21, 2010, 2010 CPD ¶ 168 at 3 n.1; Hi-Tec Sys., Inc., B-402590, B-402590.2, June 7, 2010, 2010 CPD ¶ 156 at 3.
We find no merit to Dellew’s contention that the agency was required to seek clarifications from the protester with respect to the above deficiency. As noted above, an agency is permitted, but not required, to obtain clarifications from offerors. In any event, to render its proposal acceptable, the protester would have to cure the above deficiency by amending its Attachment 0002, which would have constituted discussions. (Dellew Corporation B-410251.3: May 13, 2015) (pdf)
The record reflects that the ambiguity created by Cubic’s admitted error relates to a material aspect of its technical approach regarding open architecture. As noted above, the RFP specifically required offerors to describe the rights asserted for their technical data and software.[7] Moreover, the evaluation record further shows, consistent with the terms of the solicitation, that the protester’s failure to unequivocally assert the rights granted to the government in the [deleted] software, a key component of the protester’s offered system, caused the agency to question the extent to which Cubic’s system could be enhanced through future competitive acquisitions were the government to only have limited rights in this key component of Cubic’s system.[8] Given the circumstances, and the broad discretion afforded contracting officers in conducting clarifications, we cannot find that the contracting officer acted improperly by not requesting that Cubic clarify the ambiguity in its proposal concerning the government’s data rights in the [deleted] software. (Cubic Simulation Systems, Inc., B-410006, B-410006.2: Oct 8, 2014) (pdf)
We first note that, although the initial version of the SFO posted on October 10, 2010, stated that GSA was seeking "to lease office space . . . and two boat slips," the SFO, as amended and posted on January 11, 2011, and under which this lease was awarded, did not. Compare SFO 9NY2355 (Feb. 16, 2010) with SFO 9NY2355 (Jan. 7, 2011). That is, there was no mention in the SFO under which this lease was awarded of any requirement that boat slips or boat dockage be provided as part of the lease. Given the clarity of the solicitation, the protester's asserted reliance on the views expressed by the DHS representatives in November 2010, as somehow adding a requirement for boat dockage or boat slips to the SFO, issued in January 2011, was misplaced. We have repeatedly held that oral advice that would have the effect of altering the written terms of a solicitation, even from the contracting officer, does not operate to amend a solicitation or otherwise legally bind the agency. Noble Supply and Logistics, B‑404731, Mar. 4, 2011, 2011 CPD para. 67 at 3; TRS Research, B‑274845, Jan. 7, 1997, 97-1 CPD para. 6 at 3. This would be especially the case, where the alleged oral advice was given 2 months prior to the solicitation being reissued as amended.
Further, we agree with the agency that Eagle Creek's letter of March 31, 2011, did little or nothing to clarify specifically what was included in Eagle Creek's offer. That is, while the letter references, among other things, the "[d]ocks at Eagle Creek," "24 designated transient slips," and the "launch ramp, hydraulic trailer [and] heated 40' x 80' service department building," which would be "available to Homeland Security," it also states that "Eagle Creek is offering up to 600 [square feet] of free secured storage." (emphasis added). AR, Tab 9, Eagle Creek Letter to GSA, Mar. 31, 2011, at 1‑2. As pointed out by the agency, this letter does not state whether the boat dockage, slips, trailer, and building were going to be "made available" for a fee or at no cost (i.e., "free") to the agency.
Moreover, the record shows that negotiations with Eagle Creek closed on March 28. See AR, Tab 7, Agency Letter (Mar. 25, 2011). As such, Eagle Creek's March 31 letter, which the protester points to in support of its position that the agency knew or should have known that Eagle Creek had erroneously included the costs of boat dockage its offer, was submitted after the close of discussions. It is well established that an agency need not reopen discussions to resolve deficiencies first introduced by the offeror after discussions have closed. Ogden Support Servs., B‑270354.2, Oct. 29, 1996, 97‑1 CPD para. 135 at 7; IPEC Advanced Systems, B‑232145, Oct. 20, 1988, 88‑2 CPD para. 380 at 4.
In sum, Eagle Creek's alleged misinterpretation of the SFO to require that its offer include costs associated with boat dockage and slips was a reasonable interpretation of the solicitation. In addition, the protester's assertion that the agency knew or should have known that Eagle Creek's offer erroneously included such costs, and should have raised that issue during discussions, is without merit. (Eagle Creek Marina, B-405220, September 16, 2011) (pdf)
Finally, CMS asserts in a supplemental protest that the agency’s award to LAX was improper because the awardee (“LAX Hospitality LP, Radisson Inn”) was not the entity that submitted the proposal upon which the award was based (“LAX Hospitality, LLC, DBA Radisson Hotel at Los Angeles Airport”). In fact, CMS notes that the latter entity identified as submitting the proposal was not registered with Central Contractor Registration (CCR). It is true that a contract cannot be awarded to any entity other than the one which submitted the proposal. However, the name of an offeror need not be exactly the same in all of the offer documents; although, the offer documents or other information available must show that differently-identified offering entities are in fact the same legal entity. Al Hamra Kuwait Co., supra, at 3. The fact that an offeror has only one taxpayer identification number (TIN) or data universal numbering system (DUNS) number and only one address is often a reliable indicator of the offering entity. S3 LTD, B- 288195 et al., Sept. 10, 2001, 2001 CPD para. 164 at 11-12. The agency asserts that the difference in entity names was a mere clerical error. This discrepancy was discovered when the contracting officer’s search of the DUNS number listed on the awardee’s proposal, which indicated that the entity name identified for that DUNS number was LAX Hospitality LP, Radisson Inn. Upon discovering the discrepancy, the contracting officer contacted LAX, who confirmed that LAX Hospitality, LP was the name of the entity, not LAX Hospitality, LLC. Supp. AR at 6. The contracting officer also noted that the address listed in the proposal and in the DUNS systems was that of LAX Hospitality, LP, which was registered with the CCR. Id. Therefore, we find that, notwithstanding the variations in the identification of the awardee between the proposal and award, the agency reasonably determined that LAX Hospitality, LP was the proper entity and was eligible to receive award. (Command Management Services, Inc., B-310261; B-310261.2, December 14, 2007) (pdf)
Battelle argues that the agency improperly rejected its initial proposal based on Battelle’s omission of the option year pricing. Battelle contends that the agency should have suspected that Battelle had made a “mistake or clerical error” in its proposal and had a “duty to verify” Battelle’s proposal and conduct “clarifications” to allow Battelle to correct the omission. Protest at 3-4, 6-8. In support of its argument, Battelle cites FAR sect. 15.306(a)(2), which permits clarifications to “resolve minor or clerical errors,” and FAR sect. 15.306(b)(3)(i), which permits communications before the establishment of the competitive range to address proposal ambiguities such as “errors, omissions, or mistakes.” An offeror bears the burden of submitting and adequately written proposal that contains all of the information required under a solicitation, Sam Facility Mgmt, Inc., B-292237, July 22, 2003, 2003 CPD para. 147 at 5, and an agency may reject a proposal that omits required pricing. Joint Venture Penauillie Italia S.p.A; Cofathec S.p.A; SEB.CO S.a.s; CO.PEL.S.a.s., B‑298865, B-298865.2, Jan. 3, 2007, 2007 CPD para. 7 at 6. Although, in an appropriate case, an agency may allow an offeror to correct a mistake or clerical error in a cost or price proposal through clarifications (as opposed to discussions), when it does so, both the existence of the mistake or error and the amount intended by the offeror must be apparent from the face of the proposal. Id. at 8. Here, although the existence of Battelle’s error was clear from the face of its proposal, it was not obvious what pricing Battelle intended to propose for the missing option years. Although, as Battelle points out, the initial proposal referred to “inflation adjustment[s]” in the narrative portion of the proposal, these vague references do not explain Battelle’s intended pricing for the option years. That is, Battelle’s option year pricing, as reflected in the 24 pages of pricing spreadsheets and additional narrative that Battelle provided to the agency in its agency protest, could not be gleaned from Battelle’s references to inflation adjustments in the initial proposal submission, and did not constitute “minor or clerical errors” as contemplated by the FAR. Thus, we find that the omission of Battelle’s option year pricing could not be corrected through clarification or verification. See University of Dayton Research Inst., B‑296946.6, June 15, 2006 , 2006 CPD para. 102 at 8. Regarding Battelle’s argument that “errors, omissions, or mistakes” can be corrected by communications before the establishment of the competitive range, FAR sect. 15.306(b)(2) specifically provides that communications under this section “shall not be used to cure proposal deficiencies or material omissions, materially alter the technical or cost elements of the proposal, and/or otherwise revise the proposal.” See also FAR sect. 15.306(b)(3) (“communications shall not provide an opportunity for the offeror to revise its proposal”). Again, we agree with the agency that Battelle’s omission of the option year pricing is material, given the RFP’s requirements to provide detailed option year pricing for evaluation, and any attempt to cure this omission would necessitate submission of a revised proposal and would constitute discussions. See Joint Venture Penauillie, supra, at 8. Finally, Battelle contends that the agency’s decision to eliminate its proposal from further competition was inconsistent with the RFP. According to Battelle, since the RFP provides that the competitive range will be established based only on the evaluation of technical proposals, see RFP at 73, the elimination of Battelle’s proposal based on a cost issue was premature and its pricing omissions should have been addressed after establishment of the competitive range and through discussions. However, unless the agency decides to establish a competitive range, the RFP provision referenced by Battelle does not apply, and it does not require the agency to conduct discussions. As noted, the agency has not yet decided to establish a competitive range and to conduct discussions. Rather, the agency rejected Battelle’s proposal (along with two others), after inspecting proposals for completeness, for not containing all of the information required by the RFP, a decision which, as discussed above, was reasonable. Consistent with the RFP, if the agency makes award based on initial proposals, then Battelle’s proposal cannot be considered for award. If, on the other hand, the agency decides to conduct discussions, we expect that the agency then will have to decide whether or not to include Battelle’s proposal in the competitive range. See FAR sect. 15.306(c)(1). (Battelle Memorial Institute, B-299533, May 14, 2007) (pdf)
Where, as here, a mistake in an offer other than the awardee's offer is first alleged after award, the general rule is that the unsuccessful offeror must bear the consequences of its mistake unless the contracting officer was on actual or constructive notice of an error before award. PAE GmbH Planning and Constr., B-233823, Mar. 31, 1989, 89-1 CPD ¶ 336 at 3. Omega asserts that the magnitude of the difference in the two offerors' discount fees should have provided constructive notice of the mistake, and that the contracting officer should have sought clarification from Omega. In this connection, the agency report acknowledges that "[a]fter comparison, the evaluators did note the apparent spread of the proposed discount fees." Contracting Officer's Statement at 4. However, Omega's alleged improper pricing of its proposal does not present the type of mistake which could be corrected through clarifications, nor was the agency required to conduct discussions in order to correct the mistake. (Omega World Travel, Inc., B-283218, October 22, 1999)
New First Financial Associates, Inc. B-415713, B-415713.2: Feb 16, 2018
Geotech Environmental Services, Inc. B-415035: Nov 8, 2017
Valkyrie Enterprises, LLC B-414516: Jun 30, 2017
Alltech Engineering Corp. B-414002.2: Feb 6, 2017
Abacus Technology Corporation; SMS Data Products Group, Inc. B-413421, B-413421.3, B-413421.5, B-413421.6: Oct 28, 2016
Strategic Resources, Inc. B-411024.2: Apr 29, 2015 (pdf)
Eagle Creek Marina, B-405220, September 16, 2011 (pdf)
Command Management Services, Inc., B-310261; B-310261.2, December 14, 2007 (pdf)
Omega World Travel, Inc., B-283218, October 22, 1999
a. The Contracting Officer’s Decision Not To Seek A “Clarification” From Level 3 Was Arbitrary, Capricious, And An Abuse Of Discretion.
Level 3’s September 29, 2016 Amended Complaint alleges that the CO violated FAR 15.101-2 and 15.306(a), by failing to seek a “clarification” from Level 3 regarding the lack of a Busi.kmz routing map, and determining that Level 3’s working path traversed Iran, although Level 3’s written statement was to the contrary. Amend. Compl. at ¶¶ 107, 115.
FAR 15.101-2 regulates the lowest price “technically acceptable” source selection process, i.e., the process used in this case. AR Tab 5, at 150 (“[T]he Government will first evaluate the lowest price quote. If the lowest price quote is determined to be technically acceptable and otherwise properly awardable, no further evaluation will be conducted, and award will be made.”). FAR 15.101-2(b)(4) provides that “exchanges [between the CO and the offeror] may occur,” pursuant to FAR 15.306.
If the CO enters into “discussions,” i.e., “[n]egotiations . . . between the Government and offerors, that are undertaken with the intent of allowing the offeror to revise its proposal . . . [that] take place after establishment of the competitive range,” they must be conducted with all the offerors within the competitive range. FAR 15.306(d). But, FAR 15.306(a)(1)-(2) allows the CO to seek a “clarification” from offerors, without initiation of “discussions.” In contrast, “clarifications” are defined as “limited exchanges, between the government and offerors that may occur when award without discussions is contemplated.” FAR 15.306(a)(1) (emphasis added).20 “Clarifications” allow offerors “the opportunity to clarify certain aspects of proposals (e.g., the relevance of an offeror's past performance information and adverse past performance information to which the offeror has not previously had an opportunity to respond) or to resolve minor or clerical errors.” FAR 15.306(a)(2).
FAR 15.306(a)(2) clearly differentiates “discussions” from “clarifications,” i.e., negotiations that lead to changes to the proposal. The United States Court of Appeals for the Federal Circuit has explained that it is “clear that discussions are more substantial communications than minor clarifications.” Information Tech. & App. Corp. v. United States, 316 F.3d 1312, 1320 (Fed. Cir. 2003) (internal quotation marks omitted). But, “there is no requirement in the regulation that a clarification not be essential for evaluation of the proposal.” Id. at 1323 (emphasis added). In fact, “‘clarifications’ by [an] offeror could lead to an increase in [the offeror’s] past performance score or perhaps tilt the award in its favor.” Id. (quoting John S. Pachter et al., “The FAR Part 15 Rewrite,” 98-05 Briefing Papers 1, 6 (1998)) (emphasis added). In other words, “clarifications” are deemed information exchanges that do not alter the terms of the offer, but can be determinative in the evaluation process.
In this case, an inquiry about the absence of .kmz files in Level 3’s offer would be a “clarification,” not a “discussion.” Submission of the .kmz files would not have varied the terms of Level 3’s offer, because the written offer expressly stated that Level 3’s proposed circuit would follow the same paths used in the current circuit maintained by Level 3 and that Level 3’s working path did not traverse Iran. AR Tab 11, at 392 (“Level 3’s proposal utilizes a working path that is identical to the current [path] from Camp Arifjan to Wiesbaden.”), 397 (“Working path does not touch or go through Iran[.]”). Asking for submission of the .kmz file would allow the CO to confirm Level 3’s proposal. See 62 FED. REG. 51, 228 (Sept. 30, 1997). For this reason, a TET Member recommended a “clarification,” by asking the Contracting Specialist to request a .kmz file from Level 3:
There are gaps in the diagrams between Stara Zagora, Bulgaria, and Budapest, Hungary and Ivancice, Czech Republic. Please ask the offeror to provide the detailed routing .kmz/.kml file. The file should provide a more detailed routing between Bulgaria and Hungary as well as the routing between Hungary and Czech Republic.
AR Tab 20, at 912 (emphasis added).
Although FAR 15.036 is permissively worded, 21 the United States Court of Federal Claims has determined that a CO’s decision not to seek “clarifications” can constitute an abuse of discretion under certain circumstances. See BCPeabody Construction Services, Inc. v. United States, 112 Fed. Cl. 502, 512 (2013) (Lettow, J.). In BCPeabody, the United States Army Corps of Engineers issued a solicitation utilizing the “lowest price technically acceptable source selection process,” under FAR 15.101-2, i.e., the same evaluation process utilized by the Solicitation in this case. Id. at 505. The protestor submitted an offer deemed technically unacceptable, because the offer failed to include a “project information sheet” detailing the past performance of one of protestor’s subcontractors. Id. at 505–06. The protestor, however, also quoted a price that was more than $1,000,000 less than the price of the offer selected for award. Id. at 506. The court determined that the protestor’s failure to include the project information sheet was not a “major omission that made it impossible to fully evaluate [the] proposal,” but was a clerical error that could have been corrected by seeking a “clarification.” Id. at 512–13. The court concluded that “[g]iven [the protestor’s] significantly lower bid, the contractor officer had virtually overwhelming cause to [seek a “clarification”],” and that the failure to seek a “clarification” was a prejudicial abuse of discretion. Id. at 512 (emphasis added).
Like the omission of the pricing information sheet in BCPeabody, the omission of the .kmz file in this case was an oversight that easily could have been corrected. It was not a major omission that made it impossible to fully evaluate Level 3’s proposal. Although Level 3’s low definition .pdf maps made it appear that Level 3’s working path touched Iran, the court notes that DISA approved of the working path when they awarded Level 3 the initial contract. AR Tab 20, at 826 (“Level 3’s proposal utilizes a working path that is identical to the current STM-16 (6Q6J) from Camp Arifjan to Wiesbaden.”). That fact together with Level 3’s written representation that the path did not touch Iran and the proposed working path would follow the same path as the circuit currently provided by Level 3, evidence that the CO’s decision not to seek a “clarification” was arbitrary and capricious and an abuse of discretion. AR Tab 11, at 392, 397.
In this case, as in BCPeabody, the CO had “virtually overwhelming cause” to seek clarification from Level 3, because of its “significantly lower” price. The price difference in BCPeabody was more than $1 million; in this case; the difference in this case is approximately $38.6 million.
For these reasons, the court has determined that the CO’s decision not to seek a “clarification” regarding the .kmz routing map, in light of Level 3’s written statement was arbitrary, capricious, and an abuse of discretion. (Level 3 Communications, LLC v. U. S. and Verizon Deutschland GmbH, No. 16-829 December 5, 2016)
ness Integra’s protest centers around the solicitation’s provisions regarding labor rates and its own omission and errors regarding three such rates in its proposal. Pl.’s Mot. at 1. Specifically, Business Integra argues that the government’s determination that the proposal’s omissions rendered the entire proposal unacceptable was arbitrary and capricious because (1) the single omission of the Year 5 pricing for a Level I Systems Analyst was de minimis and therefore not material, and (2) the government should have recognized the errors and either waived the errors, corrected the errors itself, or allowed Business Integra to correct the errors. Pl.’s Mot. at 28, 34; Pl.’s Resp. at 7-17. Thus, the court must consider: (1) whether the solicitation’s provision that proposals include all labor rates is a material term, and (2) what the government’s obligations were in addressing the errors.
To be acceptable, a proposal in a procurement “must represent an offer to provide the exact thing called for in the request for proposals, so that acceptance of the proposal will bind the contractor in accordance with the material terms and conditions of the request for proposals.” Centech Grp., 554 F.3d at 1037. Correspondingly, “a proposal that fails to conform to the material terms and conditions of the solicitation should be considered unacceptable.” E.W. Bliss Co. v. United States, 77 F.3d 445, 448 (Fed. Cir. 1996) (internal citations and quotations omitted). While the parties agree that the government has the right to reject an offer that has a material defect, they disagree whether the labor-rate provision in the EAGLE II solicitation constituted a material technical requirement or a de minimis administrative directive. See Hr’g Tr. 22:7-13, 34:22 to 35:15 (Apr. 25, 2014).
Business Integra argues that its errors were de minimis because the omitted prices would have amounted to only 0.0041% of the projected Total Value of its proposal. Pl.’s Resp. at 8. In support of this assertion, the company relies on GAO’s decision in W.B. Constr. & Sons, Inc., B- 405818, 405818.2, 2012 CPD ¶ 17, 2012 WL 32162 (Comp. Gen. Jan. 4, 2012). Pl.’s Resp. at 8-9. In W.B. Construction, GAO determined that failure to bid on a line item was a minor informality because the price of that item was de minimis compared to the total cost of the contract, amounting to less than 0.07%, and would not have affected the competitive standing of the bidders. W.B. Constr., 2012 WL 32162, at *4. In the circumstances, GAO determined that the federal agency’s rejection of the bid as nonresponsive was unreasonable; the agency should have waived the omission as a minor informality. Id., at *3.
Business Integra’s reliance on W.B. Construction is unavailing because the regulatory regime applicable to that procurement differs significantly from that established for EAGLE II. The solicitation in W.B. Construction was a sealed-bid procurement, regulated under FAR Part 14. W.B. Constr., 2012 WL 32162, at *1 n.1, *4. Contrastingly, the EAGLE II solicitation was a procurement by negotiation subject to FAR Part 15. See AR 1-116. “[A] fairly sharp divide remains between the clarification rules in Part 15 for negotiated procurements and the mandatory nature of comparable provisions in Part 14 for sealed bidding.” BCPeabody, 112 Fed. Cl. at 510. Under FAR Part 14, the government is required to seek clarification for minor informalities and irregularities, but under FAR Part 15, the government is permitted but not required to allow offerors to resolve minor or clerical errors. Id. at 509-10 (comparing the effect of FAR § 14.407-1 to that of FAR § 15.306(a)(2)). Specifically, FAR Part 14 provides that
[a] defect or variation is immaterial when the effect on price, quantity, quality, or delivery is negligible when contrasted with the total cost or scope of the supplies or services being acquired. The contracting officer either shall give the bidder an opportunity to cure any deficiency resulting from a minor informality or irregularity in a bid or waive the deficiency, whichever is to the advantage of the [g]overnment.
FAR § 14.405. The GAO relied on this provision when it determined that the omission in W.B. Construction was de minimis and that the agency was unreasonable in rejecting the bid. See W.B. Constr., 2012 WL 32162, at *4. In contrast, FAR § 15.306 provides that “offerors may be given the opportunity to clarify certain aspects of proposals (e.g., the relevance of an offeror’s past performance information and adverse past performance information to which the offeror has not previously had an opportunity to respond) or to resolve minor or clerical errors.” FAR § 15.306(a)(2). Price is not mentioned in Section 15.306, and FAR Part 15 provides no definition for “minor or clerical errors.” See BCPeabody, 112 Fed. Cl. at 509.
In this instance, “since the [proposal] at hand was the result of a negotiated procurement process, its administration is governed only by the provisions in [FAR Part] 15.” C.W. Over & Sons, Inc. v. United States, 54 Fed. Cl. 514, 521 n.10 (2002) (disapproving of application of FAR Part 14 to a negotiated procurement). While this court has found an abuse of discretion in bid protests governed by FAR Part 15 where the government failed to inquire into copying errors that affected the procuring authority’s evaluation of past performance, see BCPeabody, 112 Fed. Cl. at 513, an omission of pricing information has not been found to be a minor or clerical error in these types of procurements, see ST Net, 112 Fed. Cl. at 111.
This court’s decision in ST Net provides a helpful analog to the case at hand. In ST Net, the protester omitted pricing information in its proposal for a negotiated procurement, which, if included, would have increased the total price by about 7%. 112 Fed. Cl. at 110. The court determined that the error was material, not because of the dollar amount of the error, but because the price information was important to the government’s evaluation of the offer. See ST Net, 112 Fed. Cl. at 109-10 (“Importantly, the price, brand/model information, and discount rates were not simply estimating tools, but were actually binding on the offerors.”). Business Integra attempts to distinguish ST Net by arguing that its error, amounting to 0.0041% of its projected Total Value, is far smaller than the pricing error in ST Net. Hr’g Tr. 12:21 to 13:7. This argument is at odds with the EAGLE II solicitation, which explicitly states that omission of even a single labor rate, no matter its significance, “will result in a material non-conformity.” AR 1-120. Business Integra asserts that this provision, along with other similar provisions in the solicitation, “cannot convert an [otherwise] immaterial requirement into a material one.” Pl.’s Mot. at 27. To support this argument, Business Integra cites a number of cases from this court and from GAO. See id. Business Integra focuses on two cases in particular: Linc Gov’t Servs., LLC v. United States, 108 Fed. Cl. 473 (2012), and DMS All-Star Joint Venture v. United States, 90 Fed. Cl. 653 (2010). Pl.’s Resp. at 13. Although these cases addressed negotiated procurements under FAR Part 15, the courts relied exclusively on Part 14 as a legal ground for determining that missing pricing breakdown information was immaterial. See Linc Gov’t Servs., 108 Fed. Cl. at 503 (citing FAR § 14.405 in determining a blank in pricing was a de minimis error); DMS All-Star, 90 Fed. Cl. at 666 n.16 (citing as its only authority Am. Spare Parts, Inc., B- 224745, 87-1 CPD ¶ 4, 1987 WL 101290 (Comp. Gen. Jan. 2, 1987), which involved a Part 14 sealed bidding). Nonetheless, both cases are inapposite here not because they looked to FAR Part 14 but instead because the errors being addressed were in formatting rather than in setting out pricing information. In Linc Government Services, the court allowed the government to exercise its discretion to accept blanks in place of zeros in a bid. 108 Fed. Cl. at 503-04 (“[The] oversight did not deprive the [agency] of any information.”). Similarly, the government in DMS All-Star could allow a proposal that did not format information already in the proposal into a specific section. DMS All-Star, 90 Fed. Cl. at 666 n.16 (“[A]ll material information required by the solicitation [was] present.”). Thus, even if Linc Government Services and DMS All-Star had applied FAR Part 15, the result in those cases would have been the same.
The other cases Business Integra cites are also inapposite. Some are sealed biddings under FAR Part 14 and therefore are not pertinent to the EAGLE II solicitation. See Tri-Services, Inc., B-245698, 92-1 CPD ¶ 75, 1992 WL 15020 (Comp. Gen. Jan. 15, 1992); Am. Spare Parts, 1987 WL 101290. Others are distinguishable because the proposals at issue contained omissions unrelated to price or included total price but omitted unit pricing. See AABCO, Inc. v. United States, 3 Cl. Ct. 109, 117-19 (1983) (finding that omission of leading zeros in rate information was immaterial when determining the value of the rate); Challenger Piping, Inc., B-221855, 86-1 CPD ¶ 385, 65 Comp. Gen. 505, 1986 WL 60613, at *1-*2 (Apr. 18, 1986) (determining that failure to provide a list of manufacturers and suppliers was not material when compliance was otherwise indicated); Andrea Radio Corp., B-198240, 80-2 CPD ¶ 165, 1980 WL 16036, at *1 (Comp. Gen. Sept. 2, 1980) (finding that pricing per line item was unnecessary when a bid included a total price); Fisher Berkeley Corp., B-196432, B-196432.2, 80-1 CPD ¶ 26, 1980 WL 17309 (Comp. Gen. Jan. 9, 1980) (finding that failure to include a testing certification from a specific laboratory on equipment was immaterial); Mountain Eng’g & Constr. & Weisz & Sons, B-194472, 79-2 CPD ¶ 153, 1979 WL 12114, at *2 (Comp. Gen. Aug. 27, 1979) (determining that unit pricing was unnecessary when it could be derived from provided total price and quantity of items); Space Age Eng’g, Inc., B- 176425, 1972 WL 6219, at *3-*4 (Comp. Gen. Oct. 18, 1972) (same). None of the errors in the cited cases resulted in a change in pricing.
In addition, Business Integra fails to account for the fact that the EAGLE II solicitation is for an ID/IQ procurement. The government asserts that the requirement to commit to ceiling rates in all labor categories for all years is important because the solicitation’s purpose includes providing a basis for robust competition within a pool of small businesses that are ready and willing to provide all the FC1 IT services DHS requires. This purpose would be frustrated if the labor-rates provision were to be considered immaterial. Def.’s Mot. at 17. Without this requirement, DHS would have been unable properly to select a manageable pool of businesses that would be able to compete for future task orders. Def.’s Mot. at 17; Hr’g Tr. 17:12 to 18:5. In addition, pricing on individual elements of the proposal might become important in selecting awardees to perform particular task orders under the ID/IQ framework. Def.’s Mot. at 17 (“[I]t is safe to say the requirement that contractors commit in advance to ceiling rates for the entire ID/IQ contract in all labor categories is a substantial concession that will have a significant impact on future task order pricing.”). The court accepts that the requirement to provide pricing for all labor categories for all years was a material term of the solicitation. While Business Integra’s argument regarding the inability of an agency to declare an immaterial term to be a material one is valid in an abstract sense, it has not been supported on an as-applied basis in challenging DHS’s exercise of discretion in this particular set of circumstances. Rather, the warning in the EAGLE II solicitation that pricing omissions would be considered a material defect was reasonably applied by DHS’s procurement officials.
B. DHS’s Discretion In Addressing Errors
Business Integra’s second asserted ground for error is closely related to its first argument. In asserting that DHS abused its discretion, Business Integra contends that the agency should have recognized the error and waived or corrected it. Pl.’s Resp. at 15-17. Business Integra states that the pattern of its labor-rate increases, stepping upward at 2% per year, was specified in its proposal, and that the government should have corrected the errors by calculating and then inserting the missing rates. Pl.’s Resp. at 15-16. The government resists any suggestion that DHS could have made the calculations necessary to provide the missing information or that it had an obligation to exercise its discretion to take such a step, emphasizing the high number of proposals submitted. Hr’g Tr. 26:5 to 28:15.
In support, Business Integra cites Military Waste Management, Inc., B-228862, 87-2 CPD ¶ 424, 1987 WL 103070 (Comp. Gen. Oct. 30, 1987). See Hr’g Tr. 10:11 to 11:16. The GAO determined in Military Waste that the contracting officer could, under FAR § 14.406-2(a) (1986), recodified as FAR § 14.407-2, seek an explanation from a bidder regarding an evident clerical error. 1987 WL 103070, at *1. Because the bidder confused a “per housing unit” term with a monthly price, it was “simple mathematics” to correct the problem. Id. Business Integra argues that the mathematics required to calculate a 2% increase is simpler than converting per-housing-unit to per-month. Hr’g Tr. 11:12-16. Even if this statement were true, it does not legally require an agency to conduct such calculations. Military Waste stated that, under the former provisions of FAR Part 14, an agency acted reasonably when seeking clarification in a sealed bidding procurement; it does not support a correlated reverse proposition – that failing to seek clarification in negotiated procurements is unreasonable. In addition, unlike Business Integra’s omission, the mistake in Military Waste did not change the final proposed cost. Instead, the government is permitted to reject an offer that is materially incomplete without needing to conduct an investigation into the omission and to calculate the gap-filling information. Accord ST Net, 112 Fed. Cl. at 110 (citing IBM Corp v. United States, 101 Fed. Cl. 746, 758-59 (2011)).
Alternatively, Business Integra argues that the government should have waived the defect or allowed Business Integra to correct the defect. Pl.’s Resp. at 17-20; Pl.’s Mot. at 34-36. Business Integra relies on FAR § 52.215-1, incorporated into the EAGLE II solicitation, AR 1-100, for the proposition that the government had the authority to waive the defect or allow corrections, see Pl.’s Resp. at 11. FAR § 52.215-1 states that “[t]he [g]overnment may waive informalities and minor irregularities in proposals received.” 48 C.F.R. § 52.215-1(f)(3). The next paragraph of this subsection of the FAR provides that “[t]he [g]overnment intends to evaluate proposals and award [contracts] without discussions with offerors (except clarifications as described in FAR [§] 15.306(a).” 48 C.F.R. § 52.215-1(f)(4). As noted earlier, the cited provision of the FAR permits clarifications as “limited exchanges” to provide offerors “the opportunity to clarify certain aspects of proposals . . . or to resolve minor or clerical errors.” 48 C.F.R. § 15.306(a)(1), (2). Because Business Integra’s error was material, the government was under no obligation to waive the error or allow Business Integra to correct the error. See ST Net, 112 Fed. Cl. at 110. As the government points out, requiring the agency to waive Business Integra’s error could result in disparate treatment among offerors and thus constitute an abuse of discretion. Def.’s Mot. at 19; see also Hunt Bldg. Co. v. United States, 61 Fed. Cl. 243, 273 (2004) (“[An] agency's failure to follow the terms of its own [s]olicitation and selection of an offeror based upon different requirements than those imposed upon the only other offeror are quintessential examples of conduct which lacks a rational basis.”), modified on other grounds by Hunt Bldg. Co. v. United States, 63 Fed. Cl. 141 (2004).
For the reasons stated, Business Integra’s Motion for Judgment on the Administrative Record is DENIED, and the government’s Motion for Judgment on the Administrative Record is GRANTED. Correspondingly, Business Integra’s Motion for a Preliminary Injunction is DENIED. DHS acted reasonably when it determined that Business Integra’s proposal was ineligible for an award. (Business Integra Inc. v. U. S., No. 14-210C, June 4, 2014) (pdf)
In sum, the Postal Service’s actions in eliminating Asia Pacific from consideration for an award of a contract were arbitrary and capricious. After first qualifying Asia Pacific for the Competitive Bidding Event based upon its original proposal, and then allowing Asia Pacific to submit further pricing bids during the electronic Bidding Event with the apparent result that Asia Pacific was the winner of a contractual award respecting the two largest lanes involved in the Solicitation, it subsequently was arbitrary and capricious for the Postal Service to disqualify Asia Pacific from any award based upon an interpretation of the scheduling provisions in the Solicitation that it refused to discuss with, or to clarify for, Asia Pacific. See Purchasing Manual §§ 4.2.5.c (“The final stage of discussions is reaching agreement on the contract’s terms and conditions with the apparently successful supplier. . . . [D]uring this stage any remaining issues should be addressed and revised.”), 4.2.5.c(3)(c) (“all suppliers must be treated fairly”). Cf. Information Technology, 316 F.3d at 1320-23 (applying the distinction between “minor clarification” and “discussion” in the Federal Acquisition Regulations as amended in 1997 to evaluate the fairness of communications with one offeror). (Asia Pacific Airlines, v. U. S. and Corporate Air, Alpine Air, and Aloha Airlines, Inc., No. 05-711C, October 14, 2005) (pdf) (Postal Service Procurement using Postal Service Procurement Manual)
We would find it bizarre to conclude that the Army has an obligation to clarify a bidder's clerical error, but not its own. Such a policy endorses official negligence. We see no reason to do so when the missing information is as prosaic and self-authenticating as a name and phone number. The integrity of the procurement process is enhanced, not harmed. The government's obligation is clear and simple. If it suspects a clerical error, it must ask. We therefore find that the Army's failure to inquire under these circumstances is arbitrary and capricious and a violation of 5 U.S.C. § 706. (Griffy's Landscape Maintenance LLC, v.. U.S. and Easy Tree Services, Intervenor, No. 99-999C, March 2, 2000)
Dellew Corporation B-410251.3: May 13, 2015 (pdf) Level 3 Communications, LLC v. U. S. and Verizon Deutschland GmbH, No. 16-829 December 5, 2016
Business Integra Inc. v. U. S., No. 14-210C, June 4, 2014 (pdf) Asia Pacific Airlines, v. U. S. and Corporate Air, Alpine Air, and Aloha Airlines, Inc., No. 05-711C, October 14, 2005) (pdf) (Postal Service Procurement using Postal Service Procurement Manual)