Recently, many federal government contract bidders have experienced an adverse contractor responsibility determination trend when the agency evaluates their proposal. There are specific actions that the contracting officer must follow. Without a clear understanding of the regulations, you could miss out on a lucrative contract award. Challenging the agency’s nonresponsibility determination under FAR 9.104-1can be specifically tricky in a bid protest. However, if done correctly, you can uncover serious mistakes sometimes made by the agency.
As a general rule, when a small business should not be immediately excluded from the award for responsibility reasons unless the agency refers to the SBA. This process balances the agency’s subjective power and allows the SBA to follow certain criteria to see whether or not the contractor is actually responsible or not.
A substantial amount of government contract litigation occurs because the agency may sometimes exclude the company for subjective perceptions such as the belief that the contractor does not have the financial capacity, facilities or some other reason. These are areas that allow the SBA to step in and make the final decision. See How to Structure Contractor Teaming Arrangements.
The core issue of contention occurs when the contracting officer issues a negative determination of responsibility because the proposal was technically unacceptable.
Proposal mistakes: The heart of most FAR responsibility determination concerns rests with the content of the submitted proposal. For example, if the proposal asks you to describe in detail how you intend to perform a certain task, failure to provide sufficient detail could end up with a negative responsibility determination. The courts give contracting agencies wide discretion when evaluating proposals. However, the government does make mistakes. The problem in litigation is to balance the subjective decision-making vs the legal and procurement legal requirements. Sometimes, this is very difficult to do.
Showing that your company has the necessary ability, equipment or resources to perform the solicitation requirements is also another common problem. See also SBA Certificate of Competency COC Program & Bid Protests.
Does the agency have to engage in clarifications?
The answer is no. It is up to the federal government agency whether it wants to engage with some level of dialogue with contractors. There is certainly no hard requirement for it to do so. See Rotech Healthcare, Inc., B-409020, B-409020.2, Jan. 10, 2014, 2014 CPD ¶ 28 at 6.
Tip: an agency can only come to a valid contractor nonresponsibility determination after evaluating a proposal. See FAR 9.105-1(b)(3); Sygnetics, Inc., B-404535.5, Aug. 25, 2011, 2011 CPD ¶ 164 at 4.
This is important when challenging the agency’s technical evaluation record in a bid protest.
Under FAR 9.104-1 What are Elements of FAR Contractor Responsibility Determinations?
When the contracting officer makes a responsibility determination under FAR 9.104, the evaluators should look at:
- Whether your company has adequate financial resources to perform the contract, or the ability to obtain them. (see FAR 9.104-3(a));
- Whether your company is able to comply with the delivery or performance schedule ( the agency should consider any business or commercial commitments
- Whether you have a satisfactory past performance record, and
- You have a satisfactory record of integrity and business ethics
- Your company has the necessary organization, experience, accounting and operational controls, and technical skills, or the ability to obtain them (including, as appropriate, such elements as production control procedures, property control systems, quality assurance measures, and safety programs applicable to materials to be produced or services to be performed by the prospective contractor and subcontractors
- Have the necessary production, construction, and technical equipment and facilities, or the ability to obtain them (see FAR9.104-3(a)); and
- Be otherwise qualified and eligible to receive an award under applicable laws and regulations (see also inverted domestic corporation prohibition at FAR 9.108).
What Can You Do to Challenge Your Responsibility Determination?
When challenging FAR contractor responsibility determinations in a bid protest, you can look into showing that the contracting officer unreasonably failed to consider available relevant information or otherwise violated statute or regulation. See 4 CFR 21.5(c); Greenleaf Constr. Co., Inc., B-293105.18, B-293105.19, Jan. 17, 2006, 2006 CPD ¶ 19 at 13-14.
- Companies may want to provide this information with the proposal.
- A responsibility determination by contractor not in compliance with FAR 9.104 must be immediately challenged according to the bid protest deadlines.
When making a contractor determination of responsibility, the court will not place the burden on the contracting officer to seek out information. It is up to the bidder to provide relevant information. See Independent Government Subcontractor Agreement Approaches.
The additional information provided should have a strong bearing on whether the awardee should be found responsible. Greenleaf Constr. Co., Inc., supra, at 14 (contracting officer ignored known information and instead based his determination of the awardee’s financial responsibility on information known to be inaccurate); Southwestern Bell Tel. Co., B-292476, Oct. 1, 2003, 2003 CPD ¶ 177 at 8-10 (contracting officer failed to consider serious, credible information regarding awardee’s record of integrity and business ethics in making his responsibility determination).
For help with protesting adverse contractor responsibility determination in a bid protest, call Watson & Associates’ bid protest lawyers at 1-866-601-5518.