Xl Associates, Inc. v. United States ( 2021 )

Sn the Auited States Court of Federal Clanns
No. 21-1095
(Filed Under Seal: August 31, 2021)
Reissued: September 15, 2021!
XL ASSOCIATES, INC.,
Plaintiff,
Vv.
THE UNITED STATES,
Defendant,
and
OST, INC.,
Defendant-Intervenor.
a ee
Shomari Brock Wade, Greenberg Traurig, LLP, Washington, DC, for plaintiff.
Daniel Hoffman, U.S. Department of Justice, Civil Division, Washington, DC, for defendant.
Craig Alan Holman, Arnold & Porter Kaye Scholer, LLP, Washington, DC, for defendant-
intervenor.
OPINION AND ORDER
SMITH, Senior Judge
This post-award bid protest is before the Court on the parties’ Cross-Motions for
Judgment on the Administrative Record. Plaintiff, XL Associates, Inc. (“XLA”), challenges the
evaluation of offerors and the award decision issued by the United States Department of
Homeland Security, Federal Emergency Management Agency (“FEMA” or “Agency”) for the
procurement of National Flood Insurance Program standard operations support services under
Solicitation No. 7OFA6020R00000004 (“Solicitation”). Administrative Record 80 [hereinafter
AR]. For the reasons set forth below, the Court denies plaintiffs Motion for Judgment on the
Administrative Record and grants defendant’s and defendant-intervenor’s Cross-Motions for
Judgment on the Administrative Record.
! An unredacted version of this opinion was issued under seal on August 31, 2021. The
parties were given an opportunity to propose redactions, but no such proposals were made.
I. Background
A. The Solicitation
On July 8, 2020, FEMA issued its original Solicitation for the procurement of standard
insurance operations support for the National Flood Insurance Program (“NFIP”), administered
through FEMA’s Federal Insurance Division. AR 80. The Agency expects the awardee to
provide insurance subject-matter expertise as well as standard business operations such as project
management, underwriting support, claims support, flood disaster response support,
correspondence support, field office support, publication and document assistance, and program
support. AR 88. The Solicitation states that the basis of award will be best value, with a two-
phase evaluation based on the following four factors listed in descending order of importance:
Phase I: Factor 1 (Demonstrated Relevant Prior Experience ); and Phase II: Factor 2 (Oral
Presentation), Factor 3 (Price), and Factor 4 (Past Performance). AR 147-49.
Phase I, Factor 1 (Relevant Prior Experience) requires offerors to submit written
submissions demonstrating “experience supporting the requirements complexity identified in the
Standard Operations Statement of Work (SOW).” AR 141. In their submission, offerors must
address three subfactors within Factor 1: (1) experience directly supporting the NFIP; (2)
experience directly supporting the processing of flood insurance claims; and (3) experience
implementing change management efforts. AR 139; see also AR 141. Submissions are
evaluated under Factor | “holistically” across these three subfactors and offerors are assigned a
rating based on the Agency’s “confidence in the [o]fferor’s ability to successfully perform the
work.” AR 149; see also AR25. These ratings are: “High Confidence”; “Some Confidence’;
and “Low Confidence.” AR 25. As part of Phase I, Factor I, offerors are required to also submit
written Letters of Commitment (“LOC”) for any “major subcontractor” that is relied upon to
meet evaluation criteria. AR 139.
Upon evaluating offerors’ submissions under Factor 1, the Agency advises offerors with
the highest ratings for Factor 1 to proceed to Phase I]. AR 141. In Phase II submissions,
offerors address the following factors: Factor 2 (Oral Presentation); Factor 3 (Price); and Factor
4 (Past Performance). AR 149. Factor 2 (Oral Presentation) is evaluated “holistically” across
multiple subfactors and offerors are assigned ratings of: “High Confidence”; “Some
Confidence”; or “Low Confidence.” AR 149; see also AR 26—27; 142-43. For Factor 3 (Price),
offerors complete an attached price template with labor rates. AR 140, 147; see also AR 150-
54. The Solicitation states that each offeror’s “total evaluated price will be derived from the
price of the base period plus options periods.” AR 147. Under Factor 4 (Past Performance), the
Agency evaluates offerors for relevant past performance and assigns confidence ratings in the
same manner as Factors 1 and 2. AR 148; see also AR 28. However, the Agency’s evaluation of
Factor 4 (Past Performance), unlike Factor 1 (Relevant Prior Experience), will not evaluate an
offeror “favorably or unfavorably if it lacks relevant past performance.” AR 148; see also AR
28.
The Solicitation requires FEMA to use the trade-off evaluation process to evaluate each
proposal in accordance with the evaluation criteria. AR 149. Under these terms, FEMA makes
the appropriate “trade-off decisions” between the merits of each offeror’s proposal to award a
“single contract to the responsible Offeror whose proposal represents the best value.” AR 147.
B. Evaluation
The evaluation process involves a two-tiered approach consisting of a Source Selection
Evaluation Board (“SSEB”) and the Source Selection Authority (“SSA”). AR 7. The SSEB
comprehensively evaluates each proposal in accordance with the Source Selection Plan and the
evaluation factors contained in the Solicitation and documents its findings in a Technical
Evaluation Consensus Report. AR 9, 1274. The SSEB comprises three Source Selection
Evaluation Teams: (1) a Technical Evaluation Team to evaluate Factor 1 and Factor 2, (2) a Past
Performance Evaluation Team to evaluate Factor 4, and (3) a Price Evaluation Team to evaluate
Factor 3. AR 16. The SSA makes the final source selection decision considering the evaluation
in the Technical Evaluation Consensus Report and issues the Source Selection Decision
Document (“SSDD”). AR 7, 1326.
On September 29, 2020, the Agency completed its evaluation of all proposals. AR 532.
After the Agency initiated corrective action, as detailed below, the Agency performed a
reevaluation of the offerors’ proposals. AR 994. On March 2, 2021, the SSEB issued the
Technical Evaluation Consensus Report and on March 3, 2021, the SSA issued the SSDD. AR
1274, 1329. The final evaluation ratings for OST and XLA are as follows:
Offeror | Factor 1 Demonstrated | Factor 2 Oral Factor 3 Price Factor 4 Past
Prior Experience Presentation Performance
OST High Confidence Some Confidence | $61,789,951.08 | Some Confidence
XLA Some Confidence High Confidence | $72,258,970.60 | High Confidence
AR 1658. Asaresult of the corrective action, OST’s Factor | rating changed from “Some
Confidence” to “High Confidence.” AR 1340. XLA’s Factor 4 rating changed from “Some
Confidence” to “High Confidence.” AR 1340. Following the relative order of importance of
each factor under the Solicitation, as well as the results of the Technical Evaluation Consensus
Report, the SSA found OST’s proposal represented the best value. AR 1341. Though plaintiff
was rated higher in Factor 2 and Factor 4, “[b]ased upon the relative order of importance of the
factors specified in the [S]olicitation, OST’s superior technical merit for Factor 1 [was]
considered more important than XLA’s superior technical merit assigned for Factor 2.” AR
1340. The SSA agreed with the SSEB that both offeror’s prices were “fair and reasonable” but
the “$10,469,019 price premium that would be incurred to award to XLA [was] considered
significant and not warranted or consistent with the terms of the solicitation.” AR 1338, 1340.
On March 5, 2021, FEMA notified plaintiff that it was not selected for award. AR 1342.
On March 11, 2021, FEMA provided a written debriefing to plaintiff. AR 1658.
C. Procedural History
On September 29, 2020, FEMA awarded the contract to plaintiff for a total contract value
of $60,091,536.66. AR 532. On October 14,2020, OST, the incumbent contractor, protested the
= He
award before the Government Accountability Office (“GAO”). AR575. On November 30,
2020, FEMA informed plaintiff that the GAO action had been dismissed, contingent on the
Agency’s corrective action. AR 994-95. On February 9, 2021, FEMA issued an amended
Request For Proposals (“RFP”), revising the following: (1) Factor 2 (Oral Presentation) and (2)
the pricing template. AR 1029-30. On February 12,2021, FEMA issued another amendment to
the RFP, once again revising the Scheduled Pricing Sheet. AR 1202. Plaintiff timely updated its
proposal in response to both amendments. AR 1544. On February 22, 2021, FEMA terminated
plaintiff’ s contract for the government’s convenience. AR 1215-17. As aresult, FEMA
reevaluated the proposals. See AR 1274.
On March 22, 2021, plaintiff filed its Complaint with this Court, seeking declaratory and
injunctive relief. See Complaint, ECF No. 1. On April 23, 2021, plaintiff filed its Motion for
Judgment on the Administrative Record. See Plaintiff's Motion for Judgment on the
Administrative Record, ECF No. 26 [hereinafter Pl.’s MJAR]. On May 14, 2021, defendant and
defendant-intervenor filed their Cross-Motions for Judgment on the Administrative Record as
well as their Responses to plaintiff's Motion for Judgment on the Administrative Record. See
Defendant’s Opposition to Plaintiffs Motion for Judgment on the Administrative Record and
Cross-Motion for Judgment on the Administrative Record, ECF No. 27 [hereinafter Def.’s
CMJAR]; Defendant-Intervenor’s Cross-Motion for Judgment on the Administrative Record and
Response to Plaintiff’s Motion for Judgment on the Administrative Record, ECF No. 29
[hereinafter Def.-Int.’s CMJAR]. On May 24, 2021, plaintiff filed its Reply in Support of its
Motion for Judgment on the Administrative Record and Response to the Cross-Motions for
Judgment on the Administrative Record. See Plaintiff's Reply and Response to Cross-Motions
for Judgment on the Administrative Record, ECF No. 30 [hereinafter Pl.’s Reply]. On June 2,
2021, defendant and defendant-intervenor filed their Replies in Support of their Cross-Motions
for Judgment on the Administrative Record. See Defendant’s Reply in Support of its Cross-
Motion for Judgment on the Administrative Record, ECF No. 32; Defendant-Intervenor’s Reply
in Support of its Cross-Motion for Judgment on the Administrative Record, ECF No. 31. The
Court held oral argument on July 7, 2021. The parties’ Motions are fully briefed and ripe for
review.
II. Standard of Review
This Court’s jurisdictional grant is found primarily in the Tucker Act, which affords this
Court with jurisdiction over bid protest actions. 28 U.S.C. § 1491(b). This Court evaluates bid
protests under the Administrative Procedure Act’s (“APA”) standard of review for agency
actions. See 28 U.S.C. § 1491(b)(4); Bannum, Inc. v. United States, 404 F.3d 1346, 1351 (Fed.
Cir. 2005) (citing Impresa Construzioni Geom. Domenico Garufi v. United States ,238 F.3d
1324, 1332 (Fed. Cir. 2001)). Under APA standards, agency procurement actions may be set
aside if they are “arbitrary, capricious, an abuse of discretion, or otherwise not in accordance
with the law.” 5 U.S.C. § 706(2)(A).
Under Rule 52.1 of the Rules of the Court of Federal Claims (“RCFC”), a party may file
a motion for judgment on the administrative record for the court to assess whether an
administrative body, given all disputed and undisputed facts in the record, acted in compliance
with the legal standards governing the decision under review. See Supreme Foodservice GmbH
-4-
v. United States, 109 Fed. Cl. 369, 382 (2013) (citing Fort Carson Supp. Servs. v. United States,
71 Fed. Cl. 571, 585 (2006)). On a motion for judgment on the administrative record, the parties
are limited to the Administrative Record, and the court makes findings of fact as if it were
conducting a trial on a paper record. RCFC 52.1; Bannum, 404 F.3d at 1354. Looking to the
Administrative Record, the court must determine whether a party has met its burden of proof
based on the evidence in the record. Bannum, 404 F.3d at 1355.
When a protestor claims that an agency’s decision violates a statute, regulation, or
procedure, the protestor must show that the alleged violation was “clear and prejudicial.”
Impresa, 238 F.3d at 1333. The Court will “interfere with the government procurement process
‘only in extremely limited circumstances.’” EP Prods., Inc. v. United States, 63 Fed. Cl. 220,
223 (2005) (quoting CACTI, Inc.-Fed. v. United States, 870 F.2d 644, 648 (Fed. Cir. 1989)). “If
the court finds a reasonable basis for [an] agency’s action, the court should stay its hand even
though it might, as an original proposition, have reached a different conclusion as to the proper
administration and application of the procurement regulations.” Honeywell, Inc. v. United
States, 870 F.2d 644, 648 (Fed. Cir. 1989). The court cannot substitute its judgment for that of
an agency, even if reasonable minds could reach differing conclusions. Bowman Transp., Inc. v.
Ark.-Best Freight Sys., Inc.,419 U.S. 281, 285-86 (1974).
III. Discussion
Plaintiff challenges the Agency’s award to OST, Inc. (“OST” or “awardee’”), arguing that
the Agency made the following errors: (1) FEMA relied on unstated criteria in its evaluation; (2)
FEMA arbitrarily assigned weaknesses to plaintiff’ s proposal while not giving credit for
strengths; and (3) FEMA conducted flawed best value and price determinations? See generally
Pl.’s MJAR, ECF No. 26. Defendant and defendant-intervenor respond with the following: (1)
plaintiff cannot demonstrate prejudice and does not have standing to bring this protest; (2)
plaintiff’ s arguments are untimely because they contest the terms of the Solicitation?; and (3)
FEMA propertly exercised its discretion in accordance with the Solicitation and provided a
2 Plaintiff also presented a conflict-of-interest claim that was subsequently withdrawn. See
Plaintiff’s Reply and Resp. to Cross-Motions for Judgment on the Administrative Record, ECF
No. 30. Therefore, the Court does not address that claim in this Opinion.
3 Both defendant and defendant-intervenor argue that much of plaintiff's protest is
untimely under Blue & Gold Fleet, LP. v. United States, 492 F.3d 1308 (Fed. Cir. 2007). See,
e.g., Defendant’s Opposition to Plaintiff’ s Motion for Judgment on the Administrative Record
and Cross-Motion for Judgment on the Administrative Record at 15—17,21, ECF No. 27;
Defendant-Intervenor’s Cross-Motion for Judgment on the Administrative Record and Response
to Plaintiff’ s Motion for Judgment on the Administrative Record at 2, 16, ECF No. 29.
However, plaintiff does not allege any ambiguity or patent error in the Solicitation’s terms. See
Plaintiff’s Reply and Response to Cross-Motions for Judgment on the Administrative Record at
6, ECF No. 30. As such, the waiver rule of Blue & Gold is inapplicable here.
_5-
procurement decision with an adequate rational basis. See generally Def.’s CMJAR, ECF No.
27; Def.-Int.’s CMJAR, ECF 29.
D. Unstated Evaluation Criteria
“Tt is hornbook law that agencies must evaluate proposals and make awards based on the
criteria stated in the solicitation.” NEQ, LLC vy. United States, 88 Fed. Cl. 38, 47 (2009) (citing
Banknote Corp. of Am. v. United States, 56 Fed. Cl. 377, 386 (2003), affd, 365 F.3d 1345 (Fed.
Cir. 2004)). As such, “[agencies] may not rely upon undisclosed evaluation criteria in evaluating
proposals.” /d. at 48 (citations omitted). However, “a solicitation need not identify each element
to be considered by the agency during the course of the evaluation where such element is
intrinsic to the stated factors.” /d. (citations omitted); see also Constellation W., Inc. v. United
States, 125 Fed. Cl. 505, 536 (2015). “[T]o prevail on an argument that an agency used an
unstated evaluation criterion, a protester must show that: (1) ‘the procuring agency useda
significantly different basis in evaluating the proposals than was disclosed; and (ii) the protester
was prejudiced as aresult[.]’” NEQ, 56 Fed. Cl. at 48 (citation omitted).
1. Simultaneity
Plaintiff argues that FEMA applied unstated evaluation criteria under Factor | (Relevant
Prior Experience). Specifically, plaintiff alleges that the Agency required offerors to “describe
their experience managing day -to-day operations and disaster support operations
simultaneously.” P\.’s MJAR at 14 (emphasis in original). As “XLA was not clear in describing
their experience with managing day to day operations and disaster operations simultaneously,”
the Agency assigned XLA a significant weakness under Factor 1, Subfactor 1 (Experience
Supporting NFIP). AR 1289. In response, defendant and defendant-intervenor state that the
“simultaneity” evaluation criterion is both an explicit and intrinsic requirement of the Solicitation
that was within the Agency’s reasonable discretion to apply, and that the “simultaneity”
requirement was expressly disclosed to plaintiff as part of corrective action. See Def.’s CMJAR
at 18; Def.-Int.’s CMJAR at 17.
The Court does not believe FEMA applied an unstated evaluation criterion of
simultaneity. The “simultaneous” requirement alleged by plaintiff comports with the terms of
the Solicitation. The Solicitation instructs offerors that Factor 1 (Relevant Prior Experience) will
be evaluated by determining how the offerors’ prior experience “aligns with the requirements of
the [Statement of Work (“SOW”)].” AR 141. The SOW asks for the parallel performance of
both day-to-day operations and disaster support operations, where the awardee should be able to
support FEMA “potentially around the clock during disaster events,” provide “procedures to
maintain support during an emergency, including natural disasters and acts of terrorism,” and
“continue [standard operations] to the maximum extent possible under emergency
circumstances.” AR 160-62. Taken together, the Solicitation and the SOW require the Agency
to evaluate an offeror’s ability to simultaneously manage day-to-day operations and disaster
support operations. As such, the Agency did not use a significantly different basis in evaluating
the proposals than was disclosed. Therefore, the Court finds the Agency’s evaluation consistent
with the terms of the Solicitation.
2. Letter of Commitment
Plaintiff also argues that the Agency applied unstated criteria by requiring XLA to
provide a Letter of Commitment (“LOC”) for its subcontractor, BAC Adjusting (“BAC”). Pl.’s
MJAR at 17. Plaintiff argues that “the Solicitation only requires a LOC for major
subcontractors” and plaintiff “explained repeatedly in its revised proposal that BAC is ‘a non-
major subcontractor.’” /d. (emphasis in original). Without a LOC for BAC, FEMA’s evaluation
did not include BAC’s experience as part of plaintiffs proposal, resulting in a weakness under
Factor 1, Subfactor 2 (Experience Supporting the Processing of Flood Insurance Claims). AR
1297. Defendant and defendant-intervenor argue that the Agency did not deviate from the
Solicitation by disregarding BAC’s experience under Factor 1 and that plaintiff's argument
amounts to mere disagreement with the Agency’s interpretation of a “major subcontractor.” See
Def.’s CMJAR at 19; Def.-Int.’s CMJAR at 20.
The Court finds that FEMA acted within the terms of the Solicitation when it disregarded
the experience of XLA’s subcontractor, BAC. The Solicitation requires a written LOC for each
“major subcontractor[]” as part of an offeror’s demonstration of relevant prior experience under
Factor 1. AR 139. Despite plaintiffs categorization of its subcontractor as a “non-major
subcontractor,’ AR 1076, FEMA determined that BAC was a major subcontractor because of its
involvement in supporting “day-to-day routine flood insurance claim and appeal activities.” See
AR 1076; AR 1297. Specifically, the Agency noted that “[BAC’ s] activities include requesting
claim file/supporting documentation, conducting on-site/desktop reviews, researching issues,
drafting decision memos following the [issue-rule-analysis-conclusion] format, supporting post-
decisions communications, supporting adjustments or corrective actions, and monitoring and
reporting active appeals/file suit.” AR 1297. The Solicitation does not provide an explicit
definition of what FEMA considers a “major subcontractor.” See Pl.’s MJAR at 17; see
generally, AR 80-149 (Solicitation). With respect to requiring a LOC for plaintiff’ s
subcontractor, the Court cannot say that the Agency used a “significantly different basis” in its
evaluation of major subcontractors that is inconsistent with the terms of the Solicitation. NEQ,
56 Fed. Cl. at 48 (citation omitted); see also USFalcon Inc. v. United States,92 Fed. Cl. 436, 461
(2010) (‘With no definition .. . to constrain the [Agency] and provide an objective standard for
reviewing [its] decision, the Court cannot say that this determination is irrational.”).
Accordingly, the Court finds the Agency’s determination consistent with the terms of the
Solicitation.
3. Experience Requirement
Plaintiff further argues that FEMA’s evaluation contravenes the terms of the Solicitation
in assigning its proposal a weakness under Factor 1 (Relevant Prior Experience). Pl.’s MJAR at
18. As argued above, plaintiff disagrees with the Agency’s decision to disregard BAC’s
experience because plaintiff did not submit a letter of commitment. As a result, the Agency
assigned a weakness under Factor 1. Plaintiff bases its argument on the Solicitation’s terms
regarding Factor 4 (Past Performance), which states that an “[o]fferor will not be evaluated
favorably or unfavorably if it lacks relevant past performance.” AR 148. In response, defendant
and defendant-intervenor argue that plaintiff “conflates experience and past performance . . . to
suggest that the Agency cannot downgrade experience” under Factor 1. See Def.-Int.’s CMJAR
at 22; see also Def.’s CMJAR at 18.
The Courtis unconvinced by plaintiff's arguments. Here, FEMA’s evaluation of
plaintiffs proposal is consistent with the terms of the Solicitation. The Solicitation clearly states
that the evaluation of Factor 1 is separate from Factor 4. AR 148; cf. AR 141. Moreover, this
distinction is clear because the Solicitation defines Factor 1 (Relevant Prior Experience) and
Factor 4 (Past Performance). AR 141, 148. Under Factor 1, offerors detail their experience
addressing three components: (1) experience directly supporting the NFIP; (2) experience
supporting the review, process, appeals of flood insurance claims; and (3) experience leading and
implementing change management efforts. AR 141. In comparison, under Factor 4, offerors are
evaluated on (1) quality of service provided, (2) cost control, (3) timeliness, (4) management,
and (5) customer service. AR 148. Accordingly, the Agency treated these Factors as distinct
and separate from one another in its evaluation. For Factor 1, the Agency evaluated plaintiff and
assigned a weakness because plaintiff did not provide a LOC for its subcontractor in order for the
Agency to include the subcontractor’s experience as part of plaintiffs proposal. AR 1297. For
Factor 4, the Agency did not assign plaintiff’s proposal a weakness for lacking relevant past
performance. Indeed, plaintiff received the highest rating under Factor 4, a rating of “High
Confidence” from the Agency. AR 1324. Therefore, FEMA performed its evaluation in
accordance with the terms of the Solicitation.
E. Arbitrary Evaluation and Rating
Plaintiff argues that FEMA made several errors in its evaluation. Specifically, plaintiff
argues that the Agency acted arbitrarily in its evaluation of Factor 1: (1) when it found no ‘risks’
or ‘deficiencies’ but still found flaws that ‘increase[d]’ the risk of unsuccessful contract
performance”; (2) when it assigned strengths under Factor 2 for areas in which it founda
weakness under Factor 1; and (3) when it provided no more than “a recitation of the definition of
‘Some Confidence’” as its rationale for its Factor 1 evaluation. Pl.’s MJAR at 18—20. In
response, defendant and defendant-intervenor argue that the Agency provided “reasoned,
documented explanations for the challenged ratings” and that the Court should not “second
guess” the Agency’s discretionary determinations. See Def.-Int.’s CMJAR at 24; see also Def.’s
CMJAR at 20.
It is well-established that agencies “are entitled to exercise discretion upon a broad range
of issues confronting them in the procurement process.” Impresa Construzioni Geom. Domenico
Garufi v. United States, 238 F.3d 1324, 1332 (Fed. Cir. 2001). Therefore, procurement decisions
“invoke[] ‘highly deferential’ rational basis review.” CHE Consulting, Inc. v. United States, 552
F.3d 1351, 1354 (Fed. Cir. 2008). Under that standard, the test is “whether the contracting
agency provided a coherent and reasonable explanation of its exercise of discretion.” Tech Sys.,
Inc. v. United States, 98 Fed. Cl. 228, 243 (2011) (citations omitted). “This entails determining
whether the agency entirely failed to consider an important aspect of the problem, offered an
explanation for its decision that runs counter to the evidence before the agency, or made a
decision that was so implausible that it could not be ascribed to a dif ference in view or the
product of agency expertise.” Jd. (citing Ala. Aircraft Indus., Inc.-Birmingham y. United States,
586 F.3d 1372, 1375 (Fed. Cir. 2009)). Ultimately, plaintiff“bears a heavy burden of showing
that the award decision had no rational basis.” /d. (citing Domenico Garufi, 238 F.3d at 1333).
The Court finds that the Agency provided a rational basis for its evaluation and ratings
and that plaintiff’s arguments amount to mere disagreement with the conclusions drawn by the
Agency in evaluating plaintiff's proposal. But itis not within this Court’s power to “substitute
its judgment for that of the [A]gency.” Bowman Transp., Inc. v. Arkansas-Best Freight Sys.,
Inc., 419 U.S. 281, 285 (1974) (citation omitted). Here, FEMA has provided a robust and
thorough explanation for its evaluation of plaintiff under Factor 1 (Relevant Prior Experience).
AR 1292-98 (Final Evaluation); see also AR 1286-92 (Initial Evaluation); AR 1326-42
(SSDD). In the Technical Evaluation Consensus Report, the SSEB provided rationale for each
of plaintiff’s strengths and weaknesses in the context of Factor 1 and each subfactor. See AR
1292-98. Specifically, the SSEB examined the five projects presented by plaintiff and evaluated
the relevancy of plaintiffs prior experience to the requirements of the Solicitation. See AR
1292-98. For example, Project 1 was considered relevant because it was “similar in scope to
some tasks in the SOW such as supporting the claims task” and was “similar in complexity to the
claims operation support (ex. providing accurate data for claims information and collection of
claims information).” AR 1293. However, Project 3 was not considered relevant, and therefore
was not considered, because “[a]lthough it relates to graphic visual data support, which is similar
i{n] scope to tasks of supporting creating documents under SOW Part A: NFIP Program Support,
it [did] not have similar complexity to any [section] of the SOW.” AR 1293.
The SSEB further evaluated plaintiffs prior experience under each subfactor of Factor 1
and described the specific strengths and weaknesses of plaintiff’ s proposal in meeting the SOW
requirements and NFIP goals. See AR 1292—98. For example, when considering NFIP Goal 1
under subfactor 1, the SSEB assigned a significant weakness because “XLA was not clear in
describing their experience with managing day to day operations and disaster operations
simultaneously” and that “XLA may not be able to support SOW Part A Standard Operations
and B Disaster Support during disaster season.” AR 1296. When considering subfactor 3, the
SSEB assigned a significant strength because plaintiff “demonstrated relevant prior experience
with their work on a nearly $1B contract involving change management for the Center of
Medicare and Medicaid Services (CMS),” which indicated a “significant strength due to the
complexity of the work and size of the project.” AR 1297.
In the Source Selection Decision Document, the SSA provided a similar assessment of
plaintiff’ s strengths and weakness for Factor | in terms of matching its prior experience against
program goals. See AR 1333-34. In particular, the SSA noted that plaintiff received strengths
for demonstrated prior experience by:
1) providing NFIP Subject Matter Experts with strong operational and
implementation skills that were flexible within the NFIP’s emerging processes
and complex requirements (NFIP Goal #1),
2) supporting the NFIP with updating 100+ internal NFIP businesses process maps
and SOPs (NFIP Goal #2),
3) leveraging FEMA ESW in developing an enterprise FIMA SharePoint solution to
improve and support workflow and tracking performance to eliminate bottlenecks
(NFIP Goal #3),
4) establishing relationships with stakeholders in FEMA Regional offices, FID
Divisions, Adjusting Firms, WYOs, states, local communities, and the NFIP
Direct. (NFIP Goal #4), and
5) working closely with the Office of Integration to support development, analysis,
and compiling components for the reauthorization packet (NFIP Goal #5)
AR 1333. The SSA also considered that plaintiff had a significant weakness because “XLA was
not clear in describing their experience with managing day to day operations and disaster
operations simultaneously.” The SSA further noted that “XLA was provided an
opportunity to revise their submission during Discussions. However, XLA provided a
response under a non-relevant project that was not [a] direct support of the NFIP as required
by the solicitation, and consideration was not given for the project.” AR 1333. The SSEB’s and
SSA’s explanations in the Technical Evaluation Consensus Report and Source Selection
Decision Document show that the Agency documented in detail its rationale and decision to
assign plaintiff its strengths and weaknesses. See AR 1333-34; AR 1292-98.
Further, the Agency’s differing evaluations of Factor 1 (Prior Experience) and Factor 2
(Oral Presentation) remain consistent with the Solicitation as the factors are separate and distinct,
each with different evaluation criteria. See AR 141-42. The Factor 1 evaluation focuses on an
offeror’s prior experience in supporting the requirements identified in the Statement of Work,
while much of the Factor 2 evaluation focuses on how an offeror intends to support the
requirements if awarded. See AR 141-42. Plaintiff argues that the Factor 1 and 2 evaluations
should be consistent with each other because the Solicitation states that “[f]or Factors 1 and 2,
the Government will holistically evaluate its confidence in the Offeror’s ability to perform the
work and make trade-off decisions.” AR 149. However, in the context of the rest of the
Solicitation, it is clear the Agency holistically evaluates Factor | across its respective subfactors,
and Factor 2 across its own respective subfactors, rather than consider Factors 1 and 2 in
combination. See AR 141-42. Thus, the Court finds nothing in the Administrative Record
which would support finding the Agency’s conclusions as arbitrary or capricious, an abuse of
discretion or otherwise not in accordance with the law.
F. Price Evaluations
Plaintiff contends that FEMA violated Federal Acquisition Regulation (“FAR”) 15.404-
1(b)(2) Gi) and FAR 15.505-1(b)(2)(v) in relying on Independent Government Cost Estimate
(“IGCE”) Labor Category rates for its price evaluation because the rates were established based
on the historical cost of a predecessor contract that included several other services not in the
scope of the current procurement. See Pl.’s MJAR at 24; AR 1347. Plaintiff further alleges
FEMA ignored the variance in OST’s proposed pricing in comparison to the IGCE rates, which
should have put the Agency on “notice that the IGCE was nota valid basis for comparison.” See
Pl.’s MJAR at 24-26. In response, defendant and defendant-intervenor argue that the Agency
was only required to perform a “fair and reasonable” price analysis, which was satisfied through
adequate price competition. See Def.’s CMJAR at 22; Def.-Int.’s CMJAR at 34.
-10-
The Agency established a fair and reasonable price for the contract award through
adequate price competition. The Agency can use “various price analysis techniques and
procedures to ensure a fair and reasonable price,” including “[c]omparison of proposed prices
received in response to the [S]olicitation.” Federal Acquisition Regulation 15.404-1(b)(2)(i)
[hereinafter FAR]. As the Solicitation did not require the Agency to conducta price realism
analysis, AR 138-149, “adequate price competition establishes a fair and reasonable price.”
FAR 15.404-1(b)(2)@). A price is based on adequate price competition when:
(A) Two or more responsible offerors, competing independently, submit priced offers
that satisfy the Government’s expressed requirement;
(B) Award will be made to the offeror whose proposal represents the best value where
price is a substantial factor in source selection; and
(C) There is no finding that the price of the otherwise successful offeror is
unreasonable.
FAR 15.403-1(c)(1)G). Here, those requirements were met where both plaintiff and OST
submitted independent offers to be evaluated for “best value,” and there was no finding that
either offeror’s price was unreasonable. While plaintiff alleges that the Agency’s use of IGCE
rates was flawed, FEMA can do so to ensure a fair and reasonable price. See FAR 15.404-
1(b)(2)(v); FAR 15.505-1(b)(3) (stating that other price analysis techniques, including IGCE
rates, may be used if competitive proposed prices or previous contract prices are insufficient to
determine if a price is fair and reasonable). Moreover, the IGCE rates used by the Agency were
not just based off a historical contract, but also incorporated GSA’s Contract Awarded Labor
Category Tool and IGCE Labor Category details from the Bureau of Labor Statistics. AR 1347.
As such, the Court finds the Agency’s price evaluation consistent with the FAR and find
plaintiff’ s concerns regarding the Agency’s use of IGCE rates unpersuasive.
G. Best Value Evaluation
Plaintiff contends that FEMA departed from the terms of the Solicitation when the
Agency “favored the lowest price over the superior solution, failed to consider XLA’s past
performance evaluation and superior technical evaluation overall, and considered XLA’s
technical and past performance factors independently” rather than “evaluat[ing] Factors 1 and 2
‘holistically.’” Pl.’s MJAR at 29, 31-32. Defendant and defendant-intervenor argue that
plaintiff simply disagrees with the Agency’s evaluation results and that the Agency complied
with the terms of the Solicitation and properly documented its decision. See Def.’s MJAR at 28;
Def.-Int.’s CMJAR at 29.
Agencies have “substantial discretion to determine which proposal represents the best
value for the government.” E.W. Bliss Co. v. United States, 77 F.3d 445, 449 (Fed. Cir. 1996).
Compared to other types of awards, the Court “accords contracting officers an even greater
degree of discretion when the award is determined based on the best value to the agency.” Glenn
Defense Marine (ASIA), PTE Ltd. v. United States, 720 F.3d 901, 908 (Fed. Cir. 2013). In
reviewing an agency’s best value choice of proposal, the Court defers to the agency’s decision as
-ll-
long as the decision is reasonable, “even if the [Court] itself might have chosen a different
proposal.” Widnall v. B3H Corp., 75 F.3d 1577, 1580 (Fed. Cir. 1996).
Under a comprehensive review of the record, the Court finds FEMA’s award to be
reasonable. Much of plaintiffs argument challenges the lack of a cost-realism analysis where
FEMA failed to find OST’s proposed rates unreasonably low. See Pl.’s MJAR at 23-27.
However, plaintiff has not demonstrated that a cost-realism analysis is required under the terms
of this Solicitation for a best-value contract. See AR 138-149. While it is true that FEMA did
not perform a cost-realism analysis, the Agency satisfied the Solicitation requirements through
other methods, such as an IGCE comparison and adequate price competition. See AR 1344-49.
Although plaintiff asserts that FEMA’s best-value analysis is flawed, its arguments amount to
mere disagreement with the Agency’s judgment.
Further, the Administrative Record provides FEMA’s explanation for its selection choice
and demonstrates that the Agency made a rational decision regarding its best-value determination
that comports with the terms of the Solicitation. See AR 1326-41; AR 1344-49. Following the
relative order of importance of each factor, the SSA found OST’s proposal represented the best
value. AR 1341. Although FEMA rated plaintiff higher in Factor 2 and Factor 4, the SSA
considered OST’s rating in Factor 1 more important than plaintiff’ s rating in Factor 2 in
accordance with the Solicitation. See AR 1340. While the SSA agreed that both offerors’ prices
were fair and reasonable, it found plaintiff’ s price premium over OST’s proposal significant and
not warranted given the order of importance of the evaluation factors under the Solicitation. See
AR 1338, 1340. Additionally, and as described above, the Agency holistically evaluated Factor
1 across its respective subfactors, and Factor 2 across its own respective subfactors, rather than
considering Factors 1 and 2 in combination. See AR 141-42. Therefore, the Court finds that the
Agency’s documentation of its trade-off analysis demonstrates a proper exercise of discretion
within the terms of the Solicitation.
H. Prejudice and Injunctive Relief
This Court is generally loath to “disturb a best-value award so long as the agency
‘documents its final award decision and includes the rationale for any business judgments and
tradeoffs made.’” Afghan Am. Army Servs. Corp. v. United States, 90 Fed. Cl. 341,360 (2009)
(quoting Blackwater Lodge & Training Ctr. v. United States, 86 Fed. Cl. 488, 514 (2009))
(citation omitted). So long as there exists a “rational connection between the facts found and the
choice made,” the Court will not set a procurement decision aside. Banknote Corp. of Am., 56
Fed. Cl. at 390 (quoting Motor Vehicle Mfrs. Ass’n v. State farm Mut. Auto. Ins. Co.,463 U.S.
29, 43 (1983)). As the Court is not persuaded by plaintiffs contentions that the Agency
conducted a flawed evaluation and award, the Court does not believe that plaintiff was
prejudiced by suchalleged procurement flaws.
Finally, plaintiff alleges that itis entitled to permanent injunctive relief. Pl.’s MJAR at
35-37. When analyzing whether a permanent injunction is proper, a court must analyze
“whether, as it must, the plaintiff has succeeded on the merits of the case.” PGBA, LLC v.
United States, 389 F.3d 1219, 1229 (Fed. Cir. 2004). As the plaintiff has not succeeded on the
merits of its case, the Court will not grant an injunction.
-12-
IV. Conclusion
For the reasons set forth above, plaintiffs MOTION for Judgment on the Administrative
Record is hereby DENIED. Defendant’s and defendant-intervenor’s CROSS-MOTIONS for
Judgment on the Administrative Record are hereby GRANTED. The Clerk is directed to enter
judgment in favor of defendant and defendant-intervenor, consistent with this opinion.
IT IS SO ORDERED.
s/ Given Sh, Anith
Loren A. Smith
Senior Judge
-13-