Achieving full and open competition for government requirements is one of the most basic tenets of government contracting. But, every day the Government issues solicitations that have some limitations on competition. It may set aside contracts for small and disadvantaged businesses. It may require that offerors possess appropriate security clearances. The list goes on.

Agencies are given considerable latitude to determine their needs and the best means for fulfilling them. Indeed, they are in the best position to fully appreciate how supplies and services have been used in the past and how future acquisitions would best meet their objectives. However, the policy favoring competition tempers the exercise of this discretion by requiring agencies to specify their needs and seek proposals so that all responsible sources are permitted to compete.

A solicitation may include restrictive provisions but only to the extent that the limitations are necessary to meet the agency’s needs. When faced with a protestor’s complaint that a particular requirement was “unduly restrictive,” the Government Accountability Office (“GAO”) sustained the protest because the Government failed to meet its “burden to establish that the specification [was] reasonably necessary to meet its needs.” See Booz Allen Hamilton, Inc., B-418449 at 6, 2020 WL 3402045 at *4 (May 18, 2020).

Booz Allen Hamilton (“BAH”) was one among four vendors that were awarded a multiiple award, indefinite delivery/indefinite quantity contract to provide financial statement audit support services to the Navy and its constituent agencies, one of which is the Marine Corps. The Marine Corps issued a request for quotations (“RFQ”) for a task order to perform audit services. The RFQ was issued to the vendors that had been awarded the Navy contract; however, the Marine Corps stated a vendor would not be considered for the task order unless the Marine Corps determined that the vendor was an Independent Public Accountant (“IPA”) or that it was proposing an affiliate that was an IPA. In response to questions from BAH, the Marine Corps stated that the term affiliate did not include subcontractors, which meant that a vendor could only meet the requirement if it was an IPA or that one of its corporate affiliates was an IPA. Subbing out the IPA requirement was not an option.

Prior to issuing the RFQ, the Marine Corps sent a request for information to the vendors that, among other queries, asked them to state whether they were IPAs. Based on the responses, the Marine Corps determined that BAH “could perform the required tasks [but] could not bring the level of subject matter experience that an IPA firm or its affiliate could provide.” Id. at 3, 2020 WL 3403045 at *2.

Given that, BAH protested the terms of the solicitation including the requirement that the awardee be an IPA and that an offeror could not satisfy the requirement through the engagement of a subcontractor. BAH contended that the IPA requirement unduly restricted competition and that the Marine Corps could not have a reasonable basis for prohibiting the use of a subcontractor to fulfill the requirement. The agency responded to this assertion citing an email from the agency program manager to the contracting officer. The email simply stated that an IPA firm was the only entity that would be able to provide the Marine Corps with an unmodified audit opinion “because an IPA’s consulting services would yield more credible and relevant advice due to the auditing experience and culture of an IPA firm.” Further, the email stated that a subcontractor could not fulfill the requirement because the relationship between a prime and its subcontractor would only exist for the specific project and therefore the entities would not be part of a broader organization that has a shared culture.

The GAO simply was not persuaded that the agency had reasonable justifications for the IPA requirement and its refusal to permit the requirement to be subcontracted. Essentially, the Marine Corps relied entirely upon the single email from the program manager. The GAO concluded that the email stated the PM’s belief but lacked any evidence that explained why IPAs are the only firms that could provide the sought-after services. Likewise, the email lacked any evidence beyond the program manager’s unsupported claim that a subcontractor could not satisfy the requirement. Given this thin justification, the GAO concluded that the agency could not meet its burden to justify these requirements; therefore, these requirements were unduly restrictive of competition.

Taking the GAO’s factual conclusions as accurate, this decision correctly decided that the agency’s solicitation unduly restricted competition such that otherwise responsible and capable offerors could not participate. After all, the Marine Corps did find that BAH could do the work.

Some years ago, a client encountered a solicitation that set forth several ambiguous requirements that, taken together, simply did not make sense because they would have required a staffing model that was unknown in its industry. Indeed, the model was so contrary to practice that the standards of practice promulgated by the trade association for the sector actually stated that the model was not permissible. The agency did not correct the issue in the Q&A process; thus, protesting the solicitation was the only option available to correct the problem so that the company could submit a proposal consistent with industry practice. We made the precise argument made by BAH in this protest and, happily, the agency didn’t belabor the issue and took corrective action. Ultimately, the company was awarded the contract.

The BAH case and my client’s protest led to good results that promote competition so that capable offerors can compete for agency requirements. However, many contractors are loathe to pursue a GAO protest of solicitation terms for fear of incurring the wrath of the contracting officer before they have submitted a proposal. But, if the solicitation would keep you out of the game, then a protest might not be such a bad approach. In my experience, the best course is to carefully review the solicitation at your earliest opportunity. Use the Q&A process to point out problematice terms. If the CO does not recognize that a change is warranted, then a protest before proposals are due might be required.