Government Contracting as a Team Sport: The Consideration of Subcontractor Experience

SumCo Eco-Contracting LLC, B-409434, B-409434.2, April 15, 2014
A company’s past experience often comes into play when an agency is going through the evaluation process in a procurement. In many cases, the procuring agency will evaluate a proposal based on the offeror’s past experience with projects of a similar scope and size as the project at issue in the solicitation.

But what happens to an offeror that has experience of its own, but not necessarily of the same size and scope of the work called for in the solicitation? Are they at an automatic disadvantage in the competition? We have previously seen that an offeror lacking experience of its own can rely on the experience of its affiliates, and that a joint venture can rely on the experience of its partners. But can an offeror rely on the experience of its subcontractors? GAO answered this question in the affirmative in a recent bid protest decision.

In SumCo Eco-Contracting LLC, the Army Corps of Engineers issued an invitation for bids (IFB) for beach erosion control at Prospect Beach in West New Haven, NJ. The IFB was a HUBZone set-aside, with the award to go to the lowest-priced, responsible bidder that was an SBA certified HUBZone small business. After determining that the lowest bidder was not a certified HUBZone small business, the agency moved on to the second-lowest bidder, who was a certified HUBZone small business.

Prior to making an award, the agency conducted an analysis as to the second-lowest bidder’s responsibility, specifically inquiring as to whether it had the relevant experience to perform the work called for by the IFB. The second-lowest bidder provided information to the agency that a portion of the work called for by the IFB would be performed by its subcontractor, which had the requisite experience. The agency ultimately decided that the second-lowest bidder was responsible, and moved forward with an award.

The protester challenged the agency’s affirmative responsibility determination, arguing that the agency improperly considered the experience of the non-HUBZone subcontractor in determining the awardee to be responsible. The protester argued that because the awardee, on its own, did not have the requisite experience to perform the work called for by the IFB, its offer should be rejected.

GAO rejected the protester’s argument, noting that contracting officers have broad discretion to determine whether a contractor is responsible. Here, GAO found nothing improper about the contracting officer considering the past experience of the awardee’s subcontractor. In fact, GAO pointed out several FAR clauses (FAR §§ 9.104-1 & 9.104-3) that allow for a contractor to obtain sufficient resources through subcontracting in order to be deemed responsible. As a result, GAO denied the protest.

This decision puts a spotlight on the importance of building a good team when tracking a procurement opportunity. Contractors, particularly small business contractors, cannot always check every necessary box required by a solicitation on their own. By building a team of contractors with diverse knowledge, skills and experience, contractors can raise their game and be more competitive in their pursuit of contract awards.

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