The Ignorance regarding how DCAA works is not limited to contractors, but is prevalent (no surprise) among government acquisition staff. The ignorance found among the GAO appeals division is a bit surprising and disconcerting.
There have been several decisions recently supporting the acquisition staff’s positions requiring a DCAA approved accounting system. Bidders who are not “DCAA Approved” face disqualification or penalization in the bidding process. Look at my recent article on this issue.
In the famous words of Bugs Bunny “I knew I should have taken that left turn at Albuquerque”, the GAO has taken a strange turn moving government contracting out of the Twilight Zone and into Toonland.
Now, A contractor is not only required to bid with only an approved DCAA accounting system, but must have a positive assertion of the DCAA approval. The contractor asserting such and even providing the DCAA audit report number is now deemed inadequate.
Leader essentially argues that the solicitation required only that offerors have received verification from DCAA that their accounting systems had been audited and determined adequate, but did not require the submission of any documentation from DCAA itself. Protest at 5-6; Comments at 3-4. In this regard, Leader contends that its elimination from the competition was unreasonable because Leader met the RFP’s requirement by providing its own unambiguous statement that its accounting system had been audited and approved by DCAA, along with the 2008 DCAA audit report number and additional information. Id. In Leader’s view, this information was sufficient for the agency itself to independently confirm with DCAA the verification and audit of its accounting system. Id.
In response, the agency acknowledges that a DCAA audit report would have been an acceptable source of verification; however, it explains that the solicitation expressly required offerors to furnish verification from DCAA with its proposal. AR, MOL at 8; AR, see also Supp. MOL at 3-6. In this regard, the agency also explains that the solicitation did not permit offerors to essentially self-verify the adequacy of their accounting systems. Rather, by requiring offerors to provide verification from DCAA, the agency would obtain independent verification that offerors’ accounting systems had been audited and determined adequate. Id.
When a dispute arises as to the actual meaning of solicitation language, our Office will resolve the matter by reading the solicitation as a whole and in a manner that gives effect to all provisions of the solicitation. See Level 3 Commc’ns LLC, B-412854 et al., June 21, 2016, 2016 CPD ¶ 171 at 7; KAES Enters., LLC, B-411225 et al., June 18, 2015, 2015 CPD ¶ 186 at 5. A solicitation is not ambiguous unless it is susceptible to two or more reasonable interpretations. WingGate Travel, Inc., B-412921, July 1, 2016, 2016 CPD ¶ 179 at 7. If the solicitation language is unambiguous, our inquiry ceases. Id.
On this record, we find that the agency’s interpretation of the solicitation, when read as a whole, is reasonable, whereas the protester’s interpretation is not reasonable. Here, the solicitation stated that an offeror “must have verification from [DCAA]. . . of an accounting system that has been audited and determined adequate” in order to be eligible for award. Id. at L-17 (emphasis added). The solicitation also advised that the agency would “evaluate evidence that the [o]fferor . . . [has] an adequate accounting system . . . as required under Section L.3.1.h.” Id. at M-3 (emphasis added). Finally, the solicitation cautioned that failure to “furnish verification of an adequate cost accounting system” would result in a rating of unacceptable and render the proposal ineligible for award. Id. (emphasis added). As explained by the agency, contrary to Leader’s contentions, the solicitation did not contemplate that an offeror could simply provide a declarative statement in lieu of the submission of evidence from DCAA verifying the adequacy of the offeror’s accounting system. See AR, Supp. MOL at 5. On this record, we find that the agency followed the clear and unambiguous terms of the solicitation and reasonably found Leader’s proposal unacceptable because it did not provide verification from DCAA that its accounting system had been audited and deemed adequate.
Leader also argues that its proposal should nonetheless have been accepted because it satisfied the agency’s actual and reasonable needs, its acceptance would not result in unfair prejudice to other offerors or provide Leader with a competitive advantage, and it contained sufficient information for the agency to obtain additional verification or confirmation with DCAA. See Protest at 6; Comments at 7-8. We disagree.
Clearly stated RFP requirements are considered material to the needs of the government, and a proposal that fails to conform to such material terms is unacceptable and may not form the basis for award. AttainX, Inc.; FreeAlliance.com, LLC, B-413104.5, B-413104.6, Nov. 10, 2016, 2016 CPD ¶ 330 at 5; TYBRIN Corp., B-298364.6, B-298364.7, Mar. 13, 2007, 2007 CPD ¶ 51 at 5; National Shower Express, Inc.; Rickaby Fire Support, B-293970, B-293970.2, July 15, 2004, 2004 CPD ¶ 140 at 4-5. As explained by the agency, here, the requirement to provide verification from DCAA was a material requirement, the waiver of which would result in an inconsistent and unfair evaluation, thereby prejudicing other offerors. See AR, MOL at 6-7; AR, Supp. MOL at 7. Accordingly, we have no basis to sustain the protest.
Well, golly gee, what is next? Are we awaiting a disqualification because the DCAA audit is not fresh (over two years old)?