Evaluation of Proposals

Q.  Our agency recently issued an RFP for PM services. Three firms submitted proposals. One firm shortly withdrew their bid. We evaluated and ranked two remaining proposals. We negotiated with both remaining proposers and requested BAFOs from both. The number 1 ranked firm offered a projected budget that by far exceeds our estimates (we can not afford this proposed budget.) Also they allocated substantial number of hours that we believe are excessive. The #2 ranked firm offered the budget that we can work with, and they allocated hours that we believe are reasonable for the project. The #1 ranked firm is not willing to reduce budget without substantially reducing scope. Can we proceed with award to #2 ranked firm? Both firms have equal experience, but differ in their approach and distribution of hours.

A.  It important that you evaluate proposals in accordance with the evaluation criteria contained in your RFP. We presume that evaluated price was identified as a factor in the award, and the RFP did not promise award to the highest ranked proposer. The FTA Circular 4220.1F allows for a "best value" selection decision, which would seem to fit your circumstances very well. This approach is discussed in the BPPM Section 4.5.2 - Evaluation of Proposals. If this approach is used, however, the Circular requires you to advise offerors in the RFP that you will use this approach. FTA does not require you to award to the highest ranked firm. FTA does require that price be evaluated as a factor in the award, and that you make a determination that the price is fair and reasonable prior to award. If the highest ranked offeror's price is reasonable based on the technical approach being proposed (not your budget), and if what is being proposed is in turn the best technical proposal to meet the SOW requirements (though also most expensive), then you may have to issue an amendment to the RFP clarifying the requirements of the SOW so that more economical price proposals may be offered.  (Revised: May 2010).


Q.  Does FTA have any guidance related to the proper composition of proposal evaluation teams and whether it is appropriate for Board members, the General Manager or the agency General Counsel to participate in the proposal evaluation process? A Board member has requested to be on a Proposal Evaluation Team, and procurement staff does not believe that it is appropriate as bid protests are ultimately decided by the Board.

A. FTA guidance on the evaluation of proposals may be found in the Best Practices Procurement Manual (BPPM) section 4.5.2 – Evaluation of Proposals. However, that section does not address the issue of evaluation committee membership. There is also some guidance on the selection of A-E contractors in section 6.5 – Architect-Engineer Services, including a paragraph on the membership of the evaluation committee. We would agree with you that individuals who may be called upon to adjudicate a protest should not be involved in the evaluation process as this might make it difficult for them to objectively evaluate the protest. A protestor would certainly believe that it was not being dealt with fairly if an agency board member were acting in the capacity of both “defendant” (proposal evaluator) and “judge” (protest official). Similarly, an attorney should take care not to participate as an evaluator, if that attorney might later be called upon to defend the agency against the protest.
(Revised: May 2010)
 
   
Q. A "Best Value" solicitation was issued with specific evaluation criteria as follows:  A. Qualification and Experience of the firm; B. Qualification and Experience of the Proposed Staff; C. Proposed Management Approach; D. Technical Approach.

However, up receiving proposals the Procurement Officer prepared a price analysis and it was discovered that the pricing for all 8 proposers were wide-ranging (i.e. some were very low and others were very high, but all were lower than the ICE).

Based on this information, is it a safe assumption that there is a problem with the scope of work? Should this RFP be canceled and the Scope of Work further defined or should the evaluation committee proceed with reviewing proposals and perform initial evaluations?  Rather than making the assumption based on price only, could the issues with the Scope of Work be discovered during the proposal review process?

A. We would suggest you evaluate the proposals in order to determine if there are ambiguities (or perceived performance risks) in the scope of work that are leading the offerors to either misunderstand or to overprice the project.  If you feel that the scope of work wasn't sufficiently clear once you have conducted the evaluations, you could issue a clarification in writing to all proposers, and request revised proposals.  However, if you feel that the offerors have understood the scope of work objectives, but the estimated amount of work (labor hours) is uncertain owing to unforeseen difficulties (performance risks) that might be encountered in the course of the work, then something other than a fixed price contract should be considered in order to minimize the risk and thus the amount of price contingency that is included in the proposals. If performance risk is the issue, rather than ambiguities in the scope of work, we would suggest canceling the RFP and soliciting new proposals on a CPFF basis. (Posted: December, 2010)


Q. Can we award an alternate "option" technical proposal/scope that was not requested or offered in the original RFP/best value solicitation document? It was not added through an addendum either and was just proposed by a vendor when they submitted their final proposal in response to the RFP.

Background Information: We recently issued an RFP for an analysis. The RFP had two major tasks - one for preliminary analysis for an existing product. If this product was found to be deficient, the second task (option) was for analysis of alternate products. All vendors’ submitted technical proposals and pricing for both components. But one vendor also submitted a proposal for a third task that would do additional work if the first product in the first primary task was the one which we would select.

The end user wanted us to award to this vendor including accepting their alternate proposal if the initial analysis resulted in proceeding with an existing product. Purchasing informed the end user that we could not award this alternate proposal/scope since we did not offer that scope for all other vendors to bid on. The end user believes that the RFP process allows for that flexibility and "innovation." They think this is what is meant by the best value approach. The Purchasing Department does not since we did not request through our own scope of work this alternate proposal. We did not allow any other vendor's this opportunity to bid this alternate scope and therefore, we could not evaluate the same alternate technical/price proposal from the other vendors on this scope.

A. If the proposal in question goes beyond the requirements of your scope of work (and it appears that it does) it should not be evaluated for award unless you give all proposers the same opportunity to "enhance" the scope of the project so as to accomplish more than your RFP required. We certainly would not reward a proposer for expanding the scope of work beyond what was described in the RFP. If, however, the proposal were to represent an innovative approach to accomplishing what you described as your end objective, then it could be evaluated and rewarded for its innovation. The key is whether it seeks to go beyond your stated needs by expanding those needs and then offering a solution to the expanded needs. If you now agree that your needs should be expanded, you should amend the RFP and restate the needs but be careful not to divulge any proprietary solutions/approaches to the expanded scope that this proposer may be offering, and allow all of the respondents the opportunity to propose on this new/expanded requirement. (Posted: December, 2011)


Q. When the CFO began scoring the cost proposal, it was determined we needed further information; we sought clarification as to if the cost was for two managers for the life of the proposed contract (if they're selected as Contractor), per the RFP requirements. We asked the same question of the other proposer. It now appears the cost proposal clarification is contrary to what their proposal 'certified' or stated - that, indeed, they would not agree to two managers for the life of what will be the contract (they suggest one remains and one be released later after a transition period). Their cost, of course is far cheaper than the other proposal, and by standards in the RFP regarding scoring, will receive very high points for low cost. The other proposal will receive very low points for a higher stated cost because the provided cost for the two managers. I tried three times to get the proposer in question to clarify if the cost was for two managers who would be on staff for the life of the contract. I cannot get such a statement, that, indeed, their cost is for two managers, one of whom they propose be released after an initial transition period, no doubt a cost savings to us, but is, nonetheless, contrary to the RFP requirements. Do I now revoke the responsive determination and retrieve the proposals from the Selection Committee? If I do, will they have cause to protest the Award? If I do, the other proposer will become the only proposer and happens to be the incumbent contractor.

A. From the facts you describe we would conclude that the low price proposal is not responsive to the scope of work in the RFP. The two proposals received represent two different programs, and one of them does not meet your requirements. This proposal must be rejected as non-responsive.
(Posted: December, 2011)


Q.
After interviews, is it permissible to negotiate and finalize price and scope with only the top-ranked firm, even if both firms interviewed are fairly close in the evaluation? While initial price
offered was evaluated along with qualifications, it was felt after interviews that the one firm was the best value but is over the budget amount for the contract. We want to conduct negotiations on price and scope with only the top-ranked firm.

Background: 5 proposals were submitted and evaluated. Discussions and interview of the top 2 ranked firms. Want to negotiate with only the top-ranked firm although both firms are close in points. The second ranked firm was notified of a weakness in their submittal which they did not adequately address in their interview and the top-ranked firm excelled at their interview (going into interviews, the top-ranked firm was the second ranked firm).

A. Since the scope of the contract will have to be reduced to meet budget constraints, we do not believe your agency should limit negotiations to the highest ranked firm. We would recommend that you advise both firms in the competitive range that the scope of the project is being revised, and give both companies the ability to submit revised proposals. It is premature at this point to conclude that the highest ranked firm represents the best value since you cannot accept that proposal due to funding limitations. It is conceivable that the second ranked firm could submit the best value offer after the scope is reduced and revised prices are submitted. (Posted: January, 2012) 




Q. We have identified several proposers who are in the competitive range to award a contract. One of the proposer's key personnel did not demonstrate the skills and experience required for a particular area of this contract. Are we restricted or prohibited by federal law in requesting that they substitute the current key personnel with another who maybe is more qualified in order for the proposer to remain in the competitive range? The FAR goes on to describe both the "tradeoff" process that is used when selecting a proposal Is what I explained considered a trade off?

Background: The Systems Integration approach remains a concern for this contract. The technical discussions of the individual systems mentioned the need for overall integration with other systems; however, the discussion of systems integration was deferred to the Systems Integrator presentation. The Systems Integration presentation failed to demonstrate the necessary experience or skills required for the Contract, and failed to identify specific and proven processes, methodologies, and tools necessary to manage what is acknowledged to be a complex project with numerous system interfaces.

A. It appears as though your agency established an initial competitive range and invited those companies to make presentations. The company in question did not meet your requirements in one important area. At the conclusion of these discussions, you will have a revised scoring based on the presentations and information obtained through these presentations. Each firm will have its strengths and weaknesses reevaluated and these technical issues will be weighed against the prices offered. Based on these final scores and prices you will select the best overall proposal, with price an technical factors considered. Selection will presumably be made on a best value basis, if indeed your RFP said that the award would be on a best value basis. The tradeoff you mention would refer to the tradeoff between prices and technical merits to select the best overall value. You do in fact have the discretion to select the firm that is questionable with respect to a key person, if in fact you determine that they still represent the best overall value (pricing and overall technical score), in spite of the weakness in their Systems Integration approach. If this is the case, you can legitimately select them and address the Systems Integration issue after award. But you cannot reopen discussions with only one firm and give them an opportunity to upgrade their proposal without offering the other firms the same opportunity. Fairness would require that you disclose to all the firms the areas where you judge them to be weak, and then allow them to modify their proposals to correct the weaknesses.  (Posted: January, 2013)