GSA to go ahead with Alliant

Officials must decide specific remedy after court rules in favor of protesters.

The General Services Administration plans to proceed with Alliant, a 10- year, $50 billion information technology contract, despite a judge’s ruling that upheld protests filed by eight losing bidders. “GSA remains committed to moving forward with Alliant,” an agency spokesman said last week. “Alliant will be a key tool for agencies to achieve their IT objectives in a streamlined, cost-effective manner for the next decade.” However, the agency is still considering its options for the contract’s long-term future. An announcement is due “very soon,” a GSA spokesman said With two other major governmentwide IT contracts, Applications’N Support for Widely-diverse End-user Requirements (ANSWER) and Millenia, expiring in early 2009, agencies seeking a task order that extends beyond a year may start looking for other contract vehicles, said Mary Whitley, former assistant commissioner for customer relationship management and sales at GSA’s former Federal Technology Service. Whitley said one possibility might be to extend Millenia and ANSWER to give agencies additional options if the Alliant controversy is not resolved quickly. Federal Claims Court Judge Francis Allegra halted the Alliant contract March 3 by ruling in favor of eight bidding companies that had protested GSA’s awards to 30 companies. The decision was released publicly March 5. On March 6, Jim Williams, commissioner of GSA’s Federal Acquisition Service, said GSA had made no decision about how it would proceed.However, he added, the most extreme solutions — awarding spots on the contract to all 62 bidders or scrapping the program all together — were not on the table. “We are absolutely committed to Alliant,” Williams said, adding that he and other agency officials were “very disap- pointed” in the court ruling. GSA officials believed they had done a good job of analyzing the bids and selecting awardees, he said. The bid protesters and Allegra disagreed, saying that GSA didn’t pick the winners fairly. The court sustained protests against GSA’s contract, which GSA awarded originally in July to 29 companies. However, the judge gave GSA the option of brokering a deal with the protesting companies and moving ahead with the contract. The ruling prohibits GSA from taking orders on the contract and suspends any activities related to it. The judge also ruled that GSA couldn’t rely on the same methods it used in the past to determine which companies earn a place on the contract in the future. The agency’s award process was a major reason that Allegra sustained the protests. The judge ruled that GSA didn’t apply the same award criteria equally to all 62 companies that bid for a spot on the contract. In the ruling, the Allegra wrote that GSA attached “talismanic significance to technical calculations that suffer from false precision” and failed to adequately weigh prices in its review of contractors’ bids. “Those compounding errors prejudiced the plaintiffs and oblige this court to set aside the awards in question,” he wrote. According to the ruling, GSA made a good-faith effort to distinguish among the bidders, “yet, on a variety of planes, the agency’s effort came up well short, resulting in award decisions that were arbitrary, capricious and otherwise contrary to law,” the opinion states. A focus of the protesters’ complaint was GSA’s use of information about their past performance in contracting. The agency used a survey to gather that information, but it relied on questions that were too general, the judge wrote. In particular, GSA relied on performance information from Calyptus, a polling firm whose employees weren’t given enough guidance on how to interpret responses from the bidders’ refere nces or about whether they had enough information about the bidders, according to the opinion. The judge ruled that the survey questions were too general. People who filled out the survey forms were asked to rate a company’s performance based on a five-point scale that ranged from “adverse” to “outstanding.” A single adjective, coupled with GSA’s technical rating system, could easily affect bidders’ chances of an award, the judge wrote. Stanley Associates, one of the original protestors, dropped its complaint against GSA after agency officials acknowledged a slight mistake in its adjective-based rating system. Correcting the error boosted Stanley’s score on the rating system, and GSA quickly made it the 30th contractor on Alliant, according to the opinion. More important, GSA didn’t ensure that the polling information was relevant to the bid evaluations and didn’t check the accuracy of the survey’s sketchy information, yet the agency still counted the information heavily in determining the awards, the opinion states. The ruling also criticized GSA’s evaluation of pricing. Although GSA set up benchmarks related to price, it ultimately awarded spots on the contract to some companies whose prices were among the highest. Agency officials said the prices were fair and reasonable, even though the most expensive winners listed prices twice as high as the lowest winning bidder and about 30 percent higher than an independent government cost estimate. “The agency’s inadequate treatment of price, therefore, constitutes yet another reason why the award decisions here must be set aside,” the judge ruled.  

Lessons from ITES-2S

Kevin Carroll, former program executive officer at the Army’s Enterprise Information Systems Office, went through a round of protest battles for spots on the Army’s major information technology contract, Information Technology Enabled Services-2S. The battles were similar to the situation facing the General Services Administration with its protested Alliant contract.

ITES-2S was a $20 billion, nine-year contract that the Army expected to be its primary IT procurement vehicle. After exhausting its options, the Army decided to allow the five losing bidders that successfully protested ITES-2S to join the contract.

Carroll, now president of the consulting firm Kevin Carroll Group, said GSA could try that same approach to resolve the Alliant issues even though the approach comes with risks.

Awarding the contract to Alliant’s eight protestors would speed the process of getting the massive contract running before agencies start shopping around for other IT contracts to use.

As the Army worked through protests of the ITES-2S contract, Army officials added provisions in the new deal, such as not being responsible for protesters’ costs. In working out those deals, the Army met with the contract’s awardees to make sure they weren’t upset by the decision.

“We really talked to everybody as we negotiated,” Carroll said. The Army wanted to avoid being thrown into a loop by having awardees protest the decision and start the process again.

However, Carroll pointed out the risks.

GSA could face more protests from losing bidders who didn’t originally protest. Of the 62 bidders, only eight were included in the protest that went before the claims court. Stanley Associates, an original protester, was added to the Alliant contract Dec. 21.

As a result, the 24 losing companies that didn’t take part in the process may be upset if GSA adds the protesters to the contract, Carroll said. “If I was in GSA’s shoes, I’d have to do all or none.”

Judge cautions about statistics

Federal Claims Court Judge Francis Allegra, in a ruling on the General Services Administration’s Alliant contract, wrote that GSA officials relied too much on statistics that were “arbitrary, capricious and contrary to law” in awarding the contract.

The judge criticized GSA for not recognizing the limitations of statistics. In awarding the Alliant contract, GSA used an adjective-based rating system to determine the bidders’ rankings. One poorly chosen adjective could cost a company its chance to be on the contract, he said.

Citing the book “Some Economic Factors in Modern Life,” by Sir Josiah Charles Stamp, Allegra wrote that the original sources of statistics on which people rely are often unreliable. Stamp wrote in a passage that the judge quotes in his opinion: “‘Harold Cox tells a story of his life as a young man....He quoted some statistics to a Judge, an Englishman, and a very good fellow. [The Judge] said, Cox, when you are bit older, you will not quote statistics with that assurance. The Government [is] very keen on amassing statistics — they collect them, add them, raise them to the nth power, take the cube root and prepare wonderful diagrams. But what you must never forget is that every one of those figures comes in the first instance from the village watchman, who just puts down what he damn pleases.’”

— Matthew Weigelt















































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