The GAO today released a public version of its full decision to sustain Blue Origin's protest of the Air Force's Launch Services Procurement effort, expanding on its conclusion that the solicitation does not comply with federal acquisition regulations.
GAO announced this week it had upheld the company's protest and recommended the Air Force amend the LSP Phase 2 request for proposals released in August. Blue Origin's protest is based on a number of complaints. GAO agreed with only one, and according to the decision, the company withdrew the remaining items following the agency's release of its report.
Blue Origin filed its protest on Aug. 12 -- the same day bids were due for LSP. Despite its concerns, the company submitted a proposal along with SpaceX, Northrop Grumman and United Launch Alliance. The Air Force plans to choose two winners who will split its National Security Space Launch manifest between 2022 and 2026 -- one company performing 60% of the launches and the other company 40%.
GAO agreed with Blue Origin's claim that the service's plan to award contracts to two companies who offer the "best value when combined" is ambiguous. Blue Origin argued that under this construct, the merits of an individual proposal could be devalued if it doesn’t pair well with another selected proposal.
The Air Force argued that it provided offerors the details they need regarding evaluation factors and claimed it has discretion to consider who the strengths of one proposal might pair with those of another. But GAO found this argument lacking.
The agency cites a hypothetical situation in which the top two rated proposals may not offer the best value to the government when paired. In this case, it's possible the Air Force would discard one of the top proposals for a lower-tier offering that is not highly rated but differs from the top proposals in complementary ways. GAO found that this scenario introduces a new set of evaluation criteria the service did not define to bidders.
"The Air Force repeatedly argues that it has informed offerors of the evaluation factors that will be used to evaluate their proposals, and thus, provided a common basis for competition," GAO states in its decision. "This line of argument, however, is unpersuasive because as addressed above, award may not primarily be based on whether an offeror submitted the strongest possible proposal in response to the RFP’s evaluation criteria."
GAO continues: "Rather, award may ultimately turn on whether the unique attributes of the offeror's proposal sufficiently complement another offeror's proposal so as to offer the government the most combined best value. Offerors, of course, have no control over the proposal strategy or contents of another offeror's proposal. Indeed, short of colluding with other potential offerors . . . it is not apparent how an offeror could intelligently compete."
The Air Force confirmed Thursday it would amend its solicitation and does not expect the process to delay its plans to award a contract in the spring.
GAO found that Blue Origin's other claims were largely unsubstantiated and, in some cases, relied on regulations that apply to sole-source procurements rather than open competition. Those issues, the agency found, "are simply not relevant to circumstances here."
Of note, GAO found a second claim compelling, but determined it did not have jurisdiction to consider it. Blue Origin was one of three companies to receive an other transaction agreement in 2018 to continue developing its new launch vehicle. Because of the Air Force's time line for awarding a Phase 2 procurement contract, the company claims it may not get the full benefit of the agreement made under its previous OTA.
"Blue Origin effectively complains that it was deprived of the expected 'benefit-of-its-bargain,'" the GAO decision states. "These arguments, however, present questions regarding whether the Air Force is reasonably administering OTA agreements, which are not matters for consideration as part of our office’s bid protest function."