AFFILIATE'S PAST PERFORMANCE COUNTS

The Government Accountability Office (GAO) has just reiterated the rule that an agency properly may attribute the past performance experience of a parent or affiliated company to an offeror if the firm's proposal demonstrates the resources of the parent or affiliate will affect the offeror's performance.  The relevant question is whether the workforce, management, facilities or other resources of the parent or affiliate will be used in a meaningful way in contract performance.      There has to be a "significant nexus" between the parent or affiliate and the contractor.

GAO was impressed with a letter from Chief Executive Officer (CEO) of the contractor's parent who stated the program was a top corporate priority.  The contractor's proposal stated clearly that the contractor would be calling upon the parent's and an affiliate's resources.

The protester complained, however, that the procuring agency did not contemporaneously document its analysis and therefore, GAO should not give it any credence.  Here is where GAO may have gone too far.  In fact, if this case goes to the Court of Federal Claims (COFC), the second bite of the apple, the result may be different.  GAO said:

While we generally give little or no weight to reevaluations and judgments prepared in the heat of the adversarial process, (citation omitted), post-protest explanations that provide a detailed rationale for contemporaneous conclusions, and simply fill in previously unrecorded details, will generally be considered in our review of the rationality of selection decisions so long as those explanations are credible and consistent with the contemporaneous record. (Citation omitted.)

Sound good?  The problem is the question of whether the after the fact analysis meets this test or not, is subjective.  Moreover, the test itself is tilted a little too much in the favor of accepting the after the fact rationale. We suspect a judge might reach a different conclusion.  Most judges are singularly unimpressed with after the fact explanations regarding the making of a decision when a complete contemporaneous record is required.  In fact, a judge might even find against the agency based on an inadequate record.

So the lesson for contractors is thoroughly document how the parent or affiliate will support your effort on the contract.  For contracting officers, the lesson is always complete the contemporaneous record. Do not rely on after the fact rationalizations.

bill@spriggslawgroup.com          http://www.spriggslawgroup.com/index.html