Obsidian Solutions Federal Services, LLC | U.S. GAO – Government Accountability Office

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Decision

Matter of: Obsidian Solutions Federal Services, LLC

File: B-421651

Date: July 24, 2023

DIGEST

Agency’s selection of a higher-rated, higher-priced proposal for issuance of a task
order is unobjectionable where the agency’s best-value tradeoff decision was reasonable and
consistent with the terms of the solicitation.

Obsidian Federal Solutions Group, LLC, a service-disabled veteran-owned small business
of Fredericksburg, Virginia, protests the issuance of a task order to Cherokee Nation
Strategic Programs, LLC, of Tulsa, Oklahoma, under request for quotations (RFQ) No.
HHM402‑23‑Q-0002. The Department of Defense, Defense Intelligence Agency (DIA) issued the
RFQ for risk assessment labor services at the DIA Directorate of Logistics and Global
Readiness, Supply Chain Risk Management (SCRM) Program Office (PO). The protester argues
that the best-value tradeoff was unreasonable.

We deny the protest.

BACKGROUND

On December 5, 2022, the agency issued the solicitation to small business vendors under
the General Services Administration’s One Acquisition Solution for Integrated Services
(OASIS), multiple-award indefinite-delivery, indefinite-quantity (IDIQ) contract in
accordance with the procedures of Federal Acquisition Regulation (FAR) section 16.505.
Agency Report (AR), Tab 4, RFQ at 1, 26; AR, Tab 1, Contracting Officer’s Statement (COS)
at 1‑2. The solicitation anticipated the issuance of a fixed-price labor-hour task order
for a 1-year base period, four 12-month option periods, and one 6-month option to extend
services in accordance with FAR clause 52.217‑8. RFQ at 26. The due date for receipt of
quotations was January 11, 2023. Id. at 30.

The solicitation provided for the submission of quotations in three volumes: (1)
facility security clearance status, (2) technical and management approach, and (3)
cost/price. Id. at 28‑30. The technical and management approach consisted of three
sub-factors: (1) program management plan, (2) staffing plan, and (3) transition plan.
Id. at 29. For the program management plan, vendors were to detail their ability to
manage SCRM labor support, time constraints, cost factors, and subcontractor personnel.
Id. For the staffing plan, vendors were to demonstrate their ability to recruit and
retain qualified candidates for the required labor categories. Id. For the
transition plan, vendors were to provide their proposed transition metrics as well as a
plan for managing the transition, identifying and mitigating transition risks.
Id.

The solicitation provided for the evaluation of quotations based on the following
factors: (1) facility security clearance status, which was evaluated on a pass/fail basis,
(2) technical and management approach, and (3) cost/price. Id. at 31. To determine
the overall technical rating for the technical and management approach factor, the
solicitation provided for a combined technical/risk rating, which consisted of the risks
associated with the proposed technical solution as well as any significant strengths,
strengths, weaknesses, significant weaknesses, or deficiencies in the solution.[1] Id. at 32. Quotations
would receive a rating of outstanding, good, acceptable, marginal, or unacceptable under
this factor.[2] Id. at 32‑33. The agency
then would issue a task order following a best-value tradeoff where the non-price factors,
when combined, were significantly more important than cost/price. Id. at 31.

The agency received eight timely quotations, including quotations from Obsidian and
Cherokee. COS at 3. The evaluation results for Obsidian and Cherokee were as follows:

AR, Tab 9, Source Selection Decision Document (SSDD) at 4.

In evaluating Cherokee’s quotation under the technical and management approach factor,
the agency assigned three significant strengths for Cherokee’s program management plan, one
strength for its staffing plan, and one strength for its transition plan. AR, Tab 8,
Cherokee Factor Two Evaluation at 6‑7. Cherokee’s quotation received no weaknesses or
deficiencies. Id. at 8. Overall, the agency concluded that Cherokee’s quotation
demonstrated an “exceptional approach and understanding of the requirements,” and assigned
it a rating of “outstanding.” AR, Tab 9, SSDD at 4‑5.

Obsidian’s quotation, on the other hand, received no significant strengths; instead, it
received one strength for its project management plan, two strengths for its staffing plan,
and two strengths for its transition plan. AR, Tab 7, Obsidian Factor Two Evaluation at
5‑7. Its quotation also received no weaknesses or deficiencies. Id. at 7. Overall,
the agency concluded that Obsidian’s quotation demonstrated a “thorough approach and
understanding of the requirements,” which warranted a rating of “good.” AR, Tab 9, SSDD at
5. Although Cherokee’s price was higher than Obsidian’s price, the source selection
authority (SSA) concluded that the “expected quality of the performance by [the awardee]
more than offsets the costs that would be incurred should the [agency] have to settle for a
lesser rated offer.” Id. at 9.

On April 18, 2023, the agency notified Obsidian that its quotation was not selected for
award. AR, Tab 10, Unsuccessful Offeror Notice at 1. The agency provided Obsidian with a
debriefing on April 24. AR, Tab 11, Debriefing at 1. In the debriefing, the agency
explained that the awardee’s quotation “passed the facility clearance factor, was slightly
superior in the technical and management approach, and submitted a fair and reasonable
price that was found to be advantageous to the [agency].” Id. at 4. Obsidian then
submitted a series of questions to the agency on April 26, to which the agency responded on
May 1. AR, Tab 12, Obsidian Debriefing Questions at 1; AR, Tab 13, Response to Debriefing
Questions at 1. This protest followed.[3]

DISCUSSION

The protester contends that the agency’s source selection decision was improper because
it was based on an unreasonable best-value tradeoff. Protest at 5. Specifically, the
protester contends that the agency failed to adequately support its decision to award the
contract to a vendor that submitted a price that was over $4 million higher than Obsidian’s
price. Id. at 6‑7. For reasons discussed below, we deny the protest.

The evaluation of quotations is a matter within the discretion of the procuring agency.
Platinum Bus. Servs. LLC, B-419930, Sept. 23, 2021, 2021 CPD ¶ 348 at 4. Where, as
here, a solicitation provides that a task order will be issued to the vendor whose
quotation is determined to be the best value, considering price and other factors, the
agency retains the discretion to select a vendor with a technically superior evaluation,
despite a higher price, so long as the tradeoff is properly justified and otherwise
consistent with the stated evaluation and source selection scheme. S4, Inc.,
B‑310794, Feb. 12, 2008, 2008 CPD ¶ 45 at 3. A vendor’s disagreement with the agency’s
decision, without more, does not render the evaluation unreasonable. Platinum Bus.
Servs., supra.

Here, the protester challenges the agency’s best-value tradeoff. Protest at 5‑6.
Specifically, the protester argues that selecting a vendor with a price over $4 million
higher than the protester’s price despite that vendor having only a “slightly superior”
technical quotation “cannot on its face reasonably be justified.” Id. at 6. The
agency responds that it compared the assessed strengths and significant strengths of the
two quotations and reasonably concluded that the technical advantages of Cherokee’s
proposal were worth its higher price. AR, Tab 2, Memorandum of Law (MOL) at 4‑8; AR, Tab 9,
SSDD at 9.

Based on the record, we have no basis to object to the agency’s best-value tradeoff
decision. As discussed above, Cherokee’s quotation received an overall technical rating of
“outstanding” while Obsidian’s quotation received an overall technical rating of “good.”
AR, Tab 9, SSDD at 4. In evaluating Cherokee’s technical quotation, the agency assigned
Cherokee’s program management plan significant strengths in three task areas: task area
5.1, SCRM PO Project Oversight; task area 5.6, Probability and Consequence Assessment; and
task area 5.7, Post-Acquisition Management. AR, Tab 8, Cherokee Factor Two Evaluation at
6‑7. The SSA stated that receiving significant strengths in these areas “significantly
increase[d] the likelihood of successful production of risk characterization and
reporting,” as required for deliverable area 6.1. AR, Tab 9, SSDD at 6. The SSA further
stated that no other vendor received as many significant strengths for the program
management plan or for those specific task areas. Id. In the SSA’s view, the
significant strengths that Cherokee’s quotation received under the program management plan,
combined with the strengths it received under the staffing plan and transition plan,
“offer[ed] a holistic approach” with “the best possibility of successful performance on the
contract.” Id. at 7.

In comparing Cherokee’s quotation to Obsidian’s quotation, the SSA noted that Obsidian’s
program management plan received a strength in task area 5.1, but did not receive strengths
in task areas 5.6 or 5.7. Id. Additionally, the SSA indicated that while Obsidian
received a strength for its SCRM risk assessments and understanding of the SCRM workflow
processes, this risk assessment experience was obtained before the current SCRM PO
standards and processes were established. Id. The SSA thus concluded that this
experience, as well as the four strengths received for the protester’s staffing plan and
transition plan, was not advantageous enough to warrant selection over Cherokee’s
quotation. Id. at 7‑8.

The protester’s belief that Cherokee’s price premium was simply too great constitutes
only a disagreement with the agency’s judgment, and is not sufficient to establish that the
tradeoff was unreasonable. Leading Edge Aviation Servs., Inc., B‑419427, Feb. 25,
2021, 2021 CPD ¶ 146 at 8. As mentioned above, the solicitation expressly stated that
non-price factors, when combined, were significantly more important than price. RFQ at 31.
Because the agency fully discussed the strengths and significant strengths within both
quotations, and documented its tradeoff decision, we have no basis to object to the
agency’s decision to select the higher-priced, higher-rated quotation.

The protest is denied.

Edda Emmanuelli Perez
General Counsel