Eagle II protests take another twist

A group of protesters fighting for spots on the Homeland Security Department’s Eagle II contract have had their protests dismissed now that one company, Business Integra, has taken its fight to the Court of Federal Claims.

All of the companies are 8(a) companies that had bid and lost in their attempts to win spots in Eagle II’s functional category 1 for IT service delivery.

The $22 billion contract is broken into three functional categories: service delivery, IT program support services and independent test, validation, verification and evaluation. Each of those categories is further broken down into full-and-open competitions and other competitions set aside for different small business categories.

Business Integra took its protest to the Court of Federal Claims after losing its protest before the Government Accountability Office. The company challenged DHS’s ruling that its bid was not compliant because they didn’t propose labor rates in all the categories.

GAO ruled that the Eagle II solicitation was clear in that labor rates for all labor categories needed to be submitted.

Business Integra is making the same argument that DHS made an improper ruling about labor rates in its complaint filed with the Court of Federal Claims.

Before I get into the company’s fight, it’s important to note the ripple effect it has had on other 8(a) protesters in functional category 1 for service delivery.

Because the case is now before the Court of Federal Claims - whose ruling could determine who’s in and who’s out - GAO took a step back and has dismissed the pending protests filed by four other 8(a) companies: Z&A Infotek Corp., Powertek Corp., Integrated Systems Inc. and ActioNet Inc.

Those companies now face the choice of taking their protests to the Court of Federal Claims and joining Business Integra, or they can wait and bring their protests back, arguing that the Court of Federal Claims decision doesn’t impact their situation, and that GAO was wrong to dismiss their protest.

The downside of waiting and not going to the court is that they won’t get a stay, stopping the contract from moving forward with task orders.

Of course, going to the Court of Federal Claims is expensive.

But there is the potential that the move to the Court of Federal Claims could be good for DHS, and the winning bidders in that that court’s decision might help get the contract up and running sooner than the GAO process would have.

Instead of adding more delays to the already very late Eagle II contract, the move to the Court of Federal Claims could expedite the process. Only time will tell.

As for Business Integra, their complaint illustrates how important winning Eagle II is, and how close they came to securing a spot on the contract.

Companies were told to bid on 36 different labor categories and proposed rates for three different levels of experience and two levels of security clearances. So, that’s 216 different rates. They also were told to bid rates for work at government sites and rates for work at the contractor sites, which brings the total to 432 rates. The total number of rates reaches 3,024 by my calculation because bidders submitted rates for each year of the seven-year contract.

Business Integra left off three rates out of the 3,000.

GAO didn’t buy their argument that the lack of pricing in three spots, which were for the same labor category in the fifth year of the contract and two option years, reflected the firm’s willingness to provide the service at no charge. The company also argued that the lack of rates should have been waived as a “minor informality.”

Business Integra is pursuing the same argument with Court of Federal Claims. Part of their stand is that the government needs to use common sense.

The Homeland Security Department, of course, disagrees and says that Business Integra’s solicitation was ambiguous, and that it couldn’t assume that the company would do the work without charging the government or asking for a price adjustment.

Business Integra's complaint says that the company’s pricing was in line with at least two other winning bidders and that Business Integra had higher scores in other areas.

Another thing to consider is that it is three years from the time DHS issued in the solicitation for Eagle II and the time of the awards, which are still delayed because of protests. It really makes me wonder if any of the labor rates are valid anymore.

A couple other things that stand out from the complaint are that Business Integra spent $550,000 earning certifications in Capability Maturity Model Integration level 3, ISO 9001/27000 and Earned Value Management. The company spent another $130,000 preparing its proposal.

Obviously, this contract is extremely important and the company makes that point. “Business Integra will be substantially and irreparably harmed by the lack of an Eagle II contract,” the complaint states.

That probably sums up the feelings of a lot of the companies, particularly small businesses that bid and lost on Eagle II.