L-3 prevails in fight for $193M intell contract

A lot of money was at stake as L-3 Communications, Booz Allen Hamilton and Leidos battled for a task order under the $5.6 billion Solutions for Intelligence Analysis Support II contract.

Each are primes on the Defense Intelligence Agency contract for intelligence analysis and other related services, and for this particular competition, Leidos was the incumbent on work supporting the U.S. Central Command, Joint Intelligence Operations Center, at MacDill Air Force Base in Tampa, Fla.

But they lost the competition to L-3, despite having the lowest price. Both Booz Allen and Leidos filed protests with the Government Accountability Office.

DIA pulled back its award to L-3 and allowed the bidders to submit revised proposals. That was in August.

But again, L-3 prevailed with a win in November. And again, Booz Allen and Leidos filed protests. Earlier this month, GAO ruled against the two companies. The decision, after a scrubbing by the firms, was released this week.

There are several factors worth exploring here.

L-3 had the highest bid of the three with a proposal of $193.1 million, compared to $177.4 for Booz Allen and $162.9 million for Leidos. But this was a best value competition, not lowest price.

So, while Booz Allen and Leidos may have proposed lower prices, L-3 won outstanding ratings in the other evaluation criteria of management and technical capability, which contained two sub-factors for management capacity and technical approach/risk. All of the companies scored acceptable in the small business participation factor.

The protests by Booz Allen and Leidos challenged DIA’s evaluation of the management and technical capability criteria. Both companies argued that DIA unfairly gave higher ratings to L-3 and should have scored their proposals higher as well.

Booz Allen argued that it should have been awarded more strengths instead of just the one strength for its transition, recruitment and retention plan. They claimed that DIA didn’t adequately document its rationale for the different ratings for Booz Allen and L-3.

L-3 won higher ratings than Booz Allen for its staffing approach and employee development approach. Parts of the decision here were deleted, so details aren’t available on L-3’s approach.

But GAO found that the rationale used by DAI was reasonable and dismissed Booz Allen’s assertion that L-3’s proposal was only slightly superior and not the significantly superior rating that DIA found.

DIA felt that the higher price was worth it for what it considered a better solution proposed by L-3.

Leidos’ arguments were similar and were rejected for similar reasons, but as the incumbent, Leidos also may have sold itself short in its proposal.

In the technical approach/risk sub-factor, Leidos was rated acceptable. The company argued that the evaluation didn’t consider the excellent past performance scores the company had for its work as the incumbent.

Again, parts of the decision are deleted, so details are sparse, but GAO includes a couple things that point to where Leidos’ proposal may have fallen short.

First, GAO says that the bidders were told in the solicitation to “assume that the Government has no prior knowledge of their experience and will base its evaluation on the information presented in the offeror’s proposal.”

DIA contends that Leidos’ “proposal simply did not demonstrate that its substantial depth and breadth of experience, knowledge, and capability exceeded the ‘specified performance or capability requirements in a way that will be advantageous to the government,’ and thus warrant a strength.”

From here on, several things are deleted, but it is clear that L-3’s proposal did a better job at linking its experience on other contracts to the capabilities it would bring to the contract.

I’ve reached out to Leidos for comment, but I haven’t received a response.

GAO concluded that nothing in Leidos’ or Booz Allen’s protests proved that GAO was unreasonable in its conclusions and in picking L-3 as the winner of the contract.

I can’t help but also make an observation on the price. While I know that this was not an LPTA competition, there is still a lot of pricing pressure in the market.

To me, this competition shows that a higher price can carry the day, if your proposal warrants the difference.

If that is happening more often, then that’s a welcome change in the market.