Vencore wins second shot at $230M DHS contract

Vencore Services and Solutions cried foul when ManTech International won a $230 million contract for intelligence support for the U.S. Customs and Border Protection.

While the competition was billed as best value, it essentially came down to a price battle because both companies were deemed essentially equivalent on the technical and past performance aspects of the evaluation.

After ManTech won, Vencore filed a protest with the Government Accountability Office claiming that CBP had conducting misleading discussions with the company over its costs and pricing.

GAO agreed and has told CBP to reopen discussions with bidders and ask for final revised cost proposals. That’s always an interesting recommendation to me because both companies and a third unnamed bidder all know now what the others submitted as their final prices.

Vencore had argued that the agency relied on a flawed independent government cost estimate when it raised concerns that Vencore’s labor rates were so low that they created a significant risk. CBP realized that the estimate was too high after it held discussions with Vencore, but it didn’t reopen discussions with the company, according to the GAO decision. 

As a result, Vencore raised its prices an undisclosed amount. It's bid came in at $248.5 million, compared to ManTech's bid of $230.3 million.

CBP and ManTech argued that new discussions weren’t needed and that Vencore could have tried to justify its rates. But GAO rejected this argument saying that Vencore made a business decision to raise its rates based on flawed discusions with CBP.

Because of the flawed discussions, Vencore was at a competitive disadvantage, GAO said.

While this is definitely a victory for Vencore, it isn’t over. The company has a second chance at the contract, but no guarantee.