Pricing made the difference for CACI in battle for TSA contract

The battle for the Transportation Security Administration’s main IT infrastructure contract apparently became a battle over price and how much of a premium the government was willing to pay for more innovation.

CACI International won the nearly $200 million to support TSA’s infrastructure under a contract known as "IT Management, Performance Analysis and Collaborative Technologies" or IMPACT.

Perspecta filed a bid protest in June with the Government Accountability Office and that was denied earlier this week.

A source has told me that Perspecta received a higher technical score than CACI but also had a higher price.

The question TSA had to weigh was whether the extra technical capabilities of Perspecta’s proposal justified paying the higher price. TSA decided it didn’t and that CACI’s proposal met their needs.

Perspecta challenged TSA’s assessment of its own proposal as well as the assessment of CACI’s proposal. It sounds like Perspecta tried to argue that its proposal should have been rated even higher, which would justify the higher price. But that didn’t work.

GAO hasn’t released its decision yet. That may take a few weeks as TSA, CACI and Perspecta all try to hash out what is appropriate to be released publicly and what isn’t.

But the denial illustrates the high bar protesters have to clear with these kinds of challenges.

I think we’ll see more protests like this as we push deeper into this era of IT modernization. Companies are trying to deliver innovation and sometimes that can mean bidding a higher price than your competitor.

Agencies also are struggling with how to decide when to pay a premium and when not. It is an important question to ask your customer.