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By Nick Wakeman

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Nick Wakeman

Higher price not a factor in Grant Thornton's $350M TSA win

If you just look at the disparity in pricing between the winner of a $350 million Transportation Security Administration contract and the losers, there is little doubt as to why they filed their protests.

Both losing bids by Guidehouse and Deloitte Consulting were magnitudes lower than the winning bid by Grant Thornton.

TSA will use the blanket purchase agreement to acquire a variety of program analysis and strategic support for airport security functions. The BPA naturally goes by the acronym PASS.

The contract has a ceiling of $350 million over five years. Bidders had to submit their solution and pricing for a sample task order as well as submit their past performance qualifications.

Grant Thornton’s proposed price for the task order came in at $1.7 million. Deloitte's proposed price was slightly less half of that at $867,000. Guidehouse's proposed price of $536,000 was one-third lower than Grant Thornton's offer.

But TSA picked Grant Thornton because the agency said that represented the best value to the government.

As you can imagine, both Deloitte and Guidehouse challenged how that best value evaluation was conducted and how their technical solutions were graded.

Given the difference in pricing and the relative closeness of their scores, you would think the Government Accountability Office’s decision would be a slam dunk in the protesters’ favor. But that was not to be.

GAO ruled TSA was justified in paying the higher price because they saw value in what Grant Thornton proposed. TSA also argued that Grant Thornton presented a lower risk.

On top of that, Grant Thornton's price was still magnitudes lower than the estimated pricing TSA had established.

Guidehouse and Deloitte both argued their technical proposals should have received higher marks.

All three companies received scores of High Confidence for their technical approaches. But TSA rated Grant Thornton’s proposal as technically superior.

The government also worried that some of what the companies proposed to do could not be done under the pricing they proposed. That is where the risk worry entered the picture.

Deloitte also was scored Some Confidence under the management approach category, while Grant Thornton and Guidehouse scored High Confidence.

TSA didn’t like how Deloitte said it would handle someone who was underperforming on the contract. Deloitte said the person would be replaced within 24 hours but failed to describe how they would determine if the person was under performing, according to the GAO decision.

Guidehouse was dinged in its technical proposal, even though it was scored High Confidence. TSA felt Guidehouse's proposal had a risk factor in how it would gather data and engage directly with stakeholders at the airports.

TSA said they didn’t think Guidehouse could do that level of work under the pricing it proposed and that made their technical proposal riskier, according to the decision.

Both decisions are lengthy. The Deloitte decision comes in at 16 pages and Guidehouse is 18. Both decisions have lots of footnotes.

But interestingly, the shortest section in both decisions deals with the best-value tradeoff.

There GAO basically says that TSA’s source selection authority made a “well-reasoned” decision because the official could point to strengths and weaknesses in the bids and concluded that Grant Thornton’s price was worth it.

Posted by Nick Wakeman on Feb 24, 2021 at 12:10 PM

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