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Maryland Procurement Alert, November 2012
Board of Public Works Procurement Advisory No. 2012-1 - "Veteran-Owned Small Business Enterprise Subcontracting Documentation"
On June 20, 2012, the Board of Public Works ("BPW") issued Procurement Advisory No. 2012-1, which provides standard procurement forms for inclusion in solicitations that contain a Veteran-owned Small Business Enterprise ("VSBE") subcontracting participation goal. Pursuant to St. Fin. & Proc. §§ 14-602, State agencies must attempt to achieve an overall minimum of 0.5% of the unit's total dollar value of procurement contacts directly or indirectly with VSBEs. If an agency determines that a subcontract participation goal is proper, pursuant to COMAR 21.11.13.05, the agency will include language that mirrors the Minority Business Enterprise Utilization Affidavit and Participation Schedule.
Building Materials Corp. of America v. Board of Education of Baltimore County - Maryland Court of Appeals No. 71, September Term 2011
By decision dated September 24, 2012, the Maryland Court of Appeals held that a county board of education, which must ordinarily procure construction services through a locally-conducted competitive bid process, may acquire roofing repair services for public schools through an intergovernmental purchasing cooperative when it acts pursuant to authority granted by the Board of Public Works in regulations authorized by the General Assembly.
For the full text of the decision, please see the following link: http://mdcourts.gov/opinions/coa/2012/71a11.pdf
Appeal of Policy Studies, Inc., MSBCA No. 2806 (Oct. 17, 2012)
The MSBCA recently granted Summary Decision to a State agency where the agency rejected an offeror's waiver request regarding an Minority Business Enterprise ("MBE") subgoal due to the offeror's failure to solicit enough potentially available MBEs. In Policy Studies, the Appellant ("PSI") and two other offerors submitted proposals to the Department of Health and Mental Hygiene ("DHMH") in response to a Request for Proposals ("RFP") for Managed Care Enrollment Broker Services. The RFP, as amended, contained an overall MBE goal of 25%, with subgoals of 10% Women-owned ("WBE") and 7% African-American-owned ("AABE") participation. DHMH determined PSI's proposal the most advantageous to the State by having the highest rank for both technical and price evaluations.
On the MBE Utilization Affidavit and Participation Schedule attached to its proposal, PSI requested a waiver of the full 7% AABE goal, indicating that PSI was "unable to achieve the MBE participation ... subgoals." Pursuant to COMAR 21.11.03.11, DHMH requested PSI submit documentation of its "good-faith efforts" to achieve the subgoal.
PSI's documentation indicated that it had attempted to solicit only those MBE firms that could provide an integrated service classification, "printing/fulfillment/graphic design/mailing," and that only a single AABE met this qualification, RGM, Inc. ("RGM"). PSI explained to DHMH that RGM failed to return phone calls and was not further solicited. PSI justified its decision to solicit only those MBEs that could perform all relevant functions in the by emphasizing (1) significant cost savings, (2) the State's approval of PSI's integrated business model, and (3) the superior reliability and efficiency of a unified subcontract.
DHMH determined that PSI failed to make a good faith effort to meet the AABE subgoal and rejected PSI's waiver request. DHMH based this determination, in part, on the fact that PSI had solicited only a single AABE firm; there were at least 48 AABEs available for "printing" services alone.
According to the MSBCA, the sole issue raised in the appeal was whether DHMH's decision to reject PSI's waiver request was unlawful, erroneous, unsupported, or otherwise an abuse of discretion. The MSBCA granted DHMH's Motion for Summary Decision, holding that DHMH made the only determination that would have been lawful. The MSBCA agreed with DHMH that each of the constituent work categories (e.g., printing, mailing, etc.) were available for subcontracting, and therefore PSI was obligated to solicit prospective AABEs for these scopes of work.
Appeal of L-1 Secure Credentialing, Inc., MSBCA No. 2793 (May 30, 2012)
The MSBCA recently sustained a protest on the grounds that (1) a key agency determination made during evaluation was clearly erroneous and (2) the agency failed to show that a legally sufficient cost-benefit analysis was performed to support award to the highest-priced offeror. In L-1 Secure, the Motor Vehicle Administration ("MVA") published a Request for Proposals ("RFP") for the manufacture of Maryland driver's licenses and identification cards in accordance with the REAL ID Act of 2005 and related regulations by the Department of Homeland Security.
The RFP set certain minimum standards for selection of materials and security measures. The RFP included certain evaluation criteria, setting forth that the technical and price evaluations would receive equal weight in the award determination. Among the 12 technical criteria, "Card Design and Security" and "Overall Experience and Technical Competence" were listed as the two most important criteria.
Six offerors submitted proposals for the contract; among these offerors were the Appellant, L-1 Secure Credentialing, Inc. ("L-1") and CBN-Secure Technologies, Inc. ("CBN-STI"). MVA's eight-member evaluation committee reviewed the various technical proposals and ranked CBN highest for all 12 technical criteria, while ranking L-1 third overall technically. In part, this evaluation was based on the assertions that CBN-STI's proposed identification card (1) was 100% laser-engraved as opposed to laser-printed, and (2) this engraving extended to the card's core. Also, the evaluation committee was concerned that L-1's proposed card technology could be separated or peeled while CBN-STI's card purportedly could not.
None of the members of the evaluation committee were experts in the manufacture of secure identification credentials. The Procurement Officer agreed with the Evaluation Committee's technical evaluation determination, claiming that CBN's card was "far superior" to those of other offerors.
Following the issuance of two BAFOs, CBN-STI's price was the most expensive, while L-1 was ranked third; L-1 was millions of dollars and a double-digit percentage lower than CBN-STI. Despite this financial difference, the Evaluation Committee ranked CBN-STI first overall, while L-1 was ranked third overall.
The MSBCA determined that MVA's determination as to the criterion "Overall Experience and Technical Competence" was clearly erroneous and without justification. CBN-STI was rated higher than L-1 despite L-1's experience in 44 states; by contrast, CBN-STI produced driver's licenses in only Virginia (which does not use color photographs). The only explanation given by the Procurement Officer for the ranking under this criterion was that CBN-STI had more experience with CBN-STI's card. The MSBCA disagreed with this evaluation, noting that L-1 could not be expected to have experience with a competitor's card.
The MSBCA also found that MVA provided no evidence that MVA conducted more than a pro forma "trade-off analysis," despite price being equal to weight. Where, as here, the low-priced proposal was more than 25% below the highest-priced proposal, it did not make sense that the overall rankings mirrored the technical rankings. This leads to a prima facie case that price was not fairly considered, and MVA failed to rebut that presumption.