4. UNDULY RESTRICTIVE SPECIFICATIONS

Overview of This Protest Ground: This protest ground is typically asserted by a company that wants to compete for a government requirement but recognizes that it cannot meet one or more of the provisions in the solicitation. These are almost always pre-award protests challenging the solicitation’s terms. Essentially the protester argues that the solicitation was drafted in a manner that is unduly restrictive of competition and therefore in violation of the Competition in Contracting Act.

Although this is a very common type of protest, the GAO rarely sustains protests on this basis. The GAO recognizes that the agency is in the best position to develop its requirements and therefore provides the agency significant latitude in this area. If the agency can provide a reasonable explanation for the allegedly “unduly restrictive” specification, the protest on this ground will almost always be denied. The GAO pays little heed to a protester’s mere disagreement with the agency on this issue. This discretion afforded to the government is at its maximum when the requirement in question relates to national defense or human safety.

COFC’s Key Language

Relevantly, FAR 6.101(b) requires that contracting officers use competitive procedures “that are best suited to the circumstances of the contract action and consistent with the need to fulfill the Government’s requirements efficiently.” 48 C.F.R. § 6.101(b) (2009). Restrictive provisions are permissible, but only “to the extent necessary to satisfy the needs of the agency or as authorized by law.” Id. § 11.002(a)(1)(ii) (2009). Moreover, “[t]he determination of an agency’s minimum needs ‘is a matter within the broad discretion of agency officials… and is not for this court to second guess.’” Nonetheless, where there is no rational basis for an agency’s decision, or there was a violation of an applicable regulation or procedure, the court may find such decision to be arbitrary and capricious. Accordingly, the protestor must demonstrate that there was no rational basis for the agency’s decision.

Savantage Financial Services, Inc. v. United States, 86 Fed. Cl. 700 (2009).

GAO’s Key Language

We have recognized that an agency may use detailed specifications where the record demonstrates that particular size, strength, or material requirements are necessary to ensure adequate performance, or that a particular design is reasonably related to maintaining an aesthetic appearance. Specifications for the use of particular materials may be justified when they are necessary to ensure adequate performance or that a particular design is reasonably related to the agency’s aesthetic needs. Such consideration of aesthetics and suitability is a subjective exercise. For example, agencies may use specifications requiring a particular color where the agency reasonably establishes that the color restriction is necessary to match an established color scheme. Similarly, uniformity of appearance can lead to a specification which assures consistency with the agency’s previous acquisitions.

J. Squared Inc., d/b/a University Loft Company, B-408388, Aug. 27, 2013.

In preparing a solicitation for supplies or services, a contracting agency must specify its needs and solicit offers in a manner designed to obtain full and open competition and may include restrictive provisions or conditions only to the extent that they are necessary to satisfy the agency’s needs. 10 U.S.C. § 2305(a)(1) (2006). A contracting agency has the discretion to determine its needs and the best method to accommodate them. Where a requirement relates to national defense or human safety, an agency has the discretion to define solicitation requirements to achieve not just reasonable results, but the highest possible reliability and/or effectiveness. Mere disagreement with the agency’s judgment concerning the agency’s needs and how to accommodate them does not show that the agency’s judgment is unreasonable.

Womack Machine Supply Co., B-407990, May 3, 2013.

Where a protester challenges a specification or requirement as unduly restrictive of competition, the procuring agency has the responsibility of establishing that the specification or requirement is reasonably necessary to meet the agency’s needs. We will examine the adequacy of the agency’s justification for a restrictive solicitation provision to ensure that it is rational and can withstand logical scrutiny. A protester’s mere disagreement with the agency’s judgment concerning the agency’s needs and how to accommodate them does not show that the agency’s judgment is unreasonable.

ASC Group, Inc., B-407136, Nov. 15, 2012.

In preparing a solicitation, a contracting agency is required to specify its needs in a manner designed to achieve full and open competition and may include restrictive requirements only to the extent they are necessary to satisfy the agency’s legitimate needs. 10 U.S.C. § 2305(a)(1) (2006). To the extent a protester challenges a specification as “unduly restrictive,” that is, challenges both the restrictive nature of the requirement as well as the agency’s need for the restriction, the procuring agency has the responsibility of establishing that the specification is reasonably necessary to meet its needs. The adequacy of the agency’s justification is ascertained through examining whether the agency’s explanation is reasonable, that is, whether the explanation can withstand logical scrutiny. If the agency establishes support for the challenged solicitation term, the burden shifts to the protester to show that it is clearly unreasonable.

Technosource Information Systems, LLC, B-405296, B-405296.2, B-405296.3, Oct. 17, 2011.

The fact that a requirement may be burdensome or even impossible for a particular firm to meet does not make it objectionable if the requirement properly reflects the agency’s needs.

Helionix Systems, Inc., B-404905.2, May 26, 2011.

The fact that an aspect of the RFP’s evaluation criteria may prevent a number of small firms from obtaining positive past performance ratings is not dispositive of whether the provision is unduly restrictive. Rather, agencies enjoy broad discretion in the selection of evaluation criteria, and we will not object to the use of particular evaluation criteria so long as they reasonably relate to the agency’s needs in choosing a contractor that will best serve the government’s interests.

SML Innovations, B-402667.2, Oct. 28, 2010.

This Office has considered geographic restrictions reasonably necessary for an agency to meet its needs when, for example, the agency demonstrates that convenience and efficiency of operations require that a facility be located within a particular boundary.

Eisenhower Real Estate Holdings, LLC, B-402807, July 27, 2010.

Further, when a contractor will be operating in a unique work setting, an agency may require that the contractor’s personnel possess prior experience in operating in the same type of work setting.

JRS Management, B-402650.2, June 25, 2010.

FAR Crosswalk: FAR Part 11, Describing Agency Needs, and FAR § 12.202(b).

Other Relevant Cases: See page 293 in the Index of Representative Cases.

Commentary: As noted, this protest ground is rarely sustained. That does not, however, necessarily mean that it is not an effective pre-award protest ground. Rather, it is likely that a high number of such protests result in the procuring agency’s taking corrective action after reexamining its specifications. (When the agency takes corrective action in this manner, there is no merits-based decision at the GAO.) In other words, the reported cases likely demonstrate a low sustain rate because in a significant number of these cases, the agency has taken a second look at the challenged provision and either modified it or determined that it is indeed necessary. After all, if an agency’s solicitation is protested to the GAO as unduly restrictive and the agency cannot present a reasonable need for the challenged provision, it makes little sense for the agency to incur the delay attendant to a CICA stay only to be told later by the GAO that the solicitation must be amended.

The few sustained protests in this area show where the GAO generally draws the line. First, the GAO is not satisfied with unsupported opinions of agency personnel that are devoid of any meaningful analysis or underlying documentation. (See NCS Technologies, Inc., B-403435, Nov. 8, 2010.) Also, the GAO has sustained a protest on this ground where the agency restricted a past performance evaluation solely to the prime contractor as opposed to allowing an evaluation of a proposed subcontractor’s past performance for that capability. (See Total Health Resources, B-403209, Oct. 4, 2010.) Additionally, the GAO will sustain a protest if the procuring agency requires that a piece of equipment pass a certification requirement at the time the offeror submits its proposal as opposed to the time the equipment will be fielded. (See SMARTnet, Inc., B-400651.2, Jan. 27, 2009.) In equipment supply cases, the GAO requires the agency to clearly explain why offerors cannot propose an acceptable plan to get the equipment certified following contract award.