Lost Proposals

Many contractors understand that when a proposal is submitted late, then the rule is “Late is late” and they may be eliminated from the competition for a resulting contract. Generally, the contractor is at fault when the proposal is submitted late because they control the preparation and the submission of the proposal. But what happens when a contractor timely submits their proposal, only to discover later that the Government lost their proposal??

This question was the subject of a recent decision by the Government Accountability Office in the Matter of Project Resources, Inc., File B-297968, dated March 31, 2006. In summary, if the Government loses your proposal, you lose any possibility of an award unless you can prove the agency has a “systemic failure” somewhere in their process for handling proposals received.

The Request for Proposal (“RFP”) from the United States Army Corps of Engineers (the “Corps” or the “agency”) set a date and time for receipt of proposals as no later than 2PM on October 12, 2005. Protester Project Resources, Inc. (“PRI”) had their proposal delivered by FedEx at 9:30AM on October 12, 2005. Somehow, the agency lost the PRI proposal before an evaluation of the PRI proposal could be conducted. PRI, however, did not learn of this loss until after the Corps made five awards on January 31, 2006. PRI decided to inform the agency that it had submitted a proposal. The agency searched for the proposal but was unable to locate it.

PRI filed a protest and sought relief in the form of a proper evaluation of its proposal. The GAO denied the protest.

GAO stated that “agencies have a fundamental obligation to have procedures in place to receive submissions for competitors under a solicitation, to reasonably safeguard submissions received, and to fairly consider all submissions received. As a practical matter, however, even with appropriate procedures in place, an agency may lose or misplace a submission and such occasional loss-even if through agency negligence-generally does not entitle an aggrieved competitor to relief.” (Emphasis added).1

GAO stated that “allowing an offeror to establish the content of its lost proposal after the closing date has passed would be inconsistent with maintaining a fair competitive system.”2

The GAO will recognize “a limited exception to the general rule that the negligent loss of a quote or bid in and of itself does not entitle a bidder to relief. This exception applies where the record demonstrates that the loss was not an isolated incident, but rather, was part of a systemic failure on behalf of the agency such that the procedures in place to receive and safeguard quotes cannot be considered reasonable.”3 In other words, when the loss of the proposal is “a systemic failure in the agency's procedures that typically results in multiple or repetitive instances of lost information” then a protest filed by an unsuccessful offeror may be sustained. For example, if an agency loses two quotations from the same vendor in one week, or where an agency loses the quotes of several vendors submitted in response to a number of RFPs, then a “systemic failure” may exist.

Although lost proposals are probably rare, don't take any chances. Take the simple precaution of confirming the actual receipt of all parts of the proposal with the Contracting

Officer within 24 hours or so of delivery of the proposal to the agency. An e-mail inquiry should be sufficient.

Tom Petruska, Owner
Contracts Unlimited, Incorporated

Do you need assistance with Lost Proposals or other contracting issues?

Footnotes:

1. See also Shubhada, Inc., B-292437, September 18, 2003

2. id.

3. American Material Handling, Inc., B-281556, February 24, 1999

The foregoing is not legal advice nor is it a legal opinion. Please contact your attorney for legal advice.

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