Full GAO Decision Explains Rulings on Blue Origin’s Protest of AF Launch RFP

The Government Accountability Office (GAO) today released the full text of its decision on Blue Origin’s protest of the Air Force’s procurement of launch services for contracts to be awarded beginning next year.  A letter summarizing the decision was released on Monday, but the full report goes into more detail about why GAO sustained one part of the protest, but denied others.

The Air Force issued a Request for Proposals (RFP) on May 3, 2019 for the Phase 2 Launch Service Procurement, part of its phased acquisition of launch services for the next decade.  Four companies are bidding to win contracts: Blue Origin, SpaceX, Northrop Grumman and the United Launch Alliance (ULA), a Lockheed Martin-Boeing joint venture.

Two companies will be chosen for contracts to be awarded in the next 5 years (2020-2024) for national security space launches through 2027.

Blue Origin protested the RFP on the basis that it contains “unclear and ambiguous selection criteria,” “discriminates against new competitors,” and “unnecessarily restricts competition.”

On Monday, GAO released a letter summarizing its decision to sustain the protest in part while denying other parts.  The full report had to be reviewed to ensure no proprietary information was made public so its release was delayed until today.

GAO sustained the complaint that the RFP contains unclear and ambiguous selection criteria. Instead of choosing the two offers that individually provide the best value for the government, the Air Force planned to choose two that complement each other — that “when combined” offer the best value.  GAO concluded that methodology “does not provide an intelligible, common basis on which offerors will be expected to compete and have their proposals evaluated.”

Air Force Assistant Secretary for Acquisition Will Roper said yesterday that in response to the GAO decision, those two words will be eliminated in the RFP.  He also said the changes will be implemented “in a manner that should not materially delay contract award.”

GAO denied Blue Origin’s other protests.  On the question of whether the RFP unnecessarily restricts competition, GAO concluded that was a policy dispute that fails “to state cognizable bases of protest within our Office’s bid protest jurisdiction.” Blue Origin’s argument is that the Air Force should procure services for only 2 years, not 5, because new entrants like itself are developing launch vehicles that soon might be in a better position to compete.  GAO found “no basis” to sustain the protest on that argument.

It also rejected Blue Origin’s complaints that the price evaluation methodology is ambiguous and that the RFP was soliciting commercial items in a manner inconsistent with customary commercial practice.

Blue Origin President Bob Smith said on Monday that the company appreciates GAO’s decision that unambiguous selection criteria are needed and looks forward to working with the Air Force as it continues to incorporate GAO’s views into the competition.