CIO-SP4: A tragedy, a comedy and a drama we couldn’t stop watching

The National Institutes of Health’s IT Acquisition and Assessment Center (NITAAC) chose 257 small businesses, including 123 in the 8(a) program, to be on its ...

If the CIO-SP4 contract was a show on Netflix or Amazon Prime, you probably could have predicted the story’s arc after watching episode one but you kept tuning in each week just in case it changed.

Unfortunately, you get to the latest episode released on March 31, and the story played out just as you expected. The National Institutes of Health’s IT Acquisition and Assessment Center (NITAAC) made 431 awards under the IT services governmentwide acquisition contract with a $50 billion ceiling. And just like you predicted from the beginning way back in 2021 when NITAAC dropped the first highly-anticipated episode, err, the final solicitation, CIO-SP4 is facing yet another around of protests. More than 30 unsuccessful bidders filed complaints with the Government Accountability Office on or around March 30 when NITAAC notified these, and probably many other firms, they didn’t make the cut.

If you are keeping count at home, NITAAC has now faced 188 protests over CIO-SP4 in almost two years, according to GAO’s bid protest docket. Fortunately for NITAAC, it has won most of them. But the delays in getting CIO-SP4 going and the costs to the companies and the government are main subplots to the entire saga.

GAO said the latest round of protests focuses on the companies’ elimination from moving to Phase II of the evaluations. The vendors allege NITAAC made erroneous decisions to eliminate their self-scoring proposals from the competition. The protestors said NITACC’s cut-off score threshold was too high.

GAO has until July 10 or thereabouts to decide these complaints.

“Vehicles like these are market-access vehicles. If you win, you are in the hunt for the next 10 years; if you don’t, you can’t even bid — companies will fight to the death to get market access,” said Bob Lohfeld, CEO of the Lohfeld Consulting Group, a bid and proposal capture firm. “I don’t think the Office of Management and Budget intended [Governmentwide Acquisition Contracts (GWACs)] to deny companies access to all government agencies when they began promoting GWACS as a preferred acquisition approach.”

At the same time, NITAAC is moving forward to get final confirmation from the Small Business Administration that the small business awardees are indeed small firms and qualified whether under the 8(a) program or other socio-economic initiative.

“We are posting a ‘preliminary’ notice of apparent successful offerors until such time that we can post the actual apparent successful offeror notice. This ‘preliminary’ listing may not yet be comprehensive and complete,” NITAAC said in a March 31 post.

NITAAC’s CIO-SP4 preliminary awards include:

  • 257 small businesses, which includes:
    • 123 8(a) firms
    • 53 HUBZone firms
    • 46 Service disabled veteran-owned small businesses
    • 89 Women-owned small businesses
    • 62 Veteran-owned small businesses
    • 27 Indian economic enterprise or small economic enterprise
  • 123 other than small (large businesses), which includes
    • 75 Other than small business (emerging large businesses)
  • 431 Total awards

NITAAC deputy director and CIO-SP4 contracting officer Ricky Clark said in the preliminary award announcement that they expect the awards to “improve small business access to future acquisition information and to enhance future competition,” and that “NITAAC appreciates the robust competition under this solicitation. I hope that all offerors will look for teaming opportunities and continue to participate in future procurements.”

Lohfeld said NITAAC should get a lot of credit for creating an award category for emerging or mid-sized businesses. This is something other vehicles do not do.

“I figured they would eventually get to awards and stagger to the finish line but not without a lot of hurt,” he said. “I do admit the pace of CIO-SP4 was unfathomable slow. NITAAC never saw a deadline they couldn’t move, and that created a lot of problems for industry and themselves.”

Another extension in the works?

The next episode that is still to come is whether NITAAC will have to, once again, extend the CIO-SP3 contract beyond the April 29 expiration date. NITAAC already has added almost an extra year to the original CIO-SP3 end date.

The good news for NITAAC is it finally reached the point of making the awards after this long journey despite predictions by pundits — myself included — that the procurement was flawed and would be crushed under the weight of protests.

NITAAC is not fully out of the woods yet. Lohfeld said while it’s highly likely CIO-SP4 will come to fruition by early fiscal 2024, there have been examples of agencies having to let all protestors on the vehicle just to break the cycle.

Lohfeld said NASA did that with the Solutions for Enterprise-Wide Procurement (SEWP) V GWAC.

Lohfeld said NITAAC’s big mistake with CIO-SP4 was creating an arbitrary threshold, particularly after all the proposals are received without published criteria.

“As long as the procuring agency keeps the award threshold secret, companies will always protest, hoping that if they can knock out a bidder, they will move up for an award,” he said. “If the agency discloses the award threshold and will say that every bidder who scores above the published threshold gets a contract, you won’t have continual protests. Look at OASIS+ as an example of how to do it right. They published the award threshold and will award to all bidders who meet or exceed the threshold, and if you can’t exceed the threshold, you can come back and try again when you can.”

CIO-SP3 remains popular

NITAAC’s vehicles remain popular across the government, and Lohfeld expects CIO-SP4 to be no different when it finally gets going in early fiscal 2024 at the latest.

Bloomberg Government (BGov) reported that CIO-SP3 hasn’t reached its $40 billion ceiling across both contracts with spending totaling $26.7 billion since 2012. It’s split almost equally between the small business ($12.5 billion) contract and the unrestricted version ($14.2 billion).

BGov also said the departments of Health and Human Services ($1.7 billion), Homeland Security ($685 million) and Defense ($649 million) were the top users of CIO-SP3 in 2022.

Lohfeld said he hopes other agencies running multiple award, high-dollar contracts like CIO-SP4 heed the lessons that if they decide on a fixed number of companies who will win awards, they are doomed to follow the same path as NITAAC.

He said the OASIS+ contract from the General Services Administration is doing the right thing by expecting to make more than 2,000 awards,  as well as making the threshold to get on the contract clear from the beginning.

A beginning and, now hopefully, an end that was obvious to many observers, but one we can’t stop watching either.

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