By Ann Roosevelt
BAE Systems has filed a second supplement to its initial protest with the Government Accountability Office (GAO) over the Army’s award to Oshkosh Corp. [OSK] of a potential multi-billion Family of Medium Tactical Vehicles (FMTV) rebuy contract, company officials said.
“The supplemental protest is a direct result of what the agency [Army] filed in response to our first protest,” Al Crews, vice president contracts and legal, and chief counsel of BAE’s Global Tactical Systems, said in a roundtable yesterday. The second supplemental protest also comes as a result of the Army’s providing BAE’s outside counsel the materials used as part of the source selection process, he said.
John Suttle, vice president, communications, at BAE’s Land & Armaments operating group, said, “the more we look, the more we find wrong with the process.”
“We remain and are increasingly convinced that the service’s source selection process was flawed,” Dennis Morris, president of Global Tactical Systems, said. The Army’s stated objective was to conduct a best value competition based on a clear cut set of criteria and “we believe that they did not follow their own criteria and that process.”
Notified at the end of August that Oshkosh won the FMTV rebuy award over BAE, which has been producing FMTVs for 17 years into 2010, Morris said after a detailed analysis of the Army’s debriefing of its proposal, the company filed a formal protest Sept. 4, followed by a supplemental protest Sept. 11 (Defense Daily, Aug. 28, Sept. 9, 17). This second supplemental protest was filed Oct. 16. Navistar International Corp. [NAV.N] has also protested the award.
BAE has requested a redacted version of the second supplemental protest be made publicly available, Morris said. But all the parties involved–Oshkosh, Navistar and the Army– must agree to the release.
“We believe in providing as much transparency as possible,” Crews said. “We have nothing to hide; this is not a frivolous protest.”
BAE continues to believe it offered the Army the best value proposal that would minimize the execution risk to the Army.
No details of the additional grounds for protest can be discussed without the release of a redacted document, Crews said. As part of the protest process, once a protest is filed, GAO puts in place a protective order.
“Because of that protective order, our outside counsel, who are actually prosecuting the protest are unable to reveal details of that supplemental protest even to us, so at this point we don’t know what the additional grounds are,” Crews said.
The protective order is typically limited to the attorneys and consultants for each of the parties: in this case, the Army, Oshkosh, Navistar and BAE, Crews said. This step normally excludes in-house counsel and individuals who work for the companies. It’s an “information blackout/lockdown.”
Now, the Army and other parties to the protest–Oshkosh and Navistar–will have the opportunity to respond, with a due date of Oct. 26. At that point, GAO will decide whether they will “entertain additional” supplemental protests based on the responses. And between that time and the conclusion of the 100-day process–Dec. 14–GAO will make its decision on the protest.
The protective order also covers specifics in the competing proposals. For example, Morris said Oshkosh told BAE its total cost was about 10 percent less than that in BAE’s proposal. No details were provided. The BAE proposal took an “aggressive pricing approach” in its bid, and the disparity in size between the two companies led to concerns over the lack of a detailed pricing analysis and evaluation of risk that BAE believes it is better able to carry since it’s a global company. BAE had no visibility into the Navistar bid.
Morris also said if someone provides pricing information covered under the protective order they are subject to “severe sanctions.” For an attorney, it could mean disbarment.
The FMTV rebuy contract has no attached monetary value, as it is a requirements contract, Chris Chambers, vice president and general manager GTS Programs at BAE’s Global Tactical Systems, said. Annually, a number to a delivery order is allocated if the government requires it. During the competition, a notional number of 20,000 vehicles were considered for the life of the contract.
Morris said $3 billion or so was the figure discussed for the length of the contract.
While members of the Texas and Wisconsin congressional delegations have weighed in supporting BAE in the case of Texas, and Oshkosh in the case of Wisconsin, they are not able to receive information covered in the protective order, Crews said. Members can, however, solicit information from other sources on the contract and protests.
Congressional members have a concern over the process being used and other issues such as industrial base, Morris said (Defense Daily, Oct. 6, 16). “One of the things that we’re seeing very clearly is with this particular selection of going with Oshkosh this process essentially puts the Army’s medium and heavy tactical vehicles into a single source company with no diversification in the industrial base after our potential contract work is done.”
Members appear to be interested in the general nature of the Army’s thought process, and if the service fully considered the outcomes, rather than delving into fine detail, he said.