Mentor-Protégé Agreement

Mentor-Protégé Agreement Goes Awry

In a recent case, a former 8(a) protégé was not entitled to the past performance obtained as part of a mentor-protégé joint venture where the former mentor would not be involved in the new contract. The Government Accountability Office (GAO) made a recent bid decision where a procuring agency made a mistake by crediting the protégé with the joint ventures past performance without researching the actual performance, making the mentor-protégé agreement go unexpectedly awry.

In the case, Veterans Evaluation Servs. Inc., B-412940 et al. (July 13, 2016), a solicitation to acquire medial disability examination services, the VA issued a request for proposal (RFP) seeking to award several large IDIQ contracts. The original intent was to award two contracts per district 1 through 6, and contractors were required to locate and train a network of healthcare professionals to perform examinations.

Performing the contact as part of an 8(a) mentor-protégé joint venture, VetFed Resources worked with QTC Medical Services, Inc. in an arrangement with the mentor-protégé program which had already expired by the timeline expressed in the RFP. Here is where it gets confusing – the VetFed submitted proposals for districts 1, 2, and 5. In districts 1 and 5, VetFed proposed to use QTC as its major subcontractor, using QTC’s provider network and infrastructure. But for district 2, VetFed did not propose to use QTC as its subcontractor. After the review of competitive proposals, the VA awarded contracts to VetFed for districts 1, 2, and 5.  In its evaluation of all three districts, the VA rated VetFed’s past performance as good.

After the awarded decision to VetFed, three competitors in the running filed GAO protests contesting the results of the VA’s evaluation. All three protesters argued that VetFed’s good past performance rating was unfair since they had access to the resources of its ‘former’ mentor, and without that access, VetFed would not have received a good rating and potentially, not received the contract.

There is a lesson to be learned here for the protégés of the world. In this case, the GAO stated that a protégé may not get credit for past performance in a mentor-protégé agreement unless the mentor sticks around. Coming in October, a new universal mentor-protégé program will be available online that will outline guidelines and requirements on how past performance of mentor-protégé joint ventures will be treated moving forward.

If you have questions about the GAO or mentor-protégé agreements, contact KDuncan & Company for details.

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KDuncan & Company is dedicated to providing knowledge and support for small government contractors about concerns regarding government contracting. For questions on areas such as as cost proposals, accounting systems, DCAA compliance, and incurred cost audits, reach out to KDuncan & Company.

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