Judge’s Decision Offers Insights into FirstNet's Contract Award Process
Tuesday, April 04, 2017 | Comments
The U.S. Court of Federal Claims released a redacted version of Judge Elaine D. Kaplan's decision in Rivada Mercury's pre-award protest of the First Responder Network Authority's (FirstNet) contract award process, offering insights into the award process and the reasoning behind the judge's decision against the protest

Kaplan ruled in favor of FirstNet March 17, and about a week later, FirstNet awarded the contract for a nationwide public-safety broadband network (NPSBN) to AT&T.

Rivada first filed suit in November, alleging that the government had unlawfully excluded it from the “competitive range” for the contract.

Rivada’s protest centered around two points of contention. First, Rivada argued that the government entered into discussions with the bidding parties prior to the establishment of a competitive range, thereby violating the Federal Acquisition Regulation (FAR). Second, Rivada argued that the government erred in several ways in evaluating Rivada’s proposal and in deciding to exclude it from the competitive range. In her decision, Kaplan rejected all of Rivada’s arguments.

According to the judge’s decision, the following events led up to Rivada’s protest. After the initial release of the RFP, the government received capability statements from potential offerors and narrowed that down to a field of viable competitors that included Rivada and AT&T. The exact number of potential offerors and viable competitors is unknown because of redactions in the document.

After several phases of evaluation, which both AT&T and Rivada passed through, the government began more detailed evaluations by convening a Source Selection Evaluation Board (SSEB) to evaluate each proposal’s technical merits.

This phase also included oral presentations by the companies, and after Rivada’s presentation, the government asked for several written clarifications. Upon completing its evaluation, the SSEB compiled several reports and documents on each bidder.

These documents were then considered by FirstNet’s Source Selection Authority (SSA) in narrowing down the competitive range.

For Rivada’s proposal, the SSA highlighted a few strengths but also noted several “deficiencies and weaknesses” that could pose a great deal of risk to the success of the nationwide broadband network. The weaknesses cited included the following:

• Rivada’s proposal relied on a large amount of third-party funding, and the company did not provide adequate documentation to show it could secure that funding. According to the court documents, Rivada argued that it provided nine “highly confident” letters from banks that they could get the funding for the company, but the SSEB noted that these letters included a variety of conditions and caveats, meaning that they “did not constitute an acceptable commitment to providing financing for Rivada.”
• Rivada’s plan for a wholesale marketplace for excess spectrum had deficiencies, and the company did not provide adequate evidence to show that customers would adopt the model. Rivada argued that the SSA added unstated value criteria that “no offeror could rely on the sale of excess capacity on the wholesale market.”
• Overstatement of Rivada’s device connection targets. The SSA determined that Rivada’s plan did not meet FirstNet’s definition of a device connection.
• There was a lack of executed agreements with the proposed members of the Rivada Mercury team. The SSEB concluded that the lack of binding agreements would likely delay the project so that agreements could be executed and that the proposed agreements lacked incentives or consequences to ensure successful deployment and operation of the network. Rivada argued that the SSA wrongly imposed a requirement that the company have executed subcontracts in place.

Specifics on many of the plans and cost figures were redacted from the publicly released version to protect sensitive and proprietary information.

For strengths, the SSA highlighted the experience of the Rivada Mercury team members and noted that the company offered a “purpose-built public-safety-focused network which offers a low market entry price-point” — something that could help foster adoption.

The SSA noted several weaknesses in AT&T’s proposal but also found “substantial strengths,” such as experience in building and operating a nationwide wireless system, as well as in commercializing spectrum capacity.

Similar to Rivada’s proposal, the SSA found a weakness in the fact that AT&T did not have executed contracts, but also determined, that given its capabilities, the company would have to enter into fewer contracts and already had deep experience in managing subcontractors on large projects.

Another identified weakness in AT&T’s proposal was that its “overall proposed adoption targets were low.” Specifics on that weakness are unavailable because of redactions in the judge’s decision.

The SSEB used four factors and 18 subfactors included under those factors to evaluate the proposals. Among the factors, Rivada received unacceptable scores in two (business management and products and architecture) and acceptable scores in two (coverage and capacity and past performance), while AT&T received acceptable scores in three factors (business management, coverage and capacity, and products and architecture) and a highly exceptional score in the final factor (past performance).

Of the subfactors, Rivada scored unacceptable in 10, acceptable in seven and exceptional in one. On those same subfactors, AT&T scored unacceptable in two, acceptable in nine, and highly acceptable or exceptionable in seven.

The SSA concluded that AT&T’s proposal contained a few weaknesses but nothing that would introduce excessive risk and result in a failure of the network, while Rivada’s proposal had a “significant number of weaknesses and deficiencies” that could introduce excessive risk into the network.

Rivada argued that the government held discussions with the offerors prior to establishing a competitive range and allowed offerors an opportunity to make changes to their proposals, violating FAR.

In her decision, Kaplan found that the exchanges FirstNet had with offerors following the submission of bids did not fall into the category of discussions, but were instead focused on clarifying certain aspects or enhancing its understanding of the proposals, which is allowed under FAR. Kaplan also noted that the government’s internal communications showed that it worked hard to keep the oral presentations compliant with FAR.

Rivada also argued that the government had erred in evaluating several parts of its proposal including its financing plan, plan for selling excess spectrum, agreements with team members, band 14 device portfolio and impact on Rivada’s business model, Rivada’s device connection targets and Rivada’s value proposition. In each instance, the judge rejected Rivada’s claims and found that the SSEB’s and SSA’s evaluations were reasonable.

In her decision, Kaplan addressed the idea that FirstNet had an unstated preference for a large established wireless carrier, a notion she discounted.

“The fact that the agency included only AT&T’s proposal in the competitive range does not demonstrate that the government applied an unstated preference for a large carrier; it merely reflects the agency’s reasonable determination that Rivada’s proposal carried too much risk,” Kaplan wrote.

In a statement, FirstNet CEO Mike Poth applauded the judge’s reasoning and said the organization looks forward to working with AT&T on the network.

“FirstNet is pleased the court was able to quickly release the reasoning of its decision,” Poth said in the statement. “It clearly validates our thorough and quality acquisition process, which was designed and implemented to provide FirstNet and public safety with the best value, most sustainable and lowest risk approach to deploying the nationwide public-safety network.”

In a statement released the day of the contract award, Rivada Networks, one member of the Rivada Mercury team, congratulated FirstNet on making the award and said that the company looks forward to working with states considering opting out of the FirstNet network.

“By including an opt-out right in the law, Congress clearly acknowledged that competition would be good for states, good for public safety and ultimately good for FirstNet,” Rivada’s statement said. “We will gladly provide that competition to any state that wants it.”

New Hampshire is already working with Rivada on an alternative plan should it choose to opt out of FirstNet. Meanwhile, several states including Michigan, Colorado and California have released RFPs and/or requests for information (RFI) to assist in making their opt-out decisions.

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