A Primer on Past Performance for Federal Contractors

This is the ultimate guide to past performance. Let’s get started.

The government believes a contractor’s previous performance on a contract is an indicator of future performance. Past performance as defined in FAR Part 2 means an offeror’s or contractor’s performance on active and physically completed contracts.

I. The Process for Evaluating Completed Contracts – FAR Subpart 42.15

A. When Should a Contractor be Evaluated?

An ordering agency under a GSA Schedule is required to prepare at least annually and at the time the work under the order is completed, an evaluation of contractor performance for each order that exceeds the simplified acquisition threshold. For all other contracts an agency is also required to prepare a past performance evaluation annually for contracts exceeding the simplified acquisition threshold. FAR Part 42 is the go to for the how, what and when of past performance.

B. Large Business Past Performance

Past performance evaluations of large businesses shall include an evaluation of contractors performance against and efforts to achieve the goals identified in a small business plan. It shall also include reduced or late payments made to small business subcontractors.

C. Contesting a Past Performance Evaluation

Per FAR Part 42, agency evaluations of contractor performance, including both negative and positive evaluations, shall be provided to the contractor as soon as practicable after completion of the evaluation. As a contractor you will receive a CPARS-system generated notification when an evaluation is ready for comment. Contractors then have up to 14 calendar days from the date of notification to submit comments, rebutting statements, or additional information. Agencies then must provide for review at a level above the contracting officer to consider disagreements between the parties regarding the evaluation. If your company and contracting officer cannot reach agreement, then you have the right to appeal to either the Board of Contract Appeals or the Court of Federal Claims.

All past performance evaluations are now located in CPARS at  https://www.cpars.gov. These evaluations, including any contractor-submitted information (with indication whether agency review is pending), become available for source selection officials not later than 14 days after the date on which the contractor is notified of the evaluation’s availability for comment. The Government shall update CPARS with any contractor comments provided after 14 days, as well as any subsequent agency review of comments received.

D. How Many Years Can an Agency Look Back

Agencies can use the past performance information in CPARS that is within three years (six for construction and architect-engineer contracts) of the completion of performance of the evaluated contract or order, and information contained in the Federal Awardee Performance and Integrity Information System (FAPIIS), e.g., terminations for default or cause.

II. Proposal Evaluation of Past Performance

A. Past Performance Evaluations in Negotiated Procurements

Subpart 15.3 of the FAR requires agencies to consider past performance or some other non-cost evaluation factor in all procurements, although the requirements differ somewhat depending upon the value of the procurement.

#1. Below the simplified acquisition threshold – agencies must consider past performance or some other non-cost evaluation factor (e.g., technical excellence, management capability).

#2. Procurements whose value exceeds the simplified acquisition threshold – agencies must consider past performance unless the contracting officer documents why past performance is not an appropriate evaluation factor for the acquisition.

#3. FAR Subpart 15.3 further requires (1) that agencies’ evaluation of past performance be in accordance with the terms of the solicitation, and (2) that contractors’ performance in subcontracting with small businesses be considered when evaluating their past performance.

#4. What Agencies Should Consider – FAR 15.305(2) -The evaluation should take into account past performance information regarding predecessor companies, key personnel who have relevant experience, or subcontractors that will perform major or critical aspects of the requirement when such information is relevant to the instant acquisition.

#5. No Past Performance – In the case of an offeror without a record of relevant past performance or for whom information on past performance is not available, the offeror may not be evaluated favorably or unfavorably on past performance.

The agencies have wide discretion in defining what will be evaluated. This can include what is considered “recent and relevant” and whether subcontractor or key employee past performance will be considered. Past performance does not have to be the most heavily weighted factor. And agencies can consider other factors too.

B. Past Performance for GSA Schedule Orders

#1. FAR Part 15 does not apply.

#2. The ordering agency may consider past performance.

C. Past Performance Evaluations of Joint Ventures

Small Business Administration (SBA) rules “require agencies to consider the experience and past performance of both the mentor and protégé members of a joint venture, the regulations do not mandate a specific degree of consideration for the mentor or the protégé firm.” Further, while the SBA rules require small business protégés to have some experience, it would be unreasonable to require them to have the same level of experience as the mentor.

D. Past Performance Evaluations of Small Business Subcontractors

#1. Prime Contractor Responsibility – Under prime contracts with subcontracting plans, prime contractors are required to provide past performance ratings upon request by a first-tier subcontractor. The subcontractor must make the request within 30 days after the completion of the contract or period of performance. The prime contractor must provide the rating to the subcontractor within 15 days of the request.

#2. Government Responsibility – When a small business contractor provides an agency with either its joint venture or first tier subcontractor past performance, the agency must consider it in the same way the agency is evaluating prime contractor past performance.

Using Past Performance from Novation and Acquisitions

A novation alone does not require an agency to attribute the past performance of the selling company to the acquiring company. GAO has found that where the contract performance is continuing by the successor in interest on the novated contract then it is reasonable for the procuring agency to consider those novated contracts for the past performance evaluation.

III. Past Performance Evaluations of Joint Ventures

When evaluating the capabilities, past performance, experience, business systems and certifications of an entity submitting an offer for contract set aside for small business as a joint venture established under the Small Business Administration (SBA) rules, a procuring activity must consider work done and qualifications held individually by each partner to the joint venture as well as any work done by the joint venture itself previously. A procuring activity may not require the protégé firm to individually meet the same evaluation or responsibility criteria as that required of other offerors generally. The partners to the joint venture in the aggregate must demonstrate the past performance, experience, business systems and certifications necessary to perform the contract. !3 CFR 125.8(e).

If you have questions about how to interpret this or other federal regulations contact me at [email protected].