KPMG falls short in attempt to keep incumbent DLA contract

DLA headquarters at Fort Belvoir, Virginia.

DLA headquarters at Fort Belvoir, Virginia. Courtesy of DLA

The Defense Logistics Agency gets formal backing of its choice to set aside a financial support contract for service-disabled, veteran-owned small businesses after an incumbent's protest against that move.

Just because you disagree with an agency’s decision doesn’t mean that you have grounds for a protest.

That’s one of the key takeaways from this Government Accountability Office decision to deny KPMG's allegation that the Defense Logistics Agency erred in setting aside a contract for service-disabled, veteran owned small businesses.

KPMG is the incumbent on the contract to provide financial improvement and audit readiness services to DLA.

DLA made this latest version of the contract a series of five-year blanket purchase agreements for services such as program management, business process improvement and audit sustainment initiatives.

KPMG claimed decision to make the BPAs set-aside contracts was flawed because the agency’s market research didn’t reflect the “complexities of the agency’s requirements.” The company claims the agency didn’t assess whether there were enough service-disabled, veteran-owned small businesses that could provide the needed services.

DLA countered that KPMG’s objections were merely a business disagreement with the agency’s judgement.

But the agency also shared its market research: the request for information went to 278 small businesses. Nine companies responded and submitted capability statements. Of those nine, DLA determined that four could provide the needed services.

The agency also concluded that they would likely get more responses to the solicitation than the RFI. DLA was right about that: 11 companies responded to the solicitation.

KPMG filed its protest on Dec. 3, before proposals were due on Jan. 6. GAO has denied the challenge and that lets DLA move forward with its awards. Awards are expected later this spring.

Key takeaway number two is more of a reminder of advice we hear all the time: respond to those RFIs and sources sought notices. If DLA had not gotten the response that it did, the agency would not have competed this as a set-aside.