(Editor's Note. A contractor's past performance has become a critical factor in making a contract award decision. Regulation changes, Court and Board decisions and agencies’ formal and informal guidance is changing as well as clarifying the implementation of past performance. Though we frequently report on these in our GCA REPORT, we have been waiting for the opportunity to elaborate and discuss their practical meaning. We have recently come across a couple of articles by David Bodenheimer of the law firm of Crowell and Moring, L.L.P. in the September issue of Contract Management and Carl Vacketta and Richard Vacura of the law firm of Piper & Marbury, L.L.P. in the March 1998 issue of the Government Contract Audit Report. They depict the history of this trend, current regulations, evolving trends of implementing past performance and what steps are sensible for contractors to take at this time.)

History

Past performance is not a new concept. In the 1960's, the use of past performance as an evaluation factor received a great deal of attention. The Air Force developed a "Contractors Experience List" and in 1963, the Department of Defense formalized use of past performance with a requirement for performance evaluation which included formal reports, databases, standards for review, retention and release of past performance data. By 1971 the plan was abandoned with DOD claiming the considerable cost of such an undertaking did not exceed the benefit. Since 1971 to the current period, past performance has existed either in niche industries such as construction and architect/engineering contracting as well as a factor in determining responsibility. The current proponents of past performance will have to relearn the difficulties encountered in the past (e.g. obtaining current and accurate past performance data, maintaining massive past performance databases).

Current Regulations

Past performance is at the leading edge of the current intentions to make Government procurement more like commercial acquisitions.

FASA. In 1994, the Federal Acquisition Streamlining Act established past performance as a factor COs should consider in awarding a contract. The Federal Acquisition Regulations was amended to require agency to collect past performance data and use it on competitive source selections for all contracts exceeding $1 million. Since FASA, there have been a floodgate of changes to the Federal Acquisition Regulations regarding implementation of past performance.

Definition. The FAR loosely defines it as "relevant information, for future source selection purposes, regarding a contractor's actions under previously awarded contracts" (FAR 42.1501). Since this definition reveals little, the FAR also provides a list of examples:

Quality. Record of conforming to contract requirements and standards of good workmanship.

Cost. Record of forecasting and controlling costs;

Schedule. Adherence to contract schedules, including administrative aspects of performance;

Cooperation. History of reasonable and cooperative behavior and commitment to customer satisfaction;

Attitude. Business-like concern for customer's interests.

Since these examples provide a wide latitude of subjectivity (e.g. cooperation, attitude), the FAR leaves substantial leeway for misunderstanding and disagreement.

Responsibility. Contracting Officers now "shall consider relevant past performance information" (FAR 9.104-1(c)).

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