Evaluating the “Past Performance” of Federal
Contractors: Legal Requirements and Issues
Kate M. Manuel
Legislative Attorney
January 3, 2011
Congressional Research Service
7-5700
www.crs.gov
R41562
CRS Report for Congress
P
repared for Members and Committees of Congress

---

Evaluating the “Past Performance” of Federal Contractors

Summary
Poor performance under a federal contract can have immediate consequences for contractors, who
could potentially be denied award or incentive fees, required to pay liquidated damages, or
terminated for default. In addition, it can affect their ability to obtain future contracts because
various provisions of federal law require agencies to evaluate contractors’ “past performance” and
consider past performance information when making source selection decisions in negotiated
procurements and when determining whether prospective contractors are “responsible.” “Past
performance” refers to contractors’ performance on “active and physically completed contracts.”
Recent reports alleging that some contractors received new contracts despite allegedly deficient
performance under prior or current contracts has prompted interest in the role that evaluations of
past performance play in federal contracting, as well as attempts by some members of Congress
and the Obama Administration to strengthen existing requirements pertaining to the compilation
and use of performance evaluations.
Currently, federal law requires agencies to evaluate and document contractor performance on all
contracts whose value exceeds $150,000. The evaluation must address the contractor’s
performance vis-à-vis any required subcontracting plan and may address its conformity to
contract requirements, adherence to contract schedules, and related factors. The evaluation and
any contractor response comprise the past performance information that is stored in government
databases (e.g., Past Performance Information Retrieval System (PPIRS), Federal Awardee
Performance and Integrity Information System (FAPIIS)) and may be used in future source
selection decisions. Agencies must also consider contractors’ past performance when making
source selection decisions in negotiated procurements whose value exceeds $150,000. In a
negotiated procurement, the contract is awarded to the offeror whose proposal represents the
“best value” for the government based on various factors identified in the solicitation. These
factors typically must include price and past performance. However, other factors may be
considered, and the factors can carry various weights. Additionally, agencies must consider
whether the contractor has a satisfactory performance record when determining whether the
contractor is sufficiently “responsible” to be awarded a federal contract. Agencies cannot award a
federal contract without determining that the contractor is “responsible.” While agencies are
generally prohibited from repeatedly finding a contractor nonresponsible based upon the same
deficient past performance, they also have authority to debar or suspend contractors for willful
failure to perform under a contract or a history of failure to perform.
The 111th Congress enacted or proposed legislation regarding agency evaluations of contractors’
past performance and use of past performance information in source selection decisions (e.g., P.L.
111-23, P.L. 111-83, P.L. 111-212). The Obama Administration has also implemented initiatives
that would reward contractors for good performance, including the Navy’s “Preferred Supplier
Program.” Under this pilot program, which the Department of Defense (DOD) recently proposed
expanding DOD-wide, contracting officers can grant favorable contract terms and conditions to
contractors based on good past performance.
Contractors, however, have expressed concern about certain proposed reforms on the grounds that
these reforms could result in de facto debarment or otherwise deprive contractors of due process.
Contractors’ ability to challenge allegedly erroneous or biased performance evaluations at the
time of their issuance is limited, and courts and the Government Accountability Office generally
give substantial deference to agency source selection decisions and responsibility determinations.
Congressional Research Service

---

Evaluating the “Past Performance” of Federal Contractors


Contents
Introduction ................................................................................................................................ 1
Evaluating and Documenting Contractor Performance................................................................. 1
Contents of Evaluations ........................................................................................................ 2
Procedures for Compiling, Posting, and Using Evaluations.................................................... 3
Contractor Challenges to Performance Evaluations ............................................................... 5
Consideration of Past Performance in Source Selection in Negotiated Procurements.................... 8
Past Performance as an Evaluation Factor ............................................................................. 9
Protesting Agency Evaluations of Past Performance ............................................................ 13
Other Consideration of Past Performance in Source Selection ............................................. 14
Past Performance as a Criterion in Responsibility Determinations ............................................. 15
“Satisfactory Performance Record” As Condition for Contract ............................................ 16
Protests of Responsibility/Nonresponsibility Determinations ............................................... 17
De Facto Debarment ........................................................................................................... 18
Debarment and Suspension Under the FAR ......................................................................... 19
Legislation and Other Initiatives................................................................................................ 20

Tables
Table 1. Various Exchanges Potentially Involving Past Performance Information....................... 12

Contacts
Author Contact Information ...................................................................................................... 23

Congressional Research Service

---

Evaluating the “Past Performance” of Federal Contractors

Introduction
Poor performance under a federal contract can have immediate consequences for contractors, who
could potentially be denied award or incentive fees, required to pay liquidated damages, or
terminated for default.1 In addition, it can affect their ability to obtain future contracts because
various provisions of federal law require agencies to evaluate contractor’s “past performance”
and consider past performance information when making source selection decisions in negotiated
procurements and when determining whether prospective contractors are “responsible.” “Past
performance” refers to contractors’ performance on “active and physically completed contracts.”2
Recent reports alleging that some contractors received new contracts despite allegedly deficient
performance under prior or current contracts has prompted interest in the role that evaluations of
past performance play in federal contracting,3 as well as attempts by some members of Congress
and the Obama Administration to improve agencies’ compilation and use of past performance
evaluations. Contractors, however, have expressed concerns about certain proposed reforms on
the grounds that these reforms could result in de facto debarment or otherwise deprive contractors
of due process.4
This report provides an overview of existing legal requirements pertaining to past performance,
including the issues raised by contractors’ attempts to challenge (1) agency evaluations of their
past performance, (2) source selection decisions based, in part, on consideration of past
performance information, and (3) responsibility determinations. It also surveys recently enacted
and proposed legislation and executive branch initiatives related to evaluations of past
performance.
Evaluating and Documenting Contractor
Performance
While agencies have long informally evaluated contractors’ performance and generally kept some
records regarding this performance, at least during the term of the contract, they were not
required to compile evaluations of past performance until 1993. Then, as part of reforms requiring
agency consideration of past performance in certain source selection decisions, discussed below,
the Office of Federal Procurement Policy (OFPP) directed federal agencies to “[p]repare
evaluations of contractors’ performance on all new contracts over $100,000.”5 One year later,

1 See 48 C.F.R. §§ 11.500-11.503 (liquidated damages); 48 C.F.R. §§ 16.401-16.406 (award and incentive fees); 48
C.F.R. §§ 49.401-49.406 (termination for default).
2 48 C.F.R. § 2.101.
3 See, e.g., Committee on Armed Services, Inquiry into the Role and Oversight of Private Security Contractors in
Afghanistan, 111th Cong., 2d Sess., at 55 (2010) (noting that Department of Defense files on security contracts in
Afghanistan contained “little or no information” about the past performance of security providers); Kimberly Hefling,
KBR Gets $35 Million Contract Despite Electrocutions, Army Times, Sept. 7, 2009, available at
http://www.armytimes.com/news/2009/02/ap_kbr_contract_020709 (quoting commentators who questioned this award
to KBR in light of its allegedly poor performance under a prior contract).
4 See infra note 151 and accompanying text.
5 Exec. Office of the Pres., Office of Mgmt. & Budget, Office of Fed. Procurement Policy, Final Issuance of Policy
Letter 92-5, 58 Fed. Reg. 3573, 3575 (Jan. 11, 1993). OFPP Policy Letter 92-5 further added that “[e]valuations shall
(continued...)
Congressional Research Service
1

---

Evaluating the “Past Performance” of Federal Contractors

Congress enacted the Federal Acquisition Streamlining Act (FASA) of 1994, which established a
statutory basis for agency evaluation of past performance.6 Among other things, FASA required
OFPP to prescribe “policies for the collection and maintenance of information on past contract
performance that, to the maximum extent practicable, facilitate automated collection,
maintenance, and dissemination of information and provide for ease of collection, maintenance,
and dissemination of information by other methods, as necessary.”7 OFPP met this requirement
by promulgating regulations regarding “contractor performance information” in Subpart 42.15 of
the Federal Acquisition Regulation (FAR).8 These regulations, as amended, currently prescribe
the content of contractor performance evaluations, as well as procedures for the compilation,
posting, and use of such evaluations.
The requirement that agencies evaluate contractor performance was imposed, in part, because
“performance assessment is a basic ‘best practice’ for good contract administration, and is one of
the most important tools available for ensuring good contract performance.”9 Additionally,
Congress and the executive branch hoped that written evaluations of contractor performance
would “improve[] the amount and quality of performance information available to source
selection teams,” which would, in turn, “enable[] agencies to better predict the quality of, and
customer satisfaction with, future work.”10 However, although OFPP, in particular, anticipated
that agencies would ultimately be able to rely almost exclusively on agency performance
evaluations in their source selection decisions,11 this does not seem to have occurred, as discussed
below.12
Contents of Evaluations
Under Subpart 42.15 of the FAR, agencies are generally required to evaluate contractors’
performance on all contracts valued in excess of $150,000 ($30,000 for architect-engineer
contracts, $650,000 for construction contracts) when the contract is completed or on an interim
basis, in the case of multi-year contracts.13 However, Subpart 42.15 leaves the content of this

(...continued)
be made during contract performance, as required for contract administration purposes and at the time the work under
the contract is completed.” Id. The Federal Acquisition Regulation (FAR), in contrast, currently requires evaluations of
contractor performance only “at the time the work under the contract or order is completed,” or an interim basis, in the
case of multiyear contracts. 48 C.F.R. § 42.1502(a).
6 P.L. 108-355, § 1091(b), 108 Stat. 3272 (Oct. 13, 1994) (codified at 41 U.S.C. § 405 note).
7 Id.
8 Gen. Servs. Admin., Nat’l Aeronautics & Space Admin., & Dep’t of Defense, Federal Acquisition Regulation; Past
Performance Information, 60 Fed. Reg. 16718, 16719-20 (Mar. 31, 1995).
9 Exec. Office of the Pres., Office of Mgmt. & Budget, Office of Fed. Procurement Policy, Best Practices for Collecting
and Using Current and Past Performance Information, May 2000, at Foreword, available at
http://www.whitehouse.gov/omb/best_practice_re_past_perf.
10 Id.
11 Office of Fed. Procurement Policy, A Guide to Best Practices for Past Performance, at 19 & 36 (1995) (copy on file
with the author) (encouraging agencies to rely on evaluations completed pursuant to Subpart 42.15 of the FAR in the
source selection process “to the maximum extent practicable”).
12 See infra notes 81 to 83 and accompanying text.
13 48 C.F.R. § 42.1502(b) (general requirement); 48 C.F.R. § 42.1502(e) (construction contracts); 48 C.F.R. §
42.1502(f) (architect-engineer contracts); 48 C.F.R. § 42.1502(b) (multi-year contracts). Agencies must also evaluate
performance on any construction or architect-engineer contract that is terminated for default, regardless of its value, as
well as on orders valued in excess of $150,000 placed under the Federal Supply Schedules or an interagency contract.
(continued...)
Congressional Research Service
2

---

Evaluating the “Past Performance” of Federal Contractors

evaluation largely to the agency’s discretion. When evaluating past performance, agencies are
required to evaluate only the contractor’s performance on and efforts to achieve any small
business subcontracting goals,14 although they are encouraged to consider other factors, such as
the contractor’s record of conforming to contract requirements and to standards of good
workmanship; the contractor’s record of forecasting and controlling costs; the contractor’s
adherence to contract schedules, including the administrative aspects of performance; the
contractor’s history of reasonable and cooperative behavior and commitment to customer
satisfaction; the contractor’s reporting into databases …; the contractor’s record of integrity
and business ethics, and generally, the contractor’s business-like concern for the interest of
the customer.15
The contracting agency determines the relevant evaluation factors and typically incorporates them
into a “performance assessment clause” or similar clause in the contract.16 This clause generally
also establishes the categories to be used in rating performance, which can be quite broad, and the
metrics used in applying particular ratings to specific conduct.17 Because the evaluation factors
and ratings categories are terms of the contract, they arguably cannot be changed during the
course of contract performance without the consent of both contracting parties.18
Procedures for Compiling, Posting, and Using Evaluations
Subpart 42.15 of the FAR also requires agencies to follow certain procedures when compiling,
posting, and using performance evaluations. The contracting officer, or someone who has been
delegated this authority by the contracting officer, is to prepare the evaluation.19 However, the
evaluation should be based on the experiences of the technical office and end users, where
appropriate, as well as those of the contracting office.20 A copy of the evaluation should be

(...continued)
48 C.F.R. § 42.1502(c). They are, however, prohibited from evaluating performance on contracts awarded to nonprofit
agencies employing persons who are blind or have severe disabilities. 48 C.F.R. § 42.1502(h).
14 48 C.F.R. § 42.1502(g). Section 8(d) of the Small Business Act requires that all contracts whose expected value
exceeds $650,000 ($1.5 million for construction contracts) incorporate a “subcontracting plan” that provides the
“maximum practicable opportunity” for various types of small businesses to participate in performing the contract. See
15 U.S.C. § 637(d)(4)(C) (negotiated procurements); 15 U.S.C. § 637(d)(5)(B) (sealed-bid procurements).
15 48 C.F.R. § 42.1501. When the FAR was revised to require evaluation of contractor performance, some contractors
and commentators objected to certain of these criteria, most notably the contractor’s “commitment to customer
satisfaction” and “business-like concern for the customer’s interest,” on the grounds that the criteria are inherently
subjective. See, e.g., George M. Coburn, Unfavorable Past Performance Determinations as De facto Debarment, 31
Proc. Law. 26, 27 (1996). Despite such concerns, however, their implementation does not appear to have generated
particular controversy, beyond the controversy generally associated with the issuance of allegedly biased or erroneous
performance evaluations. See infra note 31 and accompanying text.
16 See, e.g., Colonna’s Shipyard, Inc., ASBCA No. 56940, 2010-2 B.C.A. ¶ 34,494 (2010) (contractor’s performance to
be evaluated based on “technical (quality of product),” “schedule (timeliness of performance)” and “management”).
17 See, e.g., id. (performance to be rated as exceptional, very good, satisfactory, or marginal, with the marginal rating
used for performance that “does not meet some contractual requirements. The contractual performance of the element
or sub-element being assessed reflects a serious problem for which the contractor has not yet identified corrective
actions. The contractor’s proposed actions appear only marginally effective or were not fully implemented.”).
18 Evaluation criteria are often broad enough to encompass any conduct or omission of the contractor that the agency
might wish to address. However, if the contract defined the evaluation criteria narrowly, an agency might not be able to
address unanticipated conduct or omissions within the existing categories without violating the terms of the contract.
19 48 C.F.R. § 42.1503(a).
20 Id.
Congressional Research Service
3

---

Evaluating the “Past Performance” of Federal Contractors

provided to the contractor “as soon as practicable after [its] completion,”21 with the contractor
then having “a minimum of 30 days” to submit comments or additional information.22
Disagreements between the contractor and the contracting officer are reviewed “at a level above
the contracting officer,” although “[t]he ultimate conclusion on the performance evaluation is a
decision of the contracting agency.”23
The evaluation and any response from the contractor are to be marked “source selection
information” and submitted to the Past Performance Information Retrieval System (PPIRS).24
Marking them as source selection information ensures that they cannot be released to anyone
other than eligible government personnel, or the contractor whose performance was evaluated, for
at least three years.25 Because of this limitation on access to performance evaluations, access to
the PPIRS database is similarly limited, and information about a contractor in PPIRS can only be
viewed by authorized government personnel or the contractor in question. Access to the Federal
Awardee Performance Integrity Information System (FAPIIS), which includes PPIRS information
along with contractor-submitted information and information from other federal databases, was
originally similarly limited.26 However, although Congress subsequently required that most
FAPIIS information be made publicly available on the Web,27 past performance information was
explicitly exempted from such disclosure because of its protected status as source selection
information.28
Subpart 42.15 of the FAR further requires that agencies “use” recent evaluations of past
performance stored in PPIRS,29 but it does not specify for what they are to be used. This

21 48 C.F.R. § 42.1503(b).
22 Id.
23 Id. Some contracts contain language to the effect that the final performance rating is “the unilateral determination of
the reviewing official” and not subject to dispute or appeal beyond the agency. See, e.g., Colonna’s Shipyard, Inc.,
ASBCA No. 56940, 2010-2 B.C.A. ¶ 34,494 (2010). Such language is generally not enforceable. See, e.g., Burnside-
Ott Aviation Training Center v. Dalton, 107 F.3d 854 (Fed. Cir. 1997) (finding that certain award fee determinations
are reviewable notwithstanding contract language like that quoted above), aff'g Burnside-Ott Aviation Training Center,
ASBCA No. 43184, 96-1 B.C.A. ¶ 28,102 (1996); Puyallup Tribe of Indians, ASBCA No. 29802, 88-2 B.C.A. ¶ 20,640
(contract’s sovereign immunity provision cannot nullify the disputes clause), aff’d F.2d 1096 (Fed. Cir. 1989). See also
infra notes 35 to 47 and accompanying text.
24 48 C.F.R. § 42.1503(c).
25 41 U.S.C. § 423(a)(1) (prohibiting disclosure of source selection information); id., at § (f)(2) (defining “source
selection information”). See also 48 C.F.R. § 42.1503(b) (“Disclosure of such information could cause harm both to the
commercial interest of the Government and to the competitive position of the contractor being evaluated as well as
impede the efficiency of Government operations.”)
26 See Duncan Hunter National Defense Authorization Act for FY2009, P.L. 110-417, §§ 871-873, 122 Stat. 4555-58
(Oct. 14, 2008). Among other things, FAPIIS also includes brief descriptions of all civil, criminal, and administrative
proceedings involving federal contracts that resulted in a conviction or finding of fault, as well as all terminations for
default, administrative agreements, and nonresponsibility determinations relating to federal contracts, within the past
five years for all persons holding a federal contract or grant worth $500,000 or more.
27 See Consolidated Appropriations Act, 2010, P.L. 111-212, § 3010, 124 Stat. 2340 (July 29, 2010) (“Section
872(e)(1) of the Clean Contracting Act of 2008 (subtitle G of title VIII of Public Law 110–417; 41 U.S.C. 417b(e)(1))
is amended by adding at the end the following: ‘In addition, the Administrator shall post all such information,
excluding past performance reviews, on a publicly available Internet website.’”) (emphasis added).
28 Id. See also Dep’t of Defense, Gen. Servs. Admin., & Nat’l Aeronautics & Space Admin., Federal Awardee
Performance and Integrity Information System: Final Rule, 75 Fed. Reg. 14059, 14063 (Mar. 23, 2010).
29 48 C.F.R. § 42.1503(e) (“Agencies shall use the past performance information in PPIRS that is within three years
(six years for construction and architect-engineer contracts) of completion of performance of the evaluated contract or
order.”) (emphasis added). However, Subpart 42.15 elsewhere states that “[t]hese evaluations may be used to support
future award decisions.” 48 C.F.R. § 42.1503(b).
Congressional Research Service
4

---

Evaluating the “Past Performance” of Federal Contractors

provision presumably refers to consideration of agency past performance evaluations in source
selection decisions, as discussed in the following section. However, nothing in Subpart 15.3 of
FAR, which generally governs use of past performance as an evaluation factor, expressly requires
consideration in source selection decisions of the past performance evaluations that agencies are
required to complete under Subpart 42.15.30
Contractor Challenges to Performance Evaluations
Because of the potential use of agency performance evaluations in source selection decisions,
contractors are generally concerned about the contents of their evaluations and want to ensure that
these evaluations are accurate and unbiased.31 However, their ability to challenge their
evaluations outside the agency was historically limited, and they could generally only allege
improprieties in their evaluations in the course of bid protests challenging agency source selection
decisions based, in part, on the contents of these evaluations.32 This arguably afforded contractors
little relief from erroneous or biased evaluations because (1) the focus of the protest is upon the
reasonableness of the contracting officer’s source selection decision, not the reasonableness of the
evaluation of the contractor’s past performance,33 and (2) the judicial and administrative tribunals
hearing bid protests give substantial deference to the contracting officer’s determinations in the
source selection process.34
More recently, however, disputes over performance evaluations have come to be seen as potential
claims under the Contract Disputes Act (CDA) of 1978. This trend began in 2004, when the U.S.
Court of Federal Claims issued its decision in Record Steel & Construction, Inc. v. United
States.35 The contractor in Record Steel had sued seeking, among other things, a declaratory
judgment that its evaluation be “corrected to reflect accurately” its performance under the
contract.36 The government countered by asserting that the court lacked jurisdiction because,
while the Tucker Act waives the government’s sovereign immunity as to “claims” arising under
the CDA, Record Steel’s letter to the contracting officer requesting that its performance rating be

30 Policy guidance from OFPP does, however, encourage agencies to use performance evaluations completed under
Subpart 42.15 of the FAR for source selection purposes. See supra note 11 and accompanying text.
31 See, e.g., Todd Constr., L.P. v. United States, 85 Fed. Cl. 34, 36 (2008) (“Given the increasing importance of
performance reviews and prejudice to contractors from erroneous ratings, there should be some judicial forum available
to consider challenges to the fairness and accuracy of evaluations.”).
32 A bid protest is a formal, written objection to an agency’s solicitation for bids or offers, cancelation of a solicitation,
or award or proposed award of a contract. 31 U.S.C. § 3551(1)(A)-(D). For more on bid protests, see CRS Report
R40228, GAO Bid Protests: An Overview of Timeframes and Procedures, by Kate M. Manuel and Moshe Schwartz.
More recently, GAO has suggested that bid protests are not the proper forum to dispute the substance of performance
evaluations required under Subpart 42.15 of the FAR. See Ocean Tech. Servs., Inc., B-288659 (Nov. 27, 2001).
33 See, e.g., BLR Group of Am. v. United States, 84 Fed. Cl. 634, 647 (2008) (“It is conceivable that by the time the
contractor is able to challenge the evaluation, … fading memories could hinder the contractor’s chances of success.”).
In addition, the contracting officer making the source selection decision is not necessarily the same person, or even
with the same agency, that produced the allegedly biased or erroneous evaluation of the contractor’s performance.
34 See infra notes 91 to 96 and accompanying text. Some commentators also suggest that challenges to past
performance evaluations raised during bid protests make the procurement process less efficient by disrupting agency
operations. See BLR Group, 84 Fed. Cl. at 647 (“The efficiency of the procurement process would be compromised by
forcing a contractor to protest an issue that could have been resolved at an earlier time under the [Contract Disputes
Act].”).
35 62 Fed. Cl. 508 (2004).
36 Id. at 509.
Congressional Research Service
5

---

Evaluating the “Past Performance” of Federal Contractors

reevaluated and changed did not constitute a claim since it did not seek relief “as a matter of
right” or arising from or related to the contract.37 The court disagreed.38 It found that it had
jurisdiction, assuming the other requirements of the CDA were met,39 because Record Steel’s
letter to the contracting officer constituted a “claim” as that term is defined in the FAR.40 In
reaching this conclusion, the court found that a request for reevaluation and/or change of
performance ratings was a “claim of right” because the FAR requires agencies to prepare such
evaluations for contracts of the size and type held by Record Steel.41 The court also rejected the
government’s assertion that the precedent of the boards of contract appeals, which had long
declined to exercise jurisdiction over challenges to performance evaluations, meant that the court
lacked jurisdiction.42
Then, on May 6, 2010, the Armed Services Board of Contract Appeals (ASBCA) also found that
it has jurisdiction over contractor challenges to performance evaluations.43 Previously, in a series
of decisions issued between 1991 and 2006, the ASBCA and other boards of contract appeals had
found that they lacked jurisdiction in such cases because a “performance evaluation under a
contract is an administrative matter not a Government claim, and a contractor’s request that a
contracting officer change an evaluation is not a contractor’s claim.”44 Like the decision in
Record Steel, the May decision of the ASBCA relied on the FAR’s definition of “claim” to find
that the contractor’s request that the board “rescind” the contractor’s evaluation constituted a

37 Id. 518-19. As sovereign, the United States is immune to suit without its consent. See, e.g., United States v.
Sherwood, 312 U.S. 584, 586 (1941). The Tucker Act waives this immunity as to claims against the United States
founded in the U.S. Constitution, federal statutes or regulations, or express or implied contracts with the United States.
28 U.S.C. § 1491(a)(1). It also provides the court with “jurisdiction to render judgment upon any claim by or against, or
dispute with, a contractor arising under section 10(a)(1) of the Contract Disputes Act of 1978, including …
nonmonetary disputes in which a decision of the contracting officer has been issued under section 6 of that Act.” 28
U.S.C. § 1491(a)(2).
38 Record Steel, 62 Fed. Cl. at 518.
39 For example, for the Court of Federal Claims to have jurisdiction over a CDA “claim,” the claim must have been
made in writing and submitted to the contracting officer for a decision. See 41 U.S.C. § 605(a).
40 Record Steel, 62 Fed. Cl. at 518. The CDA itself does not define “claim,” nor did the contract in question. The FAR,
however, defines a claim as “a written demand or written assertion by one of the contracting parties seeking, as a matter
of right, the payment of money in a sum certain, the adjustment or interpretation of contract terms, or other relief
arising under or relating to this contract.” 48 C.F.R. § 2.101 (definitions). See also 48 C.F.R. § 52.233-1(c) (standard
contract clause).
41 Record Steel, 62 Fed. Cl. at 519 (noting that FAR Subpart 36.201(a)(1) required the agency to prepare a performance
evaluation).
42 Id. at 521. A subsequent decision of the Court of Federal Claims has, however, distinguished between performance
evaluations and PPIRS entries, finding that, while contractors are entitled by the FAR to a “fair and accurate”
performance evaluation, they are not similarly entitled to a “properly formatted PPIRS entry” since the relevant
regulations and policy guidelines “do not address the manner in which a PPIRS entry is displayed or formatted.” BLR
Group, 84 Fed. Cl. at 639. This decision also suggested that final Contractor Performance Assessment Reports
(CPARs) are not final decisions of the contracting officer for purposes of the CDA because they are issued by a
reviewing official, who is above the contracting officer, not the contracting officer. However, while only final decisions
of the contracting officer are generally disputable, the plaintiff’s claim survived because, assuming the reviewing
official is seen as issuing the performance evaluation, the contracting officer issues no decision, and s/he is otherwise
required by the CDA to issue a decision “within a reasonable time,” or the claim is deemed denied. BLR Group, 84
Fed. Cl. at 648.
43 Versar, Inc., ASBCA No. 56857, 2010-1 B.C.A. ¶ 34,437 (2010).
44 TLT Constr. Corp., ASBCA No. 53769, 02-2 B.C.A. ¶ 31,969 (2002). See also Aim Constr., ASBCA No. 52540, 07-
1 BCA ¶ 33,466 (2006); Franklin’s Cleaning & Supply Co., GSBCA No. 16527, 06-1 BCA ¶ 33,139 (2005); G.
Bliudzius Contractors, ASBCA No. 42365, 92-1 BCA ¶ 24,605 (1991); Konoike Constr. Co., ASBCA No. 40910, 91-3
BCA ¶ 24,170 (1991).
Congressional Research Service
6

---

Evaluating the “Past Performance” of Federal Contractors

claim, although the board grounded the contractor’s entitlement to a “fair and accurate”
performance evaluation in the terms of the contract and the “implied … duty of good faith and
fair dealing inherent in every contract,” not the FAR.45 A subsequent decision by the ASBCA
expanded upon the May decision by suggesting that earlier board decisions had been
misconstrued as holding that the boards always lacked jurisdiction over contractor challenges to
performance evaluations,46 and that the government’s duty to provide an “accurate and fair”
performance evaluation arises from both the FAR and the contract.47
Nonetheless, despite these recent decisions finding that the federal courts and boards of contract
appeals have jurisdiction to hear contractor challenges to allegedly erroneous or biased
performance evaluations, it is presently unclear what, if any, relief they might be able to grant.
This question was first directly addressed in the Court of Federal Claims’ decision on July 22,
2009, in Todd Construction, L.P. v. United States.48 Todd Construction had asked the court to (1)
determine that the Air Force’s final evaluation of its performance was unlawful and should be set
aside and (2) direct the Air Force to remove the final performance evaluation from the
Construction Contractor Appraisal Support System (CCASS).49 The court, however, found that
neither form of relief was within its authority.50 It found that, while it has inherent authority to
grant declaratory relief,51 a declaration of rights would not resolve the case at hand because it
would not cause the performance evaluation to be changed or removed from CCASS.52 It
similarly found that its statutory authority to remand the case to the agency with directions that
the agency take “proper and just” steps could only be used to direct the agency’s attention to

45 Versar, Inc., ASBCA No. 56857, 2010-1 B.C.A. ¶ 34,437 (2010) (“[T]he Air Force was contractually obligated to
complete a performance assessment in good faith that was fair and accurate.”). This reliance on the “implied … duty of
good faith and fair dealing inherent in every contract” is potentially significant because it could encompass aspects of
the performance evaluation process that are not explicitly addressed in the contract or regulations (e.g., the formatting
of PPIRS entries). See supra note 42.
46 Colonna’s Shipyard, Inc., ASBCA No. 56940, 2010-2 B.C.A. ¶ 34,494 (2010). According to the board, the initial
case involving a past performance evaluation found only that the issuance of a performance evaluation, per se, did not
constitute a claim. It also noted that a subsequent case found that the board had jurisdiction when a performance rating
claim is based upon a contract’s disputed terms. See Sundt Construction, Inc., ASBCA No. 56293, 09-1 BCA ¶ 34,084
(2009).
47 Colonna’s Shipyard, Inc., ASBCA No. 56940, 2010-2 B.C.A. ¶ 34,494 (2010). The contractor here also noted that
the government had an implied duty to produce a unbiased and accurate performance evaluation, but the board did not
address this issue.
48 88 Fed. Cl. 235 (2009). A December 9, 2008, decision in this case had found that the court had jurisdiction over the
contractor’s challenge to its performance evaluation on the same grounds discussed in Record Steel. See 85 Fed. Cl. 34
(2008).
49 Todd Constr., 88 Fed. Cl. at 248. Prior to July 1, 2009, agencies were not required to submit their performance
evaluations to PPIRS, and some, such as DOD, maintained their own databases (e.g., CCASS).
50 Id. at 243-44.
51 Id. (quoting Ex Parte McCardle, 74 U.S. (7 Wall.) 506, 514 (1868) (“Jurisdiction is power to declare the law.”)).
52 Id. at 244 (“If the Court possess only the power to say ‘no, the performance evaluation is not fair and accurate,’ but
no authority to order any other action, the plaintiff would be essentially no better off than it is today. Even if the Court
could say ‘the performance evaluation should be set aside,’ but had no power to require any entity to take any action on
that conclusion, the declaratory relief would be meaningless.”). In so finding, the court distinguished prior cases, where
it had granted declaratory relief, from the present case by characterizing the prior cases as involving “live disputes” of
the “yes” or “no” sort, where “the consequences flowing from [the court’s] answer did not require further intervention
from a court or board.” Id. (citing CW Gov’t Travel, Inc. v. United States, 63 Fed. Cl. 369, 387-90 (2004) (declaring
whether the contract entitled the contractor to be the exclusive service provider); Alliant Techsystems, Inc. v. United
States, 178 F.3d 1260, 1271 (Fed. Cir. 1999) (declaring whether the exercise of an option was valid); Malone v. United
States, 849 F.2d 1441, 1445 (Fed. Cir. 1988) (declaring whether a termination for default was valid)).
Congressional Research Service
7

---

Evaluating the “Past Performance” of Federal Contractors

matters that the court believes require further action to create an adequate record of the agency’s
decision, not to mandate particular factual determinations.53 Subsequent board of contract appeals
decisions also found that the boards lack authority to order an agency to rescind a poor
performance evaluation or revise the agency’s evaluation.54
Consideration of Past Performance in Source
Selection in Negotiated Procurements
Although not expressly required to do so, agencies appear to have considered past performance
when selecting vendors in “negotiated procurements” since at least the 1960s.55 A negotiated
procurement is one in which the contract is awarded to the vendor whose proposal represents the
“best value” for the government.56 This is not necessarily the vendor whose proposal has the
lowest price, but rather the vendor whose proposal represents the “greatest overall benefit” to the
government given its price, technical merit, and relationship to other evaluation criteria specified
in the request for proposals (RFP).57 Such consideration of past performance in source selection
decisions was not, however, standardized or required until the mid-1990s.58 Then, in 1993, OFPP
issued guidelines that required agencies to consider past performance information in all
negotiated procurements valued in excess of $100,000.59 This requirement was given a statutory
basis one year later, when Congress enacted FASA.60 FASA directed OFPP to promulgate

53 Todd Constr., 88 Fed. Cl. at 244-46. See 28 U.S.C. § 1491(a)(2) (“In any case within its jurisdiction, the court shall
have the power to remand appropriate matters to any administrative or executive body or official with such direction as
it may deem proper and just.”). In its 2009 decision, the court granted Todd Construction the right to amend its
complaint, which the court had characterized as “not contain[ing] sufficient factual allegations to suggest entitlement to
remand,” in light of the recent decisions by the Supreme Court in Bell Atlantic Corp. v. Twombly and Ashcroft v. Iqbal.
88 Fed. Cl. at 249. In 2010, the court found that revised complaint failed to state a basis on which relief could be
granted. See Todd Constr., L.P. v. United States, 94 Fed. Cl. 100, 116 (2010).
54 Colonna’s Shipyard, Inc., ASBCA No. 56940, 2010-2 B.C.A. ¶ 34,494 (2010) (contractor seeking a declaration that
its performance scores are erroneous and a violation of the contract, as well as remand to the contracting officer with
instructions or advice on correcting the evaluation); Versar, Inc., ASBCA No. 56857, 2010-1 B.C.A. ¶ 34,437 (2010)
(contractor seeking rescission of the performance evaluation).
55 See, e.g., Educ. Servs., B-156860 (July 26, 1965) (request for proposals (RFP) stating that NASA would solicit
information about prospective contractors’ past performance from all available government sources and consider this
information in its evaluation).
56 See 48 C.F.R. § 15.101 (best value as the goal of negotiated procurements); 48 C.F.R. § 2.101 (defining “best
value”).
57 Defense agencies were first authorized to conduct negotiated procurements in certain circumstances in 1948. Armed
Services Procurement Act, P.L. 80-413, 62 Stat. 21 (Feb. 19, 1948) (codified at 10 U.S.C. § 2302 et seq.). Civilian
agencies received similar authorization in 1949. Federal Property and Administrative Services Act, P.L. 81-152, 63
Stat. 377 (June 30, 1949) (codified at 40 U.S.C. § 471 et seq. and 41 U.S.C. § 251 et seq.). This authority was
subsequently expanded when Congress enacted the Competition in Contracting Act of 1984. See P.L. 98-369, §§ 2701-
2753, 98 Stat. 1175 (July 18, 1984).
58 Previously, in 1986, Congress enacted legislation requiring defense agencies to consider “quality” in every source
selection decision in which cost/price is not the only factor considered. See Joint Resolution Making Continuing
Appropriations for the Fiscal Year 1987, and for Other Purposes, P.L. 99-591, § 101 [Title X, § 924(a)-(b)], 100 Stat.
3341-153 (Oct. 30, 1986) (codified at 10 U.S.C. § 2305). “Quality” was defined as including the “prior experience of
the offeror.” Id. However, prior experience is not the same as past performance, and this provision was repealed by
FASA. See infra note 97; P.L. 103-355, § 1013(a), 108 Stat. 3255 (Oct. 13, 1994).
59 58 Fed. Reg. 3573.
60 P.L. 108-355, § 1091(b), 108 Stat. 3272 (Oct. 13, 1994) (codified at 41 U.S.C. § 405 note).
Congressional Research Service
8

---

Evaluating the “Past Performance” of Federal Contractors

“standards for evaluating past performance with respect to cost (when appropriate), schedule,
compliance with technical or functional specifications, and other relevant performance factors
that facilitate consistent and fair evaluation by all executive agencies.”61 OFPP did so by
promulgating regulations in 1995-1997 regarding consideration of past performance information
in negotiated procurements.62 These regulations were codified in FAR Subpart 15.3 and fully took
effect in 1999.63 Subpart 15.3, as amended, currently governs use of past performance as an
evaluation factor in negotiated procurements.
Congress and the executive branch required agencies to consider past performance in source
selection decisions in the hope that the government would obtain better performance under its
contracts—and better value for its procurement dollars—by shifting the basis of its source
selection decisions. Previously, agencies conducting negotiated procurements had relied heavily
on what some commentators described as “complex technical and cost proposals,” which
commentators asserted had “no correlation to the contractor’s ability to perform the job.”64
Consideration of past performance in source selection decisions was seen as an alternative to
reliance on such proposals, especially by those who characterized past performance information
as “the best indicator of a contractor’s ability to provide quality goods and services at a
reasonable cost.”65 Such consideration was not intended to exclude contractors with poor
performance histories from future contracts. Rather, it was anticipated that certain contractors
with poor performance histories would be able to compensate for this in other aspects of their
proposals (e.g., offering lower prices, partnering with companies with better records),66 while
others would be found nonresponsible for purposes of particular contracts or excluded from
government contracting generally through the operation of other legal authorities.67
Past Performance as an Evaluation Factor
Subpart 15.3 of the FAR currently 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:

61 Id.
62 Dep’t of Defense, Gen. Servs. Admin., & Nat’l Aeronautics & Space Admin., Part 15 Rewrite: Contracting by
Negotiation and Competitive Range Determination, 62 Fed. Reg. 51224 (Sept. 30, 1997); 60 Fed. Reg. at 16718-19.
63 The requirement was phased in, with procurements with higher values being subject to the requirement sooner than
those with lower values. See, e.g., 60 Fed. Reg. at 16719 (procurements valued in excess of $1 million subject to the
requirement July 1, 1995; those valued in excess of $500,000, by July 1, 1997; and those valued in excess of $100,000
by January 1, 1999).
64 Nathanael Causey, Past Performance Information, De facto Debarments, and Due Process: Debunking the Myth of
Pandora’s Box, 29 Pub. Cont. L.J. 637, 640 (1999/2000). See also Steven Kelman, Procurement and Public
Management: The Fear of Discretion and the Quality of Government Performance 40 (1990) (quoting a government
employee as saying “We deal with written lies,” when describing his agency’s reliance on contractors’ technical
proposals when making source selection decisions).
65 48 C.F.R. § 15.305(a)(2)(i).
66 See, e.g., Steven Kelman & Mathew Blum, Past Performance as an Evaluation Factor—Strengthening the
Government’s Best Value Decisions, 38 Gov't Cont. 37 (Oct. 2, 1996) (“[The offerors] always have the opportunity to
offset a marginal performance record with an aggressive price proposal or a strong showing in other factors that are
being considered.”); Alliant Techsystems, Inc., B-260215.4, B-260215.5 (Aug. 4, 1995) (suggesting that a contractor
that is aware of potentially adverse past performance information can explain that information or otherwise revise its
proposal). Dr. Kelman was the administrator of OFPP during the mid-1990s.
67 See infra notes 100 to 139 and accompanying text.
Congressional Research Service
9

---

Evaluating the “Past Performance” of Federal Contractors

• With procurements valued at or below the simplified acquisition threshold
($150,000), agencies must consider past performance or some other non-cost
evaluation factor (e.g., technical excellence, management capability).68
• With procurements whose value exceeds the simplified acquisition threshold,
agencies must consider past performance unless the contracting officer
documents why past performance is not appropriate evaluation factor for the
acquisition.69
Subpart 15.3 further requires (1) that agencies’ evaluation of past performance be in accordance
with the terms of the solicitation,70 and (2) that contractors’ performance in subcontracting with
small disadvantaged businesses be considered when evaluating their past performance.71
Beyond these requirements, however, Subpart 15.3 generally gives agencies broad discretion in
their use of the past performance evaluation factor.72 Agencies may define what constitutes “past
performance” for purposes of the procurement, including any subfactors that comprise the past
performance evaluation factor.73 They may also determine what performances qualify as “recent”
and “relevant” for purposes of the procurement,74 as well as whose performances are considered
when past performance is evaluated (e.g., prime contractors, subcontractors, key employees).75
Additionally, agencies may determine what role the “past performance” factor plays in relation to
other evaluation factors. Agencies are required to consider cost/price and the quality of the

68 48 C.F.R. § 15.304(c)(2).
69 48 C.F.R. § 15.304(c)(3)(i).
70 48 C.F.R. § 15.304(d). Additionally, Subpart 15.3 requires that agency solicitations (1) provide offerors with the
opportunity to identify past or current contracts for similar efforts with any entity; (2) authorize offerors to provide
information on problems encountered with identified contracts and the offeror’s corrective actions; and (3) make clear
that an offeror without relevant past performance, or for whom information on past performance is not available, may
not be evaluated favorably or unfavorably. 48 C.F.R. § 15.305(a)(2)(ii) & (v).
71 48 C.F.R. § 15.305(a)(2)(v). Additionally, when the solicitation involves “bundling,” agencies’ evaluation of past
performance must assess the offeror’s performance in meeting goals in any subcontracting plans incorporated in prior
contracts. 48 C.F.R. § 15.304(c)(3)(ii). “Bundling” refers to the consolidation of two or more requirements for goods or
services previously provided or performed under separate smaller contracts into a solicitation for a single contract that
is likely to be unsuitable for award to a small business because of its size or scope. See 15 U.S.C. § 632(o)(2).
72 Although the factors and subfactors considered must relate to the procurement, contractors’ ability to challenge
agencies’ use of allegedly improper factors is limited by the deference that judicial and administrative tribunals give to
agencies’ selection of evaluation criteria. See, e.g., SML Innovations, Inc., B-402667.2 (Oct. 28, 2010) (“[W]e will not
object to the use of particular evaluation criteria so long as they reasonably relate to the agency’s needs in choosing a
contractor that will best serve the government’s interests.”).
73 See, e.g., Brican Inc., B-402602 (June 17, 2010) (evaluation of past performance based on experience and past
performance); CapRock Government Solutions, Inc.; ARTEL, Inc.; Segovia, Inc., B-402490, B-402490.2, B-402490.3,
B-402490.4, B-402490.5 (May 11, 2010) (evaluation of past performance based on (1) conformance to contract
requirements; (2) standards of workmanship; (3) schedule; (4) business relations; (5) management of key personnel; (6)
management of subcontractors; and (7) record of complying with subcontracting goals.
74 See, e.g., Dorado Services, B-401930.3 (June 7, 2010) (defining relevant performance as that under contracts
requiring the offeror to perform refuse and recycling services of the same or similar complexity and recent performance
as that within the past five years).
75 See, e.g., Brican Inc., B-402602 (June 17, 2010) (past performance of subcontractors considered); CapRock
Government Solutions, Inc.; ARTEL, Inc.; Segovia, Inc., B-402490, B-402490.2, B-402490.3, B-402490.4, B-
402490.5 (May 11, 2010) (noting that nothing in the RFP indicated that the past performance of the prime contractor
was more important than that of the subcontractors); JSW Maintenance, Inc., B-400581.5 (Sept. 8, 2009) (past
performance of key employees considered).
Congressional Research Service
10

---

Evaluating the “Past Performance” of Federal Contractors

product or service, along with past performance, in all negotiated procurements.76 However,
depending upon their requirements, they may consider a range of other factors, such as corporate
experience, management, key personnel and staffing plan, organizational capacity, “proven plan
to achieve efficiency and cost-effectiveness,” “continuous enhancement of processes and
systems(s),” and the offeror’s small business status.77 Moreover, agencies have broad discretion in
assigning various weights to the evaluation factors.78 Past performance need not be the most
heavily weighted factor,79 and poor scoring on the past performance factor could be offset by
higher scores on other factors, particularly if little weight is given to past performance.80
Agencies also generally have broad discretion in their consideration of various sources of
information about contractors’ past performance. Much of the information used in evaluating
contractors’ past performance comes from questionnaires or customer surveys submitted by the
contractor,81 although agencies have,82 and often explicitly reserve,83 the right to consider other
information. This includes any evaluations of contractor performance that agencies were required
to prepare under Subpart 42.15 of the FAR. It should be noted, however, that Subpart 15.3 does
not require agencies to consider evaluations prepared pursuant to Subpart 42.15 in source

76 48 C.F.R. § 15.304(c)(1) (price/cost); 48 C.F.R. § 15.304(c)(2) (quality of the product or service). Certain other
evaluation factors must be used in specific circumstances. For example, the extent of participation by small
disadvantaged businesses in performing the contract must be evaluated for all non-set-aside contracts valued in excess
of $650,000 ($1.5 million for construction contracts). 48 C.F.R. § 15.304(c)(4). Similarly, the extent of proposed
subcontracting with small businesses must be an evaluation factor for contracts that involve bundling and offer a
significant opportunity for subcontracting. 48 C.F.R. § 15.304(c)(5).
77 See, e.g., Source Diversified, Inc., B-403437.2 (Dec. 16, 2010) (corporate experience); Industrial Constr. & Trading
Co., B-403849 (Dec. 13, 2010); Int’l Medical Corps, B-403688 (Dec. 6, 2010) (key personnel and staffing plan,
organizational capacity); Delta-21 Resources, Inc., B-403586 (Nov. 10, 2010) (“proven plan to achieve efficiency and
cost-effectiveness,” “continuous enhancement of processes and systems(s)”); Washington-Harris Group, B-401794, B-
401794.2 (Nov. 16, 2009) (offeror’s small business status).
78 See 48 C.F.R. § 15.304(e)(1)-(3) (requiring the solicitation to indicate whether all non-cost/non-price evaluation
factors are (1) significantly more important than cost/price; (2) approximately equal to cost/price; or (3) significantly
less important than cost/price).
79 See, e.g., Source Diversified, Inc., B-403437.2 (Dec. 16, 2010) (product description and corporate experience
weighted more heavily than past performance); ITW Military GSE, B-403866.3 (Dec. 7, 2010) (technical merit
weighted more heavily than past performance); L&N/MKB, Joint Venture, B-403032.3 (Dec. 16, 2010) (price as
important as technical merit and past performance combined). Guidance issued by OFPP in 1995 recommended that
past performance be at least 25% of the non-cost factors, or at least equal to or more important than any other non-cost
factor. See Guide to Best Practices, supra at 16-18. Agencies were not required to abide by this guidance, however.
80 It should also be noted that agencies evaluating past performance often rate it using broad descriptors (e.g.,
substantial, satisfactory, limited, and unknown). See, e.g., Dorado Services, B-401930.3 (June 7, 2010). Additionally,
vendors’ past performance is considered only in relation to that of the other vendors who submitted offers, not in the
abstract. Thus, a company whose past performance has been less than stellar, but does not result in a nonresponsibility
determination or exclusion, could be selected for award if the past performance of the other offerors was equally or
more problematic.
81 MFM Lamey Group, LLC, B-402377 (Mar. 25, 2010) (solicitation requesting offerors to submit up to five past
performance questionnaires completed by former customers); SDV Solutions, Inc., B-402309 (Feb. 1, 2010) (RFP
requiring offeror to ensure that at least three past performance questionnaires are submitted by former customers).
82 See, e.g., Seattle Sec. Servs., Inc. v. United States, 45 Fed. Cl. 560, 568 (1999) (agency has right to consider
information derived from the personal knowledge of the evaluators).
83 See, e.g., Dorado Services, B-401930.3 (June 7, 2010) (RFP granting the procuring agency the right to consider data
obtained from the government and other sources); Shaw-Parsons Infrastructure Recovery Consultants, LLC; Vanguard
Recovery Assistance, JV, B-401679.4, B-401679.5, B-401679.6, B-401679.7 (Mar. 10, 2010) (agency reserving the
right to use “outside knowledge,” including agency knowledge of the firm’s performance); CMI Management, Inc., B-
402172, B-402172.2 (Jan. 26, 2010) (RFP reserving the agency’s right to use PPIRS information).
Congressional Research Service
11

---

Evaluating the “Past Performance” of Federal Contractors

selection decisions,84 although Subpart 42.15 does require “use” of such evaluations, and failure
to consider them could be found unreasonable under the “close at hand” doctrine.85 While the
federal courts and the Government Accountability Office (GAO) have held that contracting
officers need not consider all possible information about a contractor’s past performance when
evaluating such performance for source selection purposes,86 GAO, in particular, has noted that
some information may be so “close at hand” that agencies cannot reasonably ignore it. For
example, in Shaw-Parsons Infrastructure Recovery Consultants, LLC, GAO found that the
Federal Emergency Management Agency (FEMA) acted unreasonably when it relied solely on
information regarding past performance submitted by the contractor, and failed to consider
information contained in customer questionnaires that FEMA had required the offerors to
submit.87 GAO noted that, while the solicitation may have given FEMA discretion to seek out
additional information, FEMA “could not simply ignore” the questionnaires once it had them
because they were “close at hand.”88
Agencies generally need not seek out information that would mitigate potentially adverse past
performance information contained in the sources they consult,89 although there are a few
circumstances in which they must do so, as Table 1 illustrates. They are also generally free to
draw their own inferences regarding contractors’ past performance from the sources they consult
so long as these inferences are reasonable. However, Subpart 15.3 does require contracting
officers to take into account “[t]he currency and relevance of the information, source of the
information, context of the data, and general trends in contractor’s performance” when
considering past performance information.90
Table 1. Various Exchanges Potentially Involving Past Performance Information
Authorized or
Past Performance Information
Type of Exchange
Required?
Addressed
Clarifications
Authorized
Relevance of past performance
information
Limited exchanges between the government and
offerors that may occur when award without
Adversea past performance information
discussions is contemplated
to which the offeror has not previously
had the opportunity to respond

84 The situation is different with responsibility determinations, where agencies are explicitly required to consider
agency performance evaluations in PPIRS. See infra notes 108 to 114 and accompanying text.
85 See, e.g., Contrack Int’l, Inc., B-401871.5, B-401871.6, B-401871.7 (May 24, 2010) (finding that the Army Corps of
Engineers unreasonably failed to consider negative information contained in three Contractor Performance Assessment
Reports about the awardee). The allegedly poor performance by the awardee in Contrack had also been the subject of
news coverage and a report by the Department of Defense Office of the Inspector General. Absent such coverage or
reports, however, it is unclear how a protester would know of potentially adverse performance evaluations contained in
PPIRS or other agency sources given the restrictions on access to source selection information. See supra notes 25 to
28 and accompanying text.
86 See, e.g., SDA, Inc., B-256075, B-25606 (May 2, 1994) (“[W]e do not think that the agency had to ‘go behind’ the
opinions expressed by the references and conduct further independent investigation as to the adequacy or quality of the
protester’s performance.”); IGIT, Inc., B-275299.2 (June 23, 1997) (agency need not contact all sources listed by the
offeror).
87 B-401679.4; B-401679.5; B-401679.6; B-401679.7 (Mar. 10, 2010).
88 Id.
89 See, e.g., Cessna Aircraft Co., B-261953.5 (Feb. 5, 1996); SDA, Inc., B-256075, B-25606 (May 2, 1994).
90 48 C.F.R. § 15.305(a)(2)(i).
Congressional Research Service
12

---

Evaluating the “Past Performance” of Federal Contractors

Authorized or
Past Performance Information
Type of Exchange
Required?
Addressed
Communications
Required Adversea past performance information
to which the offeror has not previously
Exchanges between the government and offerors
had the opportunity to respond
after receipt of proposals leading to the establishment
of the competitive rangeb
Discussions
Required Adversea past performance information
to which the offeror has not previously
Exchanges between the government and offerors
had the opportunity to respondc
after the establishment of the competitive range that
are undertaken with the intent of allowing the offeror
to revise its proposal
Source: Congressional Research Service, based on FAR Part 15.306.
a. The fact that another vendor is rated higher for past performance does not necessarily mean that the
information on any lower rated vendors is “adverse.” See, e.g. Value CAD, B-272936 (Nov. 7, 1996).
b. The “competitive range” consists of the most highly rated offerors, to one or more of whom an award is
likely to be made. 48 C.F.R. § 15.306(c)(1).
c. It is possible that poor past performance information could be corrected for, as wel as explained, during
discussions. This is not the case during clarifications and communications, when any information shared
must be “historical” and is not subject to change or improvement. See, e.g., Alliant Techsystems, Inc., B-
260215.4, 260215.5 (Aug. 4, 1994).
Protesting Agency Evaluations of Past Performance
Contractors that object to the procuring activity’s evaluation of their own past performance, or
that of the winning offeror, in making its source selection decision could potentially file a bid
protest challenging the decision, although protesters must overcome significant hurdles to disturb
a challenged award.91 The protester first has to demonstrate standing to bring the protest, which
generally requires that the protester be next in line for the award if the protest is sustained.92
Then, assuming that the protester has standing, it has to allege defects in the evaluation process
sufficient to overcome the substantial deference that GAO and the federal courts accord to
contracting officers’ evaluations of past performance.93 This generally means that the protester
must allege that the evaluation was unreasonable, not adequately documented, or not in
accordance with the law or the terms of the solicitation.94 Protests that fail to allege one of these

91 One study of bid protests conducted in the 1990s found that GAO had sustained only 13 out of 300 protests
challenging agencies’ use of past performance information in the period between December 1992 and May 1997. See
Only Four Percent of GAO Protests Involving ‘PPI’ Evaluations Are Sustained, GAO Defends Results, 67 Fed. Cont.
Rep. 590-91 (May 19, 1997). This study does not appear to have been updated or replicated.
92 But see Arora Group, B-288127 (Sept. 14, 2001) (recognizing a bidder whose proposal was ranked fifth as an
interested party only because its protest challenged the agency’s application of the evaluation criteria in general and, if
successful, could have placed the contractor in line for the award).
93 See, e.g., Dorado Services, B-401930.3 (June 7, 2010) (“As a general matter, the evaluation of an offeror’s past
performance is within the discretion of the contracting agency, and we will not substitute our judgment for reasonably
based past performance ratings.”).
94 See, e.g., JSW Maintenance, Inc., B-400581.5 (Sept. 8, 2009) (“Our Office examines an agency’s evaluation of past
performance to ensure that it was reasonable and consistent with the stated evaluation criteria and applicable statutes
and regulations; however, the necessary determinations regarding the relative merits of the offerors’ proposals are
primarily matters within the contracting agency’s discretion. … [O]ur office will not question an agency’s
determinations absent evidence that those determinations are unreasonable or contrary to the stated evaluation
(continued...)
Congressional Research Service
13

---

Evaluating the “Past Performance” of Federal Contractors

three things are generally seen as “mere disagreements … as to the relative merit of competing
proposals” and are denied.95 Moreover, beyond having broad discretion in determining whether
particular past performance merits a particular rating, contracting officers also have broad
discretion in determining which proposal represents the “best value” for the government. GAO
and the federal courts have expressly approved of agencies’ selection of contractors with lower
past performance ratings over contractors with higher, or even “perfect,” ratings, notwithstanding
the fact that the solicitation calls for past performance to be given more weight than price in the
source selection decision.96
Other Consideration of Past Performance in Source Selection
Agencies sometimes also consider contractors’ past performance in source selection decisions in
ways that do not entail use of the past performance evaluation factor. For example, agencies may
consider past performance as a component of other evaluation factors (e.g., experience, mission
capability), as well as its own factor.97 Additionally, under FASA, agencies may use past
performance as a factor in determining with whom to place certain orders under multiple-award
contracts.98 Subpart 16.5 of the FAR, which implements the relevant provisions of FASA,
requires that contracting officers take into account “past performance on earlier orders under the
contract, including quality, timeliness and cost control” when developing procedures for ensuring
that all contractors holding an multiple-award contract have a “fair opportunity” to be considered
for orders exceeding $5.5 million.99 Such consideration does not involve a source selection

(...continued)
criteria.”). It should also be noted that the focus of the protest is upon the determinations of the contracting officer who
made the source selection decision, not that of any contracting officer who previously gave an offeror a poor
performance evaluation. See supra note 33 and accompanying text.
95 Compare Dorado Services, B-401930.3 (June 7, 2010) (finding that the contracting officer’s assignment of a
“substantial confidence” rating to the awardee was not unreasonable despite the fact that the awardee had received
lower ratings and more unfavorable comments from its references and experienced more performance problems under
its contracts) with Brican Inc., B-402602 (June 17, 2010) (sustaining the protest because nothing in the record indicated
that the contracting officer had credited the protester with the performance of its subcontractor, while it had so credited
the awardee).
96 See also Truetech, Inc., B-402536.2 (June 2, 2010) (“[S]ource selection officials in a negotiated procurement have
broad discretion in determining the manner and extent to which they will make use of the technical and price evaluation
results; price/technical tradeoffs may be made, and the extent to which one may be sacrificed for the other is governed
only by the test of rationality and consistency with the established evaluation factors.”); FN Manufacturing, LLC, B-
403059.4, B-402059.5 (Mar. 22, 2010) (“It is well-settled that an agency properly may select a lower-rated, lower-
priced proposal” even if the RFP states that price is less important than technical merit).
97 Software Eng’g Servs. Corp. v. United States, 85 Fed. Cl. 547, 550 (2009) (using “mission capability” as an
evaluation factor and defining “mission capability” to include “directly-related current or past performance”). Offerors’
experience, which is akin to past performance, is sometime also considered as a separate evaluation factor, although
agencies are generally not required to give offerors an opportunity to address adverse information regarding their prior
experience through clarifications, communications, or discussions. See, e.g., CMI Management, Inc., B-402172, B-
402172.2 (Jan. 26, 2010) (relevant experience as an evaluation factor); Moore Medical Corp., B-261758 (Oct. 26,
1995) (upholding agency’s determination not to conduct discussions regarding prior experience, in part, because prior
experience differs from past performance).
98 See P.L. 103-355, § 1004, 108 Stat. 3249-54 (Oct. 13, 1994) (codified at 10 U.S.C. § 2304a(d)(3)) (procurements of
defense agencies); id. at § 1054, 108 Stat. 3261-65 (codified at 41 U.S.C. § 253h(d)(3)) (procurements of civilian
agencies). Under a multiple-award contract, the government enters agreements with several vendors to supply goods or
services. It can then generally award work to any of these vendors by issuing task or delivery orders.
99 48 C.F.R. § 16.505(b)(1)(iv)(A)(1). This requirement would not necessarily ensure that a particular order is placed
with the contractor who has the best past performance record, however, in part because agencies are legally obligated to
(continued...)
Congressional Research Service
14

---

Evaluating the “Past Performance” of Federal Contractors

decision, per se, because the sources were selected at the time when the contract was awarded,
and only those sources holding a multiple-award contract are eligible for orders placed under it.
However, it is akin to a source selection decision in that it effectively determines who supplies
particular goods to, or performs particular work for, the procuring activity.
Past Performance as a Criterion in Responsibility
Determinations
Ever since the FAR was promulgated in 1984,100 agencies have considered whether contractors
have a “satisfactory performance record,” among other things, in determining whether they are
sufficiently “responsible” to be awarded a government contract.101 Agencies are prohibited from
awarding a contract to a contractor who has not been determined to be affirmatively
responsible.102 Then, in 1995, after the issuance of OFPP Policy Letter 92-5 and the enactment of
FASA, OFPP amended Subpart 9.1 of the FAR to further require that agencies consider “relevant
past performance information,” as defined in Subpart 42.15, when making responsibility
determinations.103 Guidance issued by OFPP shortly thereafter clarified that agencies are to use
consideration of past performance in the responsibility determination process—not the source
selection process—as a means of avoiding contractors with poor performance histories:
A contractor with a record of unsatisfactory past performance should be screened out of the
selection process as part of the responsibility determination. If a contractor’s past
performance record passes the responsibility determination, then the record should be
compared to the other responsible offerors to determine the offeror that provides the best
value to the Government.104
However, it should be noted that while OFPP characterizes the responsibility determination
process as the means for “screening out” contractors with poor past performance, agencies may

(...continued)
order certain minimum quantities of goods or services from each contractor holding a multiple-award contract. See,
e.g., 48 C.F.R. § 16.504(a)(1); Peter J. Brandon, AGBCA No. 91-186-1, 92-1 B.C.A. ¶ 24,648 (1991).
100 Dep’t of Defense, Gen. Servs. Admin., & Nat’l Aeronautics & Space Admin., Establishing the Federal Acquisition
Regulation (Part 2 of 12), 48 Fed. Reg. 42102 (Sept. 19, 1983). Agencies were required to determine that prospective
contractors were responsible before the FAR was promulgated, and consideration of contractor’s performance record
was generally a component of this responsibility determination process. See John Cibinic, Jr. & Ralph C. Nash, Jr.,
Formation of Government Contracts 403-04 (3d ed. 1998).
101 48 C.F.R. § 9.104-1(c). Other factors include (1) whether the contractor has adequate financial resources to perform
the contract, or the ability to obtain them; (2) whether the contractor is able to comply with the required or proposed
delivery schedule; (3) whether the contractor has a satisfactory record of integrity and business ethics; (4) whether the
contractor has the necessary organization, experience, accounting and operational controls, and technical skills, or the
ability to obtain them; (5) whether the contractor has the necessary production, construction, and technical equipment
and facilities, or the ability to obtain them; and (6) whether the contractor is otherwise qualified and eligible to receive
an award under applicable laws and regulations. 48 C.F.R. § 9.104-1(a)-(b), (d)-(g).
102 48 C.F.R. § 9.103(b). See also 48 C.F.R. § 9.103(a) (“Purchases shall be made from, and contracts shall be awarded
to, responsible prospective contractors only.”).
103 60 Fed. Reg. at 16718. Subpart 9.1 was also amended to preclude prospective contractors being found
nonresponsible because they lack a relevant performance history. Id. They could, however, still be found
nonresponsible because they lack the necessary experience. See, e.g., CEA Indus., Inc., B-169160 (May 4, 1970).
104 Guide to Best Practices for Past Performance, supra note 11, at 11.
Congressional Research Service
15

---

Evaluating the “Past Performance” of Federal Contractors

not use nonresponsibility determinations to punish contractors for poor performance, and poor
performance or even default on one or several prior contracts does not necessarily constitute
adequate grounds for a nonresponsibility determination.105 Additionally, as discussed below, any
use of the responsibility determination process to avoid a contractor with poor past performance
must be short-term and procurement-specific so as to avoid de facto debarment of the
contractor.106 For dealings with a contractor to be avoided long-term and/or government-wide, the
contractor would need to be formally excluded from government contracting (i.e., debarred or
suspended).107
“Satisfactory Performance Record” As Condition for Contract
Because of the amendments made to Subpart 9.1 of the FAR in 1995, past performance has
traditionally played a unique role in the responsibility determination process. Until recently,
“relevant past performance” information was the only information that contracting officers were
required by law to consider when making responsibility determinations.108 They otherwise had
broad discretion as to what and how much information to consider,109 although they were
encouraged to consider certain information (e.g., commercial sources of supplier information,
preaward survey reports, business and trade associations).110 This changed in 2008, when
Congress enacted legislation requiring contracting officers to consider the information contained
in FAPIIS when making responsibility determinations.111 Among other things, FAPIIS contains
brief descriptions of all civil, criminal, and administrative proceedings involving federal contracts
that resulted in a conviction or finding of fault, as well as all terminations for default,
administrative agreements, and nonresponsibility determinations relating to federal contracts,
within the past five years for all persons holding a federal contract or grant worth $500,000 or
more.112 Consideration of this information would arguably be most helpful in assessing
responsibility criteria other than whether the contractor possesses a satisfactory performance
record (e.g., whether the contractor has a satisfactory record of integrity and business ethics).
However, because FAPIIS includes information from PPIRS,113 the requirement to consider the

105 See, e.g., Marine Eng'rs Beneficial Ass'n, B-181265 (Nov. 27, 1974).
106 See infra notes 127 to 134 and accompanying text.
107 See 48 C.F.R. §§ 9.400-9.409.
108 See, e.g., 48 C.F.R. § 9.105-1(c) (2008).
109 See, e.g., John C. Grimberg Co. v. United States, 185 F.3d 1297, 1303 (Fed. Cir. 1999) (“[T]he contracting officer is
the arbiter of what, and how much, information he needs.”). Contracting officers must obtain “information sufficient to
be satisfied” that the prospective contractor is responsible. 48 C.F.R. § 9.105-1(a). However, the contractor bears the
responsibility of ensuring that the contracting officer has sufficient information. 48 C.F.R. § 9.103(b); Sec. Assistance
Forces & Equip. Int'l, Inc., B-194876 (Nov. 19, 1980). An affirmative determination is improper if not based on
sufficient information. 48 C.F.R. § 9.105-1(a). However, the amount of information needed depends upon the
conclusions that can be drawn from it. See, e.g., John F. Small & Co., Inc., B-207681.2 (Dec. 6, 1982). Determinations
must also be supported by the record and based on the most current information available. See, e.g., 48 C.F.R. § 9.105-
1(b)(1); Gary Aircraft Corp., B-174455 (July 6, 1972).
110 48 C.F.R. § 9.105-1(c)(1)-(7) (“In addition, the contracting officer should use the following sources of information
... ”) (emphasis added).
111 P.L. 110-417, § 872(b)(1) & (c), 122 Stat. 4356 (Oct. 14, 2008).
112 Id.
113 Because FAPIIS contains past performance information, access to FAPIIS was initially restricted to authorized
government personnel. Although Congress subsequently required the information contained in FAPIIS to be made
publicly available on the Web, it expressly excluded evaluations of past performance. See supra notes 24 to 28 and
accompanying text.
Congressional Research Service
16

---

Evaluating the “Past Performance” of Federal Contractors

information in FAPIIS arguably could increase agency consideration of past performance
evaluations. While consideration of “relevant past performance” information would not
necessarily entail consideration of all contractor performance evaluations in PPIRS, consideration
of the information contained in FAPIIS could potentially entail this.114
Additionally, Subpart 9.1 of the FAR, which governs responsibility determinations, establishes a
rebuttable presumption that contractors who are, or recently have been, “seriously deficient” in
contract performance are nonresponsible unless the contracting officer determines that the
circumstances were beyond the contractor’s control, or the contractor has taken appropriate
corrective action.115 Subpart 9.1 does not define what constitutes a “serious deficiency” in
performance, but GAO and the courts have found that it could potentially include delinquent
performance, delivery of nonconforming items, failure to adhere to contract specifications, late
deliveries, poor management or technical judgment, failure to correct production problems,
failure to perform safely, and inadequate supervision of subcontractors.116
Protests of Responsibility/Nonresponsibility Determinations
Contractors’ ability to challenge agency determinations that they are nonresponsible, or that
another contractor is responsible, is limited. Judicial and administrative tribunals that hear
protests of contract awards do not routinely review contracting officers’ responsibility
determinations because such determinations are “practical, ... not legal determination[s]” 117 and
“are not readily susceptible to judicial review.” 118 The GAO hears protests regarding
responsibility determinations only when the protester alleges that “definitive responsibility
criteria”119 were not met or “identif[ies] evidence raising serious concerns that ... the contracting
officer unreasonably failed to consider available relevant information or otherwise violated statute
or regulation.”120 The federal courts similarly consider the merits of protested responsibility

114 It should be noted, however, that even when contracting officers are required to consider particular information
when making responsibility determinations, they are not bound by any recommendations contained in the information
that they consider. See, e.g., Carl Weissman & Sons, Inc., B-190304 (Feb. 17, 1978).
115 48 C.F.R. § 9.104-3(b).
116 See, e.g., Campbell Indus., B-238871 (July 3, 1990) (poor management and technical judgment); Ford Motor Co.,
B-207179 (Jan. 20, 1983) (late deliveries); United Power & Control Sys., Inc., B-184662 (Dec. 27, 1978)
(nonconforming items); Bill Ward Painting & Decorating, B-184612 (Jan. 28, 1976) (unsafe performance; inadequate
supervision of subcontractors); Marine Eng'rs Beneficial Ass'n, B-181265 (Nov. 27, 1974) (failure to take corrective
action); Kennedy Van & Storage Co., Inc., B-180973 (June 19, 1974) (failure to adhere to specifications); Land-Air,
Inc., B-166969 (Sept. 2, 1969) (delinquent performance).
117 Peter Kiewit Sons’ Co. v. U.S. Army Corps of Eng’r, 714 F.2d 163, 167 n.18 (D.C. Cir. 1983).
118 YRT Servs. Corp. v. United States, 28 Fed. Cl. 366, 394 (1993). These tribunals also take the view that federal
agencies “bear the burden of difficulties experienced in obtaining the required performance.” See, e.g., News Printing
Co. v. United States, 46 Fed. Cl. 740, 746 (2000).
119 Definitive responsibility criteria are special standards that contractors must meet in order to be determined
responsible for specific acquisitions. 48 C.F.R. § 9.104-2(a). Contracting officers may incorporate such standards into
solicitations when unusual expertise, special facilities, or specific experience or equipment are necessary to ensure that
the government’s needs are satisfied. See, e.g., Breland Co., B-217552 (Feb. 21, 1985) (unusual expertise); Aero Corp.,
B-201581 (June 23, 1981) (special facilities).
120 See, e.g., Gov’t Accountability Office, Office of General Counsel, Bid Protests at GAO: A Descriptive Guide 51 (8th
ed. 2006), available at http://www.gao.gov/decisions/bidpro/bid/d06797sp.pdf. Prior to 2003, the GAO exercised even
more limited jurisdiction over protested responsibility determinations, hearing only protests alleging “bad faith” by
agency officials or failure to meet definitive criteria. However, the GAO changed its policy in response to the decision
by the U.S. Court of Appeals for the Federal Circuit in Impresa Construzioni Geom. Domenico Garufi v. United States,
(continued...)
Congressional Research Service
17

---

Evaluating the “Past Performance” of Federal Contractors

determinations only when the protester’s allegations that the agency’s determination was arbitrary
and capricious, an abuse of discretion, or otherwise not in accordance with the law can survive a
preliminary motion to dismiss.121 Moreover, judicial and administrative tribunals decline to
overturn contracting officers’ responsibility determinations in many of the protests that they do
hear. They generally overturn a determination only when the protester can show that the
determination was clearly unreasonable given the record before the contracting officer.122 The
GAO and the courts have also held that a contracting officer’s determination is not unreasonable
merely because another contracting officer made a different determination after considering the
same information.123
De Facto Debarment
Because the focus of a responsibility determination is upon the contractor’s ability to satisfy the
needs of the government under a particular proposed contract, the responsibility determination
process is not designed to exclude contractors with allegedly deficient past performance, or other
problems, from future dealings with the government. Any use of it to this effect could potentially
be found to constitute de facto debarment. The federal courts developed the concept of de facto
debarment as a way of ensuring that agencies do not deprive contractors of the due process to
which they are entitled in formal exclusion proceedings (i.e., debarment and suspension) by
effectively excluding contractors by other means.124 Repeated determinations of nonresponsibility
based on the same alleged conduct by the contractor have been found to constitute de facto
debarment,125 as have statements or other conduct evidencing an intent to exclude a contractor

(...continued)
238 F.3d 1324 (Fed. Cir. 2001).
121 Watts-Healy Tibbitts v. United States, 84 Fed. Cl. 253 (2008). Claims that agency actions are arbitrary and
capricious, an abuse of discretion, or otherwise not in accordance with the law derive from the Administrative
Procedure Act (APA). The APA allows persons “suffering legal wrong because of agency action” to seek judicial
review of that action. See 5 U.S.C. § 702 (right of review); 5 U.S.C. § 706 (2)(A) (arbitrary and capricious standard).
122 See, e.g., Impresa Construzioni, 238 F.3d at 1334-35. Because the record upon which contracting officers make their
determinations is not part of the files when they find contractors responsible, courts may permit limited depositions of
contracting officers in order “to plac[e] on the record the basis for [their] responsibility determination.” Id. at 1339.
There is usually no parallel need to depose contracting officers when they determine a contractor is nonresponsible
because their files must contain documents stating the basis for the nonresponsibility determination, among other
things. See 48 C.F.R. § 9.105-2(a)(1).
123 See, e.g., MCI Constructors, B-240655 (Nov. 27, 1990); S.A.F.E. Exp. Corp., B-151834 (April 22, 1983).
124 Contractors who are suspended or proposed for debarment must be given notice of their exclusion or proposed
exclusion and an opportunity for a hearing, although the timing of the notice, in particular, differs for debarment and
suspension. The concept of de facto debarment appears to have been introduced by the U.S. Court of Appeals for the
District of Columbia Circuit’s decision in Gonzalez v. Freeman. 334 F.2d 570 (D.C. Cir. 1964). Although the Gonzelez
decision concerned the process due to contractors in de jure debarment, the court noted that the possibility of de facto
debarment. Id. at 573.
125 Shermco Indus. v. Secretary of the Air Force, 584 F. Supp. 76, 93-94 (N.D. Tex. 1984) (“[A] procuring agency
cannot make successive determinations of nonresponsibility on the same basis; rather it must initiate suspension or
debarment procedures at the earliest practicable moment following the first determination of nonresponsibility.”); 43
Comp. Gen. 140 (Aug. 8, 1963) (finding that multiple determinations of nonresponsibility can be tantamount to
debarment). However, multiple contemporaneous nonresponsibility determinations made on the same basis do not
necessarily constitute de facto debarment, especially when the determinations are based on the most current
information available. See, e.g., Mexican Intermodal Equip., S.A. de C.V., B-270144 (Jan. 31, 1996) (two
responsibility determinations were not “part of a long-term disqualification,” but were “merely a reflection of the fact
that the determinations were based on the same current information.”).
Congressional Research Service
18

---

Evaluating the “Past Performance” of Federal Contractors

from future government contracts.126 For example, in Old Dominion Dairy Products, Inc. v.
Secretary of Defense, the Air Force was found to have de facto debarred a contractor when the
contracting officer determined that the contractor lacked integrity and was nonresponsible after
another contracting officer had determined that the contractor was nonresponsible due to billing
irregularities.127 Similarly, in Art-Metal-USA, Inc. v. Solomon, the General Services
Administration was found to have de facto debarred a contractor when it determined that the
contractor was nonresponsible for a new contract and suspended its existing contracts in response
to concerns that it had supplied “inferior products.”128 In both cases, the courts noted that the
challenged agency conduct effectively excluded the contractor without providing the contractor
with the notice or opportunity for a hearing that the contractor would have received had they been
formally debarred or suspended. The courts thus enjoined the agency conduct that resulted in de
facto debarment or granted other relief to the contractor.
Cases that involve de facto debarment sometimes also involve unconstitutional deprivation of
contractors’ liberty interests.129 This generally occurs when contractors are excluded from
government contracts without notice or a hearing because of concerns about their integrity, as
contractors have a cognizable liberty interest in being “free from ‘stigmatizing’ governmental
defamation having an immediate and tangible effect on [their] ability to do business.”130
However, depending upon the circumstances, concerns about past performance could be
implicated in concerns about integrity.131
Debarment and Suspension Under the FAR
Agencies also have legal authority under Subpart 9.4 of the FAR to debar or suspend contractors
for willful failure to perform under a contract or a history of failure to perform.132 Debarment and

126 Peter Kiewit Sons’ Co. v. U.S. Army Corps of Eng'rs, 534 F. Supp. 1139 (D.D.C. 1982), rev'd on other grounds,
714 F.2d 163 (D.C. Cir. 1983) (internal government directive to hold awards to the contractor “in abeyance” for an
indefinite period); Conset Corp. v. Cmty. Servs. Admin., 655 F.2d 1291 (D.C. Cir. 1981) (circulation of a
memorandum alleging that a grant recipient had a conflict of interest, coupled with a subsequent refusal to approve the
firm for a grant); Related Indus., Inc. v. United States, 2 Cl. Ct. 517 (1983) (contracting officer stated that “under no
circumstances will he award any contract” to the contractor); Leslie & Elliott Co. v. Garrett, 732 F. Supp. 191 (D.D.C.
1990) (statement that the contractor was an “administrative burden”).
127 631 F.2d 953, 955-56 (D.C. Cir. 1980).
128 473 F. Supp. 1, 5-6 (D.D.C. 1978).
129 See, e.g., Peter Kiewit, 534 F. Supp. 1139 (finding that a government directive to hold all awards to contractor “in
abeyance” due to concerns about the contractor’s integrity, without providing notice or an opportunity to be heard,
constituted de facto debarment and deprived the contractor of a protected liberty interest). A court could, however, find
an improper de facto debarment without finding a denial of due process. See, e.g., Shermco Indus., 584 F. Supp. at 93-
94. Contractors do not have property interests in prospective government contracts, only liberty interests in certain
circumstances. See, e.g., Transco Security, Inc. of Ohio v. Freeman, 639 F.3d 318, 321 (6th Cir. 1981) (“[D]eprivation
of the right to bid on government contracts is not a property interest.”).
130 Old Dominion Dairy Prods., 631 F.2 at 955-56.
131 See, e.g., Reeve Aleutian Airways, Inc. v. United States, 982 F.2d 594 (D.C. Cir. 1993) (suspension by the
Commercial Airlift Review Board for safety reasons imposed a stigma on the contractor that “implicates the carrier’s
integrity”). But see Southeast Kansas Community Action Program, Inc. v. Lyng, 758 F. Supp. 1430 (D. Kan. 1991)
(allegation of incompetence on part of contractor is not stigmatizing); Smith & Wesson v. United States, 782 F.2d 1074
(1st Cir. 1986) (same).
132 48 C.F.R. § 9.406-2(b)(1)(i)(A)-(B) (debarment); 48 C.F.R. § 9.407-2(c) (suspension upon “adequate evidence” of
“any other cause of so serious or compelling a nature that it affects the present responsibility” of the contractor).
Congressional Research Service
19

---

Evaluating the “Past Performance” of Federal Contractors

suspension are government-wide and last for a fixed period of time.133 Such exclusions may,
however, only be implemented to protect the government, not to punish the contractor,134 and the
agency could be found to have violated the Administrative Procedure Act (APA) if it
subsequently excludes the contractor for conduct that it was aware of when it determined that the
contractor was responsible. For example, in Lion Raisins, Inc. v. United States, the U.S. Court of
Federal Claims found that the U.S. Department of Agriculture’s (USDA’s) suspension of a
contractor for falsifying raisin certifications violated the APA, given that the USDA knew of the
contractor’s conduct when making five prior determinations that the contractor was
“responsible.”135 While the decision in Lion Raisins has been criticized by some commentators136
and distinguished by some courts,137 it has been followed or cited approvingly by others138 and
could potentially be read to preclude agencies from debarring or suspending contractors under the
FAR based on “stale” allegations of wrongdoing.139 “Stale” allegations of wrongdoing could
potentially include allegations of poor performance under contracts completed some time ago.
Legislation and Other Initiatives
Concerns that certain contractors who allegedly performed poorly under prior or current contracts
received additional federal contracts have prompted some Members of Congress and the
executive branch to propose reforms. The 111th Congress enacted or considered legislation that
would (1) increase the reliability and transparency of past performance information;140 (2)

133 Debarred contractors are generally ineligible for government contracts for a fixed period of time, which can vary
depending upon the authority under which the contractor is debarred and the seriousness of the conduct underlying the
debarment, while suspended contractors are generally ineligible for the duration of any investigation into or litigation
involving their conduct. See 48 C.F.R. § 9.406-4(a)(1) (debarment); 48 C.F.R. § 9.407-4(a) (suspension).
134 48 C.F.R. § 9.402(b) (“The serious nature of debarment and suspension requires that these sanctions be imposed
only in the public interest for the Government’s protection and not for purposes of punishment.”).
135 51 Fed. Cl. 238, 247-48 (2001) (“The USDA awarded plaintiff five contracts between the completion of its
investigation in May 1999 and its decision to suspend plaintiff in January 2001. The USDA statutorily was obligated to
make an affirmative finding of plaintiff’s responsibility before awarding each of those contracts. In other words, five
times between May 26, 1999, and February 1, 2001, the USDA itself affirmed that plaintiff’s business practices met the
standards for present responsibility. Significantly, by the USDA’s own representations, it did so despite the possession
of all the evidence that it would later use to suspend plaintiff. The court finds these facts dispositive of the issue of
plaintiff’s present responsibility.”) (internal citations omitted).
136 See, e.g., Michael J. Davidson, Protest Challenges to Integrity-based Responsibility Determinations, 14 Fed. Cir.
Bar J. 473, 499-500 (2004/2005) (“Contrary to the court’s opinion, the contracting officer’s affirmative responsibility
determination is a decision by a single contracting officer, not that of the entire agency. The responsibility
determination is limited to that specific contract and does not bind the agency on any responsibility determination
beyond it. Moreover, while the lack of present responsibility determination by [a Suspension or Debarment Official]
binds the contracting officer and preempts the normal contracting officer responsibility determination, the converse is
not true. To the extent the court decided otherwise, the case was wrongly decided.”).
137 See Kirkpatrick v. White, 351 F. Supp. 2d 1261 (N.D. Ala. 2004) (noting that the investigation underlying the
suspension in the instant case was not completed until eight months after the suspension was imposed, unlike in Lion
Raisins); Gulf Group, Inc. v. United States, 61 Fed. Cl. 338 (2004) (noting that the testimony of the decision maker in
the instant case was not inconsistent with the documentation of his decision, unlike in Lion Raisins).
138 See, e.g., Todd Constr., 88 Fed. Cl. 235; Arch Chems., Inc. v. United States, 64 Fed. Cl. 380 (2005); S.K.J. &
Assocs. v. United States, 67 Fed. Cl. 218 (2005).
139 See Protest Challenges, 14 Fed. Cir. Bar J. at 503 (suggesting that Lion Raisins gave agencies “greater incentive to
act quicker” when determining whether to exclude a contractor).
140 See, e.g., Transparency in Government Act of 2010, H.R. 4983, § 503 (requiring unique identifiers for contractors
and the linkage of those identifiers with FAPIIS records); Federal Contracting Oversight and Reform Act of 2010, H.R.
5726, § 5 (requiring the creation of a single database that would consolidate the information contained in PPIRS,
(continued...)
Congressional Research Service
20

---

Evaluating the “Past Performance” of Federal Contractors

augment the factors considered when past performance is evaluated in certain source selection
decisions;141 (3) increase oversight of certain contracts based upon past performance issues on
similar contracts or involving the same contractors; 142 and (4) give “preference” to certain
contractors based on successful past performance.143 Similar legislation could be introduced in the
112th Congress if concerns persist about poorly performing contractors receiving additional
government contracts. The 112th Congress could also continue oversight of agencies’ compliance
with existing requirements regarding evaluations of past performance.144
The Obama Administration has also implemented or proposed initiatives designed to reward
contractors for good performance. Key among these is the Department of the Navy’s “Preferred
Supplier Program,” which would grant “special terms and conditions,” such as favorable progress
payments and special award fee pools, and “other potential post-award advantages” to contractors
with good past performance.145 The Department of Defense (DOD) has recently proposed
expanding this pilot program DOD-wide.146 OFPP has also issued guidance calling for agencies to
identify who is responsible for preparing interim and final performance evaluations and “consider
the achievement of small business goals in performance evaluations when the contract includes a
Small Business Subcontracting Plan.”147 OFPP also proposes to conduct periodic reviews to
ensure that agencies are submitting their evaluations to PPIRS in a timely fashion and that these
evaluations “provide clear, comprehensive, and constructive information that is useful for making
future contract award decisions.”148 The executive branch’s ability to craft incentives for good
performance is, however, arguably narrower than that of Congress because agencies cannot deny
any responsible source the opportunity to submit a bid or proposal without express statutory

(...continued)
FAPIIS, and other databases).
141 Weapon Systems Acquisition Reform Act of 2009, P.L. 111-23, § 202 (requiring agencies to consider in past
performance evaluations certain contractors’ make-or-buy decisions, or the “extent to which a contractor has given full
and fair consideration to qualified sources other than the contractor in sourcing decisions”); Department of Defense
Authorization Act for FY2011, S. 3454, § 843 (authorizing the Secretary of Defense to make determinations of fault in
cases where there is reason to believe that a contractor may have caused serious bodily injury or death to DOD civilian
or military personnel while performing a contract and consider such determinations in certain past performance
evaluations); Department of Defense Authorization Act for FY2011, S. 3455, § 842 (failure to comply with new
requirements regarding oversight and accountability of private security contractors to be included in databases of past
performance information and considered in responsibility and source selection determinations). See also National
Defense Authorization Act for FY2011, H.R. 5136, § 323 (pilot program on best value for contracts for private security
functions).
142 Department of Homeland Security Appropriations Act, 2010, P.L. 111-83, § 521 (agency inspector general to
review certain contracts when there have been past performance problems on similar contracts or involving the same
vendor).
143 Oregon Eastside Forests Restoration, Old Growth Protection, and Jobs Act of 2009, S. 2895, § 13 (preference for
local vendors based, in part, on consideration of their past performance relating to the purposes and goals of the act).
144 See, e.g., Role and Oversight of Private Security Contractors, supra note 3, at 55 (reporting congressional findings
regarding agencies’ consideration of past performance when contracting for security services in Afghanistan).
145 Office of the Under Secretary of Defense, Acquisition, Technology & Logistics, Better Buying Power: Guidance for
Obtaining Greater Efficiency and Productivity in Defense Spending, Sept. 14, 2010, at 8, available at
http://www.acq.osd.mil/docs/USD_ATL_Guidance_Memo_September_14_2010_FINAL.PDF.
146 Id.
147 Exec. Office of the Pres., Office of Mgmt. & Budget, Office of Fed. Procurement Policy, Improving the Use of
Contractor Performance Information, July 29, 2009, available at http://www.whitehouse.gov/sites/default/files/
omb/assets/procurement/improving_use_of_contractor_perf_info.pdf.
148 Id. Findings from these reviews were supposed to be publicly released “starting in FY2010,” but no findings appear
to have been released to date.
Congressional Research Service
21

---

Evaluating the “Past Performance” of Federal Contractors

authorization.149 This means that the executive branch cannot ensure awards to contractors with
good past performance by preventing other contractors from competing with them.150
Some proposed reforms have generated strong opposition from government contractors, who are
concerned that increased emphasis on past performance information could lead to de facto
debarment or “blacklisting.”151 Such contractors worry that, as the weight given to past
performance information increases, contractors will be effectively excluded from future contract
opportunities based upon information about them that they may not be aware of,152 or whose
accuracy and objectivity they cannot meaningfully challenge. Commentators have also noted that
increased consideration of past performance interjects additional subjectivity into the
procurement process,153 potentially giving rise to more bid protests, and that not every allegedly
poor performance by a contractor is the contractor’s fault.154 These concerns could prompt
renewed calls for the development of judicial or quasi-judicial mechanisms allowing contractors
to challenge agency evaluations of their past performance.155




149 See, e.g., 41 U.S.C. § 253(a)(1)(A) (generally requiring full and open competition); 41 U.S.C. § 403(6) (defining
“full and open competition” as that in which “all responsible sources are permitted to submit sealed bids or competitive
proposals on the procurement”).
150 See, e.g., Navy Announces Reward Program for Top Performers, 18 Set-Aside Alert 4 (May 28, 2010) (emphasizing
that contractors with better past performance “will not receive preference in source selection” under the Preferred
Supplier Program).
151 See, e.g., Tom Spoth, Contractor Performance Data to Become Public, Federal Times, Aug. 6, 2010, available at
http://www.federaltimes.com/article/20100806/ACQUISITION03/8060301; Matthew Weigelt, New Law Puts
Contractor Performance in Public Spotlight, Wash. Tech., Aug. 5, 2010, available at http://washingtontechnology.com/
articles/2010/08/05/obama-opens-fapiis-to-the-public.aspx Other proposals not related to past performance have also
elicited concerns regarding de facto debarment. See, e.g., National Defense Authorization Act for FY2011, S. 3454, §
843(c) (allowing defense agencies to exclude certain sources to reduce supply chain risk and providing that
determinations to exclude may not be disclosed or subjected to judicial or administrative review); Alice Lipowicz,
Contractors Fear Being Blacklisted Under New Defense Bill, Wash. Tech., July, 29, 2010, available at
http://washingtontechnology.com/articles/2010/07/29/2012-defense-bill-debarments.aspx.
152 For example, information communicated between agency personnel but not incorporated into a formal evaluation of
contractor performance.
153 See, e.g., Kimberly R. Heifetz, Striking a Balance Between Government Efficiency and Fairness to Contractors: Past
Performance Evaluations in Government Contracts, 51 Admin. L. Rev. 235, 254 (1998).
154 See, e.g., Protest Challenges, 14 Fed. Cir. B. J. at 502 (“Contractors are frequently under investigation for alleged
[misconduct], and in a large percentage of those cases the allegations are either unfounded or unproven.”); Unfavorable
Past Performance, 31 Proc. Law. at 27 (“Experience shows that a contractor’s apparent ‘seriously deficient’
performance, in the glare of discovery and cross-examination, is sometimes found by the boards and courts to be a
performance failure that is beyond the contractor’s control and without fault or negligence, and on occasion, one for
which the Government is contractually liable.”).
155 Contractors have long sought the opportunity to challenge their performance evaluations and other information
about their past performance outside the agency. See, e.g., More Guidance Needed on Implementing Past Performance
Evaluation, 66 Fed. Cont. Rep. 490 (Nov. 18, 1996). The government, however, has resisted creating judicial or quasi-
judicial mechanisms for contractors to challenge performance evaluations due to concerns that such mechanisms could
“make the system collapse under its own weight.” See, e.g., Kelman Outlines Priorities, Pledges Not to Duck Tough
Decisions, 60 Fed. Cont. Rep. 565 (Dec. 6, 1993). Dr. Kelman was the Administrator of OFPP in the mid-1990s.
Congressional Research Service
22

---

Evaluating the “Past Performance” of Federal Contractors

Author Contact Information

Kate M. Manuel

Legislative Attorney
kmanuel@crs.loc.gov, 7-4477


Congressional Research Service
23

---