Federal Claims Court Provides Guidance on Agencies’ Duty to Evaluate Offerors’ Proposed Professional Compensation

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Today, our colleagues David Dixon, Meghan Doherty and Toghrul Shukurlu published their Client Alert titled FAR’s Professional Compensation Clause and Keeping Things Real. The Alert discusses the U.S. Court of Federal Claims’ recent decision in Sparksoft Corp. v. U.S., an action involving Sparksoft Corp.’s protest of a pre-award decision of the Department of Health and Human Services, Centers for Medicare & Medicaid Services (DHS) not conduct a realism analysis on the professional compensation rates embedded within the firm-fixed-price (FFP) component of bids submitted under the solicitation.

The Court issued a declaratory judgment that the agency “shall evaluate the pending offers by Scope and Sparksoft in the procurement process for the DSH contract by conducting a realism analysis on the offerors’ proffered plans for professional compensation, as mandated by FAR § 52.222-46, related to the entire contract, including the FFP portion.”

Takeaways from the Sparksoft decision include: