From the GAO report on the tanker protest:
LINK Note that the effect of the GAO report was not that Boeing should be awarded the contract, but rather that the Air Force should repeat the solicitation and evaluation process.
"First, we found that, although the solicitation identified the relative order of importance of the requirements and features of the aircraft solicited by the Air Force, the record did not show that the Air Force, in its evaluation and source selection decision, applied the identified relative weighting in assessing the merits of the firms’ proposals. In comparing Boeing’s assessed advantages against Northrop Grumman’s assessed advantages, the Air Force did not account for the fact that many of Boeing’s assessed advantages were derived from requirements and features of the aircraft which the solicitation identified as being more important than those from which Northrop Grumman’s assessed advantages were derived. Moreover, the solicitation requested that offerors propose to satisfy as many of the solicitation’s desired aircraft features and performance as possible, but the record did not show that the Air Force in its evaluation or source selection decision credited Boeing with satisfying far more of these features and functions than did Northrop Grumman.
Second, we found that a key discriminator relied upon by the Air Force in its selection of Northrop Grumman’s proposal for award was not consistent with the terms of the solicitation. Specifically, the Air Force credited Northrop Grumman for proposing to exceed a solicitation key performance parameter objective for fuel offload versus unrefueled range (that is, the amount of fuel a tanker could offload to a receiver aircraft at a given distance of flight by the tanker without itself refueling) to a greater extent than Boeing proposed, but the solicitation plainly provided that no consideration would be given for proposing to exceed key performance parameter objectives.
Third, we found that the record did not show that the Air Force reasonably determined that Northrop Grumman’s proposed aircraft could refuel all current Air Force fixed-wing, tanker-compatible aircraft using current Air Force procedures, as was required by the solicitation. During the procurement, the Air Force twice informed Northrop Grumman that the proposed maximum operating velocity for that firm’s proposed aircraft would not be sufficient under current Air Force procedures to achieve overrun speeds for various Air Force aircraft. (In aerial refueling operations, if a receiver aircraft overruns the tanker during the final phase of rendezvous, the tanker and receiver pilots are directed to adjust to specified overrun speeds, and after overtaking the receiver aircraft, the tanker will decelerate to a refueling airspeed.) In response to the Air Force’s concerns, Northrop Grumman promised a solution to allow its aircraft to achieve the required overrun speeds. The record did not show that the Air Force reasonably evaluated the capability of Northrop Grumman’s proposed aircraft to achieve the necessary overrun speed in accordance with current Air Force procedures.
In addition, we found that the Air Force did not reasonably evaluate the capability of Northrop Grumman’s proposed aircraft to initiate emergency breakaway procedures, consistent with current Air Force procedures, with respect to a current fixed-wing, tanker-compatible Air Force aircraft. A breakaway maneuver is an emergency procedure that is done when any tanker or receiver aircraft crewmember perceives an unsafe condition that requires immediate separation of the aircraft. In such a situation, the tanker pilot is directed to accelerate, and if necessary to also climb, to achieve separation from the receiver aircraft.
Fourth, we found that the Air Force conducted misleading and unequal discussions with Boeing. The agency informed Boeing during the procurement that it had fully satisfied a key performance parameter objective relating to operational utility. Later, the Air Force decided that Boeing had not fully satisfied this particular objective, but did not tell Boeing this, which would have afforded Boeing the opportunity to further address this. GAO concluded that it was improper for the Air Force, after informing Boeing that it had fully met this objective, to change this evaluation conclusion without providing Boeing the opportunity to address this requirement in discussions. In contrast, Northrop Grumman, whose proposal was evaluated as only partially meeting this requirement, received continued discussions addressing this same matter during the procurement.
Fifth, GAO found that the Air Force improperly accepted Northrop Grumman’s proposal, even though that firm took exception to a material solicitation requirement. Specifically, the solicitation required offerors to plan and support the agency to achieve initial organic depot-level maintenance within 2 years after delivery of the first full-rate production aircraft. Northrop Grumman was informed several times by the Air Force that the firm had not committed to the required 2-year timeframe, but Northrop Grumman refused to commit to the required schedule. GAO concluded that Northrop Grumman’s refusal to do so could not considered an “administrative oversight” as was found by the Air Force in its evaluation.
Sixth, we found that the Air Force did not reasonably evaluate military construction costs in evaluating the firms’ cost proposals. The solicitation provided that the Air Force would calculate a most probable life cycle cost estimate for each offeror. A most probable life cycle cost estimate reflects the agency’s independent estimate of all contract, budgetary, and other government costs associated with all phases of the aircraft’s life cycle from system development and demonstration through production and deployment and operations and support; military construction costs were specifically identified as a cost that the agency would evaluate in calculating the firms’ most probable life cycle costs. Because the agency believed that its anticipated requirements could not be reasonably ascertained, the Air Force established a notional (hypothetical) plan, identifying a number of different types of airbases, to provide for a common basis for evaluating military construction costs. GAO found that, in addition to four errors related to military construction costs that the Air Force conceded during the protest, the record otherwise showed that the agency’s military construction cost evaluation was flawed, because the agency’s evaluation did not account for the offerors’ specific proposals and because the record did not otherwise support the reasonableness of the agency’s notional plan.
Seventh, we found that the Air Force improperly increased Boeing’s estimated non-recurring engineering costs in calculating that firm’s most probable life cycle cost. Specifically, the Air Force assigned a moderate risk to Boeing’s system development and demonstration costs, because, despite several efforts to obtain support from Boeing for its proposed non-recurring engineering costs, Boeing had not sufficiently supported its estimate. Although we found the Air Force’s assignment of a moderate cost risk reasonable, GAO also found that the Air Force unreasonably increased Boeing’s estimated non-recurring engineering costs in calculating the firm’s most probable life cycle cost where the Air Force did not find that Boeing’s estimated costs were unrealistic or not probable."