I would like to know if we can award the task order to the next lowest offer due to performance issues with the other IDIQ contractor?
This response is based on the information provided. We suggest you discuss with your contracting team, program manager and/or legal department as appropriate.
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This question cannot be definitively answered with the lack of details of the contracting situation. It appears this is being done in a multiple contract award environment. You stated you received bids which implies FAR part 14 procedures. If that is the case, then the lowest price is the winner unless,
"FAR 14.404-2 -- Rejection of Individual Bids.
...(i) Low bids received from concerns determined to be not responsible pursuant to Subpart 9.1..." which says,
"FAR 9.104-3 -- Application of Standards.
...(b) Satisfactory performance record. A prospective contractor that is or recently has been seriously deficient in contract performance shall be presumed to be nonresponsible, unless the contracting officer determines that the circumstances were properly beyond the contractor’s control, or that the contractor has taken appropriate corrective action. Past failure to apply sufficient tenacity and perseverance to perform acceptably is strong evidence of nonresponsibility. Failure to meet the quality requirements of the contract is a significant factor to consider in determining satisfactory performance. The contracting officer shall consider the number of contracts involved and the extent of deficient performance in each contract when making this determination. If the pending contract requires a subcontracting plan pursuant to Subpart 19.7, The Small Business Subcontracting Program, the contracting officer shall also consider the prospective contractor’s compliance with subcontracting plans under recent contracts."
If this is a FAR part 15 requirement then, "FAR 15.305 -- Proposal Evaluation.
(a)(2) Past performance evaluation.
(i) Past performance information is one indicator of an offeror’s ability to perform the contract successfully. The currency and relevance of the information, source of the information, context of the data, and general trends in contractor’s performance shall be considered. This comparative assessment of past performance information is separate from the responsibility determination required under Subpart 9.1."
What was in your solicitation (IFB/RFP) will be guiding in what path you take. But the lack of successful past performance should be a significant determiner of the ability to successfully perform if your solicitation has the appropriate language.