Evaluating the 'Past Performance' of Federal Contractors: Legal Requirements and Issues [February 4, 2013] [open pdf - 401KB]
"Poor performance under a federal contract can have immediate consequences for contractors, who could be denied award or incentive fees, required to pay liquidated damages, or terminated for default. In addition, it could 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.' 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. Federal law also requires agencies to 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."
CRS Report for Congress, R41562