FAR 15.305—Proposal evaluation.
Plain-English Summary
FAR 15.305 explains how agencies must evaluate competitive proposals and document the source selection record. It covers the core rule that proposals may be rated only against the solicitation’s stated factors and subfactors, the use of rating methods such as color, adjectival, numerical, or ordinal systems, and the requirement to document strengths, deficiencies, significant weaknesses, and risks. It also addresses cost or price evaluation, including when price analysis alone is enough, when cost analysis is needed, and when cost realism analysis is required for cost-reimbursement and sometimes fixed-price-type contracts. The section further covers past performance evaluation, including relevance, currency, source quality, predecessor companies, key personnel, subcontractors, offerors with no relevant history, subcontracting plan performance for small disadvantaged business concerns, and joint ventures. In addition, it addresses technical evaluation documentation in tradeoff acquisitions, the handling of cost information by technical evaluators, the special rule for small business subcontracting evaluation, the authority to reject all proposals, and the restriction on using support contractor personnel in proposal evaluation. In practice, this section is central to fair, defensible source selection because it tells contracting officers and source selection teams what they may consider, how they must document it, and where they must avoid using unstated criteria or improper evaluators.
Key Rules
Evaluate Only Stated Factors
Agencies must evaluate proposals and compare them only on the factors and subfactors listed in the solicitation. Unstated criteria, hidden preferences, or after-the-fact rationales can undermine the evaluation and create protest risk.
Use Any Rating Method
The FAR allows color, adjectival, numerical, ordinal, or combined rating methods, so long as the method is consistent with the solicitation and supports a rational comparison of proposals. The chosen method must still produce a meaningful assessment of relative qualities.
Document Evaluation Findings
The contract file must record the relative strengths, deficiencies, significant weaknesses, and risks that support the evaluation. This documentation is essential to explain the source selection decision and defend it if challenged.
Price or Cost Evaluation
For fixed-price and fixed-price with economic price adjustment contracts, comparing proposed prices will usually satisfy price analysis, and cost analysis is generally unnecessary. For cost-reimbursement contracts, the agency must perform cost realism analysis to determine the Government’s likely cost and the offeror’s understanding and ability to perform; cost realism may also be used in limited fixed-price situations.
Past Performance Must Be Relevant
Past performance is a comparative indicator of likely success, and evaluators must consider currency, relevance, source, context, and performance trends. The solicitation must explain how past performance will be evaluated, including how the agency will treat offerors with no relevant history, and the source selection authority decides relevance.
Consider Related Performance Sources
Past performance evaluation should include relevant information about predecessor companies, key personnel, and major subcontractors when that information bears on the current acquisition. For joint ventures, the agency must consider the joint venture’s performance and, if needed, the performance of each venturer.
No History Means Neutral
An offeror with no relevant past performance, or where no past performance information is available, may not be rated favorably or unfavorably on that factor. The absence of history is not supposed to become a hidden penalty or bonus.
Technical Tradeoff Records
When the source selection uses tradeoffs, the record must include an assessment of each offeror’s ability to meet the technical requirements and a summary or ranking of each technical proposal against the evaluation factors. This ensures the tradeoff decision is traceable and supportable.
Small Business Subcontracting Credit
Solicitations must be structured so that offers from small business concerns receive the highest rating for the evaluation factors identified in FAR 15.304(c)(3)(ii) and (c)(4). This gives small business participation meaningful evaluation credit where the solicitation uses those factors.
May Reject All Proposals
The source selection authority may reject all proposals if that is in the Government’s best interest. This preserves agency discretion, but the decision still must be supportable and consistent with procurement law and policy.
Limit Support Contractor Role
Use of support contractor personnel in proposal evaluation is restricted by FAR 37.203(d). Agencies must ensure evaluators are authorized and that contractor support does not compromise procurement integrity or source selection independence.
Responsibilities
Contracting Officer
Ensure the solicitation’s evaluation scheme is followed, document the cost or price evaluation, maintain the contract file record of strengths, weaknesses, risks, and deficiencies, and ensure past performance and technical evaluation procedures comply with FAR requirements. The contracting officer also must consider relevant past performance information, including joint venture and subcontractor information when applicable, and must observe restrictions on support contractor participation.
Source Selection Authority
Make the final comparative assessment and determine the relevance of similar past performance information. The source selection authority may also reject all proposals when that is in the Government’s best interest and must rely on the documented evaluation record when making the award decision.
Technical Evaluation Team
Evaluate technical proposals only against the stated factors and subfactors, assess each offeror’s ability to meet the technical requirements, and prepare summaries, matrices, rankings, and supporting narratives when tradeoffs are used. Team members must use only authorized information and follow agency procedures regarding cost information.
Cost/Price Evaluators
Perform price analysis or cost analysis as required, and conduct cost realism analysis for cost-reimbursement acquisitions and other situations where it is appropriate. They must support the documented conclusion on reasonableness or realism and provide the contracting officer with the basis for the cost or price evaluation.
Agency
Design the solicitation’s evaluation approach, including past performance treatment, no-history treatment, and small business subcontracting evaluation structure. The agency must also establish procedures for sharing cost information with technical evaluators and for controlling the use of support contractor personnel in evaluations.
Offerors
Submit proposals responsive to the stated evaluation criteria, provide relevant past performance references, identify problems and corrective actions on prior contracts when allowed, and supply information needed for the agency to assess price, cost, technical merit, and past performance. Joint ventures and firms with subcontracting plans should ensure their performance history and subcontracting compliance are accurately presented.
Practical Implications
This section is one of the main protest battlegrounds because evaluators must stay within the solicitation’s stated criteria and document why one proposal is better than another. If the record does not clearly explain strengths, weaknesses, and risks, the award decision is harder to defend.
Past performance is not just a yes/no check; agencies must judge relevance and trends, and they must treat offerors with no relevant history neutrally. A common mistake is to penalize a new entrant or overvalue old or unrelated performance.
Cost realism is often misunderstood. In cost-reimbursement procurements, the Government is not just checking whether the numbers are arithmetically correct; it is estimating what the work will likely cost and whether the offeror truly understands the requirement.
Technical evaluators should not be given unrestricted cost information unless agency procedures allow it, because that can distort technical judgments. Likewise, support contractor involvement must be carefully controlled to avoid conflicts and procurement integrity issues.
Small business subcontracting evaluation and joint venture past performance can materially affect ratings, so both contracting officers and offerors should pay close attention to how the solicitation says these items will be scored and documented.
Official Regulatory Text
(a) Proposal evaluation is an assessment of the proposal and the offeror’s ability to perform the prospective contract successfully. An agency shall evaluate competitive proposals and then assess their relative qualities solely on the factors and subfactors specified in the solicitation. Evaluations may be conducted using any rating method or combination of methods, including color or adjectival ratings, numerical weights, and ordinal rankings. The relative strengths, deficiencies, significant weaknesses, and risks supporting proposal evaluation shall be documented in the contract file. (1) Cost or price evaluation . Normally, competition establishes price reasonableness. Therefore, when contracting on a firm-fixed-price or fixed-price with economic price adjustment basis, comparison of the proposed prices will usually satisfy the requirement to perform a price analysis, and a cost analysis need not be performed. In limited situations, a cost analysis may be appropriate to establish reasonableness of the otherwise successful offeror's price (see 15.403-1 (c)(1)(i)(C)). When contracting on a cost-reimbursement basis, evaluations shall include a cost realism analysis to determine what the Government should realistically expect to pay for the proposed effort, the offeror's understanding of the work, and the offeror's ability to perform the contract. Cost realism analyses may also be used on fixed-price incentive contracts or, in exceptional cases, on other competitive fixed-price-type contracts (see 15.404-1 (d)(3)). (See 37.115 for uncompensated overtime evaluation.) The contracting officer shall document the cost or price evaluation. (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 . (ii) The solicitation shall describe the approach for evaluating past performance, including evaluating offerors with no relevant performance history, and shall provide offerors an opportunity to identify past or current contracts (including Federal, State, and local government and private) for efforts similar to the Government requirement. The solicitation shall also authorize offerors to provide information on problems encountered on the identified contracts and the offeror’s corrective actions. The Government shall consider this information, as well as information obtained from any other sources, when evaluating the offeror’s past performance. The source selection authority shall determine the relevance of similar past performance information. (iii) The evaluation should take into account past performance information regarding predecessor companies, key personnel who have relevant experience, or subcontractors that will perform major or critical aspects of the requirement when such information is relevant to the instant acquisition. (iv) In the case of an offeror without a record of relevant past performance or for whom information on past performance is not available, the offeror may not be evaluated favorably or unfavorably on past performance. (v) The evaluation should include the past performance of offerors in complying with subcontracting plan goals for small disadvantaged business (SDB) concerns (see subpart 19.7 ). (vi) For offerors that are joint ventures, the evaluation shall take into account past performance of the joint venture. If the joint venture does not demonstrate past performance for award, the contracting officer shall consider the past performance of each party to the joint venture. (3) Technical evaluation . When tradeoffs are performed (see 15.101-1 ), the source selection records shall include- (i) An assessment of each offeror’s ability to accomplish the technical requirements; and (ii) A summary, matrix, or quantitative ranking, along with appropriate supporting narrative, of each technical proposal using the evaluation factors. (4) Cost information. Cost information may be provided to members of the technical evaluation team in accordance with agency procedures. (5) S mall business subcontracting evaluation. Solicitations must be structured to give offers from small business concerns the highest rating for the evaluation factors in 15.304 (c)(3)(ii) and (c)(4). (b) The source selection authority may reject all proposals received in response to a solicitation, if doing so is in the best interest of the Government. (c) For restrictions on the use of support contractor personnel in proposal evaluation, see 37.203 (d).