The US Department of Housing and Urban Development‘s (HUD) 3.9 iteration of the Management and Marketing (M&M) Asset Manager (AM) contract was issued on 17 June 2019 and amended 15 times. That said, it appears to have finally cleared most of the bid protest land mines out there. The GAO Protests were hot and heavy; however, it was Chronos Solution’s protest against BLB Resources which really had the fireworks as you will see in just a moment. What is of note here is that in the past, the GAO rarely — and HUD would never — make public statements about unsatisfactory results hitched to the CPARS.
To lay the foundation here, Chronos Solutions is a tricky and complicated as to first, whom owns them. We know that New Residential Investment Corporation controls Chronos Solutions by and through Covius Holdings culminating from a July 2020 deal earlier this year. The rub has always been, though, did they buy ALL of Chronos Solutions. Covius states that they bought the “...credit, flood, income and tax verification services, government services, REO management and disposition, online foreclosure auction and homeowners association (HOA) tracking units …” of Chronos. REO management and disposition seem to me to include what they do with HUD, but I doubt anyone will argue the fact publicly. Of note, New Residential also bought Guardian Asset Management around the same time. The bone of contention, though, is that Chronos lost the race to BLB Resources before the show even started. Here is what they said,
Chronos Solutions, LLC, of Irving, Texas, protests the award of sole-source contract No. 86614520D0002 to BLB Resources, Inc., of Irvine, California, by the Department of Housing and Urban Development (HUD) to provide asset management services in support of HUD’s real estate owned properties in Wisconsin, Iowa, Nebraska and South Dakota (identified by the agency as Area 4D). The protester primarily argues that the agency’s decision was improper because HUD did not solicit a proposal from the protester, which was the incumbent contractor.
Chronos’ argument appeared to be that the Contracting Officer liked us and we are part of the good ‘ol boy network, so to award 4D — Wisconsin, Iowa, Nebraska and South Dakota — to BLB Resources as a bridge contract, without letting us bid on it, was unfair. And normally, that might have been the end of the story. COVID, though, has changed the world and it appears that HUD had had enough of the upstart which was created by Matt Martin under Matt Martin Real Estate Management LLC so many years ago. It would also appear that the name Boris Whiteside no longer carried with it the clout it used to. Here is how HUD put it,
For eight of the first ten months of contract performance, Chronos failed to meet certain metrics of this scorecard and received “unsatisfactory” ratings.
It was just the beginning. While Chronos continued to argue about how long they had held the contract and why everyone should bow down to the name Matt Martin, it just wasn’t in the cards. HUD continued,
On February 28, the contracting officer issued a defective performance letter to Chronos regarding Chronos’s declining performance and failure to comply with various requirements.
Prior to the 31 May 2020 expiration of Chronos’s contract, the agency awarded a sole-source bridge contract to BLB to commence performance on June 1 for up to one year (including a six-month base period and 2 three-month option periods) for a guaranteed minimum amount of $150,000, up to a maximum amount of $3,911,216, through which orders would be issued under Federal Acquisition Regulation (FAR) part 16 procedures. And Chronos was livid.
Chronos was, in many ways, identical to Innotion Enterprises whom lost the HUD M&M Field Service Manager (FSM) contract for Illinois under similar circumstances — other than the fact that Innotion was then given new and more regions after their complete debacle in Illinois.
Chronos’ position was that “no reasonable reading of Chronos’s prior performance in Area 4D could support HUD’s conclusion that Chronos was ineligible to submit an offer for a bridge contract.” Err, maybe they honestly did not understand the English language or maybe — just maybe — they thought that Martin’s previously cozy relationship with HUD would mean something under Secretary Carson’s leadership. Either way, Chronos was wrong. Here is how the ruling continued,
In response, the agency explains that the monthly scorecards “provided more detail, identifying the specific contract requirements/metrics that Chronos was failing to meet each month,” and included unsatisfactory ratings for Chronos’s performance both before and after the period covered by the CPARS.
The agency also explains that “[t]hese ongoing issues raise concerns about both timeliness of performance and ability to meet policy and program/mission goals in area 4D.”
The entire smackdown of Chronos Solutions is below.
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