Federal agencies grade their own contractors. The Federal Acquisition Regulation requires a written past performance review for every contract above the simplified acquisition threshold. The write-up comes at least once a year and again when the work ends. It goes into CPARS, the governmentwide database that buying officers read before the next award. The record stays with the business unit that did the work.
The design prices risk before money moves. Strong performers build a paper edge; weak ones carry the evidence with them. The bottleneck is input. A 2014 GAO review of past performance reporting found compliance rates from 13 to 83 percent as of April 2014 across the ten largest agencies. Most had missed the targets set by the Office of Federal Procurement Policy. Where reports land late, the file runs on stale data. The same mechanics-first reading drives how a ranked-choice vote count actually works, and this piece follows the site's federal contracting coverage.
What Gets Rated and on What Scale
FAR subpart 42.15 fixes the inputs. Each report must cover, at a minimum:
- quality of the product or service;
- cost control, except on fixed-price work;
- schedule and timeliness;
- management and business relations;
- small business subcontracting.
Each factor draws one of five marks: exceptional, very good, satisfactory, marginal, unsatisfactory. A short narrative backs every mark, and the text must rest on facts and program data. The scale has a floor. Federal guidance says a firm will not score below satisfactory just for doing no more than the contract asked. Satisfactory means the work met the terms, with small problems fixed. Marginal means some terms went unmet and fixes barely worked. This connects to our earlier piece, CPARS: The Report Card That Follows Every Federal Contractor.
How a Weak Rating Reaches the Next Competition
At award time, FAR 15.305 makes the file a standard thread in source selection. The solicitation must spell out its approach, including how firms with no history will be judged. Offerors may list past contracts and disclose problems along with the fixes they made. The source selection authority decides which prior work counts as relevant. A firm with no record stays neutral: it may not be scored up or down on past performance. A firm holding a marginal report gets no such shelter. The record carries forward because agencies keep it. Copies of the report and any contractor response are kept on file, and completed reports are marked as source selection information.
Why the File So Often Runs Late
The design assumes agencies write on time. They often do not. The GAO review found most large agencies had missed the reporting targets, with the low end near 13 percent. The rule tries to close the gap with process controls. Each agency must name the people answerable for complete submissions. FAR 42.1501 also directs agencies to track compliance with CPARS tools that measure how fast and how well reports come in. The stimulus problem is old. A yearly report is unpaid overhead for the program office, so it loses to mission work. The vendor pays the price in a thinner file.
What a Vendor Can Do About a Bad Report
The rule gives a short, fixed window. CPARS notifies the firm when a report is ready. The firm then has up to 14 calendar days to file comments and rebutting statements. An agency must offer review above the contracting officer in a dispute, though the final call stays with the agency. A useful rebuttal matches the report's own standard. Since the narrative must rest on facts, records and delivery data beat argument. The comments stay in the file. The same lever exists downstream. In a later competition, an offeror may describe past problems along with the corrective steps taken, and the government must weigh that input.
Conclusion: A Record That Compounds in Both Directions
Past performance works as a compounding file. Yearly and end-of-work reports pile up in CPARS. They follow the business unit and resurface at the next award. The file stays neutral only when no history exists. The stall points are public, not hidden: late submissions and uneven agency compliance. Vendors hold two known workarounds, the 14-day comment window backed by records and the problem-plus-fix note allowed in each new bid. A rating is a dated record from a named agency. It keeps showing up until a better one replaces it. Readers following this should also see Small Business Set-Asides: How the Rule of Two Works.
