Skip to main content

B-188871, OCTOBER 25, 1977

B-188871 Oct 25, 1977
Jump To:
Skip to Highlights

Highlights

WHERE RECORD SHOWS REASONABLE BASIS FOR AGENCY'S JUDGMENT THAT HIGHER PRICED PROPOSAL WAS SIGNIFICANTLY SUPERIOR TO LOWER PRICES PROPOSAL FOR TECHNICAL REASONS. SELECTION OF HIGHER PRICED PROPOSAL IS NOT OBJECTIONABLE. 2. OFFERORS ARE SUFFICIENTLY INFORMED OF DEGREE OF IMPORTANCE TO BE ACCORDED TO EACH EVALUATION CRITERIA IN RELATION TO EACH OTHER AND SUCH WEIGHTS ARE NOT INCOMPATIBLE WITH LISTING OF CRITERIA IN DESCENDING ORDER OF IMPORTANCE. AYDIN CONTENDS THAT THE NAVY'S TECHNICAL EVLUATION OF THE PROPOSALS WAS BIASED IN FAVOR OF THE HIGHER PRICED RAYTHEON PROPOSAL. THAT THE OUTCOME OF "COMPETITIVE" NEGOTIATIONS WAS PREDETERMINED AND THAT THERE WAS INADEQUATE DISCLOSURE IN THE REQUEST FOR PROPOSALS (RFP) OF THE EVALUATION FACTORS UPON WHICH AWARD WAS BASED.

View Decision

B-188871, OCTOBER 25, 1977

1. WHERE RECORD SHOWS REASONABLE BASIS FOR AGENCY'S JUDGMENT THAT HIGHER PRICED PROPOSAL WAS SIGNIFICANTLY SUPERIOR TO LOWER PRICES PROPOSAL FOR TECHNICAL REASONS, SELECTION OF HIGHER PRICED PROPOSAL IS NOT OBJECTIONABLE. 2. WHERE AGENCY LISTS FOUR EVALUATION CRITERIA IN RFP IN DESCENDING ORDER OF IMPORTANCE AND ASSIGNS UNDISCLOSED WEIGHTS OF 40, 33.3, 16.7 AND 10 PERCENT OF TOTAL TECHNICAL SCORE RESPECTIVELY THERETO, OFFERORS ARE SUFFICIENTLY INFORMED OF DEGREE OF IMPORTANCE TO BE ACCORDED TO EACH EVALUATION CRITERIA IN RELATION TO EACH OTHER AND SUCH WEIGHTS ARE NOT INCOMPATIBLE WITH LISTING OF CRITERIA IN DESCENDING ORDER OF IMPORTANCE.

AYDIN CORPORATION:

AYDIN CORPORATION (AYDIN) PROTESTS THE AWARD OF CONTRACT NUMBER N00421-77 -00226 TO RAYTHEON CORPORATION (RAYTHEON) BY THE NAVAL AIR STATION, PATUXENT, MARYLAND (NAVY). AYDIN CONTENDS THAT THE NAVY'S TECHNICAL EVLUATION OF THE PROPOSALS WAS BIASED IN FAVOR OF THE HIGHER PRICED RAYTHEON PROPOSAL, THAT THE OUTCOME OF "COMPETITIVE" NEGOTIATIONS WAS PREDETERMINED AND THAT THERE WAS INADEQUATE DISCLOSURE IN THE REQUEST FOR PROPOSALS (RFP) OF THE EVALUATION FACTORS UPON WHICH AWARD WAS BASED. THE NAVY DENIES THESE ALLEGATIONS AND CONTENDS THAT THE RAYTHEON PROPOSAL WAS SO TECHNICALLY SUPERIOR THAT ACCEPTANCE OF ITS HIGHER PRICE WAS FULLY JUSTIFIED.

THE RFP, ISSUED JUNE 4, 1976, REQUESTED PROPOSALS ON A FIRM FIXED PRICE BASIS FOR 28 DIRECT VIEW CONSOLES, RELATED EQUIPMENT AND DATA. THE CONSOLE IS A COMPONENT OF THE NAVY'S FLEET COMMAND CENTER AND CONSISTS OF A CATHODE RAY TUDE (CRT) SCREEN WITH FOUR COLOR CAPABILITY TO PROVIDE A VISUAL DISPLAY OF OPERATIONAL SITUATIONS. THE RFP STATED THAT AWARD WOULD BE BASED ON THE GREATEST VALUE TO THE GOVERNMENT IN TERMS OF PERFORMANCE RATHER THAN LOWEST PRICE. THE RFP LISTED PROPOSAL EVALUATION FACTORS IN DESCENDING ORDER OF IMPORTANCE AS FOLLOWS:

"1. UNDERSTANDING OF THE REQUIREMENT

"2. TECHNICAL APPROACH: THE TECHNICAL FEATURES AS PROPOSED WILL BE EVALUATED IN THE FOLLOWING ORDER OF DESCENDING IMPORTANCE:

A. OPERATION CAPABILITY B. PERFORMANCE CHARACTERISTICS C. SYSTEM COMPATIBILITY D. RELIABILITY E. EASE OF MAINTENANCE F. DEMONSTRABILITY G. LIFE CYCLE AND OPERATING COSTS

"3. SUPPORTABILITY (USE OF STANDARD OR NON-STANDARD OPERATING AND MAINTENANCE COMPONENTS)

"4. ABILITY TO MEET REQUIRED DELIVERY DATES

"5. PROPOSED PRICE."

ON JULY 30, 1976, AYDIN, RAYTHEON AND SANDERS ASSOCIATES SUBMITTED PROPOSALS. THEY WERE TECHNICALLY EVALUATED IN ACCORDANCE WITH AN EVALUATION MATRIX WHICH ASSIGNED NUMERICAL SCORES TO THE VARIOUS CRITERIA. THE MATRIX AND THE WEIGHTS ASSIGNED TO THE EVALUATION CRITERIA WERE NOT DISCLOSED IN THE RFP. THE EVALUATION ALSO INCLUDED NARRATIVE REPORTS WHICH DISCUSSED IN DETAIL THE STRENGTHS AND WEAKNESSES OF EACH PROPOSAL. TECHNICAL DISCUSSIONS WITH EACH OFFEROR WERE CONDUCTED AND REVISED PROPOSALS WERE RECEIVED ON OCTOBER 1, 1976. BY LETTER OF NOVEMBER 5, 1976, AYDIN WAS INFORMED THAT ITS PROPOSAL WAS TECHNICALLY UNACCEPTABLE AND THAT NO FURTHER REVISIONS OF IT WOULD BE CONSIDERED. AYDIN'S REQUEST FOR A DEBRIEFING PRIOR TO AWARD WAS REJECTED ON NOVEMBER 29, 1976 AND ON DECEMBER 3, 1976, AYDIN PROTESTED TO THIS OFFICE (B-187961).

IN REVIEWING THE PROTEST, THE NAVY DETERMINED THAT ITS EVALUATION MATRIX IMPROPERLY INCLUDED AT LEAST TWO FACTORS. FOR EXAMPLE THE EVALUATION MATRIX REQUIRED SCORING FOR "QUALITY AND RESPONSIVENESS OF PROPOSAL" AND "ORGANIZATION, PERSONNEL AND FACILITIES" NEITHER OF WHICH WAS LISTED AS AN EVALUATION CRITERION IN THE RFP. IT THEREFORE REVISED THE MATRIX AND BY LETTER OF DECEMBER 29, 1976 REINSTATED AYDIN INTO THE COMPETITIVE RANGE. AYDIN WITHDREW ITS FIRST PROTEST ON JANUARY 14, 1977.

FURTHER TECHNICAL DISCUSSIONS WITH EACH OFFEROR WERE CONDUCTED. AN RFP AMENDMENT AND LETTER OF JANUARY 14, 1977 REVISED THE SPECIFICATIONS, REQUIRED ADDITIONAL PROPOSAL DETAIL AND REQUESTED REVISED PROPOSALS BY JANUARY 31, 1977. BEST AND FINAL OFFERS WERE RECEIVED ON MARCH 31, 1977 AND RAYTHEON WAS AWARDED A CONTRACT ON APRIL 6, 1977 FOR $2,502,013. AYDIN'S FINAL PRICE WAS $2,227,124 AND IT SUBMITTED A NEW PROTEST TO THIS OFFICE ON APRIL 18, 1977.

AYDIN STATES THAT WHEN ITS INITIAL PROTEST RESULTED IN A CHANGE IN THE EVALUATION MATRIX, THE NAVY BOOSTED RAYTHEON'S TECHNICAL SCORE TO 100 PERCENT TO ENSURE THAT RAYTHEON RECEIVED THE AWARD. THE RECORD INDICATES THAT THE NAVY MADE A NUMBER OF TECHNICAL EVALUATIONS UNDER THE ORIGINAL AND REVISED MATRICES AS FOLLOWS:

RAYTHEON . . SANDERS . . AYDIN

ORIGINAL MATRIX (SEPT. 9, 1976) . . 98.73 . . 73.73 . . 62.45 FIRST REVISED MATRIX (NOV. 8, 1976) . . 99.3 . . 75.5 . . 59.1 SECOND REVISED MATRIX (DEC. 22, 1976) . . 100.0 . . 79.68 . . 73.04 SECOND REVISED MATRIX (FEB. 8, 1977) . . 100.0 . . 80.12 . . 80.59 SECOND REVISED MATRIX (APR. 1, 1977). . . .100.0 . . . . . 80.12 . . . 80.59

THE RECORD INDICATES THAT THE 100 SCORE FOR RAYTHEON ON DECEMBER 22, 1976 RESULTED SOLELY FROM THE ELIMINATION FROM THE PREVIOUS MATRIX OF THOSE EVALUATION CRITERIA WHICH WERE NOT PROPERLY REFLECTED IN THE RFP AND THAT NO SCORE OF THE CRITERIA COMMON TO BOTH MATRICES WAS RAISED. IT APPEARS THAT ALL OFFERORS WERE EVALUATED AGAINST THE SAME CRITERIA BEFORE AND AFTER THE CORRECTION OF THE MATRIX.

AYDIN ALSO OBJECTS TO THE NAVY'S OVERALL EVALUATION MATRIX OF FEBRUARY 8, 1977 WHICH ASSIGNED WEIGHTS AS FOLLOWS:

UNDERSTANDING . . . . . . .12 TECHNICAL APPROACH. . . . .10 SUPPORTABILITY. . . . . . . 5 DELIVERY. . . . . . . . . . 5

AYDIN CONTENDS ASSIGNING 73 PERCENT OF THE TOTAL SCORE TO THE FIRST TWO CRITERIA AND ONLY 27 PERCENT TO THE LAST TWO FACTORS PLACES AN OVERWHELMING IMPORTANCE ON THE FIRST TWO FACTORS AND THIS SHOULD HAVE BEEN REVEALED IN THE RFP. IT ASSERTS THAT THE FAILURE TO DO SO IS CONTRARY TO A NUMBER OF DECISIONS OF THIS OFFICE HOLDING THAT THE MERE LISTING OF EVALUATION CRITERIA IN THE DESCENDING ORDER OF IMPORTANT IS NOT SUFFICIENT WHERE THE WEIGHTS ARE GROSSLY OUT OF PROPORTION.

WE AGREE THAT WHETHER OR NOT NUMERICAL RATINGS ARE TO BE USED, DEFINITIVE INFORMATION SHOULD BE GIVEN TO OFFERORS AS TO THE DEGREE OF IMPORTANCE TO BE ACCORDED TO PARTICULAR EVALUATION CRITERIA IN RELATION TO EACH OTHER. WE DO NOT AGREE, HOWEVER, THAT BDM SERVICE COMPANY, B-180245, MAY 9, 1974, 74-1 CPD 237, WHICH AYDIN CITES, REQUIRES A FINDING THAT THE DEGREE OF IMPORTANCE OF EACH EVALUATION CRITERION HERE SHOULD HAVE BEEN MORE PRECISELY DEFINED. IN THE BDM SERVICE CASE, THE FIRST OF FIVE CRITERIA WAS ACCORDED 72 PERCENT OF THE TOTAL WEIGHT. HERE, THE FIRST OF FOUR CRITERIA WAS GIVEN 40 PERCENT OF THE TOTAL WEIGHT. THE SECOND, THIRD, FOURTH AND FIFTH CRITERIA IN THE BDM SERVICE CASE WERE GIVEN 12, 9, 4 AND 3 PERCENT RESPECTIVELY OF THE TOTAL WEIGHT. IN THE INSTANT CASE, THE SECOND, THIRD AND FOURTH CRITERIA WERE GIVEN 33.3, 16.7 AND 10 PERCENT RESPECTIVELY OF THE TOTAL WEIGHT. THUS, WE BELIEVE THAT LISTING THE FOUR EVLUATION CRITERIA IN THE DESCENDING ORDER OF IMPORTANCE HERE DID INFORM THE OFFERORS OF THE BROAD SCHEME OF SCORING TO BE EMPLOYED AND THAT THE WEIGHTS ASSIGNED IN THIS CASE ARE COMPATIBLE WITH SUCH LISTING.

AYDIN NEXT STATES THAT ALTHOUGH THE ORIGINAL SPECIFICATIONS DID NOT REQUIRE GROUNDED AQUIDAG COATING OR MU METAL SHIELDING FOR THE CRT, THE NAVY REQUIRED AYDIN TO SUBMIT A REVISED PROPOSAL INCORPORATING SUCH FEATURES. AYDIN CONTENDS THAT PROTECTIVE DEVICES OFFERED IN ITS ORIGINAL PROPOSAL MADE THE MU METAL SHIELD SUPERFLUOUS. IT FURTHER CONTENDS THAT AQUIDAG COATING AND MU METAL SHIELDING GREATLY INCREASES TUBE CAPACITANCE WHICH, IN TURN, INCREASES TIME REQUIRED TO SWITCH FROM ONE COLOR TO ANOTHER. AYDIN STATES THAT RAYTHEON HOLDS A PATENT ON THE PRIMARY TECHNIQUE FOR REDUCING COLOR SWITCHING TIME AND THAT THE ONLY ALTERNATIVE IS THE USE OF A WIRE MESH SCREEN IMMEDIATELY BEHIND THE FRONT OF THE TUBE. AYDIN ASSERTS THEREFORE THAT THE REQUIRED USE OF THE AQUIDAG COATING AND MU METAL SHIELD BIASED THE SELECTION IN FAVOR OF RAYTHEON. NEVERTHELESS, AYDIN SUBMITTED REVISED PROPOSALS OF OCTOBER 1, 1977 AND JANUARY 14, 1977 BOTH OF WHICH INCORPORATED SUCH FEATURES AND THE WIRE MESH SCREEN INTO ITS CRT DESIGN.

THE NAVY STATES THAT THE GROUNDED AQUIDAG COATING AND THE MU METAL SHIELD ARE NECESSARY TO MEET ITS PERFORMANCE SPECIFICATIONS AND ARE IN STANDARD USE THROUGHT THE INDUSTRY. IT CONTENDS, HOWEVER, THE USE OF THESE FEATURES DOES NOT NECESSARILY REQUIRE USE OF THE PATENTED RAYTHEON PROCESS FOR REDUCING COLOR SWITCHING TIME AND THERE ARE ALTERNATIVES OTHER THAN USE OF WIRE MESH SCREEN FOR CORRECTING COLOR SWITCHING TIME PROBLEMS AS SHOWN BY THE FACT THAT SANDERS PROPOSED SUCH AN ALTERNATIVE.

WE SEE NO MERIT IN AYDIN'S CONTENTION THAT THE PATENTED PROCESS FOR REDUCING COLOR SWITCHING TIME GAVE RAYTHEON AN UNDUE ADVANTAGE. THE RECORD REVEALS A RATIONAL BASIS FOR THE AGENCY'S INSISTENCE THAT THE AQUIDAY COATING AND MU METAL SHIELDING BE USED IN CONNECTION WITH THE CRT. IF THE USE OF SUCH FEATURES CREATES PROBLEMS WHICH IN THE OPINION OF THE AGENCY, CAN BEST BE RESOLVED BY USE OF THE PATENTED PROCESS, THERE IS NO LEGAL REQUIREMENT THAT THE AGENCY COMPROMISE ITS MINIMUM NEEDS IN THE INTEREST OF FAIR COMPETITION. MANUFACTURING DATA SYSTEMS, INCORPORATED, B-180608, JUNE 28, 1974, 74-1 CPD 348.

FINALLY, AYDIN CONTENDS THAT ALTHOUGH DEMONSTRABILITY WAS A SPECIFIED TECHNICAL EVALUATION CRITERION AND DEMONSTRATIONS WERE CONDUCTED WITH REGARD TO ITS INITIAL PROPOSAL, NONE WAS CONDUCTED AFTER THE SPECIFICATIONS WERE CHANGED AND AYDIN INCLUDED THE AQUIDAG COATING AND MU METAL SHIELDING FEATURES INTO ITS REVISED PROPOSALS. AYDIN STATES THAT THIS FAILURE TO REQUIRE FURTHER DEMONSTRATIONS INDICATES THAT THE EVALUATORS HAD CLOSED THEIR MINDS. THE NAVY STATES THAT AYDIN NEVER REQUESTED A SECOND DEMONSTRATION AND THAT ITS EVALUATORS BELIEVED THAT A SECOND DEMONSTRATION WAS UNWARRANTED BECAUSE EVEN IF AYDIN OBTAINED 100 PERCENT OF THE DEMONSTRABILITY SCORE, THE EFFECT ON ITS OVERALL SCORE WOULD HAVE BEEN NEGLIGIBLE. UNDER THESE CIRCUMSTANCES, WE CANNOT CONCLUDE THAT THE NAVY'S FAILURE TO REQUIRE A SECOND DEMONSTRATION WAS UNREASONABLE.

ACCORDINGLY, THE PROTEST IS DENIED. IN VIEW THEREOF, AYDIN'S CLAIM FOR PROPOSAL PREPARATION COSTS IS ALSO DENIED.

GAO Contacts

Office of Public Affairs