B-157170, SEP. 9, 1965

B-157170: Sep 9, 1965

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PROPOSALS WERE SOLICITED FOR THE PERFORMANCE OF LOGISTIC AND TECHNICAL INFORMATION SUPPORT SERVICES AT THE MANNED SPACECRAFT CENTER. THE OVERALL REQUIREMENT WAS FOR THE FOLLOWING CATEGORIES OF WORK: "APPENDIX A. PROPOSALS WERE TO BE SUBMITTED IN TWO SEPARATE PARTS. PROPOSERS WERE ADVISED THAT THE CONTRACTOR SELECTED MUST POSSESS A WIDE RANGE OF EXPERIENCE TO DEMONSTRATE A CAPABILITY TO PERFORM THE MANAGEMENT AND RELATED SERVICES REQUIRED. PROPOSERS WERE ADVISED THAT A SOURCE EVALUATION BOARD WOULD EVALUATE PROPOSALS IN THE LIGHT OF THE FOLLOWING MAJOR FACTORS: "A. "D. THE COST PROPOSAL WILL BE CONSIDERED AS A REFLECTION OF THE CONTRACTOR'S UNDERSTANDING OF THE WORK AND THE PERTINENT FACTORS WHICH WILL AFFECT THE COST OF PERFORMING THIS CONTRACT.'.

B-157170, SEP. 9, 1965

TO VOLT TECHNICAL CORPORATION:

BY TELEFAX DATED JULY 5, 1965, AND LETTER DATED JULY 8, 1965, WITH ENCLOSURES, YOU PROTESTED AGAINST THE DECISION OF THE NATIONAL AERONAUTICS AND SPACE ADMINISTRATION (NASA) TO NEGOTIATE A CONTRACT WITH THE FEDERAL ELECTRIC CORPORATION PURSUANT TO REQUEST FOR PROPOSALS NO. BG83-96-5-7P DATED APRIL 22, 1965.

PROPOSALS WERE SOLICITED FOR THE PERFORMANCE OF LOGISTIC AND TECHNICAL INFORMATION SUPPORT SERVICES AT THE MANNED SPACECRAFT CENTER, HOUSTON, TEXAS. THE OVERALL REQUIREMENT WAS FOR THE FOLLOWING CATEGORIES OF WORK:

"APPENDIX A--- MANAGEMENT, SERVICES AND FACILITIES TO PROVIDE TECHNICAL WRITING, TECHNICAL EDITING, COPY PREPARATION AND A DOCUMENTATION AND DATA RETRIEVAL SYSTEM;

"APPENDIX B--- MANAGEMENT AND SERVICES FOR ACCOMPLISHMENT OF MICROFILMING, MICROREPRODUCTION AND LIBRARY PROCESSING SERVICES;

"APPENDIX C--- MANAGEMENT, SERVICES, FACILITIES, SUPPLIES AND EQUIPMENT NECESSARY TO PERFORM GRAPHIC ART AND RELATED SERVICES;

"APPENDIX D--- MANAGEMENT AND SERVICES NECESSARY TO PROVIDE SUPPLY CATALOGING, ITEM IDENTIFICATION, STANDARDIZATION AND LOGISTICAL REFERENCE LIBRARY SERVICES;

"APPENDIX E--- MANAGEMENT AND SERVICES NECESSARY TO PROVIDE PUBLICATIONS AND FORMS TRIBUTION.'

PROPOSALS WERE TO BE SUBMITTED IN TWO SEPARATE PARTS, THE FIRST PART BEING A MANAGEMENT PROPOSAL AND THE SECOND A COST PROPOSAL. PROPOSERS WERE ADVISED THAT THE CONTRACTOR SELECTED MUST POSSESS A WIDE RANGE OF EXPERIENCE TO DEMONSTRATE A CAPABILITY TO PERFORM THE MANAGEMENT AND RELATED SERVICES REQUIRED, AND THAT PROPOSERS MUST DEMONSTRATE A THOROUGH UNDERSTANDING OF THE SCOPE OF WORK INVOLVED AND THE MEANS BY WHICH A QUALIFIED STAFF CAN BE PROVIDED IN THE VARIOUS FIELDS OF ENDEAVOR. CONCERNING EVALUATION OF PROPOSALS, PROPOSERS WERE ADVISED THAT A SOURCE EVALUATION BOARD WOULD EVALUATE PROPOSALS IN THE LIGHT OF THE FOLLOWING MAJOR FACTORS:

"A. THE DEGREE, QUALITY AND PERTINENCE OF THE CONTRACTOR'S EXPERIENCE.

"B. THE CONTRACTOR'S UNDERSTANDING OF THE SCOPE AND COMPLEXITY OF THE WORK INVOLVED AND THE ADEQUACY OF HIS ORGANIZATION AND PLANNING TO ACCOMPLISH THE WORK AND TO CONTROL COST.

"C. THE EXPERIENCE AND AVAILABILITY OF KEY TECHNICAL AND MANAGEMENT PERSONNEL COMMITTED FOR THIS PROGRAM.

"D. THE COST PROPOSAL WILL BE CONSIDERED AS A REFLECTION OF THE CONTRACTOR'S UNDERSTANDING OF THE WORK AND THE PERTINENT FACTORS WHICH WILL AFFECT THE COST OF PERFORMING THIS CONTRACT.'

A PROPOSAL CONFERENCE WAS HELD ON MAY 6, 1965, AND THE QUESTIONS RAISED AND ANSWERED AT THAT CONFERENCE WERE COMMUNICATED TO ALL PROPOSERS ON MAY 11, 1965, FOR THEIR USE IN PREPARING PROPOSALS.

THE REQUEST FOR PROPOSALS WAS FURNISHED TO 105 FIRMS, 11 OF WHICH SUBMITTED SEPARATE MANAGEMENT AND COST PROPOSALS ON MAY 24 AND 27, 1965, RESPECTIVELY. THESE WERE FURNISHED TO THE SOURCE EVALUATION BOARD CONSISTING OF QUALIFIED TECHNICAL AND BUSINESS PERSONNEL OF NASA FOR EVALUATION AND RECOMMENDATION FOR AWARD. A POINT SYSTEM OF EVALUATION CRITERIA WAS ESTABLISHED TO WEIGH THE PROPOSALS AGAINST THE REQUIREMENTS OF THE REQUEST FOR PROPOSALS. SUBSEQUENT TO AN EVALUATION OF WRITTEN PROPOSALS, FIVE PROPOSERS, INCLUDING VOLT, WHICH WERE CONSIDERED EITHER TO BE WITHIN A COMPETITIVE RANGE OR THOUGHT TO HAVE STRONG POSSIBILITIES OF REACHING A COMPETITIVE STATUS, WERE INVITED TO MAKE ORAL PRESENTATIONS ON JUNE 3, 1965. HOWEVER, IN ITS ORAL PRESENTATION, VOLT FAILED TO SHOW A MANAGEMENT CAPABILITY THAT WOULD HAVE TENDED TO BRING IT WITHIN COMPETITIVE RANGE OF THE FOUR HIGHEST RANKED PROPOSERS, I.E., FEDERAL ELECTRIC, RCA, PHILCO AND LOCKHEED.

AFTER COMPLETION OF ITS STUDIES AND EVALUATION, THE SOURCE EVALUATION BOARD PRESENTED ITS FINDINGS ON JUNE 30, 1965, TO THE ADMINISTRATOR FOR APPROVAL AND APPROPRIATE ACTION. BY PRESS RELEASE DATED JULY 1, 1965, NASA ANNOUNCED THAT FEDERAL ELECTRIC WAS SELECTED AS THE PROPOSER WITH WHOM CONTRACT NEGOTIATIONS WOULD BE CONDUCTED. WE ARE ADVISED INFORMALLY BY NASA THAT A CONTRACT WOULD BE EXECUTED WITH FEDERAL ELECTRIC ON OR ABOUT SEPTEMBER 1, 1965.

OUR OFFICE HAS BEEN REQUESTED TO TREAT AS CONFIDENTIAL THE ADMINISTRATIVE REPORT FURNISHED ON YOUR PROTEST SINCE DISCLOSURE IN DETAIL WOULD BE CONTRARY TO NASA PROCUREMENT REGULATION 3.106-3 (B) (1) WHICH PROVIDES, IN PART, THAT:

"* * * IN NO EVENT WILL ANY OFFEROR'S COST BREAKDOWN, PROFIT, OVERHEAD RATES, TRADE SECRETS, MANUFACTURING PROCESSES AND TECHNIQUES, OR OTHER CONFIDENTIAL BUSINESS INFORMATION BE DISCLOSED TO ANY OTHER OFFEROR.'

HOWEVER, IN CONSONANCE WITH THE REGULATION, THERE ARE QUOTED BELOW FOR YOUR INFORMATION LIMITED EXTRACTS FROM THE NASA REPORT WHICH APPEAR TO BE RESPONSIVE TO SOME OF THE MATTERS RAISED BY YOU RESPECTING THE EVALUATION OF YOUR PROPOSALS. BUT WE DO NOT FEEL THAT IT WOULD BE APPROPRIATE FOR US TO DISCUSS THE RELATIVE MERITS OR DEFICIENCIES OF YOUR PROPOSALS IN THE LIGHT OF OTHER PROPOSALS SINCE WE CANNOT, IN RETROSPECT, SUBSTITUTE OUR JUDGMENT FOR THAT OF NASA WHICH IS CHARGED BY STATUTE WITH THE ADMINISTRATION OF THE MANNED SPACECRAFT PROGRAM.

"VOLT'S ALLEGATIONS TO THE EFFECT THAT ITS PRICE IS SUBSTANTIALLY LOWER THAN FEC-S, THAT NASA CAN EFFECT A TOTAL SAVING OF 1.227 MILLION DOLLARS IN THREE YEARS BY CONTRACTING WITH VOLT AND THAT VOLT IS BETTER QUALIFIED THAN FEC ARE FULLY DISCUSSED IN THE CONTRACTING OFFICER'S STATEMENT. WHILE IT IS TRUE THAT VOLT'S TOTAL ESTIMATED COST WAS LOWER THAN FEC-S, SOME QUESTION AROSE AS TO THE ACCURACY OF VOLT'S ESTIMATE. IT WILL BE NOTED THAT THE COMPOSITE LABOR RATE ESTIMATE BY VOLT ($2.28 PER HOUR), WAS SUBSTANTIALLY LOWER THAN THE AVERAGE OF ALL PROPOSALS ($2.72), AND CONSIDERABLY LOWER THAN THE GOVERNMENT ESTIMATE ($3.04), WHICH WAS BASED PRIMARILY ON LABOR RATES PRESENTLY BEING PAID ON NASA CONTRACTS FOR SIMILAR KINDS OF WORK IN THE HOUSTON AREA.

"* * * WHILE THERE IS NO BASIS TO QUESTION VOLT'S ASSERTIONS THAT IT HAS A LARGE WORK STAFF AND THAT IT IS EXPERIENCED IN ALL AREAS OF THE RFP, IT MUST BE BORNE IN MIND THAT FAILURE OF A PROPOSAL TO BE ACCEPTED FOR AWARD DOES NOT NECESSARILY MEAN THAT SUCH PROPOSAL IS SERIOUSLY DEFICIENT, BUT SIMPLY MEANS THAT ANOTHER PROPOSAL IS CONSIDERED TO BE MORE ADVANTAGEOUS TO THE GOVERNMENT.'

IN NEGOTIATED PROCUREMENTS, THE RULES OF FORMALLY ADVERTISED COMPETITIVE BIDDING, SUCH AS THE REQUIREMENT FOR AWARD TO THE LOWEST RESPONSIVE, RESPONSIBLE BIDDER, ARE NOT APPLICABLE AND THE NEGOTIATION AUTHORITY MAY LEGALLY TAKE INTO CONSIDERATION ALL FACTORS DEEMED ESSENTIAL TO THE ACCOMPLISHMENT OF A PROCUREMENT. 40 COMP. GEN. 508.

THERE HAS NOT BEEN PRESENTED INFORMATION WHICH COULD BE REGARDED AS EVIDENCING ANY IMPROPER ACTION ON THE PART OF THE CONTRACTING OFFICE IN CONNECTION WITH ITS EVALUATION OF PROPOSALS UNDER THE REQUEST FOR PROPOSAL, AND WE DO NOT FIND ANYTHING IN THE RECORD BEFORE OUR OFFICE WHICH WOULD WARRANT OUR QUESTIONING THE NEGOTIATION PROCEDURES USED OR AN AWARD TO THAT PROPOSER WHOSE SERVICES ARE DETERMINED TO BE MOST ADVANTAGEOUS TO THE GOVERNMENT.