B-170206(2), MAR 29, 1971

B-170206(2): Mar 29, 1971

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CORRECTIVE ACTION IN OPTION RESOLICITATION IS SUGGESTED. TO ROWLEY AND SCOTT: FURTHER REFERENCE IS MADE TO YOUR TELEGRAM OF JUNE 30. THIS PROCUREMENT IS ALSO THE SUBJECT OF A PROTEST FILED BY DYNAMIC ENTERPRISES. SHOULD THE CONTRACTING OFFICER DETERMINE THAT A LESS THAN SATISFACTORY LEVEL OF PERFORMANCE IS CAUSED BY PERSONNEL STAFFING BELOW THAT SET FORTH IN ATTACHMENT A. THE CONTRACTOR IS RESPONSIBLE IN ANY EVENT FOR SUPPLYING SUFFICIENT PERSONNEL TO PERFORM THE CONTRACT SATISFACTORILY.". REVIEW BY THE CONTRACTING OFFICER AND THE FOOD SERVICE OFFICER INDICATED THAT FURTHER NEGOTIATIONS WERE REQUIRED WITH THE OFFERORS IN ORDER TO RESOLVE UNCERTAINTIES IN THE OFFERS SUBMITTED. MANPOWER WAS INFORMED BY THE CONTRACTING OFFICER THAT ITS PROPOSAL WAS CONSIDERED TO BE INADEQUATE IN THAT THE TOTAL MANHOURS OFFERED WERE APPROXIMATELY 74 PERCENT OF THE MINIMUM AMOUNT ESTIMATED TO PERFORM THE REQUIRED SERVICES.

B-170206(2), MAR 29, 1971

BID PROTEST - QUESTIONABLE NEGOTIATION PROCEDURES DECISION DENYING PROTESTS AGAINST NEGOTIATED AWARD TO MILITARY BASE MANAGEMENT, INC., FOR FURNISHING MESSING SERVICES TO NAVY ON BASIS THAT RECORD DOES NOT SUPPORT CONCLUSION THAT PROCEDURAL NEGOTIATION DEFECT REQUIRES CANCELLATION. HOWEVER, CORRECTIVE ACTION IN OPTION RESOLICITATION IS SUGGESTED.

TO ROWLEY AND SCOTT:

FURTHER REFERENCE IS MADE TO YOUR TELEGRAM OF JUNE 30, 1970, AND SUBSEQUENT CORRESPONDENCE PROTESTING ON BEHALF OF MANPOWER, INCORPORATED (MANPOWER), OF JACKSON, MISSISSIPPI, AGAINST THE AWARD OF A CONTRACT TO MILITARY BASE MANAGEMENT, INC. (MBM), UNDER SOLICITATION NO. N00204-70-R- 0029, ISSUED BY THE NAVAL AIR STATION, PENSACOLA, FLORIDA. THIS PROCUREMENT IS ALSO THE SUBJECT OF A PROTEST FILED BY DYNAMIC ENTERPRISES, INC.

THE SUBJECT RFP, ISSUED ON MARCH 16, 1970, SOLICITED OFFERS FOR FURNISHING LABOR AND MATERIALS TO PERFORM MESS ATTENDANT SERVICES IN SUBSISTENCE BUILDING 122 AT THE NAVAL CONSTRUCTION BATTALION CENTER, GULFPORT, MISSISSIPPI, DURING THE PERIOD JULY 1, 1970, THROUGH JUNE 30, 1971.

SECTION 5.0(A) OF THE RFP PROVIDED THAT:

"SECTION 5.0 - NOTICES TO OFFERORS

"(A) ALL OFFERORS SHALL SUBMIT WITH THEIR PROPOSAL, A MANNING CHART IN THE FORMAT OF ATTACHMENT A, SHOWING THE ESTIMATED NUMBER OF PERSONNEL REQUIRED IN EACH SPACE EACH HALF HOUR OF A REPRESENTATIVE WEEKDAY TO SATISFACTORILY PERFORM THE CONTRACT SERVICES. NOTHING IN THIS SECTION, OR ELSEWHERE IN THIS CONTRACT SHALL BE CONSTRUED AS LIMITING THE CONTRACTOR'S RESPONSIBILITY FOR PROVIDING SUFFICIENT PERSONNEL TO ACCOMPLISH ALL OF THE REQUIREMENTS SET FORTH HEREIN."

WITH RESPECT TO THE MANNING CHART, SECTION 9.36 OF THE RFP PROVIDED THAT:

"9.36 - STAFFING LEVELS (NUMBER OF EMPLOYEES)

"THE STAFFING LEVELS ENTERED BY THE CONTRACTOR ON THE MANNING CHARTS (ATTACHMENT A) SHALL BECOME AN INTEGRAL PART OF THE CONTRACT, AND THE CONTRACTING OFFICER MAY REQUIRE THAT THIS STAFFING LEVEL BE FULFILLED SHOULD PERFORMANCE OF THIS CONTRACT FALL BELOW ACCEPTABLE STANDARDS. THE CONTRACTOR MAY BE REQUIRED TO MAKE MONETARY ADJUSTMENTS FOR ANY MANHOURS LESS THAN THOSE SPECIFIED, SHOULD THE CONTRACTING OFFICER DETERMINE THAT A LESS THAN SATISFACTORY LEVEL OF PERFORMANCE IS CAUSED BY PERSONNEL STAFFING BELOW THAT SET FORTH IN ATTACHMENT A, MANNING CHART. NOTWITHSTANDING THE FOREGOING, THE CONTRACTOR IS RESPONSIBLE IN ANY EVENT FOR SUPPLYING SUFFICIENT PERSONNEL TO PERFORM THE CONTRACT SATISFACTORILY."

TEN FIRMS SUBMITTED OFFERS IN RESPONSE TO THE SOLICITATION. REVIEW BY THE CONTRACTING OFFICER AND THE FOOD SERVICE OFFICER INDICATED THAT FURTHER NEGOTIATIONS WERE REQUIRED WITH THE OFFERORS IN ORDER TO RESOLVE UNCERTAINTIES IN THE OFFERS SUBMITTED. BY LETTER OF APRIL 21, 1970, MANPOWER WAS INFORMED BY THE CONTRACTING OFFICER THAT ITS PROPOSAL WAS CONSIDERED TO BE INADEQUATE IN THAT THE TOTAL MANHOURS OFFERED WERE APPROXIMATELY 74 PERCENT OF THE MINIMUM AMOUNT ESTIMATED TO PERFORM THE REQUIRED SERVICES, AND WERE THEREFORE CONSIDERED TO BE INSUFFICIENT, AND PRICING WAS ALSO QUESTIONABLE. IN A LETTER DATED APRIL 27, 1970, MANPOWER RESPONDED THAT ITS OFFERED PRICE AND PROPOSED MANNING CHARTS WERE CONSIDERED TO BE CORRECT AND ADEQUATE.

SUBSEQUENTLY, IT WAS NOTED THAT THE MANNING CHARTS ISSUED WITH THE SOLICITATION WERE MISLEADING IN THAT A SEPARATE CHART WAS FURNISHED FOR THE WEEKDAY PERIOD OF MONDAY THROUGH FRIDAY, AND ONE FOR THE WEEKEND DAY PERIOD OF SATURDAY, SUNDAY AND HOLIDAYS. HOWEVER, SECTION 11.7(A)(1) OF THE SPECIFICATIONS REQUIRED OPERATION OF FOUR SERVING LINES ON SATURDAY, AS WAS REQUIRED MONDAY THROUGH FRIDAY, THE ONLY DIFFERENCE BEING THAT IT WAS ESTIMATED THAT A FEWER NUMBER OF MEALS WOULD BE SERVED ON SATURDAY. THEREFORE, BY LETTER OF MAY 8, 1970, ALL OFFERORS WERE SPECIFICALLY INFORMED OF THIS DISCREPANCY AND WERE FURNISHED REVISED MANNING CHARTS MARKED "WEEKDAY MONDAY THROUGH SATURDAY" AND "WEEKEND DAY SUNDAY/HOLIDAY," AND EACH OFFEROR WAS ALLOWED TO SUBMIT REVISED PROPOSALS.

THE LETTER OF MAY 8 ADVISED YOUR FIRM IN PART:

"A THOROUGH EVALUATION OF YOUR OFFER AND LETTER OF 27 APRIL 1970 LEAVES US UNSURE THAT YOU HAVE UNDERSTOOD OUR LETTER OF 21 APRIL 1970. IT IS AGAIN EMPHASIZED THAT YOUR PROPOSED CONTRACT MANNING IS NOT CONSIDERED SUFFICIENT TO PERFORM ANY RESULTING CONTRACT SATISFACTORILY. THE FOLLOWING POINTS ARE TYPICAL EXAMPLES OF OUR CONCERN WITH YOUR PROPOSED MANNING:

1. IN VIEW OF THE NECESSITY FOR OPERATION OF TWO SCULLERIES FOR EACH WEEKDAY MEAL PERIOD, THE VARIED STAFFING PROPOSED FOR BREAKFAST AND SUPPER VS THAT PROVIDED FOR DINNER IS NOT UNDERSTOOD.

2. YOUR WEEKEND MANNING IS UNDERSTAFFED FOR SATISFACTORY COVERAGE OF THE SERVING LINE DURING ALL MEALS.

3. IT IS UNCLEAR WHY MORE PEOPLE ARE PROPOSED FOR THE POLICING FUNCTION ON WEEKENDS THAN DURING THE WEEK FOR BREAKFAST AND SUPPER.

IN ADDITION TO THE FOREGOING POINTS IT DOES NOT APPEAR FEASIBLE FOR YOUR FIRM TO PROVIDE THE INSUFFICIENT MANNING NOW BEING PROPOSED WITHIN THE PRICE YOU HAVE OFFERED."

YOUR FIRM'S RESPONSE OF MAY 14, 1970, INDICATED THAT "WE HAVE REVISED OUR MANNING CHARTS TO ALLEVIATE THE DEFICIENCIES NOTED" AND INCREASED YOUR PRICE ACCORDINGLY.

THE FOLLOWING REVISED OFFERS WERE RECEIVED IN RESPONSE TO THE CONTRACTING OFFICER'S LETTER OF 8 MAY 1970:

TOTAL HOURS OF MANNING

OFFEROR YEARLY AMOUNT (NET) OFFERED YEARLY

MANPOWER OF JACKSON $239,932.80 108,720

JCM CORPORATION 266,109.63 109,820

INDUSTRIAL MAINTENANCE 269,310.00 95,127.5

JOHN CHRISMAN & ASSOCIATES 270,832.00 116,957

SPACE SERVICES OF GEORGIA 271,080.00 123,840

DYNAMIC ENTERPRISES280,530.00 116,126.5

MILITARY BASE MANAGEMENT 297,000.00 127,075

WORLDWIDE SERVICES 299,248.06 129,507

WEBSTER CONTRACTORS 303,857.00 121,762.5

DIVERSIFIED SERVICES 321,588.00 131,410

THE CONTRACTING OFFICER CONCLUDED AFTER REVIEW OF THE FINAL OFFERS THAT MANPOWER'S REVISED OFFER STILL DID NOT MEET THE SOLICITATION REQUIREMENTS BECAUSE OF EXTREME DEFICIENCIES IN THE MANNING SCHEDULE UNDER CLEANING FUNCTIONS IN THE DISHWASHING (SCULLERY), AND PAN WASHING AREAS, AND UNDER FOOD HANDLING FUNCTIONS IN THE VEGETABLE PREPARATION ROOM AND ON THE SERVING LINES. CONSEQUENTLY, HE DETERMINED THAT MBM HAD PROPOSED THE MOST ADVANTAGEOUS OFFER TO THE GOVERNMENT, PRICE AND OTHER FACTORS CONSIDERED, SINCE "OF ALL THE ACCEPTABLE OFFERS, MBM'S PROPOSAL OFFERED MORE HOURS AT LESS COST AS COMPARED TO THE OTHER ACCEPTABLE OFFERS." AWARD WAS MADE TO MBM ON JUNE 24, 1970.

THE BASIS OF YOUR PROTEST IS THAT OFFERORS WERE NOT PROPERLY ADVISED AS TO THE BASIS OF THE EVALUATION OF OFFERS, AND THERE IS NO PROVISION IN THE SPECIFICATIONS TO INDICATE THAT AWARD WOULD BE MADE TO THAT RESPONSIBLE OFFEROR WHO OFFERED THE MOST HOURS AT THE LEAST COST. ALSO, BY LETTER OF JUNE 17, 1970, TO THE CONTRACTING OFFICER YOU PROTESTED THE AWARD TO MBM UNTIL THE SMALL BUSINESS ADMINISTRATION (SBA) SIZE APPEALS BOARD AND OUR OFFICE HAD RULED ON THE SIZE STATUS OF MBM BASED UPON AN EARLIER PROTEST BY TIDEWATER MANAGEMENT SERVICES, INC. (TIDEWATER), A WHOLLY OWNED SUBSIDIARY OF YOUR FIRM, UNDER ANOTHER PROCUREMENT ISSUED BY THE NAVAL REGIONAL PROCUREMENT OFFICE, OAKLAND, CALIFORNIA.

WITH REGARD TO THIS CONTENTION CONCERNING MBM'S SIZE STATUS, THE ADMINISTRATIVE REPORT TO OUR OFFICE ADVISES THAT THE LUBBOCK, TEXAS, REGIONAL OFFICE OF SBA CERTIFIED ON JUNE 17, 1970, THAT MBM WAS A SMALL BUSINESS CONCERN IN REPLY TO A PROTEST BY DYNAMIC ENTERPRISES, INC., AND SINCE SBA'S LETTER OF JUNE 17 WAS RECEIVED THE SAME DATE AS YOUR LETTER OF PROTEST, THE ACTIVITY INADVERTENTLY TOOK NO ACTION ON YOUR PROTEST, EXCEPT TO NOTIFY YOU BY LETTER OF JULY 1, 1970, OF THE SIZE DETERMINATION MADE BY THE SBA. ENCLOSED IS A COPY OF OUR DECISION B 169939, AUGUST 18, 1970, TO TIDEWATER DENYING ITS PROTEST RELATIVE TO THE SAME MATTER. FOR THE REASONS STATED THEREIN, WE CANNOT CONCLUDE THAT SUCH PROCEDURAL OMISSION WOULD PROVIDE A LEGAL BASIS FOR DISTURBING THE AWARD TO MBM.

TURNING THEN TO THE MERITS OF THE PRINCIPAL BASIS OF YOUR PROTEST, IN B- 167685, OCTOBER 21, 1969, WE STATED:

"IN A NEGOTIATED PROCUREMENT, THE RULES OF FORMALLY ADVERTISED, COMPETITIVE BIDDING, SUCH AS THE REQUIREMENT FOR AWARD TO THE LOWEST RESPONSIVE, RESPONSIBLE BIDDER, ARE NOT CONTROLLING AND A CONTRACTING OFFICER MAY TAKE INTO CONSIDERATION ALL FACTORS DEEMED ESSENTIAL TO THE PROCUREMENT GOAL. WE VIEW THE INFORMATION TO BE SECURED FROM AN OFFEROR'S MANNING CHART AS AN AID TO THE CONTRACTING OFFICER IN DETERMINING WHETHER THE OFFEROR IS WITHIN A COMPETITIVE RANGE FOR NEGOTIATION PURPOSES. THIS PROCUREMENT, MOREOVER, THE MANNING CHART REPRESENTED THE OFFEROR'S BASIC APPROACH TO PERFORMING THE REQUIRED SERVICES. THE GOAL OF THIS NEGOTIATED PROCUREMENT WAS TO PROCURE SERVICES FROM A RESPONSIBLE SOURCE AT FAIR AND REASONABLE PRICES WHICH ARE CALCULATED TO RESULT IN THE LOWEST ULTIMATE OVERALL COST TO THE GOVERNMENT. SEE PARAGRAPH 3-801.1 OF THE ARMED SERVICES PROCUREMENT REGULATION (ASPR). IN ADDITION, ASPR 3-806(A) STATES THAT 'THE OBJECTIVE OF THE CONTRACTING OFFICER SHALL BE TO NEGOTIATE FAIR AND REASONABLE PRICES IN WHICH DUE WEIGHT IS GIVEN TO ALL RELEVANT FACTORS, INCLUDING THOSE IN 3-101.' ASPR 3-101 STATES THAT WHEN NEGOTIATIONS ARE ENTERED INTO DUE ATTENTION SHALL BE GIVEN TO A NUMBER OF FACTORS, INCLUDING 'CONSIDERATION OF THE SOUNDNESS OF PROSPECTIVE CONTRACTORS' MANAGEMENT OF LABOR RESOURCES, INCLUDING WAGE RATES, NUMBER OF WORKERS AND TOTAL ESTIMATED LABOR HOURS.' ASPR 3-101 (XV). THUS, IT IS EVIDENT THAT THE DETERMINATION OF AN APPROPRIATE LEVEL OF MANNING NECESSARY TO PERFORM THE WORK UNDER A PROPOSED PROCUREMENT IS A LEGITIMATE AND PROPER SUBJECT FOR NEGOTIATION. SEE B-166705, JULY 30, 1969."

WE BELIEVE THE ABOVE STATEMENT IS EQUALLY APPLICABLE TO THE PRESENT SITUATION. FURTHER, WE BELIEVE THAT IN KEEPING WITH THIS RULE, A MORE DEFINITIVE STATEMENT SHOULD HAVE BEEN CONTAINED IN THE SOLICITATION ADVISING OFFERORS THE EXACT ROLE THE MANNING CHARTS WERE TO PLAY IN THE EVALUATION OF OFFERS, ESPECIALLY IN VIEW OF THE FACT THAT OFFERORS PRESENTLY ARE ADVISED THAT, NOTWITHSTANDING THE NUMBER OF MANNING HOURS OFFERED, THE CONTRACTOR IS RESPONSIBLE IN ANY EVENT FOR SUPPLYING SUFFICIENT PERSONNEL TO PERFORM THE CONTRACT SATISFACTORILY, AND OFFERORS ARE CAUTIONED AGAINST PLACING UNDUE EMPHASIS ON CONTRACT MANNING AS BEING THE PRINCIPAL EVALUATION CRITERION. IN THIS REGARD, WE HAVE HELD THAT SOUND PROCUREMENT POLICY REQUIRES OFFERORS TO BE INFORMED OF ALL EVALUATION FACTORS AND OF THE RELATIVE WEIGHTS TO BE ATTACHED TO EACH FACTOR, B-167983, MARCH 11, 1970, AND WE FEEL THAT THE FAILURE TO SO ADVISE OFFERORS IN THE INSTANT PROCUREMENT WAS NOT CONDUCIVE TO OBTAINING PROPOSALS OFFERING THE MAXIMUM COMPETITION AND MOST REASONABLE PRICES.

WHILE WE DO NOT QUESTION THE CONTRACTING OFFICER'S FINAL DETERMINATION THAT YOUR MANNING SCHEDULE WAS DEFICIENT IN THE SPECIFIED AREAS OF OPERATION, WE THINK THAT IF MEANINGFUL NEGOTIATIONS WERE TO BE CONDUCTED, THE CONTRACTING OFFICER SHOULD HAVE ADVISED YOUR FIRM PRIOR TO THE CLOSE OF NEGOTIATIONS THAT YOUR THEN CURRENT OFFER WAS CONSIDERED TO BE OUTSIDE THE COMPETITIVE RANGE.

IT IS OUR VIEW, HOWEVER, THAT THE CIRCUMSTANCES SURROUNDING THE AWARD TO MBM DO NOT DISCLOSE SUCH A CLEAR ABUSE OF DISCRETION BY THE CONTRACTING OFFICER, OR THAT THERE IS ANY BASIS FOR IMPUTATION OF BAD FAITH ON HIS PART, SO AS TO AFFECT THE LEGALITY OF THE CONTRACT AWARDED TO MBM. VIEW THEREOF WE SEE NO ADEQUATE BASIS FOR DIRECTING CANCELLATION OF MBM'S CONTRACT AND, TO THE EXTENT YOUR PROTEST REQUESTED SUCH ACTION IT IS DENIED.

WE ARE, HOWEVER, ADVISING THE SECRETARY OF THE NAVY THAT IN THE LIGHT OF THE QUESTIONABLE NEGOTIATING PROCEDURES USED, EXERCISE OF THE OPTION IN THE CONTRACT AWARDED WOULD BE CONSIDERED IMPROPER BY OUR OFFICE, AND THAT OFFERS FOR THE SERVICES FOR NEXT YEAR SHOULD BE RESOLICITED UNDER REVISED PROCEDURES WHICH WILL MORE FULLY ADVISE OFFERORS OF THE FACTORS ON WHICH AN AWARD WILL BE BASED.