B-181411, DEC 5, 1974, 54 COMP GEN 468

B-181411, DEC 5, 1974, 54 COMP GEN 468

CONTRACTS - PROTESTS - TIMELINESS - NEGOTIATED CONTRACT IN SITUATION WHERE PROTESTER AFTER AWARD RECEIVED COPY OF AWARDEE'S PROPOSAL ON MAY 21 AND NOTED ALLEGED DEFICIENCY THEREIN, PROTEST FILED MORE THAN 5 WORKING DAYS THEREAFTER IS NOT UNTIMELY BECAUSE (1) AGENCY HAD SCHEDULED DEBRIEFING CONFERENCE FOR MAY 28 AND (2) PROTEST WAS FILED WITHIN 5 WORKING DAYS OF DEBRIEFING. 4 C.F.R. 20.2(A) (1974) URGES PROTESTERS TO SEEK RESOLUTION OF COMPLAINTS WITH CONTRACTING AGENCY AND DOES NOT REQUIRE FILING OF PROTEST AT GENERAL ACCOUNTING OFFICE WHERE IT WAS REASONABLE TO WITHHOLD PROTEST UNTIL CONTRACTING AGENCY EXPLAINED ITS POSITION AT DEBRIEFING. CONTRACTS - NEGOTIATION - SUBCONTRACTS - QUALIFICATIONS OF SUBCONTRACTORS WHERE SUCCESSFUL OFFEROR SUBMITTED QUALIFICATIONS OF TWO ALTERNATIVE SUBCONTRACTORS FOR EVALUATION WITH ITS PROPOSAL AND CONTRACTING OFFICER VERIFIED OFFICER'S ABILITY TO COMMIT HIGHEST EVALUATED OF TWO SUBCONTRACTORS, EVEN THOUGH OFFEROR HAD MADE NO FIRM COMMITMENT TO EITHER, MERELY HAVING OBTAINED FIRM QUOTES FROM BOTH, UNLIKE LISTING OF SUBCONTRACTOR REQUIREMENTS IN FORMALLY ADVERTISED INVITATIONS BY CERTAIN FEDERAL AGENCIES, AWARD WAS NOT IMPROPER SINCE NEITHER APPLICABLE PROCUREMENT REGULATIONS NOR REQUEST FOR PROPOSALS REQUIRED FIRM SUBCONTRACTOR COMMITMENT OR PRECLUDED PROPOSAL OF ALTERNATE SUBCONTRACTORS AND GOVERNMENT HAD RIGHT TO APPROVE SUBCONTRACTORS.

IN THE MATTER OF LAMBDA CORPORATION, DECEMBER 5, 1974:

REQUEST FOR PROPOSAL (RFP) RFP - 91 - 74 - HEW - OS WAS ISSUED BY THE DEPARTMENT OF HEALTH, EDUCATION, AND WELFARE (HEW), SEEKING OFFERS FOR THE INSTALLATION, TESTING AND OPERATION OF MANIPULATION TASKS AS PART OF HEW'S REVIEW OF THE NEW YORK CITY SCHOOL SYSTEM.

ONLY TWO OFFERORS SUBMITTED PROPOSALS IN RESPONSE TO THE RFP - LAMBDA CORPORATION AND DELTA RESEARCH CORPORATION. AFTER CONDUCTING NEGOTIATIONS WITH BOTH OFFERORS, AWARD WAS MADE TO DELTA ON APRIL 30, 1974, ON A COST- PLUS-FIXED-FEE BASIS.

ON MAY 6, 1974, LAMBDA ORALLY PROTESTED THE AWARD TO HEW. THIS PROTEST WAS, HOWEVER, WITHDRAWN ON MAY 7, 1974, IN VIEW OF THE SKETCHY INFORMATION THEN AVAILABLE TO LAMBDA. LAMBDA THEREFORE REQUESTED A COPY OF DELTA'S PROPOSAL AS WELL AS AN IMMEDIATE DEBRIEFING. A COPY OF DELTA'S PROPOSAL WAS FORWARDED TO THE PROTESTER ON MAY 20, 1974, AND WAS RECEIVED BY COUNSEL FOR LAMBDA ON MAY 21, 1974. ON MAY 28, 1974, LATER. THE DEBRIEFING CONFERENCE WAS HELD. LAMBDA'S PROTEST WAS FILED 3 DAYS

THE AGENCY CONTENDS LAMBDA'S PROTEST IS UNTIMELY UNDER OUR INTERIM BID PROTEST PROCEDURES AND STANDARDS, 4 C.F.R. SEC. 20.2(A) (1974), WHICH READS IN PERTINENT PART:

*** BID PROTESTS SHALL BE FILED NOT LATER THAN 5 (WORKING) DAYS AFTER THE BASIS FOR PROTEST IS KNOWN OR SHOULD HAVE BEEN KNOWN, WHICHEVER IS EARLIER. ***

THE AGENCY CITES IN SUPPORT OF ITS POSITION A STATEMENT MADE BY LAMBDA IN ITS JUNE 6 LETTER TO OUR OFFICE:

THIS PROTEST IS BASED UPON OUR REVIEW OF CERTAIN PORTIONS OF THE DELTA PROPOSAL AS WELL AS CERTAIN LIMITED INFORMATION RECEIVED AT A DEBRIEFING CONFERENCE HELD AT THE OFFICE OF THE CONTRACTING OFFICER ON MAY 28, 1974.

LAMBDA WENT ON IN ITS JUNE 6 SUBMISSION TO INDICATE THAT THE MAY 28, 1974, DEBRIEFING INFORMED IT OF THE VERY GENERAL PROCEDURES USED BY THE CONTRACTING OFFICER IN AWARDING THE CONTRACT (I.E., THAT AWARD WAS BASED ON PRICE AND OTHER FACTORS).

LAMBDA'S PROTEST IS, HOWEVER, BASED ON THE ABSENCE OF NECESSARY PERTINENT INFORMATION IN DELTA'S PROPOSAL REGARDING DELTA'S PROPOSED SUBCONTRACTING ARRANGEMENTS. THUS, THE AGENCY CONTENDS THAT SINCE LAMBDA SHOULD HAVE BEEN AWARE OF THIS DEFICIENCY ON MAY 21, ITS PROTEST TO OUR OFFICE MORE THAN 5 WORKING DAYS THEREAFTER IS UNTIMELY.

4. C.F.R., SUPRA, IN ADDITION TO THE STANDARD GOVERNING THE FILING OF BID PROTESTS QUOTED ABOVE, EXPRESSES A POLICY URGING PROTESTERS TO SEEK RESOLUTION OF THEIR COMPLAINTS INITIALLY WITH THE CONTRACTING AGENCY. LAMBDA'S ACTIONS COMPORTED WITH THIS POLICY BY ITS PARTICIPATION IN THE DEBRIEFING PRIOR TO FILING THE INSTANT PROTEST HERE. IN VIEW OF THE ABOVE POLICY, WE BELIEVE IT WOULD BE INCONGRUOUS TO FIND THIS PROTEST TO BE UNTIMELY WHERE THE PROTESTER WITHHELD FILING TO ATTEND A DEBRIEFING CONFERENCE SCHEDULED ONLY 8 DAYS LATER AT WHICH IT MAY HAVE FOUND THAT THERE WAS NO BASIS FOR PROTEST. THEREFORE, WE FEEL THAT THE MERE FACT THAT LAMBDA RECEIVED DELTA'S PROPOSAL ON MAY 20 DOES NOT COMMENCE THE RUNNING OF THE 5-WORKING-DAY PERIOD PRESCRIBED IN THE BID PROTEST PROCEDURES SINCE IT APPEARS TO HAVE BEEN REASONABLE FOR LAMBDA TO HAVE WITHHELD A PROTEST UNTIL AFTER THE AGENCY EXPLAINED ITS POSITION AT THE DEBRIEFING. BECAUSE LAMBDA PROTESTED HERE WITHIN 5 WORKING DAYS FROM THE DATE OF THE DEBRIEFING, WE MUST CONSIDER THE PROTEST TO HAVE BEEN TIMELY FILED.

SECTION IXB)(V) OF THE RFP STATES WITH REGARD TO THE CONTENTS OF THE OFFEROR'S TECHNICAL PROPOSAL THAT:

IF THE OFFEROR INTENDS TO SUBCONTRACT ANY PART OF THE WORK OR TO EMPLOY CONSULTANTS FOR ANY PHASE OF THE PROPOSED ACTIVITIES, HE WILL PROVIDE IN HIS PROPOSAL STATEMENT QUALIFICATIONS OF THOSE NOMINATED AND SPECIFIC DELINEATION OF THE TASKS TO BE PERFORMED BY SUCH SUBCONTRACTORS AND/OR CONSULTANTS.

THE RFP ALSO REQUIRED THAT:

*** THE COST PROPOSAL MUST INCLUDE BUDGETS DEVELOPED FOR EACH TASK ACTIVITY AND/OR DELIVERABLE PRODUCT, AT THE LOWEST LEVEL OF CONTRACT PROGRAM PLANNING, CONSISTENT WITH THE TECHNICAL APPROACH AND, AT THE SAME TIME, ALLOWING FOR IDENTIFICATION OF COST ELEMENTS FOR LABOR, MATERIALS, PRINTING, TRAVEL, SUBCONTRACTORS, CONSULTANTS, AND OVERHEAD. ***

IN ITS PROPOSAL, DELTA OFFERED TO SUBCONTRACT A PORTION OF THE REQUIRED COMPUTER PROGRAMMING. IT FURTHER STATED THAT THE SUBCONTRACTOR WOULD BE EITHER AMERICAN MANAGEMENT SYSTEMS (AMS) OR PLANNING RESEARCH CORPORATION (PRC) AND THAT IT HAD "*** FIRM QUOTATIONS FROM BOTH OF THESE SUPPLIERS, BUT HAS NOT YET COMMITTED TO EITHER ONE." DELTA'S PROPOSAL WENT ON TO INDICATE ITS INCLINATION TOWARD SUBCONTRACTING WITH AMS. HOWEVER, THE PROPOSED COSTS AND CAPABILITY DESCRIPTIONS OF BOTH PROPOSED SUBCONTRACTORS WERE INCLUDED IN THE DELTA PROPOSAL.

DELTA STATES IN A LETTER TO OUR OFFICE THAT:

AT THE TIME OF DELTA'S PROPOSAL SUBMISSION, WE HAD FIRM QUOTATIONS FROM TWO POTENTIAL SUBCONTRACTORS; EITHER OF THESE SUBCONTRACTORS WAS BOUND TO SUPPLY THE DESCRIBED SERVICES AT PRICES QUOTED, IF DELTA CHOSE TO PURCHASE THEM.

THE ESSENCE OF LAMBDA'S PROTEST GOES TO THE ALLEGED FAILURE OF DELTA TO COMPLY WITH WHAT LAMBDA CONSIDERS TO BE THE "FIRM COMMITMENT" OF SUBCONTRACTORS REQUIREMENT OF THE ABOVE-QUOTED PROVISIONS OF THE RFP. ACCORDING TO LAMBDA, THIS FAILURE GIVES DELTA THE IMPROPER OPTION AFTER AWARD OF SELECTING EITHER OF THE TWO SUBCONTRACTORS DELTA MENTIONED IN ITS PROPOSAL.

THE CONTRACTING OFFICER EVALUATED DELTA'S PROPOSAL ON THE BASIS OF DELTA'S USE OF AMS, AND ALTERNATIVELY PRC, AND FOUND THAT EITHER SUBCONTRACTOR WAS ACCEPTABLE TO THE GOVERNMENT. PRIOR TO CONTRACT AWARD, HE VERIFIED DELTA'S INTENT AND ABILITY TO COMMIT AMS TO THE PROJECT. CLAUSE 10 OF HEW FORM 316 (REV. 3/72) INCORPORATED INTO THE RFP STATES THAT:

*** THE CONTRACTOR SHALL NOT ENTER INTO ANY SUBCONTRACT OR PURCHASE ORDER NOT OTHERWISE EXPRESSLY AUTHORIZED ELSEWHERE IN THIS CONTRACT WITHOUT THE PRIOR WRITTEN APPROVAL OF THE CONTRACTING OFFICER AND SUBJECT TO SUCH CONDITIONS AS THE CONTRACTING OFFICER MAY REQUIRE. ***

WE HAVE REVIEWED THE DELTA PROPOSAL AND FIND NO BASIS TO DISAGREE WITH THE CONTRACTING OFFICER'S RELIANCE ON THE ADEQUACY OF THE INFORMATION CONTAINED THEREIN IN EVALUATING THE PROPOSALS. WE RECOGNIZE THAT OUR OFFICE HAS IN CERTAIN FORMALLY ADVERTISED PROCUREMENTS, FOUND THAT A BIDDER'S FAILURE TO FIRMLY COMMIT ITSELF TO A PARTICULAR SUBCONTRACTOR BY LISTING OF ALTERNATE POTENTIAL SUBCONTRACTORS COULD RENDER THE BID NONRESPONSIVE. SEE MATTER OF JAMES AND STRITZK CONSTRUCTION COMPANY, 54 COMP. GEN. 159 (1974); 50 ID. 839 (1971); 43 ID. 206 (1963). HOWEVER, THOSE DECISIONS INVOLVED INVITATIONS WHICH SPECIFICALLY REQUIRED BIDDERS TO LIST THE SUBCONTRACTORS TO BE UTILIZED ON PAIN OF HAVING THEIR BIDS REJECTED AS NONRESPONSIVE. CERTAIN FEDERAL AGENCIES EMPLOY THAT REQUIREMENT IN FORMALLY ADVERTISED PROCUREMENTS. NEITHER THE APPLICABLE PROCUREMENT REGULATIONS NOR THE PROVISIONS OF THE RFP HERE REQUIRED A FIRM SUBCONTRACTOR COMMITMENT OR PREVENTED THE SUBMISSION OF ALTERNATE PROPOSED SUBCONTRACTORS FOR TECHNICAL EVALUATION, WITH FIRM QUOTES FROM BOTH, SUBJECT TO THE CONDITION THAT NO SUBCONTRACT COULD BE ENTERED INTO WITHOUT GOVERNMENT APPROVAL. MOREOVER, INHERENT IN THE VERY NATURE OF COMPETITIVE NEGOTIATIONS IS THE CONCEPT THAT THE GOVERNMENT CAN INVESTIGATE AND EVALUATE WITHIN THE RFP'S EVALUATION FACTORS ALTERNATE MEANS OF ACCOMPLISHING THE CONTRACT OBJECTIVES OFFERED BY PROPOSERS.

IN THIS REGARD, WE SEE NO BASIS UPON WHICH THE CONTRACTING OFFICER SHOULD HAVE LIMITED HIS COMPARISON OF THE LAMBDA AND DELTA PROPOSALS ON THE BASIS OF DELTA USING PRC, WHICH ALLEGEDLY IS TECHNICALLY INFERIOR TO AMS, AS CONTENDED BY LAMBDA.

IN VIEW OF THE ABOVE, WE BELIEVE THAT AWARD TO DELTA WAS PROPER AND, ACCORDINGLY, THE PROTEST IS DENIED.

WE NOTE, AS DOES THE AGENCY, THAT A PREDETERMINED CUTOFF SCORE WAS USED IN THE EVALUATION OF PROPOSALS CONTRARY TO THE PROCUREMENT PROCEDURES OF HEW. WE CONCUR IN THE AGENCY'S POSITION THAT THIS FACT DOES NOT AFFECT THE PROPRIETY OF THE AWARD SINCE ALL OFFERORS WERE FOUND TO BE TECHNICALLY ACCEPTABLE. WE HAVE BEEN ADVISED THAT THE COGNIZANT PROCUREMENT OFFICE WILL BE ADMONISHED IN THIS REGARD AND ADVISED THAT FURTHER USE OF THIS TECHNIQUE MUST BE AVOIDED.