B-231516, Aug 22, 1988

B-231516: Aug 22, 1988

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The issue is deemed abandoned. General Accounting Office will not consider an allegation that a firm is not a small disadvantaged business. Since the conclusive authority to decide such matters is vested with the Small Business Administration. Unsupported and spectulative allegations that an agency may not have fully and fairly evaluated protester's proposal. Are untimely and otherwise fail to provide a basis for protest. Is entitled to award of the contract for hospital housekeeping services at WBAMC. Offerors also were notified that the proposal selected as most advantageous to the government would be compared with the government's "in-house" cost estimate with award to be made only if the cost of contracting was lower than the government's estimate of performing the work in-house.

B-231516, Aug 22, 1988

PROCUREMENT - Bid Protests - Allegation - Abandonment DIGEST: 1. Where the agency specifically rebuts an issue raised in the initial protest and protester fails to address the agency's rebuttal in its comments on the agency's report, the issue is deemed abandoned. PROCUREMENT - Socio-Economic Policies - Small businesses - Disadvantaged business set-asides - Eligibility - Determination 2. General Accounting Office will not consider an allegation that a firm is not a small disadvantaged business, eligible for a set-aside award, since the conclusive authority to decide such matters is vested with the Small Business Administration. PROCUREMENT - Bid Protests - GAO procedures - Protest timeliness - 10-day rule 3. Unsupported and spectulative allegations that an agency may not have fully and fairly evaluated protester's proposal, raised for the first time in protester's comments, are untimely and otherwise fail to provide a basis for protest.

Star Housekeeping Inc.:

Star Housekeeping Inc. protests award of a contract to J&J Maintenance, Inc., under request for proposals (RFP) No. DADA09-86-R 0032 issued by the William Beaumont Army Medical Center (WBAMC), El Paso, Texas. Star contends that it, not J&J, is entitled to award of the contract for hospital housekeeping services at WBAMC.

We dismiss the protest.

The solicitation, a total small disadvantaged business set-aside, provided that award would be made to the responsible offeror whose offer would be most advantageous to the government, price and other factors considered. See Federal Acquisition Regulation (FAR) Sec. 52.215-16 (FAC 84-17) (incorporated by reference in the solicitation). The RFP listed the evaluation factors in descending order of importance with "Ability to perform requirements listed in PWS (Performance Work Statement)," most important; "Technical Proposal" slightly more important than "Management Proposal;" and "Price," least important. Offerors also were notified that the proposal selected as most advantageous to the government would be compared with the government's "in-house" cost estimate with award to be made only if the cost of contracting was lower than the government's estimate of performing the work in-house.

After evaluation of the proposals received, including two rounds of best and final offers (BAFOs), the technical review group established a final competitive range within which J&J ranked first and Star ranked third as to technical and management quality. Prior to receipt of the second round of BAFOs, the contracting officer had requested separate Defense Contract Administration Services Management Area (DCASMA) offices to perform preaward surveys of all the offerors in the competitive range "in order to preclude any lapse of time in case of adverse recommendations, default or protest." A positive preaward survey of J&J was completed by May 12, 1988, and since as explained below that firm's proposal was deemed most advantageous to the government, it was selected for award. The preaward survey of Star, which also resulted in a positive recommendation, was in progress at the time the award selection was announced.

The technical evaluation group considered J&J's proposal superior because it clearly and concisely addressed all the government's requirements without any identifiable weaknesses; it documented more than adequate credentials and experience; and it provided detailed information and specifics with regard to how the PWS requirements would be executed. While Star's proposal had no major deficiencies, the review group found it inferior to J&J's because it contained only minimal specific criteria to evaluate how PWS requirements would be met, and Star's limited corporate experience would not allow for a higher rating. The contracting officer evaluated and accepted the review group's findings and recommendations that J&J was technically superior to Star.

For evaluation purposes, each offeror's prices for the base and 4 option years were added together. Star's 5-year price was found to be less than $300,000 lower than J&J's price of $7,522,320 and the contracting officer determined that J&J's technical superiority outweighed the savings. The contracting officer considered that the critical nature of a medical center's environment with regard to patient care and research necessitated choosing the contractor whose proposal demonstrated the best understanding of the PWS requirements and ability to achieve them in order to eliminate "unwarranted risk."

The comparison of the cost of contracting with J&J with that of performing the work in-house established that contracting with J&J would save the government approximately $2.5 million. Therefore, a conditional award was made to J&J. /1/ Star then filed its protest with this Office.

In the firm's initial protest, Star's president asserted that the RFP did not provide for technical factors to be weighed more than price in the evaluation of proposals. In support of that argument it referred to a statement in the RFP's explanation of the in-house cost comparison advising that only the lowest, technically acceptable offer would be compared to the government's estimate. Star argued that as a responsible prospective contractor which had submitted the lowest price and a technically acceptable proposal, it was entitled to the award under the RFP. Star also questioned whether the awardee qualified as a small disadvantaged business concern.

In its report to our Office, the Army stated that Star's protest suggested it may have misunderstood some of the circumstances of this procurement, including the evaluation scheme contained in the RFP. Specifically, the Army agreed with Star that it was responsible and had submitted the low offer. The Army also found Star's technical proposal was acceptable, but concluded the firm's relatively small price advantage did not overcome the technical superiority of J&J's proposal under the RFP which-- contrary to Star's assertion-- did make technical considerations predominant over price.

Indeed, we note that Star now has abandoned the assertion it made in its original protest that nothing in the RFP indicated that technical factors would outweigh price. The Army has established that the RFP evaluation scheme clearly provided that technical factors were more important than price. The Army further explained that the language on which Star relied pertained only to the in-house cost evaluation and not to the evaluation of proposals for award. In its comments to the report, Star made no attempt to rebut the Army's response. Where an agency specifically addresses an issue raised by the protester in the initial protest letter and the protester fails to rebut the agency's response in its comments, we consider the issue to have been abandoned by the protester. PacOrd, Inc., B-224249, Jan. 5, 1987, 87-1 CPD Para. 7. We therefore will not consider it further.

In addition, we will not resolve Star's protest that J&J may not be a small disadvantaged business. The SBA has conclusive authority to determine the disadvantaged status of a small business. See Proposed Rules, published at 53 Fed.Reg. 21482 (1988) to be codified at 13 C.F.R. Part 124. This basis of protest therefore is dismissed.

In comments on the Army report, counsel for Star now characterizes the company's protest as that:

"... it believes its offer under said solicitation was not fairly evaluated, was not evaluated in accordance with the terms of the solicitation, and was never fully evaluated. Accordingly, Star believes that its offer was not fairly and properly compared with the offers received from other potential contractors and that the conditional award made by the procuring agency to J&J ... may therefore be inappropriate."

This "suspicion," counsel states, is "borne out" by the fact that the agency proceeded with its award decision before the preaward survey on Star was completed and is "corroborated" by the agency's "refusal" to provide Star with a "detailed explanation" of how its proposal was evaluated. In addition, it is argued that because the solicitation did not disclose the "specific (numerical) value" of the evaluation criteria and the preaward survey of Star was not complete as of time of award "it would appear that an abuse of the (RFP's evaluation) formula may well have occurred."

We note that in its initial protest Star argued that it was entitled to the award of this contract based on an understanding of the relative weights of technical and price evaluation factors which has been shown to be incorrect. That is a different issue than the one now asserted: that its technical proposal was not fairly and fully evaluated. We dismiss this later-raised basis for protest as untimely, unsupported speculation.

Our Bid Protest Regulations require that a protest be filed within 10 working days after the basis of the protest is known or should have been known. 4 C.F.R. Sec. 21.2(a)(2) (1988). Where a protester initially files a timely protest, and later supplements it with new and independent grounds of protest, the later-raised allegations must independently satisfy the timeliness requirements. See Little Susitna Co., 65 Comp.Gen. 652 (1986), 86-1 CPD Para. 560. Inasmuch as all of the cited support circumstances-- the timing of the preaward survey, the amount of detail in the agency explanation, and the failure of the RFP to include the numerical weight assigned each evaluation factor-- were known or should have been known to Star as of the time of its initial protest, we perceive no reason why it could not have raised the evaluation issue at the outset.

Additionally, we note that the Army has explained it requested contemporaneous preaward surveys of all firms in the competitive range to avoid delays in the award process. While Star's preaward survey ultimately proved unnecessary because J&J, otherwise in line for award, received a favorable preaward somewhat earlier, that circumstance does not mean the award to J&J was improper. Star fails to explain why a preaward survey-- which is used to determine offeror responsibility-- incomplete at the time of award means that the evaluation of the technical acceptability of Star's proposal was in any way deficient.

With regard to the Army's alleged refusal to provide "any detailed explanation" of how its proposal was evaluated, we are unaware of any written request by Star for a debriefing. See FAR Sec. 15.1003 (FAC 84-12). In addition, in its report, the Army did discuss the basis for its conclusion that J&J was technically superior to Star, which the protester addressed only cursorily in its comments. In the absence of a debriefing request, we have difficult understanding how the Army has "refused" to provide information or how this rises above mere speculation as to whether Star's proposal was properly evaluated.

Similarly speculative is Star's assertion that an abuse of the evaluation formula "may well have occurred" because that formula was not included in the RFP. As protester notes in its comments, the precise numerical weight or formula employed in the evaluation of proposals need not be disclosed in the RFP. See FAR Sec. 15.605(e) (FAC 84-16). In the absence of specific allegations, mere speculation is insufficient as a basis for sustaining a protest. American Identification Products, Inc., B-227599, July 13, 1987, 87-2 CPD Para. 42.

Accordingly, the protest is dismissed.

/1/ The award was conditional to allow for public review of the cost comparison, as provided in the solicitation. See FAR Sec. 52.207-2 (FAC 84-29); Office of Management and Budget Circular A-76.