B-232500, B-232500.2, Jan 10, 1989, 89-1 CPD 21

B-232500,B-232500.2: Jan 10, 1989

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Protest that agency improperly awarded contract to an offeror that submitted a proposal that was technically equal to the protester's is denied where the record demonstrates that the procuring agency reasonably determined that the awardee's proposal was technically superior to the protester's proposal. Improperly conducted its debriefing and gave the protester late notice of award to another firm are dismissed as untimely since each basis was filed more than 10 working days after it was learned. Protest that contracting agency failed to conduct meaningful discussions with protester is sustained where agency failed to inform protester of significant deficiency in its proposal and protester would have had a reasonable chance at receiving award if the deficiency had been pointed out and corrected.

B-232500, B-232500.2, Jan 10, 1989, 89-1 CPD 21

PROCUREMENT - Competitive Negotiation - Contract Awards - Administrative discretion - Cost/technical tradeoffs - Technical superiority DIGEST: 1. Protest that agency improperly awarded contract to an offeror that submitted a proposal that was technically equal to the protester's is denied where the record demonstrates that the procuring agency reasonably determined that the awardee's proposal was technically superior to the protester's proposal. PROCUREMENT - Bid Protests - GAO procedures - Protest timeliness - 10-day rule 2. Protest bases that agency held inadequate discussions with the protester, improperly conducted its debriefing and gave the protester late notice of award to another firm are dismissed as untimely since each basis was filed more than 10 working days after it was learned. PROCUREMENT - Competitive Negotiation - Discussion - Adequacy - Criteria 3. Protest that contracting agency failed to conduct meaningful discussions with protester is sustained where agency failed to inform protester of significant deficiency in its proposal and protester would have had a reasonable chance at receiving award if the deficiency had been pointed out and corrected.

URS International, Inc., and Fischer Engineering Maintenance Co., Inc.; Global-Knight, Inc.:

URS International, Inc., and Fischer Engineering Maintenance Co., Inc. (URSI/FEMCO), a joint venture, and Global-Knight, Inc. protest the award of a cost reimbursement contract to Pacific Architects Engineers, Inc. (PA&E), under request for proposals (RFP) No. DAJB03-88-R-3505, issued by the U.S. Army Korea Contracting Agency for management, operation, maintenance, and repair of real property facilities at U.S. Air Force installations throughout Korea. Global-Knight argues that it is entitled to award because its proposal is at least technically equal to PA&E's and its proposed costs are lower. In the comments it submitted following a conference at our Office, Global Knight further contends that the Army held inadequate discussions with the firm, improperly conducted its debriefing, and gave late notice that award had been made to PA&E. URSI/FEMCO argues that the Army (1) did not evaluate proposals in accordance with the stated criteria; (2) did not hold meaningful discussions with the firm; (3) failed to conduct a proper cost realism analysis of PA&E's proposal; and (4) failed to provide prompt notice that award had been made to PA&E.

We deny in part and dismiss in part Global-Knight's protest. We sustain URSI/FEMCO's protest on the basis that the Army failed to advise the offeror of a specific deficiency in its proposal.

The RFP required the submission of technical and cost proposals with each to be separately evaluated. The RFP set out the following major technical evaluation criteria: (1) General Management, (2) Comprehension of the Requirement, (3) Organization and Staffing, (4) Offeror's Experience in Contract Support Services, and (5) Phase-in Plan. Criteria (2) and (3) were deemed approximately equal in weight and considered more important than criteria (1), (4) and (5), which also were approximately equal in weight. Subcriteria, which were equal in weight, were listed following each factor. The technical proposals were to be evaluated by a technical evaluation team and offers were to be assigned an adjectival rating of excellent, good, average or poor under each criterion. The cost proposals were to be evaluated by the Korea Contracting Agency for accuracy, reasonableness and realism. The RFP further provided that "technical and cost are approximately equal in importance with cost maybe slightly more important in that if two or more offerors are found to be equal technically cost will be the deciding factor for award." The contract was to be awarded to the offeror whose proposal was judged to be the most advantageous to the government based upon the evaluation criteria.

Four offerors responded to the RFP, including the awardee and the two protesters. After an initial technical evaluation, the evaluators rated PA&E first, followed by Global-Knight, URSI/FEMCO, and the fourth offeror. All four offerors were included in the competitive range.

The Army held oral discussions with each offeror and requested best and final offers (BAFOs) by July 11. The technical evaluation panel reviewed the BAFOs and revised portions of the evaluations to account for new information. However, the offerors' summary technical ratings and their overall ranking-- PA&E, Global-Knight, URSI/FEMCO-- remained unchanged.

With regard to the cost of BAFOs, URSI/FEMCO's proposed cost of $33,254,471 was low, with Global-Knight second ($33,534,446), and PA&E third ($33,603,337). Subsequently, the Army determined that PA&E's superior technical proposal was worth the additional cost, and on August 26, awarded the contract to PA&E. URSI/FEMCO and Global-Knight ere notified of the award on August 29.

With regard to Global-Knight's protest, the firm notes that under the solicitation if two or more offerors are equal technically, cost is the deciding factor for award. Global-Knight argues that due to its 25 years experience performing similar contracts and the innovative approaches it offered for productivity, its proposal was at least technically equal to that submitted by PA&E. Global-Knight therefore argues that because its proposed costs were lower than those of PA&E, it was entitled to the contract award.

In reviewing selection decisions, we have pointed out that the contracting agency is primarily responsible for determining which technical proposal best meets its needs, since it must bear the burden of any difficulties incurred by reason of a defective evaluation. Accordingly, we consistently have held that procuring officials enjoy a reasonable range of discretion in the evaluation of proposals and in the determination of which offer or proposal is to be accepted for award, and that such determinations are entitled to great weight and will not be disturbed unless shown to be unreasonable or in violation of the procurement statutes or regulations. CACI, Inc. - Federal, B-225444, Jan. 13, 1987, 87-1 CPD Para. 53.

Here, the record shows that in evaluating Global-Knight's proposal the Army did find that Global-Knight submitted a good proposal. The fact is, however, that the Army considered PA&E's proposal technically superior to, not technically equal to, the proposal submitted by Global Knight. Thus, while Global-Knight was credited with its substantial experience in contract support services and received an evaluation of excellent under criterion (4), Offeror's Experience in Contract Support Services, the Army also found that PA&E had substantial experience and rated PA&E excellent under this criterion. Both firms also received the same ratings under criterion (3) Organization and Staffing (average) and (5) Phase-in-Plan (good). Under criterion (1) General Management and (2) Comprehension of Requirement, one of the two most important criteria, however, Global- Knight received ratings of good in contrast to PA&E's ratings of excellent. Since Global-Knight has presented no basis on which to question this evaluation, we have no basis on which to question the Army's findings that the PA&E proposal was technically superior. In this regard, Global-Knight's mere belief that its proposal should have been ranked equal to PA&E's is not sufficient to demonstrate that the Army's evaluation was unreasonable. CACI, Inc. - Federal, B-225444, supra. Finally, since we have no basis on which to question the Army's decision that PA&E's proposal was technically superior to Global-Knight's, the Army could properly award the contract to PA&E at its higher proposed cost. See Kay and Associates, Inc., et al., B-229850 et al., Apr. 4, 1988, 88-1 CPD Para. 337.

On November 7, following a conference at our Office, Global-Knight submitted comments in which it further protested that the Army held inadequate discussions with the firm, improperly conducted its debriefing, and gave late notice that award had been made to PA&E. We dismiss these protest bases as untimely.

Under our Bid Protest Regulations, 4 C.F.R. Sec. 21.2(a)(2) (1988), a protest that is based on other than an apparent solicitation impropriety must be filed within 10 working days after the protester knows or should know of its protest basis. When 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. P-B Engineering Co., B-229739, Jan. 25, 1988, 88-1 CPD Para. 71. Here, in its conference comments, Global-Knight indicates that the Army held discussions with Global-Knight on June 30 and the debriefing on September 16. Global-Knight also indicates that it received notice of the award to PA&E on August 29. Since each of these issues was raised on November 7, more than 10 working days after it was learned, each is untimely and will not be considered on the merits.

URSI/FEMCO protests that the Army failed to hold meaningful discussions with the firm. In this regard URSI/FEMCO learned during a debriefing with the Army that its proposal was considered deficient under a subcriterion of criterion (1), General Management, entitled "resource and work force (security, safety, accountability)." URSI/FEMCO complains that the Army did not notify it of this deficiency during discussions, even though the Army did point out deficiencies in other subcriteria of General Management, and thus that it was denied the opportunity to correct its proposal to meet the agency's needs. URSI/FEMCO argues that, given that it submitted the low cost offer and that for purposes of award technical and cost factors were equal in weight, if the Army had pointed out the deficiency the firm may have been able to upgrade its technical proposal sufficiently to receive the contract award.

The Army admits that it inadvertently failed to inform URSI/FEMCO that its proposal contained deficiencies in the resource and work force subcriterion of the General Management criterion. The Army argues, however, that since it advised URSI/FEMCO of deficiencies in its proposal under other subcriteria of the General Management criterion, and since the proposal was considered technically acceptable, the Army fulfilled its obligation to hold meaningful discussions.

In the alternative, the Army argues that URSI/FEMCO was not prejudiced by the agency's failure to point out the deficiency. Specifically, the Army states that following BAFOs, URSI/FEMCO and PA&E received the same adjectival ratings for criterion (3), Organization and Staffing, criterion (4), Offeror's Experience in Contract Support Services, and criterion (5), Phase-in Plan. For criteria (1) and (2), however, PA&E received excellent ratings, while URSI/FEMCO received average ratings. Thus, the Army contends that, even if it had pointed out the deficiency in criterion (1), and URSI/FEMCO had been able to raise its rating from average to excellent for this factor, PA&E still would have had a higher rating for criterion (2), one of the two most important technical evaluation factors. The Army thus concludes that the PA&E proposal would still have been considered technically superior, and because the costs were so close, PA&E would have received the award.

The Competition in Contracting Act of 1984, 10 U.S.C. 2305(b)(4)(B) (Supp. IV 1986), as implemented in Federal Acquisition Regulation Sec. 15.610(b), requires that written or oral discussions be held with all responsible offerors whose proposals are in the competitive range. For competitive range discussions to be meaningful, agencies must point out deficiencies in proposals unless doing so would result in technical transfusion or technical leveling. Price Waterhouse, 65 Comp.Gen. 205 (1986), 86-1 CPD Para. 54, aff'd on reconsideration, B-220049.2, Apr. 7, 1986, 86-1 CPD Para. 333.

Although agencies are not obligated to afford offerors all encompassing discussions, or to discuss every element of a technically acceptable proposal that received less than the maximum possible score, they still generally must lead offerors into the areas of their proposals which require amplification. Furuno U.S.A., Inc., B-221814, Apr. 24, 1986, 86-1 CPD Para. 400. Discussions should be as specific as practical considerations will permit in advising offerors of the deficiencies in their proposals. Tracor Marine, Inc., B-207285, June 6, 1983, 83-1 CPD Para. 604.

Here, our review of the evaluation of URSI/FEMCO's BAFO shows that URSI/FEMCO received an overall average rating for criterion (1), General Management, because it did not adequately address the resources and work force subcriterion. This deficiency was identified during the initial evaluation of the firm's proposal, but as admitted by the Army, was not pointed out to the firm during discussions. Given that URSI/FEMCO's BAFO was downgraded in the General Management area based on this specific deficiency, we conclude that the Army's failure to notify URSI/FEMCO of it was improper. See Tracor Marine, Inc., B-207285, supra.

Further, contrary to the Army's position, we find that URSI/FEMCO was prejudiced by the agency's failure to point out the deficiency. demonstrate prejudice, an offeror is not required to prove that it would have received the award but for the agency's improper action, but rather that it would have had a reasonable chance of receiving the award. B.K. Dynamics, Inc.-- Reconsideration, B-228090.2, Feb. 18, 1988, 67 Comp.Gen. ***, 88-1 CPD Para. 165. Here, as noted above, the Army argues that even if URSI/FEMCO had raised its General Management score from average to excellent, PA&E's proposal still would have been considered technically superior and, since the cost proposals were close, PA&E would have received the award on the basis of its superior technical proposal.

We find this argument unpersuasive. If URSI/FEMCO had been adequately notified of the deficiency and had been able to raise its score for General Management to excellent, its technical rating would have been much closer to that of PA&E. Given that its cost proposal was lowest by approximately $350,000, and that cost and technical factors were equal in weight, we find that URSI/FEMCO would have had a reasonable chance at receiving the award had it been given the opportunity to correct the undisclosed deficiency in its proposal. Under these circumstances, the Army's after the fact assertion that the selection decision would not have changed even if URSI/FEMCO's score had improved is insufficient in our view to demonstrate that URSI/FEMCO was not prejudiced by the lack of opportunity to respond to the deficiency in its proposal. Since we find that URSI/FEMCO was deprived of the opportunity to address this deficiency, we recommend that a new round of discussions be conducted with URSI/FEMCO, followed by the submission of a new BAFO. However, during discussions, URSI/FEMCO should be limited to addressing the noted deficiency in the resource and work force subcriterion of General Management and should not be permitted to submit any price revisions because the deficiency was merely an informational one. If, following discussions, the Army concludes that URSI/FEMCO is entitled to award, the contract awarded to PA&E should be terminated for convenience and award made to URSI/FEMCO. We also find that URSI/FEMCO is entitled to recover the costs it incurred in filing and pursuing the protest, including attorneys' fees. Bid Protest Regulations, 4 C.F.R. Para. 21.6(d)(1) (1988). In view of our finding and recommendation, we need not consider the other issues raised in URSI/FEMCO's protest.

URSI/FEMCO's protest is sustained. Global-Knight's protest is denied in part and dismissed in part.