B-235568.3, Sep 28, 1989

B-235568.3: Sep 28, 1989

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PROCUREMENT - Bid Protests - GAO procedures - GAO decisions - Reconsideration PROCUREMENT - Competitive Negotiation - Offers - Technical acceptability - Negative determination - Propriety DIGEST: The General Accounting Office will not question the exclusion of the protester's step-one proposal as unacceptable in two-step negotiated procurement where the proposal was reasonably found deficient. We now find the protest to have been timely filed. We now consider it to have been a timely agency-level protest that the Air Force denied by its letter of May 17. We will consider the protest. The RFTP was issued on November 20. Proposed some that were contrary to the specified requirements. AOA's proposal was found deficient in the following areas: (1) link power calculation and data compression.

B-235568.3, Sep 28, 1989

PROCUREMENT - Bid Protests - GAO procedures - GAO decisions - Reconsideration PROCUREMENT - Competitive Negotiation - Offers - Technical acceptability - Negative determination - Propriety DIGEST: The General Accounting Office will not question the exclusion of the protester's step-one proposal as unacceptable in two-step negotiated procurement where the proposal was reasonably found deficient, requiring major revisions to make the proposal acceptable.

Allen Osborne Associates, Inc.-- Reconsideration:

Allen Osborne Associates, Inc. (AOA), requests that we reconsider our May 25, 1989, dismissal of its protest under request for technical proposals (RFTP) No. F04606-89-R-25237, issued by the Sacramento Air Logistics Center, Department of the Air Force, as the first step of a two-step negotiated procurement /1/ for the acquisition of 17 Transionospheric Sensing Systems (TISS) /2/ to include training, data, installation, contractor logistics support and first article testing. AOA protested the rejection of its technical proposal, without discussions, as technically unacceptable. We dismissed the initial protest because it appeared that AOA had not filed its protest within 10 working days of the date on which it learned that its proposal would not be considered. See 4 C.F.R. Sec. 21.2(a)(2) (1989). We now find the protest to have been timely filed, but we deny it on the merits.

On May 9, 1989, AOA received a two-page debriefing memorandum from the Air Force rejecting AOA's proposal as technically unacceptable and detailing the reasons for the rejection. AOA, by letter dated May 11, submitted to the Air Force its comments with respect to the debriefing memorandum in which AOA at least implicitly expressed disagreement with the evaluation and requested corrective action by the agency. By letter dated May 17, the Air Force informed AOA that it would not change its original determination. After further review of AOA's letter of May 11 to the agency, we now consider it to have been a timely agency-level protest that the Air Force denied by its letter of May 17. See Western Division Investments et al., B-213882.2, Sept. 5, 1984, 84-2 CPD Para. 258. Since AOA filed its protest with our Office on May 24, within 10 working days of denial of the agency-level protest, we will consider the protest.

The RFTP was issued on November 20, 1988. Three firms submitted technical proposals. The Air Force evaluated proposals and found that AOA had incorrectly calculated several of the critical performance capabilities, neglected to substantiate others, and proposed some that were contrary to the specified requirements. Specifically, AOA's proposal was found deficient in the following areas: (1) link power calculation and data compression; (2) calibration requirements; (3) amplitude scintillation accuracy; (4) calculation of vertical total electron content; and (5) substantiating data on the performance of the proposed equipment. The Air Force rejected AOA's proposal and determined that only one firm submitted a technically acceptable proposal that was acceptable without extensive revisions or major rewrite. The agency therefore proceeded with the second step request for pricing proposal with the one offeror. This protest followed.

Initially, we note that an agency may reject, without discussions, a step one proposal that is technically unacceptable if the proposal either fails to meet essential requirements of the solicitation or can be made acceptable only through extensive revisions. See Midcoast Aviation, Inc., B-223103, June 23, 1986, 86-1 CPD Para. 577. Thus, the basic issue here is whether the Air Force reasonably evaluated AOA's proposal as requiring a major rewrite. Since evaluating proposals basically involves the exercise of the contracting agency's discretion, we will not question the results of an evaluation unless shown to be unreasonable. See Datron Sys. Inc., B-220423; B-220423.2, Mar. 18, 1986, 86-1 CPD Para. 264. Further, the fact that a protester may disagree with the agency's conclusion does not itself render the evaluation unreasonable. See TIW Sys. Inc., B-222585.8, Feb. 10, 1987, 87-1 CPD Para. 140.

The protester maintains that the Air Force's evaluation was erroneous and insists that its technical proposal, as submitted, was acceptable under the terms of the solicitation. In response, the Air Force asserts that AOA's technical approach was unacceptable. The Air Force states that AOA's proposed system did not meet the specification in three key measurement areas and that AOA's proposal failed to provide sufficient detail, requiring a major rewrite of the proposal in all areas.

The record contains extensive highly technical arguments by both parties. We limit our discussion to a few critical examples of deficiencies found by the agency in AOA's proposal. The record shows that one of the most crucial components of the TISS is the Global Positioning Satellites receiver. AOA proposed to use a Rogue receiver modified to meet the solicitation requirements. The Air Force in its evaluation of AOA's proposal found that AOA did not provide a link power calculation to substantiate its data and improperly employed data compression to meet the "accuracy parameters" of the specifications. The Air Force states that the link power calculation is critical to the technical proposal to substantiate the performance characteristics of the Rogue receiver. response, AOA admits that the details of the Rogue receiver performance computation were not given in its proposal and that a link calculation was not presented. Moreover, the Air Force has evaluated AOA's modified link power calculation presented in its agency-level protest and determined that AOA's response did not address the full content of the specifications and did not demonstrate compliance. The protester has not even attempted to rebut these technical findings by the Air Force. Thus, there has been no showing that the Air Force's evaluation of its initial proposal as submitted was flawed.

The Air Force also found that AOA employed data compression, even though the specifications and the Air Force's response to relevant questions at the pre-bidders' conference clearly stated that the accuracy requirements apply to the original sampled data, not the compressed data. The protester admits that it used compressed data but maintains that the use of compressed data will provide accuracies which meet the RFP requirements. The Air Force has rebutted this assertion, and the protester has not questioned the Air Force's technical response. We are therefore unable to find the evaluation to be flawed.

With respect to the calibration requirement, the Air Force found that AOA failed to provide substantive information on how calibration would be accomplished and maintained. In response, AOA merely asserts, without any substantiation, that its proposal met the solicitation calibration requirements. Mere disagreement with the agency about the technical evaluation, without more, however, is not enough to show that the evaluation was unreasonable. See Structural Analysis Technologies, Inc., B-228020, Nov. 9, 1987, 87-2 CPD Para. 466.

In short, the Air Force found AOA's proposal to be incomplete and lacking details. The Air Force determined that AOA was unable to meet the RFP requirements with its proposed Rogue receiver and did not demonstrate that other key hardware would meet the requirements. The Air Force found that the revisions necessary to make AOA acceptable would constitute a new proposal. The protester has failed to show otherwise. Based on this record, we find that the protester, while expressing disagreement with the technical determination by the agency, has not shown the evaluation to be unreasonable.

Finally, the protester contends that since two of the three offerors were determined to be technically unacceptable, the Air Force should not have proceeded to step two with one offeror. Although an agency in a two-step sealed bidding procurement may cancel step two and proceed to complete the procurement through negotiation where, as here, there is only one acceptable offeror, the agency is not required to do so. See HSQ Technology, B-227054, July 23, 1987, 87-2 CPD Para. 77. Since step two in this case is a negotiated procurement, we believe the agency properly proceeded with the negotiation.

The protest is denied.

/1/ The agency apparently employed a negotiated variation of two step sealed bidding (see Federal Acquisition Regulation (FAR), subpart 14.5 (FAC-12)). Specifically, the agency requested technical proposals, without prices, in step one and required the submission of pricing information in response to a request for pricing proposals (RFP) in step two. For purposes of our decision, we see no essential difference between the two methods.

/2/ TISS measures the effects of the ionosphere on satellite signals. This information is derived from Global Positioning Satellites and is used by the Air Force with space tracking and surveillance radars, and communication satellite links.