Matter of: Intown Properties, Inc. File: B-250392 Date: January 28, 1993

Matter of: Intown Properties, Inc. File: B-250392 Date: January 28, 1993

PROCUREMENT Competitive Negotiation Offers Competitive ranges Exclusion Administrative discretion Agency reasonably excluded protester's proposal from the competitive range where, although protester's proposed price was low, its technical deficiencies were such that proposal ranked 15th out of 16 proposals and had no reasonable chance of being selected for award.

Attorneys

DECISION Intown Properties, Inc. protests the exclusion of its proposal from the competitive range under request for proposals (RFP) No. 17-92- 063N, issued by the Department of Housing and Urban Development (HUD) for multifamily project management services for HUD properties in Florida. The protester essentially argues that its proposal was improperly evaluated.

We deny the protest.

The RFP contemplated the award of one or more indefinite quantity, combination fixed-price/cost-reimbursement (no fee) contracts. The RFP contained the following eight technical and management evaluation factors and the available points under each (out of a total of 110 points): (1) demonstrated experience in implementing HUD regulations, policies, and procedures for multifamily projects (10 points); (2) demonstrated experience and capability in managing similar projects (15 points); (3) demonstrated experience in managing major repair and rehabilitation programs, including the ability to prepare timely and accurate specifications and cost estimates for repairs and rehabilitation, and to inspect work (25 points); (4) demonstrated capability and expressed commitment of key personnel (5 points); (5) demonstrated capacity to handle the statement of work's (SOW) subcontracting responsibility (15 points); (6) demonstrated experience in facilitating the formation of resident organizations and resident management (10 points); (7) demonstrated understanding of the physical economic, social, and security conditions of the projects to be managed, including management plan (20 points); and (8) demonstrated understanding of the physical economic, social, and security conditions of retirement service centers, including management plan (10 points). Offerors' proposed prices, although secondary to technical and management considerations, were to be considered in determining which offers were the most advantageous to the government; only as technical and management scores became more equal would price become the determining factor for award.

Twenty-three firms, including the protester, submitted initial technical proposals. The agency's source evaluation board (SEB) evaluated and scored these proposals. After the technical evaluation, but prior to making the competitive range determination, the SEB was provided with and considered each offeror's price. The SEB determined that 7 of the 23 initial offers were technically unacceptable. Of the 16 remaining proposals, scores ranged from 19 to 102 points. The agency established a cutoff of 65 points for the competitive range, based on its determination that such proposals would have no reasonable chance of being selected for award. As a result, 8 offerors, including Intown, with a total score of 27 points, were not included in the competitive range.

In rating Intown's proposal, the SEB evaluated deficiencies in all technical and management factors reviewed, particularly in three areas, comprising 32 percent of the total available points, where the firm received zero points: subcontracting (factor no. 5), experience in facilitating resident organizations (factor no. 6), and understanding of retirement service centers (factor no. 8). In another area, experience in managing major repair and rehabilitation programs (factor no. 3) comprising 23 percent of the total available points, Intown received only 9 of the available 25 points.

Following discussions with the eight competitive range offerors, which submitted prices 69 to 141 percent higher than the protester, and submission of best and final offers, which included only price changes, the agency awarded contracts to Royal American Management, MTB Investment, Inc., and Southeastern Property Management, Inc., all higher-technically rated, higher-priced offerors. This protest ensued. Intown argues that HUD improperly ignored portions of its proposal in the evaluation and that, in any case, it should have been included in the competitive range since its proposal was not rejected as technically unacceptable and its price was lower than those of the other competitive range offerors.

The competitive range consists of all proposals that have a reasonable chance of being selected for award, generally including proposals that are technically acceptable or reasonably susceptible of being made acceptable through discussions. Kranco, Inc., B-242579, May 1, 1991, 91-1 CPD Para. 425. However, a technically acceptable proposal may be excluded from the competitive range if, based upon the array of technical ratings actually obtained by the offerors and consideration of the proposed costs, the proposal does not stand a real chance of being selected for award. The Cadmus Group, Inc., B-241372.3, Sept. 25, 1991, 91-2 CPD Para. 271. We will not disturb a determination to exclude an offeror from the competitive range unless the record indicates that the determination was unreasonable. KJ Realty/Bayview Group, B-244492, Oct. 21, 1991, 91-2 CPD Para. 349; Kranco, Inc., supra.

Based on our examination of the record, we find that HUD's evaluation and exclusion of Intown's proposal from the competitive range was reasonable. The greatest deficiency in Intown's proposal was under the previously mentioned three factors comprising 32 percent of the available points, where Intown's proposal received no points. In connection with one of the factors in this area, the subcontracting requirement, the RFP required, among other things, a purchase tracking system, inspection services, and compliance with certain Federal Acquisition Regulation (FAR) requirements concerning competition and labor standards. Also in this area, in order to ensure procurement integrity, the RFP prohibited certain activities in subcontracting, including providing a competitive advantage to any firm seeking to do business with HUD and conducting identity-of-interest transactions, such as those with family members. In its evaluation under this factor, the agency determined that Intown's proposal "did not satisfactorily address expertise as it relates to subcontracting for supplies, material, equipment, and services"; "failed to demonstrate staff's knowledge relating to [FAR] on labor laws"; "provided no plan or outline describing procurement authority or chain of command in procurement activity"; "provide[d] no policies and procedures to act as safeguards to ensure procurement integrity and protect [HUD's] interest; and "provided no plan to train staff in procurement procedures."

In arguing that it improperly was downgraded under the subcontracting factor, Intown directs our attention to a portion of its proposal discussing repair subcontracting. We find that this discussion does not establish that HUD's conclusions were incorrect. Intown's proposal merely states that it inspects work and insures that subcontractors are in compliance with federal minimum wage limits. Nowhere does the proposal describe Intown's procedures and methods concerning the deficiencies cited, such as the absence of an adequate purchase tracking system or inspection services. Further, the proposal includes no description of the firm's methods of compliance with either the FAR labor laws or the RFP's procurement integrity requirements. Consequently, we have no basis to question the agency's evaluation in this area. Another of the three factors where Intown's proposal received no points was the requirement for demonstrated understanding of the conditions in retirement service centers, along with a management plan for these projects (factor no. 8). The protester acknowledges that it did not have any experience in this area and did not include the required management plan in its proposal. Thus, we have no basis to question the evaluation in this area.

As indicated above, under the other primary area of deficiency, experience in managing major repair and rehabilitation programs (factor no. 3), the single most important factor, Intown's proposal received 9 out of 25 possible points. Among the evaluated deficiencies in this area were "insufficient detail on recent management, coordination, and monitoring of major rehab programs," and "limited experience in managing and coordinating repair programs including preparation of specifications and cost estimates." In support of its claimed experience with major repair and rehabilitation work, the protester cites two projects described in its proposal, one completed in 1987 and another which is on-going, and also contends that "virtually every [other] property" managed by the firm in the past 10 years (14 are listed in its proposal) has been rehabilitated under the firm's management. Intown also cites the portion of its proposal entitled "Highlights of Experience and Capabilities," which states that the firm has "provided excellent service to HUD in drawing specifications. . . ." The proposal also indicates that Intown uses data from standard inspection forms to price and develop specification sheets.

Again, Intown's proposal does not show that HUD's conclusions were incorrect. The proposal is essentially limited to brief listings of the types and dollar amounts of the repair and rehabilitation work involved in the cited projects. Nowhere does the proposal indicate methods and procedures for management of the work, such as, for example, who performed the work, how the work was coordinated (among subcontractors and residents), and how work progress was monitored. Further, the general information provided in the firm's proposal gives no indication of any specific experience in preparing specifications and cost estimates for major repair and rehabilitation programs, as specifically required under the evaluation factor.

It is an offeror's responsibility to furnish all of the information required by the solicitation, and an agency therefore properly may exclude from the competitive range an offer with significant informational deficiencies. Cook Travel, B-238527, June 13, 1990, 90-1 CPD Para. 571. Here, whether or not the protester possesses the repair and rehabilitation experience it claims, its proposal failed to present such experience in the detail necessary for the agency to rate the proposal higher in this area. In light of the information included in Intown's proposal, we think the agency reasonably found that the firm had limited repair and rehabilitation experience.

In sum, we find that the record supports the agency's conclusion that while the protester's proposal was not overall technically unacceptable, it was clearly technically deficient in important technical/management areas. While Intown's offered price was significantly lower than the awardee's, the agency determined that, because of the substantial deficiencies, Intown's proposal had no reasonable chance of being selected for award. Given the RFP's emphasis on technical factors rather than price, we find that HUD's exclusion of the protester from the competitive range on this basis was reasonable.

The protest is denied.