B-149330, OCT. 10, 1962

B-149330, OCT. 10, 1962

TO WATSON ELECTRONICS AND ENGINEERING COMPANY, INCORPORATED:

REFERENCE IS MADE TO YOUR LETTER DATED JULY 6, 1962, PROTESTING AGAINST THE ACTION OF THE U.S. ARMY SIGNAL SUPPLY AGENCY IN AWARDING A CONTRACT TO GENERAL PRECISION, INCORPORATED, LINK DIVISION, UNDER RFP PR AND C NO. 62- ELS/D-2404.

UNDER THE RFP OFFERORS WERE REQUESTED TO SUBMIT PROPOSALS ON A COST REIMBURSEMENT BASIS FOR THE DESIGN AND FABRICATION OF FOUR TACTICAL IMAGE INTERPRETATION FACILITIES, AND THE RFP ADVISED OFFERORS THAT THEIR PROPOSALS WOULD BE EVALUATED ON A BASIS WHICH INCLUDED THE MOST ADVANTAGEOUS METHOD OF APPROACH, CONTRACTOR'S EXPERIENCE, AVAILABILITY OF QUALIFIED TECHNICAL PERSONNEL, ADEQUACY OF FACILITIES, AND PROPOSED COSTS. ONE HUNDRED AND THIRTY-EIGHT COMPANIES WERE SOLICITED, 17 PROPOSALS WERE RECEIVED, AND THESE PROPOSALS WERE EVALUATED ON A POINT SYSTEM BASIS COVERING 15 DIFFERENT MAJOR CATEGORIES OF TECHNICAL AND GENERAL INFORMATION RELATIVE TO THE OFFERORS AND THEIR PROPOSALS. UNDER THIS EVALUATION SYSTEM A TOTAL NUMBER OF 100 POINTS WAS ASSIGNED. THE NUMBER OF POINTS ASSIGNED TO EACH CATEGORY WAS CHOSEN BASED ON THE IMPORTANCE OF THAT CATEGORY TO THE OVERALL PERFORMANCE IN MEETING THE OBJECTIVES OF THE PROGRAM. HOWEVER, IT WAS DETERMINED PRIOR TO THE EVALUATION THAT, BECAUSE OF THE URGENCY OF THIS PROGRAM, ADDITIONAL CONSIDERATION SHOULD BE GIVEN TO AN OFFEROR WHO COULD DELIVER IN LESS TIME THAN THE MAXIMUM REQUESTED IN THE RFQ. THREE POINTS FOR EACH MONTH OF EARLIER DELIVERY WERE THEREFORE ADDED TO THE TOTAL 100 POSSIBLE POINTS.

TECHNICAL EVALUATION OF THE 17 PROPOSALS WAS ACCOMPLISHED BY A TEAM OF FIVE ENGINEERS AND SCIENTIFIC PERSONNEL, AND ESTIMATED COSTS WERE WITHHELD FROM THE TEAM MEMBERS UNTIL AFTER THE TECHNICAL EVALUATION WAS COMPLETED. EVERY TECHNICAL AND NONTECHNICAL CATEGORY WAS RATED BASED ON THE INFORMATION PRESENTED BY THE BIDDER ON THAT PHASE OF THE PROGRAM. CONTRACTORS WHO PRESENTED A LOGICAL APPROACH SHOWING TECHNICAL DATA FOR THEIR REASONING, AND SOUND JUDGMENT IN SOLVING THAT PHASE OF THE WORK, WERE RATED THE HIGHEST. THOSE CONTRACTORS WHO SHOWED LESS PROFICIENCY, OR FAILED TO DISCUSS THESE POINTS ENTIRELY, OBTAINED A LOWER RATING OR NO RATING (A ZERO RATING). CATEGORIES OF NONTECHNICAL NATURE WERE RATED IN THE SAME MANNER.

A COMBINED SCORE WAS ARRIVED AT BY THE TEAM FOR DETERMINING THE BEST QUALIFIED OFFERORS. THE BIDDER WHICH OFFERED THE BEST TECHNICAL APPROACH, BASED ON THE TECHNICAL PRESENTATION OF HIS BID, PERSONNEL BACKGROUND, AND GENERAL COMPANY PERFORMANCE OF OTHER CONTRACTS WITH THE SIGNAL CORPS OR OTHER GOVERNMENT AGENCIES, RECEIVED THE HIGHEST SCORE. THE SCORE, WHICH WAS AGREED UPON BY ALL REVIEWERS, SHOWS THAT GENERAL PRECISION, INCORPORATED, LINK DIVISION, ATTAINED A SCORE OF 89 COMPARED TO A SCORE OF 21 FOR YOUR COMPANY. SCORES OF OTHER OFFERORS ARE WITHIN THESE TWO LIMITS, YOUR COMPANY BEING THE LOWEST OF THE OFFERORS SCORED. BASED ON THIS SCORING, PLACEMENT OF THE CONTRACT WITH LINK DIVISION WAS RECOMMENDED. AFTER A COMPLETE PRICE DETERMINATION AND REQUIRED LEGAL PROCEDURES BY THE FORT MONMOUTH PROCUREMENT OFFICE, GENERAL PRECISION, INCORPORATED, LINK DIVISION, WAS AWARDED THE CONTRACT ON JUNE 28, 1962, FOR A TOTAL SUM OF $854,026.

YOUR PROTEST IS BASED PRIMARILY UPON THE CONTENTION THAT YOUR COMPANY IS FULLY QUALIFIED TO PERFORM THE CONTRACT AND, SINCE YOUR PROPOSAL OFFERED THE LOWEST PRICE ON AN ESTIMATED COST BASIS, YOU WERE ENTITLED TO THE CONTRACT. IN SUPPORT, YOU EXPRESS THE BELIEF THAT YOUR ABILITY TO PERFORM IS UNEXCELLED ANYWHERE, THAT YOUR PROPOSAL DEFINED EXACTLY THE PROBLEMS TO BE SOLVED AND DEMONSTRATED UNDERSTANDING OF THEIR SOLUTION, THAT NO QUESTIONS WERE RAISED RELATIVE TO YOUR PROPOSAL, AND THAT YOU WERE ADVISED BY PERSONNEL OF THE CONTRACTING ACTIVITY THAT YOUR PROPOSAL WAS CLEARLY AND COMPLETELY PRESENTED. YOU THEREFORE QUESTION THE COMPETENCY OF THE PERSONNEL ASSIGNED TO EVALUATE THE PROPOSALS AND CONTEND THAT THE POINT EVALUATION SYSTEM WAS ARBITRARILY APPLIED AND RESULTED IN AN ERRONEOUS EVALUATION OF YOUR PROPOSAL.

WITH RESPECT TO THE EVALUATION OF YOUR PROPOSAL UNDER THE POINT EVALUATION SYSTEM, WE ARE ADVISED THAT THE HIGHEST NUMBER OF POINTS UNDER EACH OF THE 15 MAIN CATEGORIES AND SUBDIVISIONS THEREOF WAS ASSIGNED TO THAT PROPOSAL WHICH WAS JUDGED BEST IN THAT CATEGORY OR SUBDIVISION. AS A RESULT EACH PROPOSAL ON EACH POINT WAS BEING EVALUATED AGAINST EVERY OTHER PROPOSAL, AND WHERE A PROPOSAL WAS JUDGED LOWEST ON ANY CATEGORY OR SUBDIVISION IT WAS THEREFORE ASSIGNED A ZERO POINT RATING ON SUCH CATEGORY OR SUBDIVISION. ZERO POINT RATINGS ON YOUR PROPOSAL ON THE CATEGORIES ENTITLED "REQUIREMENTS," "EASE OF EXERCISING CONTROL," "TECHNICAL FEASIBILITY," "RELIABILITY," AND "MAN-MACHINE RELATION" THEREFORE DO NOT INDICATE A DETERMINATION THAT NO COMPETENCE IN THOSE AREAS WAS SHOWN BY YOUR COMPANY, AND THE RATING OF ONE OUT OF A POSSIBLE TWO POINTS ON THE ADEQUACY OF YOUR FACILITIES INDICATES ONLY THAT YOUR FACILITIES WERE LESS THAN THOSE OF LINK DIVISION, WHICH WAS RATED AT TWO POINTS.

EXAMINATION OF THE EXPLANATIONS ADVANCED BY THE SIGNAL RESEARCH AND DEVELOPMENT LABORATORY FOR THE POINT RATINGS ASSIGNED TO YOUR PROPOSAL AND THAT SUBMITTED BY LINK DIVISION INDICATES THAT ZERO RATINGS ON VARIOUS CATEGORIES OF YOUR PROPOSAL WERE ATTRIBUTABLE EITHER TO THE FACT THAT PORTIONS OF YOUR PROPOSAL WERE STATED IN GENERAL, RATHER THAN SPECIFIC TERMS, OR TO THE FACT THAT YOUR PROPOSAL FAILED TO SET OUT DETAILS ON HOW THE VARIOUS EQUIPMENTS AND COMPONENTS WOULD BE MODIFIED TO MEET THE SPECIFICATION REQUIREMENTS OR WOULD BE INTEGRATED INTO A WORKABLE SYSTEM. THIS LACK OF DETAIL APPEARS TO BE WELL ILLUSTRATED BY THE FACT THAT YOUR PROPOSAL CONSISTED OF 13 PAGES, WHILE THE PROPOSAL SUBMITTED BY LINK DIVISION COVERED 151 PAGES.

CONCERNING THE FACT THAT YOU WERE NOT REQUESTED TO CLARIFY YOUR PROPOSAL, IT IS THE POSITION OF THE CONTRACTING AGENCY THAT SINCE THIS PROCUREMENT WAS ISSUED ON A CLOSED BID BASIS, IT WAS THE RESPONSIBILITY OF EACH OFFEROR TO SUPPLY ALL INFORMATION NECESSARY TO EVALUATE THE MERITS OF HIS PROPOSAL, AND NO CHANGES OR ADDITIONS TO THE PROPOSALS WERE TO BE ACCEPTED UNLESS ALL OFFERORS WERE GIVEN THE SAME OPPORTUNITY. WHILE THE REVIEWING TEAM HAD AUTHORITY TO REQUEST CLARIFICATION OF SPECIFIC POINTS ON MATERIAL SUBMITTED IF SUCH CLARIFICATION WAS CONSIDERED NECESSARY FOR EVALUATION PURPOSES, IT IS THE POSITION OF THE CONTRACTING AGENCY THAT THE LACK OF DETAIL IN YOUR PROPOSAL PRECLUDED QUESTIONS DIRECTED TO CLARIFICATION OF SPECIFIC POINTS AND THAT IT WAS CONSIDERED IMPROPER TO INFORM YOU OF SUCH DEFICIENCIES DURING THE EVALUATION PROCESS OR TO ASK YOU TO SUBMIT DETAILED INFORMATION TO SUPPLEMENT THE GENERAL STATEMENTS CONTAINED IN YOUR PROPOSAL. IT IS THE AGENCY'S FURTHER POSITION THAT YOU WERE NOT TOLD AT ANY TIME THAT YOUR PROPOSAL WAS CLEAR AND SATISFACTORILY PRESENTED.

THE VARIOUS FACTORS WHICH ARE PROPERLY FOR CONSIDERATION IN THE POINT EVALUATION OF COST-TYPE PROPOSALS AND THE RELATIVE WEIGHTS WHICH ARE TO BE ASSIGNED TO EACH FACTOR ARE MATTERS PRIMARILY FOR CONSIDERATION BY THE CONTRACTING AGENCY, AND THIS OFFICE WILL NOT SUBSTITUTE ITS JUDGMENT FOR THAT OF THE AGENCY UNLESS THERE IS EVIDENCE OF LACK OF GOOD FAITH IN ESTABLISHING AND APPLYING SUCH FACTORS AND WEIGHTS. BASED UPON OUR REVIEW OF THE RECORD OF THE INSTANT PROCUREMENT, IT WOULD APPEAR THAT THE EVALUATION FACTORS WERE WEIGHTED AND APPLIED IN ACCORDANCE WITH THE ESTABLISHED PROCEDURES OF THE CONTRACTING AGENCY. WE FIND NO EVIDENCE OF BAD FAITH IN THE EVALUATION, AND THE QUALIFICATIONS AND EXPERIENCE OF THE EVALUATION TEAM IN THE FIELD OF IMAGE INTERPRETATION, AS SUBMITTED FOR OUR REVIEW, APPEAR TO BE OF A NATURE WHICH WOULD PRECLUDE THIS OFFICE FROM QUESTIONING THE TEAM'S COMPETENCE TO EVALUATE THE PROPOSALS.

CONCERNING YOUR CONTENTION THAT YOU WERE ENTITLED TO THE AWARD BECAUSE YOU WERE LOW OFFEROR, IN A RECENT DECISION TO THE SECRETARY OF THE AIR FORCE (B-147394), SEPTEMBER 4, 1962) WE HAD OCCASION TO CONSIDER BOTH THE USE OF A POINT EVALUATION SYSTEM IN AWARDING A COST TYPE CONTRACT AND THE VALIDITY OF AN AWARD, BASED UPON COMPARATIVE POINT EVALUATION SCORES, TO OTHER THAN THE LOW OFFEROR. AS SET OUT THEREIN, OUR CONCLUSIONS ON THESE POINTS ARE AS FOLLOWS:

"* * * UNDER THE COST-REIMBURSEMENT TYPE CONTRACT THERE IS NO FIRM PRE- ESTABLISHED PRICE. THE COST OF THE CONTRACT TO THE GOVERNMENT IS GENERALLY ESTABLISHED ON THE BASIS OF THE ACTUAL COSTS OF PERFORMANCE PROPERLY INCURRED BY THE CONTRACTOR. FOR THIS REASON THE ASPR PROVIDES THAT THE CONTRACTOR'S ESTIMATED COST OF CONTRACT PERFORMANCE AND PROPOSED FEE ARE NOT TO BE CONSIDERED AS CONTROLLING IN THE AWARD SELECTION. THE PRIMARY CONSIDERATION IN SELECTING THE CONTRACTOR FOR A COST-REIMBURSEMENT CONTRACT IS: WHICH CONTRACTOR CAN PERFORM THE CONTRACT IN A MANNER MOST ADVANTAGEOUS TO THE GOVERNMENT. ASPR 3.805.2. UNDER THIS CRITERION THE RELATIVE TECHNICAL COMPETENCE OF PROSPECTIVE CONTRACTORS IS OF PARAMOUNT IMPORTANCE. IN OUR VIEW IT IS NOT SUFFICIENT IN THE CPFF SITUATION IF THE AWARD PROCEDURE ONLY ATTEMPTS TO CHOOSE CONTRACTORS ON A MINIMUM NEEDS BASIS. WE DO NOT FIND THAT THE USE OF A POINT EVALUATION SYSTEM BY THE ADMINISTRATIVE AUTHORITY FOR THE PURPOSE OF SELECTING THE SOURCES FOR NEGOTIATION OF A CPFF TYPE CONTRACT IS CONTRARY TO STATUTE OR REGULATION.

IN VIEW OF THE FOREGOING, AND IN FURTHER VIEW OF THE FACT THAT THE CONTRACT IN QUESTION WAS NEGOTIATED PURSUANT TO A DETERMINATION UNDER 10 U.S.C. 2304 (A) (11), AND SUCH A DETERMINATION BECOMES FINAL UNDER THE PROVISIONS OF 10 U.S.C. 2310, YOUR REQUEST THAT WE DIRECT THE CONTRACTING AGENCY TO RESCIND THE AWARD TO GENERAL PRECISION, INCORPORATED, LINK DIVISION, MUST BE DENIED.

YOU ARE ADVISED, HOWEVER, THAT THE SECRETARY OF THE ARMY IS BEING ADVISED OF OUR OPINION, AS PREVIOUSLY SET OUT IN OUR DECISION B 147394, SEPTEMBER 4, 1962, TO THE SECRETARY OF THE AIR FORCE, THAT OFFERORS IN FUTURE PROCUREMENTS OF THIS TYPE WILL BE PLACED IN A BETTER POSITION TO MAKE MORE ACCURATE AND REALISTIC PROPOSALS IF THEY ARE INFORMED IN ADVANCE OF THE RELATIVE IMPORTANCE TO BE ATTACHED TO EACH EVALUATION FACTOR.