B-176429, SEP 15, 1972

B-176429, SEP 15, 1972

BID PROTEST - BIDDING BY GEOGRAPHICAL AREA - PERSONNEL QUALIFICATION DENIAL OF PROTEST BY BUSINESS MANAGEMENT CONSULTANTS (BMC) AGAINST THE AWARD OF A CONTRACT TO ULTRA SYSTEMS, INC., BY THE SMALL BUSINESS ADMINISTRATION UNDER A NEGOTIATED RFP FOR ACCOUNTING, TECHNICAL, AND MANAGEMENT CONSULTANT SERVICES IN EACH OF 15 GEOGRAPHICALLY DEFINED AREAS THROUGHOUT THE UNITED STATES. SINCE THE ULTRASYSTEMS BID COVERED TWO AREAS WITHIN REGION IX WHILE THE BMC BID ONLY COVERED THE LOS ANGELES AREA, PROTESTANTS' CONTENTION THAT A PRICE SAVINGS WOULD RESULT FROM AN AWARD TO HIM IS CLEARLY ERRONEOUS. ALSO, THE DETERMINATION OF PERSONNEL QUALIFICATIONS IS A MATTER OF JUDGMENT WITHIN THE DISCRETION OF THE CONTRACTING AGENCY AND WILL BE QUESTIONED BY GAO ONLY WHERE THE DETERMINATION IS CLEARLY UNREASONABLE OR IN VIOLATION OF PROCUREMENT STATUTES OR REGULATIONS. B 174799, JUNE 30, 1972. ACCORDINGLY, THE PROTEST MUST BE DENIED.

TO BUSINESS MANAGEMENT CONSULTANTS:

REFERENCE IS MADE TO YOUR LETTERS DATED JUNE 29 AND JULY 10, 1972, PROTESTING THE AWARD OF A CONTRACT TO ULTRASYSTEMS, INC., BY THE SMALL BUSINESS ADMINISTRATION (SBA) UNDER NEGOTIATED SOLICITATION NO. SBA-406 LA -72-1, ISSUED APRIL 17, 1972, FOR ACCOUNTING, TECHNICAL AND MANAGEMENT CONSULTANT SERVICES IN EACH OF 15 GEOGRAPHICALLY DEFINED AREAS THROUGHOUT THE UNITED STATES. EACH OFFEROR COULD SUBMIT A PROPOSAL ONLY FOR THE SBA REGION OF THE 10 IN EXISTENCE, IN WHICH HIS MAIN OFFICE IS LOCATED. SINCE THE HOME OFFICES OF BUSINESS MANAGEMENT CONSULTANTS AND ULTRASYSTEMS, INC. (NEWPORT BEACH, CALIFORNIA), ARE IN CALIFORNIA, WE ARE CONCERNED HERE ONLY WITH REGION IX, ENCOMPASSING CALIFORNIA, NEVADA AND ARIZONA.

THE REASONS FOR YOUR PROTEST ARE STATED AS FOLLOWS:

"1. ULTRASYSTEMS BID $165,699. MY BID WAS $99,933. THIS COULD REPRESENT A SAVINGS OF $65,766, OR ALMOST 40 PERCENT TO THE GOVERNMENT.

"2. I AM FULLY QUALIFIED TO PERFORM THIS TYPE OF WORK. I HAVE HANDLED SOME OF THE TOUGHEST SBA ASSIGNMENTS IN THE PAST TO THE STATED SATISFACTION OF THE SBA FIELD OFFICES. SEE MY PROPOSAL.

"3. THE PERSONNEL IDENTIFIED IN MY PROPOSAL ARE BETTER QUALIFIED THAN THOSE OF ULTRASYSTEMS TO ACCOMPLISH THE PROGRAM OBJECTIVE OF IMPROVING THE BUSINESS PERFORMANCE OF SBA BORROWERS. THIS CONCLUSION IS BASED ON THE FOLLOWING."

IN COMMENTING ON THE FIRST REASON, QUOTED ABOVE, SBA STATED:

"REGION IX OF THE SMALL BUSINESS ADMINISTRATION INCLUDES THE STATES OF CALIFORNIA, NEVADA AND ARIZONA. THE REQUEST FOR PROPOSALS OFFERED THE POSSIBILITY OF TWO SEPARATE CONTRACTS FOR THE WORK TO BE PERFORMED WITHIN THE REGION, ONE CENTERED PRIMARILY IN SAN FRANCISCO AND THE OTHER CENTERED PRIMARILY IN THE LOS ANGELES AREA. UNDER THE TERMS OF THE IFB, ULTRASYSTEMS, INC., WAS PERMITTED TO SUBMIT PROPOSALS FOR THE PERFORMANCE OF THE REQUIRED SERVICES FOR BOTH OF THE REGION IX AREAS. THE CONTRACTING OFFICER COULD ACCEPT A PROPOSAL FROM ANY ONE CONTRACTOR TO FURNISH THE SERVICES FOR BOTH SUCH AREAS. ULTRASYSTEMS, INC., HAD BEEN PERFORMING THIS TYPE OF WORK EFFORT PREVIOUSLY AND WAS RATED BY THE SBA EVALUATION BOARD AS THE NUMBER ONE PROSPECTIVE CONTRACTOR FROM A TECHNICAL STANDPOINT, IN EACH OF THE TWO GEOGRAPHICAL SECTIONS OF REGION IX. ITS COST PROPOSAL FOR THE LOS ANGELES AREA TOTALLED $98,374, WHILE THE PROPOSAL OF MR. SACKETT TOTALLED $99,933.

"IT IS UNDERSTANDABLE WHY MR. SACKETT, FAILING TO APPRECIATE THE FACT THAT ULTRASYSTEMS, INC., WAS ALSO THE SUCCESSFUL BIDDER FOR THE OTHER HALF OF REGION IX, WOULD BELIEVE THAT ACCEPTANCE OF HIS PROPOSAL WOULD REPRESENT A SAVINGS TO THE GOVERNMENT. HOWEVER, SINCE THE AWARD TO ULTRASYSTEMS, INC., COVERS THE PERFORMANCE OF WORK NOT ONLY IN THE LOS ANGELES AREA BUT ALSO IN SAN FRANCISCO, IT IS APPARENT THAT MR. SACKETT'S COMPARISON IS INVALID. THE ACCEPTANCE OF ULTRASYSTEMS, INC., PROPOSAL RESULTED IN A COST SAVINGS TO THE GOVERNMENT ***."

IN THE CIRCUMSTANCES, WE MUST AGREE WITH SBA'S CONCLUSION THAT THE ULTRASYSTEMS, INC., PROPOSAL WAS LOWER IN PROPOSED PRICE AND REPRESENTED A COST SAVINGS TO THE GOVERNMENT.

AS TO YOUR SECOND REASON, SBA REPORTS THAT IT DOES NOT CONTEST YOUR QUALIFICATIONS OR ABILITY TO DO THIS TYPE OF WORK. IT POINTS OUT THAT YOUR FIRM HAS PERFORMED WORK AS A SUBCONTRACTOR ON SIMILAR WORK FOR SBA AND THAT THE ASSIGNMENTS WERE "HANDLED WELL." IN THE EVALUATION OF PROPOSALS, YOU WERE FOUND QUALIFIED TO PERFORM THIS TYPE OF WORK.

FINALLY, YOU CONTEND THAT YOUR PERSONNEL ARE BETTER QUALIFIED THAN THOSE OF ULTRASYSTEMS, INC. THE PROPOSALS WERE EVALUATED IN ACCORDANCE WITH THE CRITERIA SET OUT IN THE SOLICITATION INCLUDING QUALITY OF PERSONNEL. ALTHOUGH BOTH FIRMS RATED HIGH, ULTRASYSTEMS RECEIVED THE BETTER SCORE. THE QUALIFICATIONS OF PERSONNEL ARE OBVIOUSLY A MATTER OF JUDGMENT. IT IS OUR POSITION THAT THE EXERCISE OF SUCH JUDGMENT IS PRIMARILY WITHIN THE DISCRETIONARY AUTHORITY OF THE PROCUREMENT AGENCY SUBJECT TO QUESTION BY OUR OFFICE ONLY WHERE CLEARLY UNREASONABLE OR IN VIOLATION OF PROCUREMENT STATUTES OR REGULATIONS. B-174799, JUNE 30, 1972. WE FIND NOTHING IN THE RECORD TO SUGGEST THAT THE CITED STANDARDS WERE VIOLATED IN REACHING THE ADMINISTRATIVE CONCLUSION IN THIS CASE.

IN VIEW OF THE ABOVE, WE MUST DENY YOUR PROTEST.