B-179046, B-179061, B-179062, MAR 28, 1974, 53 COMP GEN 710

B-179046, B-179061, B-179062, MAR 28, 1974, 53 COMP GEN 710

CONTRACTS - NEGOTIATION - EVALUATION FACTORS - MANNING REQUIREMENTS - GOVERNMENT ESTIMATED BASIS AN AWARD OF A MESS ATTENDANT CONTRACT TO THE OFFEROR WHO SUBMITTED A PROPOSAL WHICH INCLUDED ONLY ONE MANNING CHART THAT EXHIBITED A MANNING LEVEL ABOVE 95 PERCENT OF THE GOVERNMENT ESTIMATE WILL NOT BE QUESTIONED, NOTWITHSTANDING THE ALLEGATION THAT THE NAVY IMPROPERLY INTERPRETED THE GOVERNING REQUEST FOR PROPOSALS PROVISION, AS THERE IS MORE THAN ONE REASONABLE INTERPRETATION OF THE PROVISION. CONTRACTS - NEGOTIATION - EVALUATION FACTORS - MANNING REQUIREMENTS - PRICE/HOUR LESS THAN BASIC LABOR EXPENSE SINCE THE REQUEST FOR PROPOSALS FOR MESS ATTENDANT SERVICES MANDATES THE REJECTION OF AN OFFER WHOSE DOLLAR/HOUR RATIO (PRICE/HOURS) DOES NOT EXCEED THE OFFEROR'S BASIC LABOR EXPENSE, WHERE THE SUCCESSFUL OFFEROR'S BASIC LABOR EXPENSE EXCEEDED ITS DOLLAR/HOUR RATIO, EVEN WHEN SUGGESTED VARIABLE FACTORS ARE UTILIZED, THE CONTRACT AWARD MADE WAS IMPROPER. CONTRACTS - NEGOTIATION - EVALUATION FACTORS - FACTORS OTHER THAN PRICE - EMPLOYEE ABSENTEEISM ABSENTEEISM OF EMPLOYEES, WHICH WAS NOT STATED IN THE REQUEST FOR PROPOSALS AS A FACTOR TO BE USED IN COMPUTING OFFERORS' BASIC LABOR EXPENSE, WAS PROPERLY NOT CONSIDERED IN SUCH COMPUTATION. CONTRACTS - NEGOTIATION - EVALUATION FACTORS - MANNING REQUIREMENTS - GOVERNMENT ESTIMATED BASIS UNDER A MESS ATTENDANT SERVICES SOLICITATION AN OFFEROR WHO SUBMITTED TWO OF THREE MANNING CHARTS UNDER 95 PERCENT OF THE GOVERNMENT'S ESTIMATE, AND A TOTAL OFFER OF LESS THAN 95 PERCENT OF THE GOVERNMENT'S TOTAL ESTIMATE WAS IMPROPERLY AWARDED A CONTRACT SINCE THE REQUEST FOR PROPOSALS REQUIRED CONFORMANCE WITH THE 95-PERCENT LEVEL. CONTRACTS - NEGOTIATION - EVALUATION FACTORS - MANNING REQUIREMENTS - PRICE/HOUR LESS THAN BASIC LABOR EXPENSE SINCE NO FACTOR WAS STATED IN THE REQUEST FOR PROPOSALS (RFP) RELATIVE TO CALCULATING OFFERORS' BASIC LABOR EXPENSE, EVEN THOUGH NAVY UTILIZED 5- PERCENT FACTOR, ANOTHER FACTOR EQUAL OR SUPERIOR IN ITS REALISM COULD HAVE BEEN UTILIZED, AND SUCCESSFUL OFFEROR'S BASIC LABOR EXPENSE COULD HAVE BEEN LOWERED THEREBY MAKING IT CONFORM TO THE RFP LIMITS.

IN THE MATTER OF ABC MANAGEMENT SERVICES, INC., MARCH 28, 1974:

REQUESTS FOR PROPOSALS (RFP) N00204-73-R-0035, -0037 AND -0038 FOR MESS ATTENDANT SERVICES WERE ISSUED ON APRIL 18, 27 AND 25, 1973, RESPECTIVELY, BY THE NAVAL AIR STATION, PENSACOLA, FLORIDA.

RFP-0035 (B-179061)

THIS SOLICITATION SOUGHT OFFERS FOR FURNISHING MESS ATTENDANT SERVICES AT THE NAVAL COASTAL SYSTEMS LABORATORY, PANAMA CITY, FLORIDA.

SECTION "D" OF THE RFP STATED THAT:

SECTION D - EVALUATION FACTORS FOR AWARD DISCOUNTS (1968 SEP)

IN ACCORDANCE WITH SUBPARAGRAPH (A) OF THE CLAUSE ENTITLED "DISCOUNTS" IN THE SOLICITATION INSTRUCTIONS AND CONDITIONS (STANDARD FORM 33A), PROMPT PAYMENT DISCOUNTS WILL BE CONSIDERED IN THE EVALUATION OF OFFERS, PROVIDED THE MINIMUM PERIOD FOR THE OFFERED DISCOUNTS IS:

30 DAYS WHERE DELIVERY AND ACCEPTANCE ARE AT DESTINATION. THE OFFERED DISCOUNT OF A SUCCESSFUL OFFEROR WILL FORM A PART OF THE AWARD WHETHER OR NOT SUCH DISCOUNT WAS CONSIDERED IN THE EVALUATION OF HIS OFFER AND SUCH DISCOUNT WILL BE TAKEN IF PAYMENT IS MADE WITHIN THE DISCOUNT PERIOD.

EVALUATION OF OFFEROR'S MANNING CHARTS AND PRICES

(A) THE MANNING LEVELS REFLECTED IN THE OFFEROR'S MANNING CHARTS MUST BE SUFFICIENT TO PERFORM THE REQUIRED SERVICES. FOR THE PURPOSE OF EVALUATING PROPOSALS AND ESTABLISHING A COMPETITIVE RANGE FOR THE CONDUCT OF NEGOTIATIONS, THE GOVERNMENT ESTIMATES THAT SATISFACTORY PERFORMANCE WILL REQUIRE TOTAL MANNING HOURS (INCLUDING MANAGEMENT/SUPERVISION) OF APPROXIMATELY 47 ON A REPRESENTATIVE WEEKDAY AND APPROXIMATELY 31 ON A REPRESENTATIVE WEEKEND DAY/HOLIDAY. SUBMISSION OF MANNING CHARTS WHOSE TOTAL HOURS FALL MORE THAN 5% BELOW THESE ESTIMATES MAY RESULT IN REJECTION OF THE OFFER WITHOUT FURTHER NEGOTIATIONS UNLESS THE OFFEROR CLEARLY SUBSTANTIATES THE MANNING DIFFERENCE WITH SPECIFIC DOCUMENTATION DEMONSTRATING THAT THE OFFEROR CAN PERFORM THE REQUIRED SERVICES SATISFACTORILY WITH SUCH FEWER HOURS.

(B) FURTHER EVALUATION OF THE OFFERORS' MANNING CHARTS WILL BE BASED ON THE FOLLOWING CRITERIA:

(1) THE MANNING DISTRIBUTION IN SPACE/JOB CATEGORIES PRIOR TO, DURING, AND AFTER MEAL HOURS AND AT PEAK PERIODS MUST REPRESENT AN EFFECTIVE, WELL PLANNED MANAGEMENT APPROACH TO THE EFFICIENT UTILIZATION OF MANPOWER RESOURCES IN PERFORMING THE SERVICES REQUIRED; AND

(2) THE HOURS SHOWN IN THE MANNING CHARTS MUST BE SUPPORTED BY THE PRICE OFFERED WHEN COMPARED AS FOLLOWS. THE TOTAL HOURS REFLECTED IN THE MANNING CHARTS FOR THE CONTRACT PERIOD (I.E., BASED ON A CONTRACT YEAR CONTAINING 252 WEEKDAYS AND 113 WEEKEND DAYS/HOLIDAYS) WILL BE DIVIDED INTO THE TOTAL OFFERED PRICE (LESS ANY EVALUATED PROMPT PAYMENT DISCOUNT) TO ASSURE THAT THIS DOLLAR/HOUR RATIO IS AT LEAST SUFFICIENT TO COVER THE FOLLOWING BASIC LABOR EXPENSES:

(I) THE BASIC WAGE RATE;

(II) IF APPLICABLE, FRINGE BENEFITS (HEALTH AND WELFARE, VACATION, AND HOLIDAYS); AND

(III)OTHER EMPLOYEE-RELATED EXPENSES AS FOLLOWS:

(A) FICA (INCLUDING HOSPITAL INSURANCE) AT THE RATE OF 5.2%; (AMENDED TO 5.85%)

(B) UNEMPLOYMENT INSURANCE AT THE RATE SET FORTH BY THE OFFEROR IN THE PROVISION IN SECTION B OF THIS SOLICITATION ENTITLED "OFFEROR'S STATEMENT AS TO UNEMPLOYMENT INSURANCE RATE AND WORKMEN'S COMPENSATION INSURANCE RATE APPLICABLE TO HIS COMPANY"; AND

(C) WORKMEN'S COMPENSATION INSURANCE AT THE RATE SET FORTH BY THE OFFEROR IN THE PROVISION REFERRED TO IN (B) ABOVE.

FAILURE OF THE PRICE OFFERED TO THUS SUPPORT THE OFFEROR'S MANNING CHART MAY RESULT IN REJECTION OF THE PROPOSAL WITHOUT FURTHER NEGOTIATIONS.

(C) AWARD WILL BE MADE TO THE RESPONSIBLE OFFEROR WHOSE PROPOSAL, MEETING THE CRITERIA SET FORTH IN (A) AND (B) ABOVE, OFFERS THE LOWEST EVALUATED TOTAL PRICE.

NOTE TO OFFEROR: THE PURPOSE OF THE ABOVE PRICE-TO-HOURS EVALUATION IS TO ASSURE:

(I) THAT MANNING CHARTS SUBMITTED ARE NOT UNREALISTICALLY INFLATED IN HOPES OF SECURING A MORE FAVORABLE PROPOSAL EVALUATION; AND

(II) THAT AWARD IS NOT MADE AT A PRICE SO LOW IN RELATION TO BASIC PAYROLL AND RELATED EXPENSES ESTABLISHED BY LAW AS TO JEOPARDIZE SATISFACTORY PERFORMANCE.

NOTHING IN THIS SECTION D SHALL BE CONSTRUED AS LIMITING THE CONTRACTOR'S RESPONSIBILITY FOR FULFILLING ALL OF THE REQUIREMENTS SET FORTH IN THIS CONTRACT.

THE GOVERNMENT'S TOTAL ESTIMATED NEED WAS 15,347 MAN-HOURS. SPACE SERVICES OFFERED 95 PERCENT OF THE GOVERNMENT'S ESTIMATE BASED ON EITHER A CONTRACT YEAR CONTAINING 250 REPRESENTATIVE WEEKDAYS AND 115 REPRESENTATIVE WEEKEND/HOLIDAYS OR ONE CONTAINING A 252/113 DISPERSION. AS STATED IN SECTION D (A) ABOVE, THE GOVERNMENT ESTIMATED THE MANNING REQUIRED AS 47 MAN-HOURS PER REPRESENTATIVE WEEKDAY AND 31 MAN-HOURS PER REPRESENTATIVE WEEKEND/HOLIDAY. SPACE SERVICES OFFERED 45 (95.7447 PERCENT OF THE GOVERNMENT'S ESTIMATE) AND 29 (93.5484 PERCENT OF THE GOVERNMENT ESTIMATE), RESPECTIVELY.

THE AGENCY INITIALLY STATED THAT SPACE SERVICES' TOTAL MANNING WAS WITHIN THE ALLOWED 5-PERCENT VARIATION OF THE GOVERNMENT'S TOTAL MANNING REQUIREMENT. THUS, IT WOULD APPEAR THAT SPACE SERVICES DID NOT HAVE TO JUSTIFY THE SUBMISSION OF ITS FIGURES. HOWEVER, THE PROTESTER SUBSEQUENTLY ARGUED THAT SPACE SERVICES' SUB-95-PERCENT OFFER OF REPRESENTATIVE WEEKEND/HOLIDAY MANNING WAS ACCEPTED CONTRARY TO THE TERMS OF SECTION "D," THE SUB-95 PERCENT FIGURE BEING WITHOUT ANY SUBSTANTIATION. THE NAVY THEN REPLIED THAT SPACE SERVICES INDEED HAD SUBSTANTIATED ITS MANNING DEFICIENCY WITH SPECIFIC DOCUMENTATION DEMONSTRATING THAT IT COULD PERFORM AT ITS OFFERED WEEKEND/HOLIDAY LEVEL. THE CONTENT OF THIS SPECIFIC DOCUMENTATION WAS THAT SPACE SERVICES' OFFER WAS CLOSE TO THE 95-PERCENT LEVEL.

SECTION DA) OF THE RFP STATES THAT:

*** SUBMISSION OF MANNING CHARTS WHOSE TOTAL HOURS FALL MORE THAN 5% BELOW *** (THE GOVERNMENT'S) ESTIMATES MAY RESULT IN REJECTION OF THE OFFER WITHOUT FURTHER NEGOTIATIONS ***.

AS WE STATED IN B-179174, JANUARY 15, 1974:

WHILE THERE IS UNCERTAINTY IN THE INTERPRETATION TO BE GIVEN THIS LANGUAGE, WE BELIEVE THAT THE MOST LOGICAL AND REASONABLE CONSTRUCTION TO BE MADE OF IT (SECTION DA)) CONTEMPLATES MAKING A COMPARISON OF EACH OFFEROR'S PROPOSED MANNING LEVEL FOR EACH REPRESENTATIVE DAY WITH THE GOVERNMENT'S ESTIMATE FOR THAT RESPECTIVE REPRESENTATIVE DAY. THE TENOR OF THE SECTION SOUGHT TO REQUIRE THE SUBMISSION OF OFFERS WHICH DEMONSTRATED ADEQUATE STAFFING (MANNING LEVELS CLOSE TO THE GOVERNMENT'S ESTIMATES) ON A REPRESENTATIVE WEEKDAY AND A REPRESENTATIVE WEEKEND/HOLIDAY.

HOWEVER, WE NOTE THAT THE NAVY GENERALLY HAS MADE A COMPARISON OF THE OFFEROR'S TOTAL OFFERED MAN-HOURS FOR THE YEAR VIS-A-VIS THE GOVERNMENT TOTAL ESTIMATED MAN-HOUR NEEDS FOR THE YEAR. SEE 53 COMP. GEN. 198 (B 178707, OCTOBER 2, 1973). THIS METHOD IS NOT A PROPER ONE TO ACHIEVE WHAT WE FIND TO BE THE DESIRED END OF SECTION *** (DA)) - ASSURING SUFFICIENT MANNING AT ALL TIMES - SINCE IT CAN LEAD TO DISTORTED OFFERS WHICH TECHNICALLY COMPLY WITH THE TOTAL 95-PERCENT LEVEL. INDEED, IT IS POSSIBLE THAT AN EXTREMELY LOW MAN-HOUR FIGURE FOR REPRESENTATIVE WEEKEND/HOLIDAY MAY IN ESSENCE BE COUNTER-BALANCED BY A RELATIVELY HIGH WEEKDAY FIGURE; THUS SEEMINGLY ASSURING ADEQUATE WEEKDAY PERFORMANCE BUT CASTING DOUBT ON THE OFFEROR'S WEEKEND CAPABILITIES.

WHILE WE DISAGREE WITH THE INTERPRETATION GIVEN THIS SECTION BY THE NAVY, WE NOTE THAT OUR INTERPRETATION IS NOT THE ONLY REASONABLE ONE. READING THE RFP AS A WHOLE, WE CAN SEE HOW THE AGENCY CONCLUDED THAT A COMPARISON OF TOTAL OFFERED MANNING WITH TOTAL ESTIMATED NEED WAS CONTEMPLATED. ***.

WHILE WE CONTINUE TO BE OF THE VIEW THAT SUCH AN INTERPRETATION IS IMPROPER, WE WILL NOT RECOMMEND TERMINATION OF THE INSTANT AWARD ON THIS BASIS.

ABC ALSO CONTENDS THAT SPACE SERVICES' OFFERED PRICE DOES NOT SUPPORT ITS OFFERED MAN-HOURS SINCE THE CRITERIA STATED IN SECTION DB)(2) WERE NOT MET.

SPACE SERVICES OFFERED 45 HOURS PER REPRESENTATIVE WEEKDAY AND 29 HOURS PER REPRESENTATIVE WEEKEND/HOLIDAY. BASED ON THE CONTRACT YEAR ADOPTED BY THE PROCUREMENT ACTIVITY, 250 REPRESENTATIVE WEEKDAYS AND 115 REPRESENTATIVE WEEKEND DAYS, SPACE SERVICES OFFERED 14,585 HOURS. HOWEVER, BASED ON THE CONTRACT YEAR SPECIFIED IN THE RFP, 252 AND 113 RESPECTIVE TYPE DAYS, SPACE SERVICES OFFERED 14,617 HOURS.

SPACE SERVICES' BASIC HOURLY LABOR EXPENSE AS INITIALLY CALCULATED BY THE AGENCY WAS:

BASIC WAGE $2.91

HEALTH & WELFARE .12

FICA (5.85%) (FN1) .17

UNEMPLOYMENT (.07%) (FN1) .002

WORKMEN'S COMP. (1.4%) (FN1) .04

VACATION/HOLIDAY --

TOTAL $3.242

FN1 COUNSEL FOR ABC ASSERTS THAT THE PERCENTAGE FOR FICA, UNEMPLOYMENT AND WORKMEN'S COMPENSATION SHOULD BE TAKEN AS A FACTOR OF BASIC WAGE AND HEALTH AND WELFARE BENEFITS. WE FEEL, HOWEVER, THAT IT IS EQUALLY REASONABLE TO TAKE SUCH PERCENTAGES WITH REFERENCE MERELY TO BASIC WAGE. INDEED, THIS IS WHAT THE CONTRACTING OFFICER DID IN THE PRESENT SITUATION.

THE AGENCY IN ITS LATEST SUBMISSION INDICATES THAT THE CALCULATION OF BASIC LABOR EXPENSE REQUIRES THE INCLUSION OF A 5-PERCENT FACTOR FOR VACATION/HOLIDAY BENEFITS. INDEED, THE INCLUSION OF SUCH A REALISTIC FACTOR HAS PREVIOUSLY BEEN RECOMMENDED BY OUR OFFICE. SEE 53 COMP. GEN. 388 (1973). WITH THE ADDITION OF THIS FACTOR SPACE SERVICES' BASIC LABOR EXPENSE IS $3.39. WE FIND, HOWEVER, THAT SPACE SERVICES' DOLLAR/HOUR RATIO IS AS FOLLOWS:

$47,340.00 GROSS PRICE (ALSO NET EVALUATED PRICE SINCE THE CONTRACTING OFFICER DID NOT DEDUCT .1% 10-DAY PROMPT PAYMENT DISCOUNT) FN2

47,340/14,585 (250/115 CONTRACT YEAR) $3.25 (3.2458)

47,340/14,617 (252/113 CONTRACT YEAR) 3.24 (3.2387)

FN2 SECTION DB)(2) INDICATES THAT EACH OFFEROR'S OFFERED NUMBER OF MAN HOURS WILL BE DIVIDED INTO ITS TOTAL PRICE "LESS ANY EVALUATED PROMPT PAYMENT" DISCOUNTS TO DETERMINE THE OFFEROR'S DOLLAR/HOUR RATIO. SECTION "D" ALSO STATES THAT A DISCOUNT OF LESS THAN 30 DAYS (AS WAS SPACE SERVICES') CANNOT BE EVALUATED IN TERMS OF THE OFFEROR'S PROPOSAL BUT THAT THE GOVERNMENT MAY TAKE ADVANTAGE OF ANY SUCH DISCOUNT SHOULD IT SO DESIRE. THIS LATTER PROVISION MEANT TO PRECLUDE THE DOWNWARD ADJUSTMENT OF THE PRICE OF AN OFFEROR GIVING LESS THAN A 30-DAY DISCOUNT VIS-A-VIS THE PROPOSALS OF OTHER OFFERORS WHO OFFER PROMPT PAYMENT DISCOUNTS OF THE LENGTH DESIRED BY THE GOVERNMENT. SECTION DB)(2), HOWEVER, IS MEANT TO PROVIDE A METHOD WHEREBY THE GOVERNMENT CAN ASSURE ITSELF THAT THE PRICE WHICH WOULD ACTUALLY BE PAID TO THE CONTRACTOR EXCEEDED HIS COSTS. THIS REGARD, WE FEEL THAT SINCE THE AGENCY MAY AVAIL ITSELF OF A LESS THAN 30-DAY PROMPT PAYMENT DISCOUNT, SUCH A DISCOUNT MAY AND PROBABLY SHOULD HAVE BEEN DEDUCTED FROM THE OFFEROR'S GROSS PRICE IN ORDER TO PROPERLY DETERMINE DOLLAR/HOUR RATIO UNDER SECTION DB)(2). THE FAILURE TO DO SO IN THIS INSTANCE WAS NOT, HOWEVER, IMPROPER AS THE CONTRACTING OFFICER REASONABLY FOLLOWED THE STATED REQUIREMENTS OF THE RFP ALTHOUGH WE FEEL THAT THE RFP SHOULD NOT HAVE EXCLUDED SUCH PROMPT PAYMENT DISCOUNTS FROM THE EVALUATION FORMULA.

HERE, SPACE SERVICES COMPUTED BASIC LABOR EXPENSE ($3.39) EXCEEDS ITS DOLLAR/HOUR RATIO (BASED ON EITHER NUMBER OF OFFERED HOURS).

THE AGENCY RECOGNIZES THAT SPACE SERVICES' PRICE DID NOT SUPPORT ITS OFFERED HOURS BUT JUSTIFIES AWARD TO SPACE SERVICES ON THE BASIS THAT THE HIGHEST PROBABLE AMOUNTS WERE USED FOR THE VARIABLE FACTORS.

IN THIS REGARD, SPACE SERVICES INDICATES THAT A FACTOR OF 2.234 PERCENT ($0.005/HOUR FOR VACATION AND $0.06/HOUR FOR HOLIDAY) IS MORE REALISTIC THAN THE 5 PERCENT USED BY THE AGENCY FOR VACATION/HOLIDAY BENEFITS. HAVE NOTED PREVIOUSLY THAT SUCH A 5-PERCENT FIGURE IS NOT MANDATED BY THIS RFP LANGUAGE. 53 COMP. GEN., SUPRA. HOWEVER, THE AGENCY BY ITS OWN CALCULATION INDICATES THAT FOR HOLIDAYS ALONE A 3.1 PERCENT FACTOR IS REQUIRED. THEREFORE, EVEN IF THE AGENCY WERE TO HAVE UTILIZED SPACE SERVICES' OWN ESTIMATE OF VACATION COSTS IN COMPUTING LABOR EXPENSE, THE RESULTS WOULD BE AS FOLLOWS:

BASIC WAGE $2.91

HEALTH & WELFARE .12

FICA .17

UNEMPLOYMENT .002

WORKMEN'S COMP .04

HOLIDAY (3.1%) .09

VACATION (PER SPACE SERVICES) .005

TOTAL $3.337

MOREOVER, IF, AS SPACE SERVICES ADDITIONALLY SUGGESTS, 2.06 PERCENT ($0.06 PER HOUR) WERE TO ALSO HAVE BEEN USED BY THE AGENCY IN COMPUTING HOLIDAY EXPENSE (RATHER THAN THE 3.1 PERCENT ($0.09) ACTUALLY USED) SPACE SERVICES' BASIC LABOR EXPENSE WOULD STILL EQUAL ONLY $3.307 AND WOULD, THEREFORE, NOT BE SUPPORTED BY ITS DOLLAR/HOUR RATIO (MAXIMUM $3.25).

WHILE WE REITERATE THAT A 5-PERCENT VACATION/HOLIDAY FACTOR IS NOT REQUIRED AND THAT A MORE REALISTIC FIGURE COULD HAVE BEEN USED IN DETERMINING BASIC LABOR EXPENSE, SEE B-179102, DECEMBER 19, 1973, EVEN HAD SPACE SERVICES' RECOMMENDED FACTOR BEEN APPLIED, ITS BASIC LABOR EXPENSE CANNOT SUPPORT ITS OFFERED HOURS WITHIN THE RFP CRITERIA. SPACE SERVICES INDICATES THAT WITH REFERENCE TO COMPUTING BASIC LABOR EXPENSE "*** DEFINITE CONSIDERATION MUST BE GIVEN ABSENTEEISM (OF EMPLOYEES)." HOWEVER, SUCH WAS NOT A FACTOR STATED IN THE RFP AND COULD NOT, THEREFORE, BE INTERJECTED WITHOUT AMENDING THE RFP. SINCE THIS WAS NOT DONE IN THE PRESENT CASE, ABSENTEEISM PER SE WAS PROPERLY NOT CONSIDERED IN TOTALING BASIC LABOR EXPENSE.

ACCORDINGLY, FOR THE ABOVE-NOTED REASONS, WE BELIEVE THAT ABC'S PROTEST SHOULD BE SUSTAINED AND WE RECOMMEND THAT THE NAVY NOT EXERCISE ITS OPTION UPON THE COMPLETION OF THE FIRST YEAR'S SERVICE. RFP-0037 (B-179062)

THE SUBJECT RFP SOUGHT PROPOSALS RELATIVE TO FURNISHING MESS ATTENDANT SERVICES AT THE NAVAL COMMUNICATION TRAINING CENTER, CORRY FIELD, PENSACOLA, FLORIDA.

SECTION "D" OF THIS RFP DIFFERS FROM THAT SET FORTH WITH REGARD TO B 179061, ABOVE, ONLY IN RESPECT TO SECTION DA). SECTION DA) OF THE PRESENT RFP READS AS FOLLOWS:

(A) THE MANNING LEVELS REFLECTED IN THE OFFEROR'S MANNING CHARTS MUST BE SUFFICIENT TO PERFORM THE REQUIRED SERVICES. FOR THE PURPOSE OF EVALUATING PROPOSALS AND ESTABLISHING A COMPETITIVE RANGE FOR THE CONDUCT OF NEGOTIATIONS, THE GOVERNMENT ESTIMATES THAT SATISFACTORY PERFORMANCE WILL REQUIRE TOTAL MANNING HOURS (INCLUDING MANAGEMENT/SUPERVISION) OF APPROXIMATELY 288.5 FOR PERIOD 73 JUL 01 THRU 73 DEC 16 AND 74 JAN 07 THRU 74 JUN 30 ON A REPRESENTATIVE WEEKDAY AND APPROXIMATELY 182.5 ON A REPRESENTATIVE WEEKEND DAY/HOLIDAY FOR PERIOD 73 JUL 01 THRU 73 DEC 16 AND 74 JAN 07 THRU 74 JUN 30 AND 190 FOR ALL DAYS FOR PERIOD 73 DEC 17 THRU 74 JAN 06. SUBMISSION OF MANNING CHARTS WHOSE TOTAL HOURS FALL MORE THAN 5% BELOW THESE ESTIMATES MAY RESULT IN REJECTION OF THE OFFER WITHOUT FURTHER NEGOTIATIONS UNLESS OFFEROR CLEARLY SUBSTANTIATES THE MANNING DIFFERENCE WITH SPECIFIC DOCUMENTATION DEMONSTRATING THAT THE OFFEROR CAN PERFORM THE REQUIRED SERVICES SATISFACTORILY WITH SUCH FEWER HOURS.

SPACE SERVICES, THE SUCCESSFUL OFFEROR ON THIS SOLICITATION, OFFERED:

PERCENT OF

GOVERNMENT

MAN-HOURS DAY PERIOD ESTIMATE

274 REPRESENTATIVE (7/1/73-12/16/73) 94.97

WEEKDAY (1/7/74-6/30/74)

173 REPRESENTATIVE (7/1/73-12/16/73) 94.78

WEEKEND/HOLIDAY (1/7/74-6/30/74)

180.5 ALL 12/17/73-1/6/74 95.0

WE ALSO CALCULATE THE GOVERNMENT'S TOTAL ANNUAL MAN-HOUR NEED AS FOLLOWS:

DAILY ESTIMATED HOUR

288.5 (REP. WEEKDAY) X239 WEEKDAYS (7/1/73-12/16/73)

(1/7/74-6/30/74) 68,951.5

182.5 (REP. WEEKEND/ X104 WEEKEND/ (7/1/73-12/16/73)

HOLIDAY) HOLIDAY (1/7/74-6/30/74) 18,980

190.0 X22 (9 WEEKEND/

HOLIDAY)

(13 WEEKDAYS) 12/17/73-1/6/74 4,180

252 WEEKDAYS 92,111.5

113 WEEKEND/

HOLIDAYS

(THE AGENCY, USING A 250-WEEKDAY, 115-WEEKEND/HOLIDAY YEAR,

ESTIMATED 91,793)

SPACE SERVICES' TOTAL OFFER WAS, BY OUR CALCULATION -

MAN-HOURS DAYS

274 (REP. WEEKDAY) X 239 65,486

173 (REP. WEEKEND/HOLIDAY) X 104 17,992

180.5 X 22 3,971

87,449

(SPACE SERVICES' OFFER BY THE AGENCY'S CALCULATION EQUALED -87,146)

SPACE SERVICES' TOTAL OFFER WAS 94.9381 PERCENT OF OUR CALCULATED TOTAL ESTIMATE AND 94.93752 PERCENT OF THE AGENCY'S.

IN VIEW OF THE LANGUAGE OF SECTION DA), WE DO NOT FEEL THAT AN AWARD TO AN OFFEROR EXHIBITING TWO SUB-95-PERCENT MANNING CHARTS (OF THE THREE REQUIRED) IS PROPER WHERE AS IN B-179061, SUPRA, THE ALLEGED SUBSTANTIATION FOR DOING SO IS MERELY THE OFFEROR'S PROXIMITY TO THE 95 PERCENT FIGURE AND WHERE ITS TOTAL OFFER IS LESS THAN 95 PERCENT OF THE GOVERNMENT'S TOTAL ESTIMATE. ACCORDINGLY, AWARD TO SPACE SERVICES WAS IMPROPER.

ABC ALSO CONTENDS THAT SPACE SERVICES' PRICE DOES NOT SUPPORT ITS OFFERED HOURS. THE AGENCY CALCULATED THAT SPACE SERVICES' EVALUATED PRICE OF $299,796, WHEN DIVIDED BY ITS TOTAL NUMBER OF OFFERED HOURS, INDICATES A DOLLAR/HOUR RATIO OF $2.63 ($2.627771). AS IN B-179061, ABOVE, SPACE SERVICES' 10-DAY PROMPT PAYMENT DISCOUNT WAS NOT CONSIDERED IN REACHING THIS RATIO. OUR POSITION, AS IN B-179061, IS THAT UNDER THE LANGUAGE OF THE RFP THIS IS PERMISSIBLE. SEE NOTE (FN2), SUPRA.

WE CALCULATE SPACE SERVICES' BASIC LABOR EXPENSE, AS DID THE AGENCY, AS FOLLOWS:

BASIC WAGE $2.22

HEALTH & WELFARE .15

VACATION & HOLIDAY (5%) .1110

FICA (5.85%) .129870

UNEMPLOYMENT (.07%) .001554

WORKMEN'S COMP. (1.40%) .031080

TOTAL (APPROX. $2.64) $2.643504

THE PRESIDENT OF SPACE SERVICES STATES THAT "UPON REVIEWING THE VARIOUS FACTORS USED I FEEL THEY ARE FAIRLY REALISTIC," ALTHOUGH HE DOES SUGGEST THAT A FIGURE OF 3.153 PERCENT ($0.02/HOUR FOR VACATION AND $0.05/HOUR FOR HOLIDAY) WOULD HAVE BEEN MORE REALISTIC.

IN B-179102, SUPRA, WHERE A 5-PERCENT VACATION-HOLIDAY FACTOR WAS ALSO USED, AND THE LOW OFFEROR'S BASIC LABOR EXPENSE EXCEEDED ITS DOLLAR/HOUR RATIO BY $0.016 AS A RESULT, WE HELD THAT AWARD TO THAT OFFEROR WAS NOT IMPROPER. WE STATED THAT "UNDER THESE CIRCUMSTANCES, IT APPEARS THAT THE CONTRACTING OFFICER COULD HAVE REASONABLY CONCLUDED THAT THE PURPOSE OF THE RFP CRITERION WOULD BE MET BY ACCEPTANCE OF FEDERAL'S OFFER."

IN THE INSTANT CASE, WE SEE NO REASON WHY ANOTHER FACTOR EQUAL OR SUPERIOR IN ITS REALISM TO THE 5-PERCENT FACTOR COULD NOT HAVE BEEN UTILIZED. INDEED, A FACTOR OF 4.291 PERCENT (OR LESS) WOULD ALLOW SPACE SERVICES' DOLLAR/HOUR RATIO TO EQUAL (OR EXCEED) ITS BASIC LABOR EXPENSE.

ACCORDINGLY, WE BELIEVE THE RATIONALE EXPRESSED IN B-179102, SUPRA, IS APPLICABLE IN THE PRESENT CASE AND THAT THE CONTRACTING OFFICER COULD REASONABLY HAVE CONCLUDED THAT THE PURPOSES OF THE RFP CRITERION WOULD BE MET BY AWARD TO SPACE SERVICES.

HOWEVER, IN VIEW OF OUR CONCLUSION THAT SPACE SERVICES' SUB-95 PERCENT MANNING LEVEL WAS IMPROPERLY ACCEPTED, WE CONCLUDE THAT ABC'S PROTEST SHOULD BE SUSTAINED. WE RECOMMEND, THEREFORE, THAT THE NAVY NOT EXERCISE ITS OPTION FOR CONTINUED SERVICE UPON THE COMPETION OF THE FIRST YEAR OF THE INSTANT CONTRACT.

RFP-0038 (B-179046)

THE SUBJECT RFP SOUGHT OFFERS FOR PERFORMING MESS ATTENDANT SERVICES AT THE NAVAL AIR STATION, PENSACOLA, FLORIDA.

SECTION DA) OF THE SOLICITATION PROVIDED THAT:

(A) THE MANNING LEVELS REFLECTED IN THE OFFEROR'S MANNING CHARTS MUST BE SUFFICIENT TO PERFORM THE REQUIRED SERVICES. FOR THE PURPOSE OF EVALUATING PROPOSALS AND ESTABLISHING A COMPETITIVE RANGE FOR THE CONDUCT OF NEGOTIATIONS, THE GOVERNMENT ESTIMATES THAT SATISFACTORY PERFORMANCE WILL REQUIRE TOTAL MANNING HOURS (INCLUDING MANAGEMENT/SUPERVISION) OF THE FOLLOWING:

PERIOD 73JUL01 THROUGH 74JUN30

BUILDING 680 (BUTCHER SHOP) - APPROXIMATELY 7 ON A REPRESENTATIVE WEEKDAY AND 0 ON A REPRESENTATIVE WEEKEND/HOLIDAY.

BUILDING 601 - APPROXIMATELY 144.5 ON A REPRESENTATIVE WEEKDAY AND APPROXIMATELY 101 ON A REPRESENTATIVE WEEKEND DAY/HOLIDAY.

BUILDING 602 (BAKE SHOP) - APPROXIMATELY 12.5 ON A REPRESENTATIVE WEEKDAY AND 0 ON A REPRESENTATIVE WEEKEND/HOLIDAY.

BUILDING 1907 - APPROXIMATELY 126 ON A REPRESENTATIVE WEEKDAY (MONDAY THRU SATURDAY) AND APPROXIMATELY 83 ON A REPRESENTATIVE SUNDAY/HOLIDAY.

PERIOD 73SEP01 THROUGH 73MID-DEC AND 74JAN01 THROUGH 74MAY31

BUILDING 602 - APPROXIMATELY 179.5 ON A REPRESENTATIVE WEEKDAY AND APPROXIMATELY 164.5 ON A REPRESENTATIVE SATURDAY AND APPROXIMATELY 145.5 ON A REPRESENTATIVE SUNDAY/HOLIDAY.

PERIOD 73JUL01 THROUGH 73AUG31 AND 74JUN01 THROUGH 74JUN30

BUILDING 602 - APPROXIMATELY 201.5 ON A REPRESENTATIVE WEEKDAY AND APPROXIMATELY 169.5 ON A REPRESENTATIVE SATURDAY AND APPROXIMATELY 166 ON A REPRESENTATIVE SUNDAY/HOLIDAY.

SUBMISSION OF MANNING CHARTS WHOSE TOTAL HOURS FALL MORE THAN 5% BELOW THESE ESTIMATES MAY RESULT IN REJECTION OF THE OFFER WITHOUT FURTHER NEGOTIATIONS UNLESS THE OFFEROR CLEARLY SUBSTANTIATES THE MANNING DIFFERENCE WITH SPECIFIC DOCUMENTATION DEMONSTRATING THAT THE OFFEROR CAN PERFORM THE REQUIRED SERVICES SATISFACTORILY WITH SUCH FEWER HOURS."

SPACE SERVICES, THE SUCCESSFUL OFFEROR, SUBMITTED THE FOLLOWING PROPOSED HOURS:

JULY 1, 1973 - JUNE 30, 1974

OFFER'S

MAN HOURS GOVERNMENT PERCENT OF

ESTIMATE GOVERNMENT

ESTIMATE

BLDG. 680 (BUTCHER 7 REP. WKDY. 7 100

SHOP) 0 REP. W/H 0 -

BLDG. 601 137 REP. WKDY. 144.5 94.8

96 REP. W/H 101 95.0

BLDG. 602 (BAKE 12.5 REP. WKDY. 12.5 100

SHOP) 0 REP. W/H 0 -

BLDG. 1907 120 REP. WKDY.* 126 95.2

79 REP. SUN./HOL. 83 95.18

SEPT. 1, 1973 - DEC. 15, 1973

JAN. 1, 1973 - MAY 31, 1973

BLDG. 602 170.5 REP. WKDY. 179.5 94.7

138 REP. SUN./HOL. 145.5 94.84

156 REP. SATURDAY 164.5 94.83

JULY 1, 1973 - AUGUST 31, 1973

JUNE 1, 1974 - JUNE 30, 1974

BLDG. 602 191 REP. WKDY. 201 95.0

161 REP. SATURDAY 169.5 94.98

158 REP. SUN./HOL. 166 95.18

*INCLUDING SATURDAYS.

ABC CONTENDS THAT SPACE SERVICES' OFFER, WHICH CONTAINS SIX SUB-95 PERCENT MANNING CHARTS OUT OF THE 12 REQUIRED, SHOULD HAVE BEEN REJECTED. THE NAVY STATES THAT SPACE SERVICES SUBSTANTIATED THESE FRACTIONAL MANNING DIFFERENCES WITH SPECIFIC DOCUMENTATION AS REQUIRED BY SECTION "D" OF THE RFP. THE SUBSTANCE OF THIS DOCUMENTATION WAS, HOWEVER, THE MERE FACT THAT SPACE SERVICES' FIGURES WERE CLOSE TO THE 95-PERCENT LEVEL. AS PREVIOUSLY NOTED, WE DO NOT CONSIDER THIS TO BE SUFFICIENT DOCUMENTATION.

WE CALCULATE THE GOVERNMENT,S TOTAL ESTIMATE AND SPACE SERVICES' TOTAL OFFER AS FOLLOWS:

GOVT. GOVT. SPACE SPACE

DAILY ANNUAL SERVICES SERVICES

NUMBER EST. EST. DAILY ANNUAL

BLDG OF DAYS OFFER OFFER

680 WEEKDAY 252 7 1,7647 1,764

601 WEEKDAY 252 144.5 36,414 137.0 34,524

601 WEEKEND/HOLIDAY113 101.0 11,413 96 10,848

602 WEEKDAY 252 12.5 3,150 12.5 3,150

1907 WKDY. (MON.-SAT.) 305 126.0 38,430 120 36,600

1907 SUN./HOLIDAY 60 83 4,980 79 4,740

602 WKDY. 9/1/73-12/15/73

178 179.5 31,951 170.5 30,349

1/1/74-5/31/74

602 SAT. 9/1/73-12/15/73

37 164.5 6,086.5 156.0 5,772

1/1/74-5/31/74

602 SUN./ 9/1/73-12/15/73

42 145.5 6,111 138.0 5,796

HOL. 1/1/74-5/31/74

602 WKDY 7/1/73-8/31/73

64 201.5 12,896 191.0 12,224

6/1/74-6/30/74

602 SAT. 7/1/73-8/31/73

13 169.5 2,203.5 161.0 2,093

6/1/74-6/30/74

602 SUN./ 7/1/73-8/31/73

15 166.0 2,490 158.0 2,370

HOL. 6/1/74-6/30/74

157,889 150,230

THUS, BY OUR CALCULATION, SPACE SERVICES ACTUALLY OFFERED 95.1491 PERCENT OF THE GOVERNMENT'S TOTAL ESTIMATE. THE AGENCY, HOWEVER, FOUND SPACE SERVICES' TOTAL OFFER, BASED ON A YEAR CONTAINING 250 WEEKDAYS AND 115 WEEKEND HOLIDAYS, TO BE 149,980 HOURS - 95.148 PERCENT OF ITS CALCULATION OF THE GOVERNMENT'S TOTAL ESTIMATE (157,628). ALTHOUGH WE FEEL THAT THE CALCULATIONS MOST PROBABLY SHOULD HAVE BEEN DONE ON THE BASIS OF A 252- WEEKDAY, 113-WEEKEND/HOLIDAY YEAR AS SET OUT IN THE RFP, WE BELIEVE THAT SPACE SERVICES MET THE CONTRACTING OFFICER'S VIEW OF THE CRITERIA BUT, MORE IMPORTANTLY, DID IN FACT MEET THE MORE APPROPRIATE CRITERIA. THEREFORE, WE CONCLUDE THAT, NOTWITHSTANDING THE FACT THAT SPACE SERVICES SUBMITTED A NUMBER OF SUB-95-PERCENT MANNING CHARTS, THE CONTRACTING OFFICER DID NOT ACT IMPROPERLY IN NOT REJECTING SPACE SERVICES' OFFER AS ITS NUMBER OF OFFERED HOURS WAS WITHIN 95 PERCENT OF THE GOVERNMENT'S TOTAL ANNUAL ESTIMATE.

THE AGENCY ADDITIONALLY CALCULATES SPACE SERVICES' BASIC LABOR EXPENSE AS FOLLOWS: BASIC WAGE $2.15

HEALTH & WELFARE .12

VACATION/HOLIDAY (5%) .11

FICA (5.85%) .13

UNEMPLOYMENT (.07%) .002

WORKMEN'S COMP. (1.40%) .03

TOTAL $2.542

SPACE SERVICES' DOLLAR/HOUR RATIO WAS CALCULATED BY THE AGENCY AS FOLLOWS: (GROSS PRICE) FN3 $397,898.00

AGENCY CALC. OF SPACE SERV. TOTAL OFFERED HRS. DIVIDED BY 149,980

TOTAL $ 2.653

FN3SEE NOTE (FN2), SUPRA.

(OUR CALCULATION IS $397,898.00/150,348 (OUR CALCULATION OF SPACE SERVICES' OFFERED HOURS) $2.64651.)

THEREFORE, SPACE SERVICES' DOLLAR/HOUR RATIO EXCEEDS ITS BASIC LABOR EXPENSE (BOTH BY OUR CALCULATION AND THE AGENCY'S) AND ITS PRICE DOES SUPPORT ITS OFFERED HOURS AS REQUIRED BY THE RFP.

FOR THE REASON STATED ABOVE, ABC'S PROTEST ON THE INSTANT SOLICITATION IS DENIED.