B-182361, MAY 14, 1975

B-182361, MAY 14, 1975

1. GAO NO LONGER ENTERTAINS PROTESTS AGAINST AFFIRMATIVE DETERMINATION OF RESPONSIBILITY OF ANOTHER COMPETITOR IN VIEW OF SUBSTANTIAL DEGREE OF DISCRETION AFFORDED CONTRACTING OFFICIALS IN REACHING SUCH DETERMINATIONS WHICH IN TURN DIRECTLY ADVERSELY IMPACTS UPON THE LIKELIHOOD OF SUCCESS OF A PROTEST ON THIS BASIS. 2. PROTEST THAT SPECIFICATIONS ARE DEFECTIVE IS UNTIMELY UNDER 4 C.F.R. SEC. 20.2 (1974) OF BID PROTEST PROCEDURES SINCE IT WAS NOT FILED UNTIL AFTER AWARD AND REQUIREMENT IS THAT SUCH ALLEGATIONS MUST BE FILED BEFORE CLOSING DATE FOR RECEIPT OF PROPOSALS. 3. MANNER OF CONTRACT ADMINISTRATION IS SEPARATE QUESTION FROM VALIDITY OF CONTRACT AWARD AND FORMER IS NOT PROBATIVE EVIDENCE DISPOSITIVE OF LATTER ISSUE.

SOCIAL SYSTEMS TRAINING AND RESEARCH, INC.:

SOCIAL SYSTEMS TRAINING AND RESEARCH, INC. (SSTAR), HAS PROTESTED A CONTRACT AWARD BY THE UNITED STATES COAST GUARD TO SYSTEMS IN EDUCATION & TRAINING, INC. (SET), RESULTING FROM REQUEST FOR PROPOSALS (RFP) CG 51,133 -A TO CONDUCT A DRIVER TRAINING PROGRAM.

THE RFP REQUIRED PRICES FOR TWO ITEMS: (1) COST PER MONTH FOR THREE INSTRUCTORS; AND (2) COST PER WEEK PER INSTRUCTOR FOR ADDITIONAL INSTRUCTORS ABOVE THREE. ITEM 1 WAS EVALUATED ON A 9-MONTH BASIS, WHILE ITEM 2 WAS EVALUATED ON AN ESTIMATED 10 ADDITIONAL INSTRUCTOR WEEKS. PERFORMANCE COVERED FROM DATE OF AWARD THROUGH JUNE 30, 1975. THE WORK STATEMENT INDICATED THAT A RATIO OF ONE INSTRUCTOR PER TWENTY STUDENTS WAS CONTEMPLATED (AVERAGE OF 60 STUDENTS PER WEEK) AND A MAXIMUM OF 120 STUDENTS COULD BE ANTICIPATED FOR A 2- TO 4-WEEK PERIOD DURING MID AND LATE SUMMER PERIODS. VARIOUS MONTHLY REPORTING AND DATA COLLECTION TASKS WERE IMPOSED UPON THE INSTRUCTORS, IN ADDITION TO THE CLASSROOM AND DRIVING RANGE TRAINING. THE RFP ALSO SPECIFIED THAT THE OFFEROR WOULD BE REQUIRED TO MAINTAIN A SUFFICIENT NUMBER OF VEHICLES TO MEET THE ANTICIPATED STUDENT LOAD, APPROXIMATELY 16 CARS, PLUS VARIOUS OTHER CLASSROOM EQUIPMENT.

PROPOSALS WERE RECEIVED TIMELY FROM SSTAR, DUAL SYSTEMS DRIVING SCHOOLS (DUAL), AND SET IN THE RESPECTIVE AMOUNTS OF $84,456, $57,187 AND $50,561.90. THEREAFTER, DISCUSSIONS WERE CONDUCTED WITH DUAL AND SET ONLY ON SEPTEMBER 26 AND 27, 1974, RESPECTIVELY. THE COAST GUARD STATES THAT THE DISCUSSIONS ENCOMPASSED ONLY MATTERS THAT PERTAINED TO THE PROSPECTIVE RESPONSIBILITY OF THE TWO CONCERNS. THE MEMORANDUM OF NEGOTIATION MAINTAINED BY THE CONTRACT NEGOTIATOR LISTS THE ONLY SUBJECT OF DISCUSSION WITH SET AS "WHAT TECHNICALLY THE COAST GUARD EXPECTED OF WHOEVER GOT THE CONTRACT ***." THE MEMORANDUM OF THE DISCUSSION WITH DUAL EVIDENCES THAT IN ADDITION TO A DISCUSSION OF WHAT WAS TECHNICALLY EXPECTED OF THE SUCCESSFUL COMPETITOR, NUMEROUS OTHER AREAS WERE PURSUED. IT IS STATED BY THE COAST GUARD THAT THE REASON SSTAR WAS OMITTED FROM DISCUSSIONS WAS DUE TO THE FACT THAT SSTAR HAD PERFORMED PREVIOUSLY AND WAS CONSIDERED AUTOMATICALLY QUALIFIED.

ON SEPTEMBER 27, 1974, THE COAST GUARD INFORMED ALL THREE OFFERORS THAT THEIR TECHNICAL PROPOSALS WERE ACCEPTABLE AND THAT BEST AND FINAL OFFERS WOULD BE RECEIVED UNTIL OCTOBER 1, 1974. REVISED PRICES WERE SUBMITTED BY ALL THREE COMPETITORS:SSTAR - $75,950; DUAL - $56,195; SET - $53,318.90. SINCE SET'S PROPOSED PRICE WAS LOW, AWARD WAS THEN MADE TO IT ON OCTOBER 4, 1974, AT A UNIT PRICE FOR ITEM 1 OF $5,520.22 OR $49,681.98 FOR A 9- MONTH PERIOD, AND A PRICE OF $3,636.90 FOR ITEM 2.

SSTAR PROTESTS THE AWARD ON TWO BASES. FIRST, SET'S LOW PRICE AND LACK OF TRAINED PERSONNEL INDICATE THAT IT IS NOT RESPONSIBLE. SECOND, ALL OFFERORS DID NOT COMPETE EQUALLY BECAUSE OFFERORS OTHER THAN SSTAR WERE PERMITTED TO BASE THEIR PROPOSALS ON A SUBSTANTIALLY LOWER LEVEL OF EFFORT THAN STATED IN THE RFP.

REGARDING THE FIRST BASIS OF PROTEST, OUR OFFICE HAS DISCONTINUED ITS PRACTICE OF REVIEWING PROTESTS AGAINST AFFIRMATIVE DETERMINATIONS OF COMPETITOR'S RESPONSIBILITY DUE TO THE SUBSTANTIAL DEGREE OF DISCRETION AFFORDED CONTRACTING OFFICIALS IN REACHING THAT DETERMINATION, WHICH IN TURN DIRECTLY ADVERSELY IMPACTS UPON THE LIKELIHOOD OF SUCCESS OF A PROTEST ON THIS BASIS. MATTER OF SPOT COMMERCIAL MAINTENANCE, INC., ET. AL., B-178701, JANUARY 17, 1975, AND CASES CITED THEREIN.

IN SUPPORT OF ITS SECOND GROUND OF PROTEST, SSTAR MAINTAINED, AT A CONFERENCE HELD AT OUR OFFICE, THAT THE PRESENT LEVEL OF EFFORT UNDER THE CONTRACT AWARDED SET IS PROBATIVE OF THE COAST GUARD'S APPROACH TO THE LEVEL OF EFFORT ISSUE. SSTAR ALLEGES THAT THE 20:1 INSTRUCTOR/STUDENT RATIO HAS NOT BEEN MAINTAINED. SSTAR ARRIVES AT THIS CONCLUSION IN LIGHT OF THE FIGURES SUBMITTED BY THE COAST GUARD. FOR EXAMPLE PURPOSES, THE 9- WEEK PERIOD FROM OCTOBER 14, 1974, THROUGH DECEMBER 9, 1974, SHOWS AN AVERAGE STUDENT ENROLLMENT OF APPROXIMATELY 81 PER WEEK. THE COAST GUARD COMPUTES ITS RATIO ON THE BASIS OF FOUR INSTRUCTORS (THE OPTION ITEM FOR EIGHT INSTRUCTOR WEEKS WAS EXERCISED TO COMMENCE OCTOBER 14, 1974). SSTAR, NOTING THE REPORTING AND MAINTENANCE REQUIREMENTS, STATES THAT ALL FOUR INSTRUCTORS COULD NOT BE FULFILLING INSTRUCTIONAL REQUIREMENTS, WHILE AT THE SAME TIME PREPARE REPORTS AND MAINTAIN THE VEHICLES AND OTHER EQUIPMENT. SSTAR ALSO ALLEGES THAT THE CONTRACTING OFFICER WAS AWARE OF THE CRITICAL NEED FOR, AT THE LEAST, A FULL TIME SECRETARY TO MEET THE REPORTING REQUIREMENTS AS A RESULT OF HIS ADMINISTRATION OF THE PREVIOUS CONTRACT, WHICH WAS HELD BY SSTAR. FROM THE FOREGOING, SSTAR MAINTAINS THAT THE CONTRACTING OFFICER KNEW AT THE TIME OF AWARD, AS EVIDENCED BY SUBSEQUENT EVENTS, THAT THE RATIO REQUIREMENT COULD NOT BE MET.

THE COAST GUARD MAINTAINS THAT PRICE WAS THE SOLE DETERMINATIVE FACTOR FOR AWARD, ONCE ALL FIRMS WERE CONSIDERED TECHNICALLY CAPABLE OF PERFORMING. THE COAST GUARD MAINTAINS THAT ALL COMPETITORS WERE TOLD TO SUBMIT THEIR PROPOSALS ON THE BASIS OF THE REQUIREMENTS AS STATED IN THE SPECIFICATIONS. IT IS THE COAST GUARD'S POSITION THAT THE MANNER IN WHICH THE CONTRACTUAL REQUIREMENTS FOR REPORTING AND MAINTENANCE ARE MET ARE THE SOLE RESPONSIBILITY OF THE CONTRACTOR - THE GOVERNMENT ONLY BEING CONCERNED WITH THE END RESULT. IN THIS REGARD, THE COAST GUARD STATES IN ITS REPORT FROM THE CONTRACTING OFFICER UNDER COVER LETTER DATED FEBRUARY 26, 1975, THAT ALL OF THE CONTRACT REQUIREMENTS ARE BEING MET IN A TIMELY FASHION WITH THE STAFFING LEVEL OF THREE COURSE INSTRUCTORS, PLUS ONE ADDITIONAL INSTRUCTOR.

AS SSTAR'S PROTEST RAISES THE ISSUE OF DEFECTIVE SPECIFICATIONS - THE STAFFING LEVEL SPECIFIED IN THE RFP WAS UNREALISTIC AND INCAPABLE OF FULFILLMENT - IT IS UNTIMELY AND WILL NOT BE CONSIDERED ON ITS MERITS. SECTION 20.2 OF OUR INTERIM BID PROTEST PROCEDURES AND STANDARDS (4 C.F.R. PART 20 (1974)) REQUIRES THAT PROTESTS BASED UPON ALLEGED IMPROPRIETIES ON THE FACE OF A SOLICITATION MUST BE PROTESTED PRIOR TO THE CLOSING DATE FOR RECEIPT OF PROPOSALS, IN THIS CASE, SEPTEMBER 20, 1974. THE SSTAR PROTEST LETTER DATED OCTOBER 7, 1974, SENT TO OUR OFFICE AND THE COAST GUARD AT THE SAME TIME, IS BEYOND THE STIPULATED PERIOD.

CONCERNING WHETHER ALL COMPETITORS WERE COMPETING EQUALLY, WE NOTE THAT AWARD WAS MADE TO THE LOW OFFEROR ON THE BASIS OF THE SPECIFICATIONS STATED IN THE RFP. SSTAR RECOGNIZES THIS IN ITS LETTER DATED NOVEMBER 15, 1974. THIS ASPECT OF SSTAR'S PROTEST IS INEXTRICABLY INTERTWINDED WITH ITS DISAGREEMENT AS TO THE ADEQUACY OF THE SPECIFICATIONS DISCUSSED ABOVE. IT APPEARS THAT THE REASON SSTAR'S PRICE PROPOSAL WAS SO MUCH HIGHER THAN THE OTHER COMPETITORS IS ATRRIBUTABLE TO THE INCLUSION OF COST FACTORS NOT MANDATED BY THE SPECIFICATIONS. WITHOUT PROTESTING TO THE CONTRACTING OFFICER, OR HAVING REQUESTED A WRITTEN CLARIFICATION BEFORE SUBMITTING ITS PROPOSAL, SSTAR WAS NOT JUSTIFIED IN UNILATERALLY BASING ITS PRICE PROPOSALS ON A LEVEL OF EFFORT BEYOND THAT REQUIRED BY THE SPECIFICATIONS. IN THIS REGARD, STANDARD FORM 33A (MARCH 1969), WHICH WAS INCORPORATED IN THE RFP BY REFERENCE, PROVIDED AT PARAGRAPH 3 THAT "*** ANY EXPLANATION DESIRED BY AN OFFEROR REGARDING THE MEANING OR INTERPRETATION OF THE SOLICITATION DRAWINGS, SPECIFICATIONS, ETC., MUST BE REQUESTED IN WRITING AND WITH SUFFICIENT TIME TO ALLOW A REPLY TO REACH OFFERORS BEFORE SUBMISSION OF THEIR OFFER." SSTAR STATES THAT IN RESPONSE TO ITS ORAL INQUIRY CONCERNING THE QUESTION OF SUPPORT STAFF, COAST GUARD ADVISED THAT THE PROPOSAL SHOULD BE FORMULATED ON THE BASIS OF INSTRUCTIONAL AND SUPPORT STAFF CALLED FOR IN THE SPECIFICATIONS. HOWEVER, THE RFP ONLY REQUIRED PRICES FOR TWO ITEMS, THREE INSTRUCTORS AND AN OPTIONAL FOURTH INSTRUCTOR.

SSTAR CITES 45 COMP. GEN. 71, 75 (1965) FOR THE PROPOSITION THAT AN AWARD TO A BIDDER DEVIATING FROM AN ADVERTISED SPECIFICATION DOES NOT RESULT IN A BINDING CONTRACT, INASMUCH AS ITS CONTRAVENES THE PRESCRIPTION OF 10 U.S.C. SEC. 2305(C) THAT AWARD MUST BE MADE ON THE BASIS OF THE SAME SPECIFICATION OFFERED ALL BIDDERS. THAT CASE IS DISTINGUISHABLE IN THAT IT INVOLVES A FORMALLY ADVERTISED PROCUREMENT. THE PRESENT PROCUREMENT WAS NEGOTIATED. MORE IMPORTANTLY, AS OBSERVED ABOVE, AWARD WAS MADE ON THE BASIS OF THE SPECIFICATIONS AS CONTAINED IN THE RFP AND THERE IS NO EVIDENCE THAT OFFERORS WERE NOT COMPETING ON AN EQUAL BASIS.

SSTAR HAS RAISED A COLLATERAL ISSUE WHICH NEEDS TO BE DISCUSSED, THAT IS THE ADMINISTRATION OF THE CONTRACT AND WHETHER THE SPECIFICATIONS ARE BEING MET. THIS IS A FUNCTION OF THE PROCURING ACTIVITY WHICH WE WILL NOT QUESTION, PRIMARILY BECAUSE IT IS THE ACTIVITY WHICH MUST DEAL WITH THE CONTRACTOR ON A CONTINUING BASIS. CONSEQUENTLY, THE MANNER IN WHICH THE CONTRACT IS ADMINISTERED DOES NOT IMPACT UPON THE VALIDITY OF AN AWARD. WE VIEW THE TWO SEPARATELY, AND THE FORMER IS NOT PROBATIVE EVIDENCE DISPOSITIVE OF THE LATTER ISSUE.

WHILE THE RFP DID NOT LIST THE FACTORS AGAINST WHICH THE PROPOSALS WERE TO BE EVALUATED (SEE MATTER OF AEL SERVICE CORPORATION, ET. AL., 54 COMP. GEN. 800 (1974)) WE DO NOT PERCEIVE ANY PREJUDICE FROM THE OMISSION. IS CLEAR THAT AWARD WAS CONTEMPLATED ON THE BASIS OF LOW PRICE. HOWEVER, WE ARE BRINGING THIS MATTER TO THE ATTENTION OF THE SECRETARY OF TRANSPORTATION FOR CORRECTION IN FUTURE PROCUREMENTS.

IT ALSO APPEARS THAT THIS PROCUREMENT COULD HAVE BEEN FORMALLY ADVERTISED. WHEN FORMAL ADVERTISING IS FEASIBLE AND PRACTICABLE UNDER THE EXISTING CIRCUMSTANCES IT IS THE PREFERRED METHOD OF PROCUREMENT. THE FACT THAT A PROCUREMENT MAY FALL WITHIN ONE OF THE STATUTORY EXCEPTIONS TO THE REQUIREMENT FOR FORMAL ADVERTISING IS NOT SUFFICIENT JUSTIFICATION TO NEGOTIATE IF FORMAL ADVERTISING IS, AT THE SAME TIME, FEASIBLE AND PRACTICABLE. WE RECOGNIZE THAT IN THIS INSTANCE OFFERORS WERE GIVEN AN OPPORTUNITY TO REVISE THEIR INITIAL PRICES AFTER THE DETERMINATIONS OF RESPONSIBILITY HAD BEEN CONDUCTED. NOTWITHSTANDING THAT FACT, THE RECORD DOES NOT INDICATE THAT THE DISCUSSIONS WHICH OCCURRED INFLUENCED THE REVISED PRICES. FURTHER, THE SPECIFICATION WAS SUFFICIENTLY COMPLETE TO PERMIT FORMAL ADVERTISING, A FIXED-PRICE CONTRACT WAS CONTEMPLATED AND AWARDED AND THE COMPETITION WAS SOLELY ON PRICE. SEE FOR EXAMPLE, 52 COMP. GEN. 569 (1973). IN SPITE OF OUR DIFFERENCE OF OPINION AS TO THE BEST PROCUREMENT METHOD TO HAVE BEEN FOLLOWED, AGAIN WE DO NOT FEEL THAT ANY OFFEROR WAS PREJUDICED BY THE AGENCY'S CHOICE.

THE PROTEST IS THEREFORE DENIED.