Credence Management Solutions, LLC; Advanced Concepts and Technologies International, LLC

Decision

Matter of:Credence Management Solutions, LLC; Advanced Concepts and Technologies International, LLC

File:  B-415960; B-415960.2; B-415960.3; B-415960.4; B-415960.5

Date:   May 4, 2018

DIGEST

1.  Protests challenging the agency’s evaluation of proposals are denied where the agency’s evaluation was reasonable and consistent with the terms of the solicitation.

2.  Protests alleging that the agency engaged in disparate treatment in the evaluation of proposals are denied where the differing evaluation results were reasonably based on substantive differences between the proposals.

Advanced Concepts and Technologies International, LLC (ACTI), of Waco, Texas, and Credence Management Solutions, LLC (Credence), of Vienna, Virginia, protest the issuance of a task order to QuantiTech, Inc., of Huntsville, Alabama, under request for proposals (RFP) No. ID04170046, issued by the General Services Administration (GSA), for programmatic assistance services to the project management office (PMO), Aircraft Survivability Equipment (ASE) in Huntsville, Alabama.  The protesters challenge the agency’s evaluation of proposals.

We deny the protests.

BACKGROUND

The RFP, issued in accordance with the procedures of Federal Acquisition Regulation (FAR) section 16.505 on August 25, 2017, sought a contractor to provide programmatic assistance services to the PMO ASE to support its mission to research, develop, field, and sustain ASE technology.[1]  Agency Report (AR), Tab 18A, RFP Instructions, at 1-2; Tab 18B, RFP Performance Work Statement (PWS), at 5.  The competition was limited to firms holding one of GSA’s One Acquisition Solution for Integrated Services (OASIS) small business pool 1 multiple-award indefinite-delivery, indefinite-quantity (IDIQ) contracts.  Tab 18A, RFP Instructions, at 1.  The RFP contemplated the issuance of a task order with fixed-price, labor-hour, and cost-reimbursable contract line item numbers (CLINs) for a base year and four 1-year option periods.[2]  Id. at 2-3.

Award was to be made on a best-value tradeoff basis considering three evaluation factors:  (1) technical, (2) past performance, and (3) price.  Id. at 10.  The technical factor would be more important than past performance, and the non-price factors would be significantly more important than price.  Id.  The technical factor consisted of three subfactors, listed in descending order of importance:  management approach, staffing, and transition-in plan.  Id. at 10-13.

For the management approach subfactor, offerors were required to address four elements, including, as relevant here, organizational structure, communication, and performance.  RFP at 15.  For the organizational structure element, offerors were required to provide and explain their proposed organizational structure, including relationships for reporting and review.  Id.  Additionally, the RFP required offerors to identify where proposed labor positions would be placed within the organizational structure and the applicable PWS references that these labor positions would perform.[3]  Id.  The RFP also advised that if applicable, the offeror should identify how the subcontractor(s) relate to, and function within, the offeror’s organizational structure.  Id.  For the communication element, offerors were required to identify and explain the process for controlling information flow and communication among subcontractors, the customers, and other government personnel.  Id.  For the performance element, offerors were required to provide and explain the procedures for planning, allocating, and controlling resources, including processes for scheduling, tracking, measuring task order performance, and quality control.  Id.  In evaluating these elements, the government would determine its overall confidence in “whether the Offeror clearly addressed each item” and “how well the Offeror demonstrated a sound management approach” to effectively manage the task order requirements and perform high-quality services.  Id. at 15-16 (emphasis in original).

With respect to the staffing subfactor, offerors were required to address recruiting and retention, and compensation and benefits.  Id. at 16.  As relevant here, under the compensation and benefits element, offerors were required to submit a total compensation plan setting forth the proposed salaries and fringe benefits for the prime contractor’s and subcontractor’s professional employees.  Id.  Additionally, the plan required the inclusion of the direct hourly labor rate and employee total compensation (ETC) labor rate, for the base and option years, for each labor category and its associated skill level for the fixed-price and labor-hour CLINs.  Id.  The RFP required that compensation levels must not only reflect a clear understanding of the work to be performed, but also indicate the capability to obtain and keep suitably qualified personnel.  Id.  The RFP further stated that the government was concerned with the quality and stability of the workforce to be employed on the task order and advised that professional compensation found to be unrealistically low or not in reasonable relationship to the various job categories could be viewed as evidence of a failure to comprehend the complexity of the task order requirement or could indicate a lack of sound management judgment.  Id. 

In evaluating the staffing subfactor, proposals would be evaluated on whether an offeror “clearly addressed each item” and “how well” the offeror demonstrated an understanding of the requirements, sound staffing management approach, and the ability to provide uninterrupted high quality work based on a determination of whether proposed compensation was commensurate with the Huntsville, Alabama area.  Id. at 17 (emphasis in original).  Specifically, for evaluating the compensation and benefits element, the RFP advised that the government would develop ETC rates for the Huntsville, Alabama area for each labor category and associated skill level and would compare the government’s rates to the offeror’s proposed ETC labor rates to determine if the offeror’s rates were commensurate with rates for the Huntsville area.  Id. at 17-18.  The RFP stated that there were a total of 15 labor categories for the fixed-price and labor-hour CLINs.  Id. at 18.  The RFP noted that if an offeror’s proposed ETC labor rates for more than four labor categories were more than 10 percent below the government’s established ETC labor rate, the offeror would be considered a performance risk, and assigned a level of weakness.  Id.  The RFP also advised that the realism analysis was limited to the total compensation plan, and that most probable cost adjustments would not be made.  Id. 

Proposals were to be evaluated in three phases.  Tab 18A, RFP Instructions, at 10.  In Phase 1, the technical factor and subfactors would be evaluated and assigned ratings of highly acceptable, acceptable, or unacceptable.[4]  Id.  The RFP advised that an unacceptable rating in any one subfactor, regardless of the ratings in the other subfactors, could lead to an overall unacceptable rating.  Id.  A technical proposal receiving an overall unacceptable rating could be eliminated from further award consideration.  Id.  Phase 2 would consist of the past performance and price evaluation,[5] and Phase 3 would consist of the best-value determination.[6]  Id.

On October 25, the agency received 14 revised proposals, including ACTI’s, Credence’s, and QuantiTech’s.[7]  CO Statements at 5.  A technical evaluation panel (TEP) evaluated proposals under the technical and past performance factors and reached consensus findings and ratings.  Id. at 7. 

In evaluating ACTI’s proposal, as relevant here, the agency determined that 14 of ACTI’s proposed ETC labor rates were below the government’s minimum acceptable rates and assigned the proposal a significant weakness and a high risk of unsuccessful performance.[8]  AR, Tab 8, Consensus Evaluation Report, at 5.  The agency calculated that ACTI’s 14 unacceptable labor rates were on average 29.73 percent lower than the government’s rates.  Id.  The agency concluded that the proposal failed to demonstrate an adequate understanding of the requirement and rated the staffing subfactor as unacceptable.  Id.  Despite this unacceptable rating, the agency determined that it had sufficient confidence that ACTI could perform the overall requirement, given ACTI’s identified strengths, lack of weaknesses, and acceptable ratings assigned to the firm’s proposal for the management approach and transition-in plan subfactors.  Tab 9, Award Decision, at 24.  The agency assigned an acceptable rating to ACTI’s proposal under the technical factor.  Id.

In evaluating Credence’s proposal, as relevant here, the agency determined that Credence failed to explain the process for planning, allocating, and controlling resources.  AR, Tab 8, Consensus Evaluation Report, at 30.  In this regard, the agency determined that Credence’s proposal did not provide sufficient detail to support its approach to provide ready-to-use tools, templates, and processes to support its program management framework and assigned a weakness to the firm’s proposal for the performance element of the management approach subfactor.  Id.  Additionally, the agency determined that Credence’s proposal offered six unacceptable ETC labor rates that were, on average, 16.93 percent lower than the government’s minimums, while the nine acceptable rates were 5.35 percent higher than the government’s minimums.  Id. at 31. The agency stated that it considered the risk of unsuccessful performance to be moderate and, based on the acceptable ratings under the technical subfactors, assigned the firm’s proposal an acceptable rating under the technical factor.  Id. at 28.

The final ratings were as follows:

	ACTI	Credence	QuantiTech
Technical Factor	Acceptable	Acceptable	Highly Acceptable
Management Approach subfactor	Acceptable	Acceptable	Highly Acceptable
Staffing subfactor	Unacceptable	Acceptable	Acceptable
Transition-In Plan subfactor	Acceptable	Acceptable	Acceptable
Past Performance	Medium Confidence	Significant Confidence	Medium Confidence
Price	$78,205,541	$103,589,914	$108,247,706

AR, Tab 9, Award Determination, at 42. 

The CO, acting as the source selection authority (SSA), conducted an independent, integrated assessment based on the evaluation findings in order to determine the best-value proposal.  Id. at 41.  In discussing proposals, the CO stated that there was a noticeable difference between the proposals from Credence, QuantiTech, and another offeror, all of which were within 10 percent of the independent government estimate (IGE), on the one hand, and the proposals from ACTI and two other offerors, which were more than 20 percent below the IGE, on the other hand.  Id. at 42.  Based on a review of the compensation and benefit element under the staffing subfactor, the agency concluded that each of the latter offerors not only received a significant weakness based on a high number of unacceptable ETC labor rates, but also were rated unacceptable under the staffing subfactor.  Id.  QuantiTech’s and Credence’s proposals received a weakness for this subfactor.  Id.  Additionally, the agency identified QuantiTech’s proposal as the most highly rated, and compared other offerors’ proposals to QuantiTech’s to determine the best-value proposal.  Id. at 43.  In this regard, the agency identified three significant strengths assigned to QuantiTech’s proposal under the most important technical subfactor, management approach, as discriminators that made QuantiTech’s proposal “far superior” to Credence’s and ACTI’s proposals.  Id. at 44, 46. 

For ACTI, the CO noted that ACTI’s technical factor was considered to present a higher risk to successful performance and noted that, despite a 27.8 percent price premium, QuantiTech’s proposal represented a better value than ACTI’s.  Id. at 45.  For Credence, the agency noted that despite the superior past performance rating assigned to Credence’s proposal, QuantiTech’s proposal was “noticeably superior” to Credence’s under the technical factor and management approach subfactor, the most important factor and subfactor, respectively.  Id. at 46.  Additionally, the agency concluded that despite a 4.3 percent price premium, QuantiTech’s proposal offered a better value than Credence’s.  Id. at 47.

The agency selected QuantiTech’s proposal as offering the best value and notified offerors of award.  ACTI and Credence requested and received debriefings prior to protesting to our Office. [9]

DISCUSSION

The protesters challenge the agency’s evaluation of proposals.  We have reviewed the protesters’ arguments and conclude that none offers a basis to sustain the protests.  We discuss the protesters’ pertinent challenges below.[10]

In reviewing protests challenging the evaluation of proposals in a task order competition, we do not conduct a new evaluation or substitute our judgment for that of the agency, but examine the record to determine whether the agency’s judgment was reasonable and in accord with the evaluation criteria and applicable procurement laws and regulations.  IndraSoft, Inc., B-414026, B-414026.2, Jan. 23, 2017, 2017 CPD ¶ 30 at 6.  A protester’s disagreement with an agency’s judgment is not sufficient to establish that an agency acted unreasonably.  See SRA Int’l, Inc.; Vistronix, LLC, B-413000, B-413000.2, July 25, 2016, 2016 CPD ¶ 208 at 10. 

Management Approach Subfactor Evaluation

Credence challenges the assessment of a weakness to its proposal under the performance element of the management approach subfactor for failing to provide sufficient detail regarding ready-to-use tools templates and processes for the protester’s program management framework.  Protest at 20.  Credence contends that its proposal provided a detailed response that identified the tools, templates, or processes it intended to use.  Id. at 21.  Credence also contends that it should have been rated higher under the management approach and staffing subfactors. 

The RFP instructed offerors to explain the procedures for planning, allocating, and controlling resources, including the process for scheduling, tracking, measuring task order performance, as well as quality control processes, and stated that the evaluation would be based on whether the offeror clearly demonstrated a sound approach to these tasks.  RFP at 15. 

Credence did not identify its proposed tools, templates, or processes under the performance element of the management approach subfactor.  Credence’s proposal stated that “[u]sing a customized [performance management framework] aligned with PMO ASE requirements, Team Credence will provide ready-to-use tools, templates, and processes which will support optimal efficiencies and minimize risks while enhancing performance and delivery.”  AR, Tab 51B, Credence Proposal, at 9.  The TEP determined that the proposal did not support its claim to “support optimal efficiencies and minimizing risk while enhancing performance and delivery” with any details of the specific tools, templates, processes, or metrics that would be used to manage the performance of this requirement.  See AR, Tab 8, Consensus Evaluation Report, at 28; Memorandum of Law (MOL) at 12. 

Additionally, the agency found that the proposal did not explain how these proposed tools, templates, or processes would be used, and that the lack of detail prevented a meaningful evaluation.  MOL at 12.  To the extent the protester argues that the proposal detailed such items, the record reflects otherwise.  Items such as SharePoint,[11] and the integrated master schedule, for example, were referenced under the communication element of the management approach subfactor rather than the performance element.  See AR, Tab 51B, Credence Proposal, at 8.  In addition, these items were not identified as the tools, templates, or processes.  Id. at 8-9.  Similarly, items that were identified under the performance element, such as CMMI (Capability Maturity Model Integration) or quality control processes, were also not specifically identified as tools, templates, or processes.  Id. at 10.  On this record, we find no basis to sustain the protest.

To the extent Credence asserts it should have received higher ratings under the management approach and staffing subfactors, the essence of an evaluation is reflected in the evaluation record itself, not the adjectival ratings assigned; there is no legal requirement that an agency must award the highest possible rating, or the maximum point score, under an evaluation factor simply because a proposal or quotation contains strengths or is not evaluated as having any weaknesses, or both.  Science Application Int’l Corp., B-413112, 413112.2, Aug. 17, 2016, 2016 CPD ¶ 240 at 10.  Additionally, the record here demonstrates that the SSA properly evaluated the proposals and exercised his discretion in differentiating between the competing proposals and determining which provided the best value to the agency.  AR, Tab 9, Award Decision, at 41-49.  While Credence disagrees with the agency’s assessment, it has not shown that the agency’s evaluation was unreasonable or contrary to the solicitation.

Staffing Approach Subfactor Evaluation

ACTI and Credence both raise challenges to the agency’s evaluation of the staffing subfactor.  We address each protester’s primary arguments.

ACTI contends that the agency’s assessment of a significant weakness under the staffing subfactor was flawed because GSA did not substantiate the IGE against compensation data under the predecessor contract.  ACTI Comments at 6, 8.  In response, the agency explains that it created the IGE using a database that compiled data from the Bureau of Labor Statistics direct labor and other compensation rates, a national survey of employers, and occupational wage data collected from employers of every size, in every state, metropolitan, and non-metropolitan area in all industries, except self-employed persons.  ACTI CO Statement at 16; MOL at 5.  Additionally, the agency explains that the structure of the prior contract and changes to the requirement, for example, the conversion from a cost-type contract with a lower level of effort performed by a large business under the prior contract to a fixed-price contract with an increased level of effort to be performed by a small business on the instant solicitation, precluded the agency from relying on information from the predecessor contract.  ACTI CO Statement at 14; AR, Tab 9, Award Decision, at 3; ACTI Supp. AR, Tab 6, Declaration of the CO Representative, at 1-2.

Credence contends that the agency’s evaluation and assessment of a weakness was unreasonable.  Credence Protest at 15.  In this regard, Credence contends that the agency erred in not considering the methodology Credence used to develop its rates.  Id. at 16-20.

In similar cases, we have found that the purpose of evaluating the proposed compensation for professional employees is to determine whether offerors will obtain and keep the quality of professional services needed for adequate contract performance, and to evaluate whether offerors understand the nature of the work to be performed.  MicroTechnologies, LLC, B-413091.4, Feb. 3, 2017, 2017 CPD ¶ 48 at 8.  In the context of fixed-price contracts, our Office has explained that an evaluation of such compensation is designed to anticipate whether an awardee understands the contract requirements, and has proposed a compensation plan appropriate for those requirements--in effect, a price realism evaluation regarding an offeror’s proposed compensation.  See Apptis Inc., B-403249, B-403249.3, Sept. 30, 2010, 2010 CPD ¶ 237 at 9.  The depth of an agency’s price realism analysis is a matter within the sound exercise of the agency’s discretion.  ENMAX Corp., B-281965, May 12, 1999, 99-1 CPD ¶ 102 at 9.  In reviewing protests challenging price realism evaluations, our focus is on whether the agency acted reasonably and in a manner consistent with the solicitation’s requirements.  Navistar Def., LLC; BAE Sys., Tactical Vehicles Sys. LP, B-401865 et al., Dec. 14, 2009, 2009 CPD ¶ 258 at 17.

Here, the RFP required offerors to provide ETC labor rates that could attract and retain professional employees in the Huntsville area.  RFP at 16.  Additionally, the RFP advised offerors that the government would compare the offeror’s proposed ETC labor rates to the government’s established ETC labor rates, and, if more than four labor category rates were found to be more than 10 percent lower than the agency’s ETC rates, the offeror would be considered a performance risk and assigned a level of weakness.  Id. at 18.

In reviewing ACTI’s proposed ETC labor rates, the agency determined that ACTI’s proposal included 14 rates that were more than 10 percent below the ETC rates established by the agency.  Accordingly, the agency assigned ACTI’s proposal a significant weakness and determined that ACTI’s proposed staffing represented a high risk of unsuccessful performance.  In reviewing Credence’s proposed ETC rates, the agency determined that Credence’s proposal included six unacceptable rates and assigned Credence’s proposal a weakness.

While our Office generally disfavors mechanical evaluations of proposals, where, as here, the solicitation placed offerors on notice that the agency did not intend to look beyond a comparison between an offeror’s and the government’s proposed ETC labor rates, we have no basis to find the agency’s evaluation unreasonable.[12]  See e.g., Native Resource Dev. Co., B-409617.3, July 21, 2014, CPD ¶ 217 at 4-5 (protest sustained where agency mechanically compared staffing estimates to an undisclosed IGE without looking at the offeror’s proposed staffing); cf., ENMAX Corp., supra (protest denied where the RFP placed offerors on notice that the agency may not look beyond a comparison of an offeror’s proposed rates to rates compiled by the government).

Additionally, we find ACTI’s allegations that the IGE was unsubstantiated unavailing.  In this context, we have no basis to object to the agency’s explanation for why it did not use data from the predecessor contract to substantiate the IGE, given the changes the agency identified between the predecessor contract and this acquisition.  Moreover, the protester’s various challenges to the validity of the IGE or the methodology used to create the IGE--for example, that ACTI’s methodology for developing its rates included validation against data from multiple sources, that two of ACTI’s subcontractors proposed compensation rates substantially below the IGE, or that every offeror proposed at least three or more compensation rates that were below the rates in the IGE, see ACTI Comments at 9-10--do not substantively show that the agency’s methodology or data used to create the IGE was incorrect or unreasonable.  See Energy Enterprise Solutions, LLC; Digital Mgmt., Inc., B-406089 et al., Feb. 7, 2012, 2012 CPD ¶ 96 at 4.  Accordingly, we find the agency’s evaluation unobjectionable.

Disparate Treatment Allegations

Credence and ACTI argue that the agency engaged in disparate treatment of offers under the management approach subfactor in assigning certain strengths or significant strengths, to QuantiTech’s proposal, but not to the protesters’.  Credence Supp. Protest at 3; ACTI Supp. Protest at 18.  We find no merit to these challenges.  Below, we discuss a few examples.

It is a fundamental principle of federal procurement law that a contracting agency must treat all offerors equally and evaluate their proposals evenhandedly against the solicitation’s requirements and evaluation criteria.  Sumaria Sys., Inc.; COLSA Corp., B-412961, B-412961.2, July 21, 2016, 2016 CPD ¶ 188 at 10.  Where a protester alleges unequal treatment in a technical evaluation, it must show that the differences in ratings did not stem from differences in the proposals.  See Serv1Tech, Inc., B-413758.6 et al., May 11, 2017, 2017 CPD ¶ 145 at 9. 

For example, ACTI alleges that although it also provided a clear description of the allocation of positions to include roles and responsibilities across the offeror’s and government’s structure under the organizational structure element of the management subfactor, only QuantiTech’s proposal received a significant strength.  ACTI’s Comments and Supp. Protest at 19.  The agency responds that it assigned a significant strength because QuantiTech’s proposal, unlike ACTI’s, included information regarding the [DELETED] that would be responsible for the position.[13]  ACTI Supp. CO Statement at 2.

In this regard, the record shows that QuantiTech’s proposal included [DELETED] that corresponded to the offices to be supported under the task order.  ACTI Supp. AR, Tab 7, QuantiTech Revised Proposal, at 7-11.[14]  Specifically, for each function [DELETED], QuantiTech’s proposal identified the [DELETED] that would be responsible for each position.  Id.  ACTI’s proposal contains a chart that identifies ACTI’s proposed resource alignment by crosswalk reference to the PWS, OASIS Occupation, labor category, headquarters, and product managers.  AR, Tab 33B, ACTI Revised Proposal, at 5-6.  It does not, however, identify whether the prime or subcontractor would be performing the task.  Id.  Accordingly, we have no basis to question the agency’s evaluation.

As another example, Credence contends that similar to QuantiTech’s proposal, its proposal offered a detailed communication plan that included internal weekly, monthly and quarterly meetings supported by descriptions of items to be reviewed.  Credence Supp. Protest at 5.  In response, the agency explains that the references to weekly status reporting and monthly internal cost and schedule reporting in Credence’s proposal were identified under the performance element of the management approach subfactor, and, moreover, were found to be vague and lacking details.  MOL at 31.  Credence responds that it is advocating for a “holistic, qualitative evaluation” in which evaluators were not precluded from considering information proposed within each of the three technical subfactors, i.e., the management approach, staffing, and transition-in plan, even if titled under a separate heading.  Credence Comments at 8. 

Here, the RFP stated that the distinct elements under each subfactor would be evaluated on whether the offeror “clearly addressed each item.”  RFP at 15-18 (emphasis in original).  Thus, it was reasonable for GSA to limit its consideration to the information provided under a particular element or subfactor.  To the extent the protester is advocating for an evaluation scheme not contemplated by the solicitation, its argument is an untimely challenge to the terms of the solicitation that should have been raised prior to the submission of proposals.  See 4 C.F.R. § 21.2(a)(1).

To the extent the protesters raise challenges to the agency’s best-value tradeoff determination, given our conclusions above, we find no basis to sustain these arguments.

The protests are denied.

Thomas H. Armstrong
General Counsel

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