BNUMBER: B-258139.5
DATE: February 26, 1996
TITLE: Energy and Environmental Services
Corporation--Reconsideration
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DECISION FOR PUBLIC RELEASE
A protected decision was issued on the date below and was subject to a
GAO Protective Order. This version has been redacted or approved by
the parties involved for public release.
Matter of:Energy and Environmental Services
Corporation--Reconsideration
File: B-258139.5
Date:February 26, 1996
Jay W. Maynard, Esq., for the protester.
John Van Schaik, Esq., and Michael R. Golden, Esq., Office of the
General Counsel, GAO, participated in the preparation of the decision.
DIGEST
Request for reconsideration based on original decision's failure to
address protester's argument that contracting agency failed to perform
cost realism analysis of awardee's proposal, as required by Defense
Federal Acquisition Regulation Supplement (DFARS) sec. 215.801, is
denied; while original decision did not set forth and directly address
the requirements of DFARS sec. 215.801, the decision did address and deny
protester's numerous allegations that, in contravention of DFARS sec.
215.801, the agency failed to determine if awardee's proposed costs
for environmental services were (1) realistic for the work to be
performed, (2) demonstrated that awardee understood the requirements
of the solicitation, and (3) were consistent with its technical
approach.
DECISION
Energy and Environmental Services Corporation (EES) requests
reconsideration of our decision Energy and Envtl. Servs. Corp.,
B-258139.4, May 15, 1995, 95-2 CPD para. 32, in which we denied EES'
protest against the award of a contract to ASCR Contracting Company,
Inc. (ACCI) under request for proposals (RFP) No. DAAD01-93-R-0046,
issued by the Department of the Army for the acquisition of caretaker
and environmental services for the U.S. Army Jefferson Proving Ground.
We deny the request.
The RFP contemplated the award of a cost-plus-fixed-fee contract and
advised offerors that the contract would be awarded on the basis of
the best value to the government and that the government would be
willing to pay more for a superior technical/management proposal. The
solicitation also informed offerors that the government intended to
award the contract without holding discussions.
Of eight offers received in response to the RFP, ACCI's proposal was
ranked first technically with a score of 985 out of a possible 1,000
points and EES' proposal was ranked second with a score of 874. The
EES and ACCI proposals both received low risk ratings. ACCI proposed
the second lowest cost of $5,659,732, and EES proposed the second
highest cost of $14,168,513. The third ranked technical proposal,
with a score of 782.6, was the lowest in cost, $5,474,866. The fourth
ranked technical proposal had a score of 761.3 and, at $6,743,299, was
fourth low.
As explained in our decision, in recommending award to ACCI, the
contracting officer noted that ACCI's proposal was rated low risk for
performance; was technically superior to the others by a significant
margin; had no deficiencies and a number of advantages; and was only
3.3 percent higher in cost than the lowest-cost proposal, which had
two major deficiencies, a significant number of weaknesses, and only
one advantage. Award was made to ACCI based on its initial proposal.
In its protest, EES principally argued that the Army did not perform a
cost realism analysis of ACCI's cost proposal, as required by Defense
Federal Acquisition Regulation Supplement (DFARS) sec. 215.801. As EES
noted, that provision defines a cost realism analysis as "a review of
the overall costs of an offeror's proposal to determine if they--(1)
Are realistic for the work to be performed; (2) Reflect a clear
understanding of the requirements; and (3) Are consistent with the
various elements of the offeror's technical proposal." EES asserted
that, in contravention of DFARS sec. 215.801, the Army failed to
determine if ACCI's proposed costs for environmental services were
realistic for the work to be performed, demonstrated that ACCI
understood the requirements of the solicitation, or were consistent
with its technical approach. In making these arguments, EES focused
on various alleged inconsistencies between ACCI's technical and cost
proposals and argued that the agency failed to analyze the realism of
ACCI's proposed costs because agency officials failed to compare
ACCI's cost and technical proposals and therefore did not appreciate
these inconsistencies. In our decision, we concluded that the agency
had conducted an adequate cost realism analysis.
In its reconsideration request, EES' principal contention is that our
decision ignored the firm's primary basis for protest--that the Army
did not conduct a cost realism analysis because it failed to follow
the DFARS requirement that a cost realism analysis include a
comparison of each offeror's technical proposal to its cost proposal.
EES notes that our decision stated:
"Given that the PEB [proposal evaluation board] examined both
the technical and cost proposals and concluded that they were
consistent and accurately reflected [ACCI's] understanding and
proposed approach, there was no requirement that the cost
analyst also compare the two parts of the proposal. Rather,
in view of the PEB's determination, the cost analysis properly
was based on the assumption that the proposed staffing
reflected in the cost proposal was consistent with ACCI's
technical proposal."
EES argues that this paragraph misstates the facts. First, according
to EES, no agency official (including the PEB, the cost-price analyst,
and the contracting officer) ever compared each offeror's technical
proposal to its cost proposal, as required by DFARS sec. 215.801.
Second, EES argues that the Army never asserted that it compared cost
and technical proposals during the evaluation and also did not
contradict the protester's claim that such a comparison was required
by the DFARS. EES also maintains that, in its protest submissions, it
showed that the Army's cost analyst did not understand the process
involved in conducting a cost realism analysis but simply accepted the
offerors' costs as proposed. Additionally, EES states that, although
the Army claimed during the protest that the PEB chairman examined the
cost proposal, it is not clear whether anyone other than the PEB
chairman examined the proposal.[1]
Although our decision did not directly address the requirements of
DFARS sec. 215.801, we did find that these requirements were met.
Specifically, we addressed the agency's conclusion that the costs of
ACCI's proposal were realistic (we addressed EES' contentions that
ACCI's proposal was unrealistic because it did not include travel
costs for environmental services, did not include overhead other than
fringe benefits for caretaker services, and included a low general and
administrative rate), that ACCI's proposal reflected a clear
understanding of the requirements (we addressed EES' contention that
if the PEB had been aware of the low staffing level for environmental
services reflected in ACCI's cost proposal it would have concluded
that ACCI did not understand the requirements of the solicitation and
would have lowered ACCI's technical score under the qualification of
personnel factor on the environmental services portion of the
contract), and that ACCI's overall costs were consistent with the
various elements of its technical proposal (we considered EES'
assertion that the cost realism analysis and the technical evaluation
did not take into account alleged inconsistencies between the staffing
proposed in ACCI's technical proposal and the staffing costs reflected
in ACCI's cost proposal), and determined that the agency had
effectively complied with those DFARS provisions. Moreover, despite
its assertions, EES had not demonstrated any substantial inconsistency
between ACCI's technical and cost proposals. In addition, we noted
that after the protest was filed, the PEB considered ACCI's cost
proposal and determined that ACCI could in fact perform the contract
with the effort proposed. Although EES now argues that only the PEB
chairman examined ACCI's cost proposal, this contention does not
contradict the point which we made in our original decision--that
during the protest, the agency considered ACCI's cost proposal and
concluded that ACCI could perform the contract with the effort
proposed in its cost proposal.
In short, although EES again argues that the cost realism analysis
required by DFARS sec. 215.801 was not performed, the protester is
essentially disagreeing with our decision in this respect. That
disagreement provides no basis for reconsideration. R.E. Scherrer,
Inc.--Recon., B-231101.3, Sept. 21, 1988, 88-2 CPD para. 274.
EES also raises other specific objections to the propriety of the
evaluation. It contends that, after the cost analyst reviewed each of
the cost proposals, she reduced the government estimate so that it
matched the awardee's proposed costs. EES maintains that the cost
analyst then recommended award to ACCI because that firm's costs
matched the government estimate. According to EES, this was a
"bootstrap analysis," not the cost realism analysis that was required;
had the required analysis been performed, a question would have been
raised as to the ability of ACCI to perform 50 percent of the contract
with its own personnel as required by the solicitation. EES argues
that, at a minimum, the cost realism analysis of ACCI's offer would
have led to questions about ACCI's offer and "presumably [questions
about] other offerors that would have [led] the Army to conduct
discussions with those in the competitive range." According to EES,
this issue was not addressed in our decision.
Although EES now challenges the revised government estimate, in
comments submitted during the development of the protest record EES
stated that "[a]lthough the protester believes that the [g]overnment
improperly revised its estimate, it has accepted that estimate for
purposes of analysis and for its arguments." As a result of EES'
position, in our decision we declined to address EES' contentions
concerning the estimate. Under the circumstances, we will not now
consider EES' contentions concerning the estimate.
EES also maintains that our decision "incorrectly states the facts
surrounding the disparity of personnel proposed in the technical
proposal and in the cost proposal." In its protest submissions, EES
argued that ACCI's technical score for the qualification of personnel
factor under the environmental services portion of the contract was
too high because it was based on the evaluators' erroneous conclusion
that ACCI proposed a full-time, [deleted] person staff for
environmental services. In our decision, we addressed this contention
by noting that the Army did not assume that ACCI proposed [deleted]
full-time personnel for environmental services. Rather, the Army
explained that ACCI would draw on [deleted] listed people on an
as-needed basis.
EES now maintains that our decision incorrectly stated the facts
because, according to the protester, agency officials did not know
there was such a disparity between ACCI's technical and cost proposals
because they did not review those proposals until they were forced to
do so by the protest. EES also argues that our decision incorrectly
states that ACCI's proposal stated that ACCI would draw on the
[deleted] people listed on an as-needed basis.
Finally, EES once again argues that, in spite of the offer of
[deleted] people in the firm's technical proposal, ACCI's cost
proposal included costs for only [deleted] personnel. According to
EES, ACCI's technical proposal did not explain how [deleted] personnel
would be able to perform the work of the six positions required by the
contract, much less the [deleted] or [deleted] positions identified in
the technical proposal. Again, EES maintains that, had the Army
compared ACCI's technical and cost proposals, it would have discovered
this disparity and, according to the protester, at a minimum,
discovery of this disparity would have precluded award to ACCI on the
basis of initial offers.
First, agency evaluators did not base their evaluation on the
assumption that ACCI had proposed a full-time staff of [deleted]
people for environmental services. Rather, as we stated in our
earlier decision, agency evaluators read ACCI's proposal as offering
to draw on [deleted] listed people on an as-needed basis. While EES
now argues that ACCI's proposal did not state that, the protester does
not, by reference to ACCI's proposal or by other means, demonstrate
that this was an unreasonable conclusion by the evaluators. In fact,
our review of ACCI's technical proposal reveals no full-time
commitment of a specific number of people to environmental services.
Second, while EES continues to argue that there was a disparity
between the staff described in ACCI's technical proposal and the
staffing costs set out in ACCI's cost proposal, and that agency
officials failed to discover this disparity, this contention also
provides no basis for reconsideration. We again point out that the
PEB examined both parts of the proposal and concluded that they were
consistent and accurately reflected EES' understanding and proposed
approach. We noted in our prior decision that the agency specifically
determined that in light of its approach to the work, ACCI could meet
the requirements with [deleted] full-time equivalent personnel for
environmental services, and that nothing in the record established
that this determination was unreasonable. EES' continuing
disagreement does not provide a basis for reconsideration.
The reconsideration request is denied.
Comptroller General
of the United States
1. EES also states that it was denied a hearing concerning its
contention that the Army failed to compare the cost and technical
proposals during the evaluation of the offers since the Army did not
contradict that contention. EES complains that, after its request for
a hearing was denied, the protester found "a different set of facts
stated by GAO in its decision." As EES states, we concluded that
there was no reason to conduct a hearing to determine whether, during
the evaluation of the proposals, agency officials performed the type
of comparison of ACCI's technical and cost proposals which EES
maintains was required. Since the Army did not argue that it had
performed such a comparison, there was no factual dispute that
required a hearing for resolution. Nothing in EES' reconsideration
request changes that conclusion.