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.