BNUMBER:  B-260934.2; B-260934.3
DATE:  September 12, 1995
TITLE:  CAS, Inc.

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REDACTED DECISION
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:CAS, Inc.

File:     B-260934.2; B-260934.3

Date:     September 12, 1995`

Howell Roger Riggs, Esq., for the protester.
James S. Roberts, Jr., Esq., Townes, Woods & Roberts, P.C., for 
Mevatec Corporation, an interested party.
Robert R. Hamilton, Esq., Department of the Army, for the agency.
Andrew T. Pogany, Esq., Office of the General Counsel, GAO, 
participated in the preparation of the decision.

DIGEST

1.  Where protest contains general allegations of improper cost 
evaluation which are only supported with detailed reasons in 
subsequent comments on an agency report that were filed by the 
protester more than 10 working days after receipt of the agency 
report, General Accounting Office will dismiss the protest grounds as 
untimely.

2.  Where selection officials reasonably regard proposals as 
essentially equal technically, cost may become the determinative 
factor in making an award notwithstanding that the evaluation criteria 
assigned cost less importance than technical considerations.

3.  Given the inherently subjective nature of the technical judgments 
of agency evaluators, it is within their reasonable discretion whether 
a particular proposal deserves a "good" as opposed to a "very good" 
rating, or a "very good" as opposed to an "exceptional" rating.  
Stated differently, agency evaluators' judgments, for example, about 
the slight qualitative differences which can render a proposal "very 
good" as opposed to "good" are not subject to rational legal objection 
unless a clear showing of unreasonableness is made.

DECISION

CAS, Inc. protests the award of a contract to Mevatec Corporation 
under request for proposals (RFP) No. DASG60-94-R-0036, issued by the 
U.S. Army Space and Strategic Defense Command, Huntsville, Alabama, 
for technical and programmatic support for the Program Executive 
Office, Missile Defense programs and projects.[1]  The protester 
principally contends that the agency improperly evaluated cost 
proposals, including the offerors' award fee, which was given greater 
weight than permitted by the terms of the solicitation; that the 
agency's determination that CAS's and Mevatec's technical proposals 
were essentially equivalent was unreasonable; and that Mevatec 
allegedly engaged in "bait and switch" techniques.[2]

We dismiss the protest in part and deny it in part.

BACKGROUND

The RFP, issued August 28, 1994, contemplated the award of two 
level-of-effort, cost-plus-award-fee contracts pursuant to a small 
disadvantaged business (SDB) set-aside and a small business 
set-aside.[3]  The RFP specified the total number of labor hours 
required and defined the labor categories and hours within each 
contract line item number.  The RFP stated that the government would 
select the proposal which was most advantageous and represented the 
best value to the government.  The RFP contained three evaluation 
areas:  (1) technical (including technical approach factor, technical 
direction planning factor, and qualifications and availability of 
personnel factor); (2) management (including management approach 
factor, and past performance factor); and (3) cost (including cost 
realism and total evaluated probable cost).  The RFP stated that the 
technical area was more important than the management and cost areas 
combined and that the management area was less important than the 
technical area and more important than cost.  Concerning cost realism, 
the RFP stated that poor cost realism may result in a lower evaluation 
of the technical and management areas.  The RFP also stated as follows 
concerning cost:

 "The government may select for award the offeror whose total 
 evaluated probable cost is not necessarily the lowest, but whose 
 technical and management proposals are sufficiently more advantageous 
 to the government so as to justify the payment of additional costs.  
 Conversely, the government may select for award the offeror whose 
 total evaluated probable cost is the lowest, when other proposals are 
 not sufficiently more advantageous so as to justify the payment of 
 additional costs."

Finally, the RFP stated that the government would evaluate for award 
purposes by adding the total cost for all options (such as labor surge 
requirements) to the total cost for the basic requirement.

Seven proposals were received, five of which were included in the 
competitive range.  After discussions with the offerors and receipt of 
best and final offers (BAFO), the agency's source selection evaluation 
board (SSEB) issued a final evaluation report of the BAFOs which was 
presented to the agency's source selection authority (SSA).  A cost 
analysis report was also issued and made available to the SSA.  The 
final evaluation results presented by the SSEB were as follows:[4]

Offeror     Technical RatingManagement RatingOverall RatingEvaluated 
                                                Cost

Mevatec     Exceptional Exceptional Exceptional [Deleted]

CAS         Exceptional Exceptional Exceptional [Deleted]
As between Mevatec and CAS, the SSA selected Mevatec after determining 
that both firms were "essentially equivalent" from a technical 
standpoint.  The SSA specifically found as follows:

 "While the results of the SSEB evaluation give CAS a slight advantage 
 over Mevatec, they are both rated Exceptional overall [while CAS's 
 costs are [deleted] higher than Mevatec's].  I find that the slight 
 difference in technical merit is not worth the difference in cost. . 
 . .  Of importance, Mevatec did better in the indicator of the 
 ability to perform the Technical Direction factor.  This slight 
 advantage in Mevatec's proposal virtually balances the small 
 advantage which may be afforded by CAS's slight edge in technical 
 approach.  Moreover, Mevatec rated slightly better than CAS in 
 management because of its proactive approach. . . .  Finally, I note 
 that part of the difference between CAS and Mevatec's total evaluated 
 probable cost is in CAS's fee, which overall is higher than 
 Mevatec's."

The SSA determined Mevatec's proposal to be the "best buy" for the 
government; the agency awarded the contract to that firm.  This 
protest followed.

COST EVALUATION

As stated above, the agency's cost realism resulted in a total 
evaluated probable cost of approximately [deleted] for CAS and 
[deleted] for Mevatec.  CAS first argues that the agency improperly 
evaluated CAS's maximum proposed award fee (which included award fees 
for its subcontractors and which was substantially in excess of 
Mevatec's award fee) despite the fact that the RFP allegedly did not 
provide that the evaluated "most probable cost" would include an 
offeror's maximum proposed award fee.  According to the protester, 
this evaluation of a maximum proposed award fee resulted in 
displacement of CAS as the low evaluated offeror.

We will not consider this issue.  The record shows that CAS, at the 
very latest, was advised during its debriefing on March 23, 1995, that 
the agency's cost evaluation included the maximum award fee proposed 
by each offeror.  However, this protest basis was not raised until CAS 
filed its first supplemental protest on May 12, 2 months after the 
firm knew or should have known of the basis for this protest.  
Accordingly, we dismiss this ground of protest as untimely filed.  See 
4 C.F.R.  21.2(a)(2) (1995).

In its initial protest, CAS challenged the cost/technical tradeoff 
decision and generally alleged, concerning the cost evaluation, that 
in a "head to head cost evaluation [of] cost realism and most probable 
cost, CAS should have won this area" since raw labor rates in the 
Huntsville area are similar and its indirect burden rates are low.  
The agency report in response to these allegations, dated April 27, 
1995, and containing all cost evaluation documentation, was furnished 
to the protester under a protective order at that time.

In its comments filed with our Office in response to the agency 
report, the protester, for the first time, presents specific detailed 
cost arguments that Mevatec's cost proposal should have been upwardly 
adjusted by approximately [deleted].  Several other very specific 
allegations of cost exceptions are made which would generally require 
our Office to obtain another agency report to resolve these matters.

We find these allegations to be also untimely.  Where a protest 
contains general allegations of improper agency evaluation or actions 
which are only supported with detailed reasons in subsequent comments 
on an agency report that are filed more than 10 working days after the 
protester's receipt of that report, we will dismiss the subsequent 
protest grounds as untimely filed.  See Dial Page, Inc., B-256210, May 
16, 1994, 94-1 CPD  311.  Here, the protester knew or should have 
known of the specific and detailed bases of its protest concerning the 
cost evaluation upon receipt of the agency report in April; since it 
did not file these protest grounds within 10 working days of its 
receipt of the report, we dismiss them as untimely.[5]

ESSENTIALLY EQUIVALENT DETERMINATION

CAS next argues that the SSA unreasonably determined the Mevatec and 
CAS proposals to be essentially equal in technical merit because of 
his finding that the "slight" difference in technical merit in CAS's 
favor did not sufficiently offset the advantages to Mevatec's lower 
cost.  CAS principally bases its argument on the following statement 
in the SSEB's report:

     "While the overall adjectival ratings show a three-way tie [among 
     CAS, Mevatec, and an 8(a) firm] at the exceptional level, it is 
     the consensus opinion of the SSEB that there is a separation 
     between the top three offerors that is not visible in the [final 
     summary adjectival ratings].  This is caused, to some extent, by 
     the lack of an additional adjectival rating between good and 
     exceptional. . . .  [In the] technical area CAS [is] first, [and] 
     Mevatec second. . . .  For the management area, the ranking is 
     Mevatec first [and] CAS second. . . .  Since the technical area 
     was designated as more important than management and cost 
     combined, the overall ranking is CAS first [and] Mevatec second."

According to the protester, because of the "coarseness" of the 
adjectival ratings, the SSA could not make appropriate "fine gradient 
distinctions" between the two proposals.

Where selection officials reasonably regard proposals as being 
essentially equal technically, cost may become the determinative 
factor in making an award notwithstanding that the evaluation criteria 
assigned cost less importance than technical considerations.  Contrary 
to the protester's assertions, strict equality is not required.  For 
example, we have upheld determinations that technical proposals were 
essentially equal despite significantly great technical differentials.  
See, e.g., Lockheed Corp., B-199741.2, July 31, 1981, 81-2 CPD  71 
(where the technical differential was more than 15 percent); Ogilvy, 
Adams & Rinehart, B-246172.2, Apr. 1, 1992, 92-1 CPD  332.  Moreover, 
given the inherently subjective nature of the technical judgments of 
the evaluators, we think it is best left to their discretion whether a 
particular proposal, for example, deserves a "good" as opposed to a 
"very good" rating.  Stated differently, agency evaluators' judgments 
about the slight qualitative differences which can render a proposal 
"very good" (or exceptional) as opposed to "good" are not subject to 
rational legal objection unless a clear showing of unreasonableness is 
made.  See Mevatec Corp., B-260419, May 26, 1995, 95-2 CPD  33.  We 
find no such showing here.

The record shows that the SSA did not simply rely on the evaluators 
final adjectival ratings.  Rather, the SSA had available the detailed 
technical report of the SSEB.  This report showed, for example, that 
CAS's technical approach for the programmatic support effort 
demonstrated exceptional understanding of the requirements.  The SSEB 
presented detailed technical narrative findings supporting this 
determination, including positive evaluations of CAS's cost/schedule 
risk assessments, cost data estimating and modeling effort, 
international program support, system integration, and operational 
exercises.  Similarly, the SSEB presented detailed narrative findings 
supporting its exceptional rating of Mevatec in these same technical 
areas.  The record shows no substantial difference in the evaluators 
findings concerning the two proposals.  Further, CAS has failed to 
show any substantial discriminating technical factor which would put 
into question the agency's determination that the proposals were 
essentially equal.  In the absence of any attempt by the protester to 
show significant or substantial technical superiority of its proposal, 
we deny this basis of protest for failure of proof by the protester.

MISCELLANEOUS ISSUES

Finally, CAS alleges that Mevatec engaged in "bait and switch" 
techniques by recruiting and hiring substantial numbers of CAS 
employees after award of the contract.  First, CAS refers to a Mr. 
Barnett, a key personnel under the RFP, who CAS hired on November 1, 
and who also permitted Mevatec to use his resume in competing for this 
contract.[6]  In response, the agency states, and we agree, that there 
is nothing wrong with a person employed by one company from committing 
himself to work with another company contingent upon the future award 
of a contract.

Second, contrary to CAS's assertions that after award of the contract 
substantial numbers of its employees were hired by Mevatec at 
significantly higher salaries, the record shows that Mevatec hired 
only seven employees of CAS out of a total work force of 60 full time 
employees (amounting to about 10 percent of the work force).[7]  CAS 
has presented no evidence that Mevatec intended prior to award to 
change its personnel to gain any advantage.  In this regard, the 
agency states, and the record shows, that the contracting officer 
reviewed the impact of these individuals' labor rates on the composite 
labor rates provided by Mevatec during the evaluation of proposals; 
his review shows that the pay rate for these individuals is less than 
the composite rates and therefore did not affect proposed costs or the 
cost standing of the offerors.  We therefore do not find any 
deliberate intent by Mevatec to engage in "bait and switch" 
techniques, and we also do not find any cost or other prejudice to CAS 
by Mevatec hiring these seven personnel after award.

The protest is dismissed in part and denied in part.

Comptroller General
of the United States

1. Programs and projects required to be supported include National 
Missile Defense, PATRIOT, Corps Surface to Air Missile, Theater High 
Altitude Area Defense, Ground Based Radar, and Joint Tactical Ground 
Station.  The successful contractor must monitor, assess, and analyze 
programs and activities, provide systems integration, systems 
engineering, and technical assistance support.

2. In its initial and supplemental protests, CAS raised numerous other 
issues which it abandoned in its comments on the agency report.  
Specifically, CAS, in its comments on the agency report, only "asserts 
[three] principal grounds upon which [this] protest" is based.  In 
this decision, we will consider only the protest grounds which the 
protester itself considers in its comments on the agency report.  See 
Logics, Inc., B-237411, Feb. 1, 1990, 90-1 CPD 140.

3. The award under the SDB set-aside is not now at issue in this 
protest.  Accordingly, we will only discuss the competition between 
CAS and Mevatec for the small business set-aside award.

4. The agency employed adjectival ratings for the technical proposals.  
These ratings were as follows:  exceptional, good, acceptable, and 
unacceptable, in descending order of merit.

5. As mentioned previously, this protest was subject to a protective 
order under which counsel for the protester and the interested party 
were admitted.  At the protester's request, we also admitted an expert 
consultant, a certified public accountant, who was employed by the 
protester to present expert opinion to our Office concerning the cost 
issues in the protest.  The consultant relied upon the exhibits, 
statements, and information contained in the agency report which the 
protester had received much earlier.  These opinions by the expert 
apparently formed the basis for the specific and detailed cost 
adjustment complaints subsequently raised by the protester in its 
comments on the agency report.  While the expert may have received 
this information late, we think receipt of the agency report by the 
protester's counsel started the 10-day period for purposes of our 
timeliness rules.  See Dial Page, Inc., supra.  In any event, even if 
we accept all the cost adjustments proposed by CAS's expert, we note 
that Mevatec still remains the low evaluated offeror by a significant 
amount.  Finally, the protester argues that the agency will incur 
"transition costs" to bring Mevatec "up to speed" and which should 
have been evaluated.  The short answer is that we do not find this 
cost factor as an evaluation item in the RFP.

6. The letter of intent from Mr. Barnett, dated October 8, 1994, that 
Mevatec submitted to the agency, stated unequivocally that Mr. Barnett 
"agree[d] to work for Mevatec Corporation as an independent consultant 
for the PEO Missile Defense support effort" and that Mevatec was 
"authorized to use [his] name in the proposal."

7. Further, the record shows that Mevatec hired these personnel only 
after Mevatec was "approached by the incumbent CAS personnel."