BNUMBER:  B-265605.3; B-265605.4
DATE:  February 22, 1996
TITLE:  M.E.E., Inc.

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Matter of:M.E.E., Inc.

File:     B-265605.3; B-265605.4

Date:     February 22, 1996

Donald A. Tobin, Esq., Thomas J. Touhey, Esq., and Lori Ann Lange, 
Esq., Bastianelli, Brown, Touhey, & Kelley, for the protester.
Lt. Col. Richard W. Tobin II, and Kathryn M. Burke, Esq., Department 
of the Air Force, for the agency.
Henry J. Gorczycki, Esq., and Guy R. Pietrovito, Esq., Office of the 
General Counsel, GAO, participated in the preparation of the decision.

DIGEST

1.  Where a solicitation's required Davis-Bacon Act wage determination 
is revised after submission of proposals but prior to award, the 
contracting agency properly proposes to amend the solicitation to 
incorporate the revised determination and reopen the competition to 
permit submission of revised proposals. 

2.  Where an agency proposes to amend a solicitation and reopen the 
competition on bases that are not the subject of a protest, the 
proposed action is not corrective action in response to a protest and 
the protester is not entitled to reimbursement of its protest costs.

DECISION

M.E.E., Inc. protests the reopening of discussions under request for 
proposals (RFP) No. F02604-94-R0010, issued by the Department of the 
Air Force for maintenance, repair, and minor construction services 
under the simplified acquisition of base engineering requirements at 
Luke Air Force Base, Gila Bend Air Force Auxiliary Field, and Fort 
Tuthill Recreation Area, Flagstaff, Arizona.  M.E.E. also claims 
entitlement to protest costs under this and two earlier protests filed 
against a contract awarded to PI Construction Corporation.

We deny the protest and the claim.

The RFP, issued on October 25, 1994 as a total set-aside for small 
disadvantaged businesses (SDB), contemplated award of an indefinite 
delivery/indefinite quantity, fixed-price task order contract.  The 
RFP provided for award on a best value basis and stated that technical 
merit and price were of equal importance.  

Offerors were required to propose prices in terms of a coefficient of 
the "Means price," which is determined from standardized prices for 
construction work published in the Means cost book.  Under this 
pricing method, the sum of labor and materials is adjusted to reflect 
the Phoenix City Cost Index and minimum wage rates specified under the 
Davis-Bacon Act, 40 U.S.C.  sec.  276a (1994), to produce the Means price.  
The Means price for work performed under the contract will be 
multiplied by the contractor's proposed price coefficient to ascertain 
the price to be paid the contractor for work performed.  Thus, an 
offeror proposing a coefficient of 1.0 offers to perform the contract 
at the Means price, while a proposed coefficient greater than 1.0 or 
less than 1.0 is an offer to perform at a price greater than or less 
than the Means price, respectively.

After the conduct of discussions and evaluation of best and final 
offers (BAFO), the Air Force awarded a contract to PI as representing 
the best value to the government.  PI's proposal was higher-rated 
technically and was priced higher than M.E.E.'s.

On August 4, 1995, M.E.E. protested the award to PI to our Office on 
the following bases (hereafter, the "first protest"):

     "A.  The Air Force failed to give equal weight to cost and 
     technical criteria[;]

     "B.  Air Force improperly penalized M.E.E. for providing a price 
     below the coefficient[;]

     "C.  The Air Force failed to hold meaningful discussions with 
     M.E.E.[;]

     "D.  The Air Force improperly gave credit to capabilities not 
     required by the solicitation[.]"

M.E.E. also protested PI's SDB status to the Small Business 
Administration (SBA).  On September 13, 1995, at about the time the 
Air Force submitted its report on M.E.E.'s first protest, the SBA 
determined that PI did not qualify as an SDB concern for this 
procurement.  On September 15, M.E.E. submitted two additional protest 
bases (hereafter, the "second protest") to our Office, challenging the 
award to PI because the SBA had determined that PI was not an SDB 
concern, and objecting to the Air Force's evaluation of M.E.E.'s 
proposed price coefficient.

On September 29, the Air Force terminated PI's contract based upon the 
SBA's determination that the contractor was not an SDB concern.  On 
October 3, the Air Force notified our Office of the termination, 
stating that it was amending the RFP and would reopen discussions and 
request revised BAFOs.

On October 5, M.E.E. protested the Air Force's proposed amendment of 
the RFP and reopening of negotiations (hereafter, the "third 
protest").  M.E.E. contends that an award can and should be made based 
on the BAFOs previously submitted, and further argues that the Air 
Force improperly disclosed M.E.E.'s price coefficient to competitors 
when the agency advised competitors of M.E.E.'s initial protest bases, 
so that reopening the competition would result in an improper auction.  

The agency responds that the RFP needs to be amended because of 
possible confusion concerning the weight to be given technical merit 
and price, and to reflect the agency's changed requirements.  
Specifically regarding the evaluation factors, the Air Force states 
that while it agrees with the protester that price and technical merit 
were intended to be accorded equal weight, there are some inconsistent 
solicitation references to the evaluation criteria that may cause 
confusion to offerors, and the agency needs to amend RFP sections L 
and M to resolve any possible ambiguity arising from such 
inconsistencies.  Regarding the agency's changed needs, the 
solicitation will be amended to eliminate requirements for computers 
and computer software that are no longer needed, change the percentage 
of work to be performed at two of the three locations, and incorporate 
revised Davis-Bacon Act wage determinations that, on the whole, 
increase the applicable minimum wage rates.

Given the Air Force's termination of PI's contract, the primary issue 
for our resolution is the propriety of the agency's decision to amend 
the solicitation and reopen the competition.  As M.E.E. states in the 
third protest, it believes the competition need not be reopened 
because the proposed amendment would have no material effect on the 
BAFOs already submitted, and should not be reopened in any event, to 
avoid an auction situation.  We do not agree with either position. 

Where a contracting agency receives a modification to a Davis-Bacon 
Act wage determination before award that increases any wage rates, the 
contracting officer is required to amend the solicitation to 
incorporate the new determination, furnish the wage rate information 
to all offerors that submitted proposals, and allow offerors a 
reasonable opportunity to submit revised proposals.  See Federal 
Acquisition Regulation (FAR)  sec.  22.404-6(c), 22.404-5(c)(3); OMNE of 
New Jersey, Inc.,
71 Comp. Gen. 274 (1992), 92-1 CPD  para.  236.  Recompetition in order to 
permit incorporation of an applicable wage determination into the 
solicitation is proper even where prices have been exposed.  See 
Prestige Constr. Co., B-224327, Nov. 19, 1986, 86-2 CPD  para.  590; 
Bick-Com Corp., B-189894, Nov. 23, 1977, 77-2 CPD  para.  404.

M.E.E. nevertheless argues that the changes in the wage rates in this 
case do not materially affect offerors' proposed prices because the 
Means price used to calculate contract payments accounts for changes 
in Davis-Bacon wage determinations, and thus any amendment 
incorporating such changes is immaterial and does not justify 
reopening the competition.  We disagree.

The principal purpose of the Davis-Bacon Act is to protect a 
contractor's employees from substandard earnings by fixing a floor 
under wages on government projects.  ABC Paving Co., 66 Comp. Gen. 47 
(1986), 86-2 CPD  para.  436.  The Air Force RFP incorporated by reference 
the standard Davis-Bacon Act clause (Nov 1992) set forth at FAR  sec.  
52.222-6, which obligates the contractor to pay only the wages 
contained in the wage rate determination incorporated into the RFP.  
The revised wage rate determinations have not been incorporated into 
the RFP and, therefore, the previously submitted BAFOs do not obligate 
the offerors to pay these increased wage rates.  Where a contract 
resulting from a solicitation would not bind the contractor to pay its 
employees applicable increases in the Davis-Bacon Act wage rates, an 
amendment incorporating such wage rate changes into the solicitation 
is material regardless of its effect on price.  Id.; Promethean 
Constr. Co., Inc., B-255222, Feb. 7, 1994, 94-1 CPD  para.  78.  

M.E.E. also complains that the agency disclosed information about 
M.E.E.'s price coefficient to competitors and that reopening the 
competition therefore would constitute an improper auction.  We 
disagree.

Prohibited auction techniques essentially consist of government 
personnel furnishing information about one offeror's price to another 
offeror during negotiations, thereby promoting direct price bidding 
between offerors.  FAR  sec.  15.610(e)(2); General Eng'g Serv., Inc., 
B-242618.2, Mar. 9, 1992, 92-1 CPD  para.  266.  M.E.E.'s allegation is 
based on the agency's notification to other offerors of M.E.E.'s first 
protest, where the agency quoted verbatim M.E.E.'s statement that the 
"Air Force improperly penalized M.E.E. for providing a price below the 
coefficient."  
It is not clear to us that the release of the statement in issue 
promotes the direct price competition envisioned by the FAR auction 
prohibition.  In any case, where, as here, the reopening of 
discussions is required, even though an offeror's price itself has 
been disclosed, the reopening does not constitute an improper auction.  
The possibility that a contract may not be awarded on the basis of 
fair and equal competition has a more harmful effect on the integrity 
of the competitive procurement system than the fear of an auction; the 
statutory requirement for competition takes priority over the 
regulatory prohibitions on auction techniques.  
Ameriko/Omserv--Recon., B-252879.4, May 25, 1994, 94-1 CPD  para.  341. 

In sum, we find that the agency could not properly make a new award 
selection after the termination of PI's contract without amending the 
RFP to incorporate the higher, revised Davis-Bacon Act wage 
determinations and obtaining offerors' revised proposals.  Since this 
alone provides a sufficient basis to reopen the competition, we need 
not address M.E.E.'s objections to the agency's other reasons for 
reopening.  

We also need not address M.E.E.'s remaining protest issues, which 
concern the agency's award to PI, the conduct of discussions, and the 
evaluation of M.E.E.'s proposal.  M.E.E.'s challenge to the award to 
PI was rendered academic by the Air Force's termination of PI's 
contract promptly after the SBA's determination that PI was not an SDB 
concern.  M.E.E.'s objections to the conduct of discussions and 
evaluation of its proposal are rendered academic by the agency's 
determination to reopen negotiations, obtain revised proposals, and 
perform a new evaluation.  Since it is not our practice to consider 
academic questions, these protest issues are dismissed.  East West 
Research, Inc.--Recon., B-233623.2, Apr. 14, 1989, 89-1 CPD  para.  379.

Finally, M.E.E. requests that we find it entitled to reimbursement of 
protest costs for its three protests.  M.E.E. contends that the 
agency's proposed amendment to eliminate apparent inconsistencies in 
the RFP's description of and references to the evaluation factors is 
corrective action in response to M.E.E.'s protest that the agency did 
not apply the stated evaluation plan during evaluations.  

Our Bid Protest Regulations provide that a protester may be entitled 
to reimbursement of protest costs where the procuring agency takes 
corrective action in response to a clearly meritorious protest.  See 4 
C.F.R.  sec.  21.8(e) (1995); Tri-Ex Tower Corp., B-245877, Jan. 22, 1992, 
92-1 CPD  para.  100.  Where an agency's actions do not constitute 
corrective action in response to a protest issue, the protester is not 
entitled to reimbursement.  Tri-Ex Tower Corp., supra.

The recompetition action proposed by the Air Force is not corrective 
action in response to M.E.E.'s protests.  M.E.E.'s allegations of a 
defective technical evaluation (the first protest) did not prompt the 
Air Force to propose to amend the RFP as discussed above.  Rather, as 
we have found, the amendment was required as a legal matter--and, in 
fact, the Air Force has defended the original evaluation as consistent 
with the solicitation's evaluation plan.  Also, the termination of 
PI's contract, which rendered academic M.E.E.'s challenge of the 
selection (the second protest), was to comply with the SBA's 
determination of PI's eligibility for the award.  In such 
circumstances, M.E.E. is not entitled to reimbursement of its protest 
costs.  Id.; Loral Fairchild Corp.--Entitlement to Costs, B-251209.2, 
May 12, 1993, 93-1 CPD  para.  378; Mantech Field Eng'g Corp.--Recon., 
B-246152.5, Dec. 17, 1992, 92-2 CPD  para.  422.

The protest and the request for costs are denied.

Comptroller General
of the United States