BNUMBER:  B-266297
DATE:  February 9, 1996
TITLE:  American Overseas Book Co., Inc.

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Matter of:American Overseas Book Co., Inc.

File:     B-266297

Date:     February 9, 1996

Cicely P. Marks for the protester.
Janice E. McIntyre for The Faxon Company, Inc., the interested party.
Terrence J. Tychan, Department of Health & Human Services, for the 
agency.
Aldo A. Benejam, Esq., and Christine S. Melody, Esq., Office of the 
General Counsel, GAO, participated in the preparation of the decision.

DIGEST

1.  Agency's determination that protester's initial proposal was 
technically unacceptable and outside the competitive range was 
reasonable where the proposal would require major revisions in order 
to become acceptable.

2.  Protester whose proposal was properly found technically 
unacceptable and excluded from the competitive range is not an 
interested party to challenge the award, where there is another 
technically acceptable proposal within the competitive range, since 
the protester would not be in line for award if its protest were 
sustained.

DECISION

American Overseas Book Company, Inc. (AOBC) protests the exclusion of 
its proposal from the competitive range, and the subsequent award of a 
contract to The Faxon Company, Inc., under request for proposals (RFP) 
No. 263-95-P-(AL)-0019, issued by the Department of Health and Human 
Services (HHS) for subscription services to domestic and foreign 
serial publications and periodicals for users of the National 
Institutes of Health libraries.  The protester contends that HHS' 
determination to exclude AOBC's proposal from the competitive range 
was unreasonable, and that the subsequent award to Faxon at a higher 
price than AOBC proposed was improper.

We deny the protest.

The RFP sought proposals for a fixed-price, indefinite 
delivery/indefinite quantity contract for a 12-month base period of 
performance, with up to four 1-year option periods.  For each contract 
period, offerors were required to submit fixed unit and extended 
prices for all items listed in section B of the RFP and a total price.  
Offerors were required to submit separate technical and business 
(price) proposals.

Section M of the RFP explained that proposals would be point-scored in 
accordance with the following technical evaluation criteria:  (1) 
organizational experience (38 points); (2) technical approach (30 
points); and (3) personnel qualifications (12 points), for a maximum 
possible technical score of 80 points.  The RFP explained in detail 
the type of information that HHS would consider under each criterion.  
The RFP warned offerors to submit sufficient information to allow HHS 
to evaluate their proposals in accordance with the detailed criteria 
listed in the RFP.  Price was to be evaluated by assigning the maximum 
number of points available (20 points) to the proposal with the lowest 
total evaluated price (including options), and proportionately lower 
scores to higher-priced proposals.  Technical proposals were to 
receive "paramount consideration" in the award.  Award was to be made 
to the offeror whose proposal was most advantageous to the government.

Five firms, including the protester, responded to the RFP.  A 
technical evaluation panel (TEP) evaluated proposals in accordance 
with the evaluation scheme announced in the RFP, with the following 
results (point scores shown are rounded off):

                   Point Scores           Evaluated
    Offeror         Technical             Price           Price

 Faxon            73           19         $33,279,658

   B              68           19         $33,672,408

   C              51           18         $34,863,908

   D              54            0         (no price)

  AOBC            39           20         $31,809,533 

The TEP found Faxon's and offeror B's proposals acceptable, while 
offeror C's, D's and AOBC's proposals were found technically 
unacceptable.  Based on those results, the contracting officer 
retained the proposals submitted by Faxon and offeror B within the 
competitive range; conducted discussions with only those two offerors; 
and requested best and final offers (BAFO) from those two firms.

Although the TEP reevaluated proposals based on BAFOs, there was 
little change in the final scores.  Faxon's final technical score 
remained unchanged and its price (which remained unchanged following 
discussions), was assigned the maximum number of points available 
(20); offeror B's final technical score improved to 71 points, and its 
price earned a score of 19.7 points.  The TEP concluded that both 
Faxon and offeror B could satisfy the requirement.  On September 8, 
the contracting officer awarded the contract to Faxon.  This protest 
followed.

AOBC argues that HHS' decision to eliminate its proposal from the 
competitive range was unreasonable.  The protester also contends that 
award to Faxon was improper.

An offeror must submit an initial proposal that is adequately written 
and that affirmatively establishes its merits or run the risk of 
having its proposal rejected as technically unacceptable.  Source AV, 
Inc., B-234521, June 20, 1989, 89-1 CPD  para.  578.  Offers that are 
technically unacceptable as submitted and would require major 
revisions to become acceptable are not required to be included in the 
competitive range for discussion purposes.  W.N. Hunter & Assocs.; 
Cajar Defense Support Co., B-237259; B-237259.2, Jan. 12, 1990, 90-1 
CPD  para.  52.  In reviewing whether a proposal was properly rejected as 
technically unacceptable for informational deficiencies, we examine 
the record to determine, among other things, whether the RFP called 
for detailed information and the nature of the informational 
deficiencies, for example, whether they tended to show that the 
offeror did not understand what it would be required to do under the 
contract.  BioClean Medical Sys., Inc., B-239906, Aug. 17, 1990, 90-2 
CPD  para.  142; DRT Assocs., Inc., B-237070, Jan. 11, 1990, 90-1 CPD  para.  47.  
We will not reevaluate a proposal but, rather, will consider only 
whether the agency's evaluation was reasonable and consistent with the 
evaluation scheme in the RFP.  Communications Int'l, Inc., 69 Comp. 
Gen. 553 (1990), 90-2 CPD  para.  3.  We have reviewed the individual 
evaluators' sheets and the TEP's narrative explanation and find that 
the evaluators reasonably concluded that AOBC's proposal was 
technically unacceptable.

Section L of the RFP established the acceptable minimum requirements 
for the format and content of technical proposals.  The RFP 
specifically instructed that technical proposals must contain 
sufficient information so as to allow the TEP to evaluate the 
offeror's understanding of the scope of work.  Specifically, under a 
section entitled "Technical Proposal Instructions," offerors were 
instructed to respond to each of the evaluation criteria listed in the 
RFP with specific, detailed information.  For instance, offerors were 
instructed to provide references to "similar or related" contracts and 
to describe in their proposals "all work being carried out by your 
organization which is closely related" to the work covered by the RFP.  
Further, the RFP instructed offerors to submit detailed information 
explaining their technical approach, including sufficient information 
demonstrating their understanding and management of the tasks required 
by the RFP.  The RFP's instructions were similarly detailed with 
respect to the type of information the agency required to assess 
proposals under the "personnel qualifications" criterion.

The record shows that the TEP identified several informational 
deficiencies in AOBC's technical proposal, leading the evaluators to 
conclude that AOBC had failed to demonstrate awareness and 
understanding of the complexities of the contemplated contract.  As a 
result, the protester's proposal was downgraded under all evaluation 
criteria.  In addition to being downgraded for informational 
deficiencies, AOBC's proposal was downgraded because the firm lacked 
corporate experience with contracts similar in size and scope.  In 
this connection, the TEP found that while the protester had tailored 
its database to support the requirements of the library system of 
another customer of AOBC (another government agency), that agency's 
requirements differ in size and scope from the HHS requirements 
reflected in the RFP.

The TEP also found that the protester's proposal showed limited 
automation capability.  For instance, the evaluators found that sample 
automated claim reports AOBC submitted with its proposal were "very 
difficult to read" and lacked sophistication.  Also, several 
evaluators noted that while AOBC made certain claims in its proposal 
concerning its electronic transaction capabilities, AOBC had not 
included sufficient information in its proposal to support its alleged 
capabilities.  The evaluators further noted that AOBC's proposed 
software had been developed and written using software language 
unrecognizable by any of the TEP members.[1]  The TEP also found that 
AOBC could not transmit claims to publishers electronically.  In 
summary, the TEP concluded that these were significant weaknesses that 
rendered AOBC's proposal unacceptable and not susceptible of becoming 
acceptable through discussions with the firm.

Based on our review of the record, we think that the TEP reasonably 
concluded that AOBC failed to follow the RFP's clear, specific 
instructions and that the information the firm did provide was 
insufficient to show that AOBC understood the requirements and the 
complexities of the contemplated contract.  Accordingly,  we have no 
basis to question the TEP's conclusion, based on these findings, that 
AOBC's proposal was unacceptable.

With respect to several of the weaknesses identified in its proposal, 
AOBC's arguments suggest that the agency should have inquired further 
so as to permit the firm to clarify various statements throughout its 
proposal.  As stated above, however, agencies are not required to 
conduct discussions with a firm that submitted a proposal that 
requires major revisions to become acceptable.  The record shows that 
the evaluators reasonably regarded AOBC's proposal as containing 
deficiencies of sufficient magnitude that major revisions would have 
been required to make the proposal acceptable.  Under these 
circumstances, we have no basis to object to the agency's decision to 
exclude AOBC's proposal from the competitive range.  See Engineering & 
Computation, Inc., B-258728, Jan. 31, 1995, 95-1 CPD  para.  155.

AOBC further argues that in evaluating proposals, the TEP applied 
unannounced evaluation criteria.  AOBC contends that its proposal was 
improperly downgraded due to its claims processing approach, computer 
software capability, and its failure to provide information on the 
educational backgrounds of proposed key personnel.  According to the 
protester, AOBC's low technical score was the result of the TEP's 
application of evaluation criteria not specifically identified in the 
RFP.[2]

While solicitations must identify the major factors that the agency 
intends to consider in the evaluation of proposals, they need not 
identify the areas under each factor that might be considered in the 
evaluation, if the unidentified areas are reasonably related to or 
encompassed by the stated evaluation criteria.  Drytech, Inc. 
B-246152.2, Feb. 24, 1992, 92-1 CPD  para.  217.  Here, we have reviewed the 
protester's allegations and cannot find any basis for concluding that 
the TEP applied criteria not reasonably related to the evaluation 
factors announced in the RFP. 

Under the "technical approach" factor, for example, the RFP stated 
that the TEP would evaluate the offerors' "demonstrated ability" to 
provide "fast, reliable service in order placement," and "handling of 
claims."  The RFP also required offerors to explain how they would 
provide various electronic services and contained specific 
computerization requirements.  Given these requirements, we think that 
the TEP reasonably considered AOBC's software capabilities and its 
claims processing approach.  Further, contrary to AOBC's contention, 
we think that the "personnel qualifications" criterion contemplates 
that the TEP would assess the relevant experience of proposed key 
personnel, including their educational backgrounds. 

The fact that AOBC's proposal was significantly downgraded in these 
areas does not mean that the TEP applied unannounced evaluation 
criteria.  Rather, as already explained, the record shows that based 
on its assessment of AOBC's proposal, the TEP reasonably concluded 
that the protester had submitted insufficient information to show that 
it could meet the RFP's requirements.  Accordingly, we have no basis 
to question the TEP's conclusion that AOBC's proposal was technically 
unacceptable.

With respect to AOBC's challenge to the award to Faxon, under our Bid 
Protest Regulations, a party is not interested to maintain a protest 
if it would not be in line for award if the protest were sustained.  
See 4 C.F.R.  sec.  21.0(a) (1995).  Since HHS reasonably found AOBC's 
proposal technically unacceptable and properly excluded the 
protester's proposal from the competitive range, and since offeror B's 
acceptable proposal remained in the competitive range, AOBC is not an 
interested party to challenge the award to Faxon.  See Dick Young 
Prods. Ltd., B-246837, Apr. 1, 1992, 92-1 CPD  para.  336.

The protest is denied.

Comptroller General
of the United States

1. Also of concern to the TEP was the "tone" of AOBC's proposal.  In 
this regard, several evaluators noted that AOBC was generally critical 
of the RFP's requirements and of the agency's approach.  This led the 
TEP to conclude that either AOBC did not understand the requirements, 
or that the firm was reluctant or unwilling to accept the 
responsibilities contemplated by the RFP.

2. AOBC also takes issue with the composition of the TEP.  The 
composition of an evaluation panel, however, is a matter within the 
contracting agency's discretion, which we will not review absent a 
showing of possible fraud, bad faith, conflict of interest, or actual 
bias.  Southeast Medical Alliance, B-242034, Dec. 17, 1990, 90-2 CPD  para.  
495.  AOBC has not made any such showing.