BNUMBER:  B-266339.2
DATE:  April 16, 1996
TITLE:  Optimum Technology, Inc.

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Matter of:Optimum Technology, Inc.

File:     B-266339.2

Date:April 16, 1996

John R. Tolle, Esq., and William T. Welch, Esq., Barton, Mountain & 
Tolle, for the protester.
Virginia G. Farrier, Esq., Defense Information Systems Agency, for the 
agency.
Glenn G. Wolcott, Esq., and Paul Lieberman, Esq., Office of the 
General Counsel, GAO, participated in the preparation of the decision.

DIGEST

1.  Prior performance of similar requirements by awardee's 
subcontractor does not give rise to prohibited organizational conflict 
of interest or provide an unfair competitive advantage where 
subcontractor's prior work did not affect the requirements being 
solicited and any advantage accruing is merely that of an incumbent 
contractor.  

2.  Agency's equal weighting of certain evaluation factors under 
solicitation which stated that lower-listed factors would be afforded 
less weight does not provide basis to sustain protest where record 
clearly establishes that protester was not prejudiced as a result.

3.  Where solicitation stated that evaluation factors were listed in 
descending order of importance, actual weighing of the factors applied 
by the agency is unobjectionable where it reflected a reasonable 
downward progression.

DECISION

Optimum Technology, Inc. protests the award of a contract to Excel 
Management, Inc. under request for proposals (RFP) No. 
DCA100-95-R-0051, issued by the Defense Information Systems Agency 
(DISA).  Optimum asserts that Excel should have been excluded from the 
competition because the prior contract performance of one of its 
proposed subcontractors created an impermissible organizational 
conflict of interest, and that the award was otherwise improper 
because the agency failed to follow the RFP's stated evaluation 
scheme.

We deny the protest.

On April 5, 1995, the agency issued the RFP at issue (hereafter 
referred to as "-0051") as a competitive set-aside under section 8(a) 
of the Small Business Act, 15 U.S.C.  sec.  637(a) (1994).  The 
solicitation contemplated the award of a firm,
fixed-price contract to design and install an Integrated Network 
Management System (INMS) for the DISA Columbus Regional Control Center 
(RCC).  The system is intended to provide the capability to interface 
with a variety of network element management systems and contains 
options for the management of classified networks and maintenance.  
The solicitation stated that award would be made on the basis of cost, 
technical, and management factors, with technical and management 
factors more important than cost.[1]

On April 24, the agency conducted a site visit to provide potential 
offerors an opportunity to receive a detailed technical briefing 
regarding the existing systems.  On April 25 and 26, potential 
offerors were given guided tours through the Columbus facility to see 
the operational areas and physically review the systems.
On or before the June 19 closing date, proposals were submitted by 
several offerors including Optimum and Excel.  All of the offerors 
proposed various subcontractors that offered some familiarity with the 
INMS environment at the Columbus facility.  Excel's proposal stated 
that Excel intended to use I-Net, Inc. as a subcontractor; I-Net had 
previously provided INMS services for several DISA sites including the 
Columbus facility.

Upon evaluation of the proposals, the agency established a competitive 
range which included the Optimum and Excel proposals and thereafter 
conducted discussions and requested best and final offers (BAFOs), 
which were submitted on September 5.  Optimum's BAFO received a 
technical/management rating of 9.38; Excel's BAFO received a 
technical/management rating of 9.33.[2]  Excel's and Optimum's BAFOs 
were both rated "excellent" and were considered to be technically 
equal.  However, Excel's proposed price was approximately 20 percent 
lower than Optimum's.  Excel's proposal was selected for award on the 
basis of its lower price, and this protest followed. 

ALLEGED REQUIREMENT TO EXCLUDE EXCEL'S PROPOSAL 

Conflict of Interest

Optimum asserts that performance of a prior contract for INMS services 
by I-Net, Excel's proposed subcontractor, created a prohibited 
organizational conflict of interest that required the agency to 
exclude Excel's proposal from consideration.  We disagree.

On February 26, 1993, I-Net was awarded contract No. DCA200-93-D-0024 
(hereafter referred to as "-0024") under the 8(a) set-aside program.  
That contract called for I-Net to provide network management and 
related systems engineering services to support DISA throughout the 
world; performance of individual tasking requirements under this 
contract were generally authorized through issuance of delivery 
orders.[3] Ten delivery orders were ultimately issued under the 
contract, several of which reflected DISA's long range intent to 
"operate and maintain a worldwide communication architecture to 
support network management functions at all the DISA network 
management centers."  Specifically, under delivery orders 001 and 005, 
I-Net provided INMS services at DISA Headquarters in Virginia; under 
delivery orders 002 and 006, I-Net provided INMS services at the DISA 
Europe RCC in Germany; and under delivery order 004, I-Net provided 
INMS services at the DISA Pacific RCC in Hawaii.  

Task order 009 was verbally issued on May 18, 1994, and contemplated 
"the orderly implementation of integrated commercial-off-the-shelf 
(COTS) hardware and software that will test . . . system and network 
management at the Columbus System/Network Management Center."[4]

On July 11, 1994, another contractor filed an agency-level protest 
challenging the issuance of task order 009.[5]  That protest was based 
on allegations that the task order was outside the scope of contract 
No. -0024 and that I-Net had graduated from the 8(a) program prior to 
the task order's issuance.  By letter dated August 20, 1994, the 
contracting officer denied the protest, but also stated that task 
order 009 was being terminated for the convenience of the 
government.[6]  At the time task order 009 was terminated, I-Net had 
conducted a site survey,[7] performed a requirements analysis,[8] and 
prepared a cost proposal[9] pursuant to that order. 

The agency subsequently issued RFP No. -0051, the solicitation at 
issue here.  The work statement included in RFP No. -0051 contained 
requirements similar to those in task order 009.  In this regard, the 
agency states: 

     "The essential difference between the SOW for solicitation DCA 
     100-95-R-0051 and Task Order 009 . . . is the scope of work to be 
     performed at the Columbus RCC.  Task Order 009 had a wider scope 
     and included in the functions of the then IS/NMS to manage 
     control of computer applications and communication devices on the 
     Defense Logistic[s] Agency (DLA) Base at Columbus in addition to 
     the management of DISA communication networks.  The SOW for [RFP 
     No. -0051] focus[es] only on the capability of the INMS to manage 
     and control DISA communication networks."

Optimum protests that I-Net's partial performance of task order 009 
"placed I-Net in a conflict of interest as defined by FAR [Federal 
Acquisition Regulation] 9.505-2(b)(1)."  That section of the FAR 
states: 

     "If a contractor prepares, or assists in preparing, a work 
     statement to be used in competitively acquiring a system or 
     services--or provides material leading directly, predictably, and 
     without delay to such a work statement--that contractor may not 
     supply the system, major components of the system, or the 
     services unless [exceptions omitted]."[10]

The FAR provides that the responsibility for identifying and resolving 
organizational conflicts of interest is that of the contracting 
officer, who in doing so is admonished to exercise "common sense, good 
judgment and sound discretion."  FAR  sec.  9.504, 9.505.  Our Office will 
not disturb a contracting officer's determination regarding an 
organizational conflict of interest unless it is shown to be 
unreasonable.  ICF, Inc., B-241372, Feb. 6, 1991, 91-1 CPD  para.  124.
 
In its response to Optimum's protest, the agency provided a detailed 
chronology regarding the development of the work statement contained 
in RFP No. -0051.  Specifically, the record shows that, in March 1993, 
personnel from the Columbus RCC and DISA Headquarters collaborated on 
the development of an INMS requirement document that established 
DISA's functional requirements for network management.  This document, 
referred to as the "functional requirements specification" or "FRS," 
was relied on by DISA for various INMS procurements and was ultimately 
incorporated into RFP No. -0051, specifying the requirements the 
awardee must perform.   

The record contains multiple affidavits from various government 
personnel who developed the work statement in RFP No. -0051; each of 
the affidavits state that the government's requirements under RFP No. 
-0051 were developed without input from any outside entity.  The 
individual primarily responsible for drafting the functional 
requirements specification explicitly states:  "no contractor help was 
used in developing the specification," and, more specifically, "[t]he 
FRS used in this solicitation [RFP No. -0051] was not developed using 
information obtained from 
I-Net."  Along with the affidavits, the record contains multiple 
documents tracking the development process, including preliminary 
requirements specifications.[11] 

While Optimum expresses disagreement with the agency's 
representations, its conclusory allegation that I-Net's prior 
performance "could not have been disregarded" when the solicitation 
was drafted is not supported by the record.  In fact, the record shows 
that the requirements in RFP No. -0051 were substantially established 
prior to I-Net's performance of task order 009 and were incorporated 
in that task order--not that the requirements in RFP No. -0051 were 
created as a result of I-Net's performance of task order 009.  Optimum 
effectively concedes this to be the case by stating in its protest 
that:  "[t]he RFP here [No. -0051] is a direct re-do of I-Net's 
earlier contract [task order 009]."  Further, the INMS requirements in 
task order 009 were similar to the INMS requirements of the delivery 
orders previously issued to I-Net.  Again, Optimum's own statements 
acknowledge this fact.  Specifically, after reviewing I-Net's various 
delivery orders under contract No. -0024, Optimum notes, "the I-Net 
delivery orders . . . all bore a striking similarity to one another."  

On this record, it is clear that the requirements contained in RFP 
-0051 were substantially established by the government prior to 
I-Net's performance of task order 009.  Accordingly, since I-Net's 
performance of task order 009 neither involved preparation of the work 
statement in RFP No. -0051 nor led directly to the development of that 
statement, Optimum's contention that the awardee should have been 
excluded from the competition because of an organizational conflict of 
interest proscribed by FAR  sec.  9.505-2(b)(1) is without merit.

Unfair Competitive Advantage

Optimum also argues that Excel's proposal should have been excluded 
from consideration on the basis that I-Net's prior activities under 
contract No. -0024 provided it with an unfair competitive advantage.  
Optimum complains that it was not provided with the same level of 
information in order to prepare its proposal that I-Net was able to 
provide Excel, and that Optimum was not given the same opportunity as 
I-Net, through its prior contract, to familiarize itself with the 
Columbus facility or "benefit from an open dialogue" with DISA 
personnel.[12]

The agency responds that it did everything it could to provide 
potential offerors with all relevant information that was not 
proprietary.  In this regard, the agency provided offerors with all of 
the information from I-Net's performance of task order 009 which was 
not considered proprietary to I-Net.[13] 

The mere existence of a prior or current contractual relationship 
between a contracting agency and firm does not create an unfair 
competitive advantage, see ETEK, Inc., B-234709, July 11, 1989, 89-2 
CPD  para.  29, nor is an agency required to compensate for every 
competitive advantage inherently gleaned by a potential offeror's 
prior performance of a particular requirement.  Versar, Inc., 
B-254464.3, Feb. 16, 1994, 94-1 CPD  para.  230.  For example, an incumbent 
contractor's acquired technical expertise or firsthand knowledge of 
the costs related to a requirement's complexity are not generally 
considered to constitute unfair advantages the procuring agency must 
eliminate.  Id.; Delta Oaktree Prods., B-248903, Oct. 7, 1992, 92-2 
CPD  para.  230; Rolm Corp., B-214052, Sept. 11, 1984, 84-2 CPD  para.  280.

Here, I-Net's status with regard to the protested procurement is 
essentially that of an incumbent contractor.  As discussed above, 
Optimum acknowledges the similarity between the requirements of 
contracts previously performed by I-Net, including task order 009, and 
the requirements contained in RFP No. -0051.  Optimum's allegation, 
that it did not have access to the same type of information as I-Net 
provided Excel, is essentially nothing more than a complaint that its 
contract performance experience is not the same as I-Net's.  There is 
no basis to object to an offeror's advantage unless it is created by 
improper preference or other unfair action by the procuring agency.  
Versar, Inc., supra; Delta Oaktree Prods., supra; Rolm Corp., surpa.  
On the contrary, incumbent contractors with good performance records 
can offer real advantages to the government and proposal strengths 
flowing from a firm's prior experience are proper considerations in 
selecting an awardee.  Sabreliner Corp., B-242023; B-242023.2, Mar. 
25, 1991, 91-1 CPD  para.  326; Benchmark Sec., Inc., B-247655.2, Feb. 4, 
1993, 93-1 CPD  para.  133.  Here, the record provides no indication of 
improper preference or other unfair action by the agency.  Moreover, 
the agency took reasonable measures to provide all potential offerors 
with all of the legally disclosable relevant information flowing from 
the terminated predecessor task order.  Under these circumstances, 
there is no basis to require the exclusion of Excel from the 
competition because of its proposed use of I-Net as a subcontractor. 
EVALUATION OF PROPOSALS

Optimum also protests that the agency failed to follow the evaluation 
scheme established in the solicitation.  In this regard, section M of 
the RFP identified the following technical and management evaluation 
factors, and stated that they were listed in descending order of 
importance:

     Technical
     
     Engineering/Technical Approach
     Understanding of the INMS Network Management Requirements
     Clear Understanding of the Problem
     System Performance 
     Security

     Management

     Relevance of Past Experience and Performance
     Risk Management
     Program Management, Organization Structure and Personnel
     Management Services

After reviewing the agency's evaluation documents,[14] Optimum filed a 
supplemental protest alleging that the agency failed to follow the 
evaluation scheme established in the solicitation, first asserting 
that "the agency weighed some subfactors that were listed after other 
factors more than the preceding factors."  This allegation is based on 
Optimum's misunderstanding of the relationship between raw points and 
weighted scores.  

The record shows that the agency assigned the following weights to the 
evaluation factors:  

     Technical                               Weight
     
     Engineering/Technical Approach          20
     Understanding of the                    
       INMS Network Management Requirements  15 
     Clear Understanding of the Problem      10
     System Performance                      10
     Security                                 5

     Management                              Weight

     Relevance of Past Experience/Performance20
     Risk Management                         10
     Program Management, 
     Organization Structure and Personnel     5
     Management Services                      5

In evaluating proposals, the agency first assigned raw point scores 
between 1 and 10 to each of several subfactors associated with the 
various evaluation factors.[15] The number of subfactors varied from 
factor to factor and the total raw point scores associated with each 
evaluation factor did not reflect the total points available for each 
factor under the RFP's weighing scheme.  In order to achieve the 
specified weighing, the agency properly divided the raw score for each 
evaluation factor by the number of subfactors, then multiplied by the 
appropriate weighing factor.  In short, the record is clear that the 
agency did not accord greater weight to a lower-listed evaluation 
factor then it accorded to a higher-listed evaluation factor.  
Next, Optimum complains that, although offerors were advised that the 
evaluation factors were listed in descending order of importance, in 
fact, two technical factors ("Clear Understanding of the Problem" and 
"System Performance") and two management factors ("Program Management" 
and "Management Services") were improperly accorded equal weight. 

It is true that the agency failed to explicitly follow the stated 
evaluation scheme; that is, the agency should have afforded somewhat 
greater weight to the technical evaluation factor "Clear Understanding 
of the Problem" than it afforded to "System Performance" and 
similarly, should have afforded somewhat greater weight to the 
management evaluation factor "Program Management" than it afforded to 
"Management Services."  However, it is manifestly clear that Optimum 
was not prejudiced by the agency's failure to do so.  Specifically, 
Excel's score under the technical factor "Clear Understanding" was 
higher than Optimum's; accordingly, giving greater weight to this 
factor would have benefited Excel.  Although Optimum's score under the 
management factor "Program Management" was slightly higher than 
Excel's, the RFP provided that technical factors were more important 
than management factors.  In short, the record shows that appropriate 
application of somewhat greater weight to the higher-listed of the two 
equally weighted pairs of factors would have benefited Excel rather 
than Optimum.     

Prejudice is an essential element of every viable protest, and we will 
not disturb an agency's award decision even where the record reflects 
some minor error in the evaluation of proposals, so long as the error 
does not prejudicially affect the protester.   See, e.g., Mesa, Inc., 
B-254730, Jan. 10, 1994, 94-1 CPD  para.  62.  Since the net effect of the 
agency's action was a benefit to Optimum, the company was not 
prejudiced by DISA's evaluation approach.

Finally, Optimum protests that, because the RFP stated that factors 
would be scored in descending order of importance, "no single 
subfactor should have been weighed much more than any other one."  
Optimum maintains that the weighing scheme identified above was 
improper because the difference between the first and last subfactors 
was "significant," noting that "[t]he first [factor] is worth four 
times the last."

The Competition in Contracting Act of 1984 (CICA) requires contracting 
agencies to set forth in the solicitation all significant evaluation 
factors that the agency expects to consider and their relative 
importance.  10 U.S.C.  sec.  2305(a)(2) (1994); H.J. Group Ventures, Inc., 
B-246139, Feb. 19, 1992, 92-1 CPD  para.  203.  A solicitation which lists 
evaluation factors in descending order of importance generally meets 
CICA's requirements unless one factor has a disproportionately high 
value relative to the others.  See, e.g., BDM Servs. Co., B-180245, 
May 9, 1974, 74-1 CPD  para.  237.  In short, when a solicitation states 
that evaluation factors are listed in descending order of importance, 
offerors are on notice that the evaluation criteria listing reflects a 
reasonable downward progression of relative weights.  General 
Exhibits, Inc., 
56 Comp. Gen. 882 (1977), 77-2 CPD  para.  101.

Here, the evaluation scheme which the agency employed reflects a 
reasonable downward progression of evaluation weights.  No single 
factor was unusually significant or unusually insignificant.  See 
Raytheon Support Servs. Co., B-219389; B-219389.2, Oct. 31, 1985, 85-2 
CPD  para.  495 (agency's evaluation was proper where solicitation stated 
listed three factors in descending order of importance and employed a 
scheme where first factor was worth 75 percent, second factor was 
worth 15 percent, and third factor was worth 10 percent); cf. BDM 
Servs. Co., supra (where solicitation listed 5 evaluation factors and 
most important factor was          6 times the weight of the second 
factor and 24 times the weight of the fifth factor, predominant value 
accorded first factor should have been disclosed); Coastal Science and 
Eng'g, Inc., 69 Comp. Gen. 66 (1989), 89-2 CPD  para.  436 (where 
solicitation stated that technical was more important than cost, the 
fact that technical was 9 times more important than cost should have 
been disclosed).  Accordingly, the agency's evaluation scheme was not 
unreasonable. 

The protest is denied.

Comptroller General 
of the United States

1. Section M also stated that, between technical and management, 
technical was more important and that technical evaluation factors 
would be valued at approximately
60 percent of the technical/management score, while management factors 
would be valued at approximately 40 percent of the score.

2. The agency used an adjectival and numerical rating system.  
Proposals were given scores ranging from 1 to 10 under each evaluation 
factor and subfactor.  Scores of 9-10 were considered "excellent," 
reflecting a proposal that was comprehensive and complete, met or 
exceeded all requirements, and demonstrated in detail how to 
accomplish the task with minimum risk.  Scores of 7-8 were considered 
"good," reflecting a proposal that generally met or exceeded 
requirements, demonstrating a feasible approach with little risk.  
Scores of 5-6 were considered "adequate," reflecting a proposal which 
minimally met requirements and provided minimal detail regarding 
feasibility of approach.  Scores of 3-4 were considered "marginal," 
reflecting a proposal with correctable defects.  Scores below 3 were 
considered unacceptable with defects requiring major revision.

3. Each delivery order incorporated one or more task orders.

4. Task order 009 was confirmed in writing on June 7, 1994, through 
the issuance of delivery order 007.

5. That protester is not a party to this matter.

6. The protest was denied on the basis that task order 009 was within 
the scope of contract No. -0024 and that I-Net "exited the Small 
Business Program effective 
June 16, 1994."

7. I-Net's site survey report reflected technical information that 
I-Net had gathered on the systems that were being managed by Columbus 
along with information about the Columbus facility including space, 
power, wiring, and other environmental factors, and 
installation/deinstallation considerations.

8. I-Net's requirement analysis essentially reviewed the requirements 
that were stated in the government's work statement, followed by 
I-Net's proposed solution to meet those requirements.

9. I-Net's cost proposal consisted of various elements including the 
hardware and software required to implement the system, support 
service including maintenance and training, and other costs such as 
labor and travel.  More specifically, the cost proposal reflected 
I-Net's vendor arrangements and labor costs.

10. This FAR provision is intended to avoid a situation in which a 
contractor favors its own products or capabilities in preparing the 
work statement.  FAR  sec.  9.505-2(b)(2).  There is no basis to 
distinguish such potential conflicts of interests involving prime 
contractors from those involving subcontractors.  See The Pragma 
Corp., B-255236 et al., Feb. 18, 1994, 94-1 CPD  para.  124; Medical Service 
Corp. Int'l., B-255205.2, Apr. 4, 1994,  94-1 CPD  para.  305.  

11. Although Optimum initially requested a hearing in this matter, 
after receipt of the agency record it expressly withdrew that request 
on the basis that "the case can be decided based upon the written 
filings the parties have made."  Accordingly, our Office did not hold 
a hearing in this matter.

12. To the extent Optimum's protest is now challenging the adequacy of 
the information provided with the solicitation, the issue is not 
timely raised.  Bid Protest Regulations,  sec.  21.2(a)(1), 60 Fed. Reg. 
40,737, 40,740 (Aug. 10, 1995) (to be codified at 4 C.F.R.  sec.  
21.2(a)(1)).

13. Procuring agencies have an obligation to protect the proprietary 
information of a contractor or offeror.  See Information Ventures, 
Inc., B-240925; B-240925.2, Jan. 15, 1991, 91-1 CPD  para.  39 (withholding 
of proprietary information proper due to the protections afforded 
under the Trade Secrets Act, 18 U.S.C.  sec.  1905); 49 Comp. 
Gen. 28 (1969) (when government's use of proprietary or confidential 
data or trade secrets in a solicitation violates a firm's proprietary 
rights, our Office may recommend that the contracting agency either 
make a sole source award to the entity whose data was compromised or, 
if possible, cancel the solicitation and resolicit without using the 
proprietary data).

14. In response to Optimum's initial protest, which included various 
allegations regarding the agency's allegedly improper evaluation of 
proposals, the agency provided Optimum's counsel with various 
evaluation documents, subject to the terms and conditions of this 
Office's protective order.  By letter dated December 5, 1995, Optimum 
withdrew its initial allegations except for the alleged conflict of 
interest, discussed above.

15. The solicitation identified the various subfactors, but did not 
indicate an order of importance for them.  Accordingly, the agency 
gave the subfactors equal weight.