BNUMBER: B-270090.3
DATE: February 13, 1996
TITLE: Lloyd-Lamont Design, Inc.
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Matter of:Lloyd-Lamont Design, Inc.
File: B-270090.3
Date: February 13, 1996
Kenneth S. Kramer, Esq., and Catherine E. Pollack, Esq., Fried, Frank,
Harris, Shriver & Jacobson, for the protester.
Arthur I. Leaderman, Esq., Smith, Pachter, McWhorter & D'Ambrosio, for
Remtech Services, Inc., an intervenor.
Samuel D. Kreiter, Esq., Department of the Navy, 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. Protester's contention that agency improperly evaluated proposals
is denied where the record shows that the agency evaluated in
accordance with the criteria announced in the solicitation, and the
record reasonably supports the evaluators' conclusions.
2. Where the solicitation announced that the Department of the Navy
intended to evaluate proposals and make award on the basis of initial
proposals without conducting discussions, and the Navy reasonably
determined, on the basis of it evaluation of the initial proposals,
that the technically superior, slightly higher-cost offeror
represented the best value under the solicitation's evaluation scheme,
the Navy was not required to conduct discussions with the protester.
DECISION
Lloyd-Lamont Design, Inc. (LLD) protests the award of a contract to
Remtech Services, Inc. under request for proposals (RFP) No.
N00030-96-R-0200, issued by the Department of the Navy for training
acquisition and support. The protester argues that the agency's
evaluation of proposals was unreasonable; that the Navy improperly
failed to conduct discussions; and that the agency's cost/technical
tradeoff was flawed.
We deny the protest.
BACKGROUND
The RFP was issued as a competitive, small disadvantaged business
set-aside under section 8(a) of the Small Business Act, 15 U.S.C. sec.
637(a) (1994). The RFP contemplated the award of a
cost-plus-fixed-fee, level-of-effort contract for training acquisition
and support services related to strategic weapons systems (SWS), for a
base year with options for performing various requirements through
fiscal year 2000. Section M of the RFP listed the following
evaluation factors in descending order of importance: (1) personnel;
(2) technical approach; (3) corporate experience; (4) management
approach; (5) transition plan; and (6) facilities and equipment.
Within each factor, the RFP listed subfactors of varying importance.
Cost was to be evaluated for reasonableness and realism. Award was to
be made to the offeror whose proposal represented the best value to
the government. The RFP stated that in making the "best value"
determination, the agency would apply a tradeoff formula announced in
the solicitation which permitted the agency to pay up to a 30 percent
premium for a technically superior proposal.
Three firms, including the protester and the awardee, submitted
proposals in response to the RFP. Each offeror proposed a different
major subcontractor, all of which had been incumbents under prior
contracts for these services. A source selection evaluation board
(SSEB) evaluated technical proposals by assigning numerical point
scores (ranging from 0 to 100 points) under each subfactor; cost was
not point-scored. A source selection advisory council (SSAC) reviewed
the SSEB's results and computed a final weighted point score for each
proposal. LLD's proposal earned a total weighted score of 90.596
points; Remtech's proposal earned a total score of 93.402 points.
Remtech's proposed cost, $10,417,985, was slightly higher than LLD's,
$10,257,424--a difference of $160,561 over the life of the contract,
including options.
Based on the results of the evaluation, the SSAC concluded that
Remtech's proposal offered the best value to the government, and
recommended award to that firm. The source selection authority (SSA)
agreed with that recommendation, and on September 28, Remtech was
awarded the contract. The agency debriefed LLD on October 3, and this
protest followed.[1]
PROTESTER'S CONTENTIONS
LLD argues that the agency's evaluation of competing proposals was
flawed in several respects, particularly with respect to the
evaluation of its proposal under the "personnel" and "management
approach" factors. Specifically, the protester argues that its
proposal deserved a higher rating because of its "superior, qualified
personnel" and "proven staffing approach," and that the agency treated
Remtech's proposal differently in the evaluation. LLD also argues
that the agency improperly awarded the contract without conducting
discussions, and that the cost/technical tradeoff was flawed.
ANALYSIS
Evaluation of Proposals
In reviewing a protest challenging an agency's technical evaluation,
we examine the record to ensure that the agency's evaluation was
reasonable and consistent with the stated evaluation criteria. See
Abt Assocs., Inc., B-237060.2, Feb. 26, 1990, 90-1 CPD para. 223. With
respect to the protester's contentions regarding the evaluation of
proposals, we have reviewed the proposals, individual evaluators'
narrative sheets, the team evaluation narratives, and the award
recommendation memorandum, and find no basis for questioning the
SSEB's ratings.
Although LLD's proposal earned a relatively high score overall, the
evaluators considered several aspects of the proposal weak. Of
particular concern was LLD's staffing plan, in which LLD offered what
the SSEB considered to be a significant percentage of key personnel on
a part-time basis. One evaluator specifically noted that some of
LLD's "most qualified [key personnel] fall into this [part-time]
category." Another evaluator expressed concern that LLD's approach
could create a scheduling conflict, noting that the protester's
approach could have a detrimental effect on support tasks and
scheduling. The evaluators also noted that LLD's proposal did not
indicate "SWS experience in manning analysis support," and showed
"very little experience in [information resources management]," one of
two areas critical for successful contract performance. One evaluator
specifically noted that given the number of employees proposed with
college degrees in mathematics and computer sciences, LLD's personnel
assignments did not correlate with the employees' field of study; it
was found that while a majority of proposed personnel had college
degrees, some of LLD's key personnel held degrees in subjects
unrelated to their proposed functions.
The record shows that the SSEB considered LLD's proposed staffing plan
to be the significant weakness in the proposal, affecting the most
important evaluation factor, "personnel," as well as the "management
approach" factor. The agency had recently experienced performance
problems under the incumbent contract (which had been awarded to LLD's
proposed major subcontractor in this procurement), primarily as a
result of that firm's use of part-time personnel during contract
performance. The agency explains that part-time personnel would
likely be assigned to other projects, potentially preventing
short-term reassignments to the project. In addition, the agency
found that under LLD's staffing plan, although fully dedicated
personnel could be reassigned to address immediate problems, since the
majority of them were tasked at higher levels, their reassignment
could interrupt ongoing, critical work. In short, the agency
anticipated that under LLD's approach, the Navy could experience
similar performance problems as it had under the incumbent contract.
Primarily because of this weakness, the SSEB downgraded LLD's proposal
under the "personnel" factor, and slightly downgraded LLD's proposal
under the relevant subfactor[2] within the "management approach"
factor.
In view of the SSEB's conclusions regarding the adverse impact LLD's
staffing plan could have on the successful performance of the
contract, we have no basis to question LLD's score under the personnel
or management approach evaluation factors. The SSEB's ratings of
LLD's proposal under these factors reasonably reflect the evaluators'
concerns over the impact LLD's staffing plan could have on contract
performance, particularly in view of the agency's recent experience
under the incumbent contract which used LLD's approach. Further, we
have reviewed the record in light of the protester's allegations
regarding unequal treatment of LLD's and Remtech's proposals in the
evaluation and find no evidence supporting the protester's allegation
that offerors were treated differently. LLD's mere disagreement with
the evaluators' judgment does not make the SSEB's ratings
unreasonable. Calspan Corp., B-258441, Jan. 19, 1995, 95-1 CPD para.
28.[3]
Cost/Technical Tradeoff
The RFP announced that in deciding which proposal offered the best
value, the Navy would make a cost/technical tradeoff in accordance
with the following formula:
"As indicated on the graph, the [g]overnment is willing to pay
[30] percent more for an offeror with a proposal that earns the
highest possible technical score (i.e. 100 points), than an
offeror with the lowest evaluated price who has the lowest
possible technically acceptable proposal score (i.e. 75 points).
For example, as the technical quality of a proposal increases,
the acceptable increase in the price premium also increases. Any
point above the line [on the attached graph] represents an offer
above the premium the [g]overnment is willing to pay; therefore,
an award on the basis of that offer would not be deemed the best
value to the [g]overnment. Conversely, any point on or below the
line represents an offer within the premium and one which the
[g]overnment may consider for award. The [g]overnment will make
award to the [o]fferor, on or below the line, which represents
the best value to the [g]overnment."
The protester contends that the agency mechanically applied this
formula, and argues that the position of offerors' total scores on the
graph, by itself, was an insufficient basis upon which to make award
to Remtech. According to the protester, the agency was required to
make a separate determination justifying paying a 1.6 percent premium
for the technical benefits of Remtech's proposal.
In a negotiated procurement, unless the RFP so specifies, there is no
requirement that award be based on lowest cost. A procuring agency
has the discretion to select a more highly-rated technical proposal if
doing so is reasonable and is consistent with the evaluation scheme
set forth in the RFP. Management Sys. Designers, Inc., B-244383.3,
Sept. 30, 1991, 91-2 CPD para. 310. We will uphold an award to a higher
rated offeror with higher proposed costs where the agency reasonably
determines that the cost premium was justified considering the
technical superiority of the selected offeror's proposal. United
Telecontrol Elecs., Inc., B-235774.2, Nov. 7, 1989, 89-2 CPD para. 433.
Even where a source selection official does not specifically discuss
the technical/cost tradeoff in the selection decision document, we
will not object if the tradeoff is supported by the record. Maytag
Aircraft Corp., B-237068.3, Apr. 26, 1990, 90-1 CPD para. 430.
Here, although, as LLD correctly points out, the SSA did not
specifically explain his rationale for paying more for Remtech's
technically superior proposal, we think that the record reasonably
supports the tradeoff decision. The record shows that the protester's
proposal suffered from a noteworthy weakness with respect to staffing
that the evaluators reasonably found problematic and was the primary
reason that Remtech's proposal was found technically superior. Given
the evaluators' legitimate concerns over the impact of the weaknesses
in LLD's proposal on the successful performance of the contract, and
in light of the relatively minimal difference in total cost between
LLD's and Remtech's proposal, the SSA's cost/technical tradeoff
decision was unobjectionable.
Discussions
LLD argues that the agency improperly awarded a contract to Remtech at
a higher cost without conducting discussions. The protester argues
that given the evaluators' concern over its proposed staffing, the
agency should have afforded it an opportunity to explain its rationale
for the proposed part-time staffing approach, for example, which would
have raised its ratings under several factors.
Where, as here, an RFP sets forth the provisions of Federal
Acquisition Regulation (FAR) sec. 52.215-16, Alternate III, advising
offerors of the agency's intent to award without conducting
discussions, a Department of Defense contracting agency may properly
do so, provided the contracting officer determines that discussions
are unnecessary. FAR sec. 15.610(a)(4) (FAC 90-29);[4] Infotec Dev.,
Inc., B-258198 et al., Dec. 27, 1994, 95-1 CPD para. 52. The discretion
of the contracting officer to determine whether or not to hold
discussions is not unfettered; we will review the exercise of that
discretion to ensure that it was reasonably based on the particular
circumstances of the procurement, including consideration of the
proposals received and the basis for the selection decision. See
Facilities Management Co., Inc., B-259731.2, May 23, 1995, 95-1 CPD para.
274; The Jonathan Corp.; Metro Mach. Corp., B-251698.3; B-251698.4,
May 17, 1993, 93-2 CPD para. 174.
Here, the Navy reasonably determined that Remtech's proposal was
clearly technically superior to LLD's proposal. The difficulties in
LLD's proposed staffing plan cited by the evaluators were reasonably
based and represented a clear discriminator in finding Remtech's
proposal to be technically superior. Based on our review of the
record, we think that given the evaluators' conclusions, the agency
reasonably had no doubt that Remtech's slightly higher cost proposal
offered the best value to the government. Under these circumstances,
the Navy could properly make award to Remtech on the basis of initial
proposals. Compare Information Spectrum, Inc., B-256609.3;
B-256609.5, Sept. 1, 1994, 94-2 CPD para. 251 (discussions were not
necessary where the agency reasonably could determine which offer
represented the best value to the government) with The Jonathan Corp.;
Metro Mach. Corp., supra (discussions were necessary where the agency
could not reasonably determine which proposal represented the best
value to the government, given the significant discrepancy between the
agency's cost realism estimate and the cost proposals received and the
closeness of the competition); see also TRW, Inc., B-254045.2, Jan.
10, 1994, 94-1 CPD para. 18.
The protest is denied.
Comptroller General
of the United States
1. Subsequently, the agency informed us that the head of the
contracting activity had determined that it was in the government's
best interest to continue performance of the contract, notwithstanding
the protest. See 31 U.S.C. sec. 3553(d)(3)(C)(i)(I) (1994).
2. Under this subfactor, evaluators were to score proposals based on
the following question: "[d]oes the offeror have the ability to adapt
to emergent problems, including making available resources for short
term specialized projects?"
3. The protester also takes issue with the evaluation of its proposal
with respect to SWS experience and educational backgrounds of key
personnel. The agency points out, however, that even if LLD's
proposal had been assigned a perfect score (100 points) in the
relevant subfactors, the effect on LLD's final weighted score would be
an immaterial change from 90.596 points to 91.331 points.
4. This authority now extends to civilian agencies as well. See 41
U.S.C sec. 253b(d) (1994); FAR sec. 15.610(a)(3) (FAC 90-31).