BNUMBER:  B-274335
DATE:  December 4, 1996
TITLE:  Harry A. Stroh Associates, Inc.

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DOCUMENT FOR PUBLIC RELEASE
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:Harry A. Stroh Associates, Inc.

File:     B-274335

Date:December 4, 1996

Gilbert J. Ginsburg, Esq., and Raymond Fioravanti, Esq., Epstein, 
Becker & Green, P.C., for the protester.
Donald E. Barnhill, Esq., and Joan K. Fiorino, Esq., East & Barnhill, 
for Ace Maintenance & Services, Inc., an intervenor.
Thomas J. Duffy, Esq., and Terence Cleary, Esq., Department of the 
Army, for the agency.
Andrew T. Pogany, Esq., and Michael R. Golden, Esq., Office of the 
General Counsel, GAO, participated in the preparation of the decision.

DIGEST

Where a request for proposals sets forth the provisions of Federal 
Acquisition Regulation  sec.  52.215-16, Alternate II (FAC 90-31), advising 
offerors of the agency's intent to award without conducting 
discussions, contracting agency may properly do so, provided the 
contracting officer reasonably determines that discussions are 
unnecessary.  Contracting agency reasonably determined to award to the 
offeror which submitted the technically superior proposal at a fair 
and reasonable price based on initial proposals, despite protester's 
arguments that a possibility existed that its inferior technical 
proposal could eventually become, through discussions, the best value 
proposal.

DECISION

Harry A. Stroh Associates, Inc. (Stroh) protests the award of a 
fixed-price contract, on the basis of initial proposals, to Ace 
Maintenance & Services, Inc. under request for proposals (RFP) No. 
DABT11-96-R-0001, issued by the Department of the Army for complete 
housekeeping services at several hospitals and clinics.  Stroh 
contends that the agency unreasonably failed to conduct discussions by 
making award on the basis of initial proposals.[1]

We deny the protest.

The RFP, issued on March 27, 1996, provided that award would be made 
to the offeror whose proposal provided the best value to the 
government considering the evaluation factors set forth in Section M 
of the RFP.  The RFP contemplated a base year performance period with 
four 1-year option periods.  The technical evaluation factors, in 
descending order of importance, were as follows:  (1) technical 
management/organization; (2) staffing; (3) past 
performance/experience;              (4) business management; and (5) 
technical and management transition.  The RFP stated that price would 
not be assigned a numerical score but would be considered of equal 
importance to the combined technical evaluation factors.  The RFP also 
stated that "[a]ll efforts will be made to evaluate the proposals 
without conducting discussions and requesting [b]est and [f]inal 
offers."[2]

The agency received 13 proposals by June 5, 1996, the closing date for 
receipt of initial proposals.  The technical proposals were evaluated 
by a source selection evaluation board (SSEB) with the following 
results:[3]

Offeror              Technical            Price

Ace                  [Deleted]            $21.6 million

Offeror A            [Deleted]            [Deleted]

Stroh                [Deleted]            [Delteted]

Offeror B            [Deleted]            [Deleted][4]
Based on the evaluation results, the SSEB made the following 
recommendation to the source selection authority (SSA):

     "[A] thorough evaluation of all the proposals revealed that Ace 
     Maintenance Services, Inc. had a technically superior proposal 
     and should be awarded the contract without discussions.

     "[T]he board evaluated all other proposals as not acceptable for 
     inclusion in the competitive range.  The board felt that 
     deficiencies noted were not correctable within the time frame for 
     contract award.  Therefore, it was unanimously agreed upon by the 
     Board to not establish a competitive range but to rather make 
     contract award to the offeror who demonstrated the most complete 
     understanding of the Government scope of work and [Performance 
     Work Statement (PWS)] requirements."

The SSA reviewed the evaluation results.  With respect to Ace, she 
found, among other things, that the firm's procedures manual and 
technical proposal were very well organized, structured following the 
PWS and the Quality Assurance Surveillance Plan, and clearly 
demonstrated a thorough understanding of the PWS and the concept of 
total disinfection cleaning vital in hospital housekeeping.  She also 
determined that Ace's staffing matrix was clear and concise, and "very 
close" to the IGE annual hours.  In contrast, she determined that 
Stroh's procedures manual conflicted with the PWS and that the firm's 
Quality Control Program met minimum needs but did not demonstrate a 
full understanding of the government's requirements.  Further, she 
found that Stroh's staffing matrix did not show hours adequate to meet 
all requirements since certain "shift leaders" were not shown, and 
assignments were not made to cover many areas of the hospital.  She 
concluded as follows:

     "Based on the significant superiority of Ace's proposal and their 
     price being considered fair and reasonable, it is determined that 
     it is not to the government's advantage to conduct 
     discussions."[5]

The agency awarded the contract to Ace on August 16, 1996.  This 
protest followed.

Where, as here, an RFP sets forth the provisions of FAR  sec.  52.215-16, 
Alternate II (FAC 90-31), advising offerors of the agency's intent to 
award without conducting discussions, the contracting agency may 
properly do so, provided the contracting officer reasonably determines 
that discussions are unnecessary.  See FAR  sec.  15.610(a)(3) (FAC 90-31); 
see generally Lloyd-Lamont Design, Inc., B-270090.3, Feb. 13, 1996, 
96-1 CPD  para.  71.  

Stroh, in its initial protest, argued, on information and belief, that 
the agency could not properly have made an award to Ace based on 
initial proposals because "Ace's proposal was found to have contained 
deficiencies."  Stroh offered no support or explanation for this 
allegation.  Stroh received the agency report which detailed the 
evaluation of Ace's proposal, including the agency's specific 
determination that Ace's technical proposal was significantly superior 
to Stroh's (and other offerors') proposals.[6]  After reviewing the 
report, Stroh withdrew the allegation that Ace's proposal contained a 
deficiency.

Stroh, in its comments, for the first time argues that the agency 
could not properly have made an award based on initial proposals 
because Ace's technical proposal received a rating of only 
"satisfactory" in one subfactor and that under the source selection 
plan (SSP), the agency was required to conduct discussions 
notwithstanding the explicit terms of the RFP permitting award on the 
basis of initial proposals.[7]

We find this argument to be untimely.  To be considered timely, 
protest issues must be raised not later than 10 days of when the basis 
for protest was or should have been known.  Bid Protest Regulations,  sec.  
21.2(a)(2), 61 Fed. Reg. 39039, 39043 (1996) (to be codified at 4 
C.F.R.  sec.  21.2(a)(2)).  Accordingly, this protest ground will not be 
considered.  Stroh was aware of this basis of protest not later than 
when it received the agency report, but first raised the matter in its 
comments on the agency report which were filed more than 10 calendar 
days after Stroh received the report.[8]  

Finally, Stroh argues that it should have received the award based on 
its initial proposal because its proposal was acceptable and lower in 
price, or that the agency should have conducted discussions with 
offerors.  The RFP here specifically advised offerors that the 
government intended to evaluate proposals and award a contract without 
discussions and that each initial proposal should contain the 
offeror's best terms.  Based on the initial proposals received, the 
agency determined that Ace's proposal represented the best value to 
the government based on its technical superiority and reasonable 
price.  We do not think that the mere possibility that an inferior 
initial proposal could eventually become, through discussions, the 
best value proposal precludes the agency from awarding the contract to 
the offeror with the clearly best value proposal based on initial 
proposals.  Concerning Stroh's argument that its proposal did not 
contain the deficiencies found by the agency and was acceptable, Stroh 
does not argue that its proposal (even absent these deficiencies) was 
technically equal to Ace's proposal and does not contest the agency's 
determination that Ace's proposal was clearly superior.  Under these 
circumstances, we have no basis to object to the agency's award 
without discussions to Ace.  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 could reasonably determine which 
offer represented the best value to the government) with The Jonathan 
Corp.; Metro Mach. Corp., B-251698.3; B-251698.4, May 17, 1993, 93-2 
CPD  para.  174 (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.[9]

Comptroller General
of the United States

1. In its comments on the agency report, the protester withdrew 
certain other issues initially raised in its original protest.

2. Section L of the RFP incorporated by reference Federal Acquisition 
Regulation (FAR)  sec.  52.215-16 (FAC 90-31), entitled "CONTRACT AWARD 
(OCT 1995)--Alternate II," which provides that the government "intends 
to evaluate proposals and award a contract without discussions. . . .  
Therefore, each initial offer should contain the offeror's best terms 
from a cost or price and technical standpoint."

3. The SSEB used a numeric scale of [deleted].  We show the results 
for the four highest ranked offerors.

4. The independent government estimate (IGE) was [deleted].  Although 
                                          a fixed-price contract was 
                                          contemplated, the RFP did 
                                          require certain price 
                                          support data from offerors 
                                          to validate whether proposed 
                                          prices were consistent with 
                                          the technical proposals.  
                                          The agency conducted a price 
                                          analysis which included a 
                                          comparison of Ace's price to 
                                          the current contract as 
                                          adjusted for additional 
                                          requirements, general and 
                                          administrative rates, profit 
                                          rates and a comparison to 
                                          other offerors' prices and 
                                          the IGE.

5. The contracting officer states, contrary to arguments advanced by 
the protester in its comments, that no competitive range determination 
was made by the agency.  The agency simply selected the best value 
offeror based on initial proposals.  The record supports this view.

6. Counsel for the protester also received Ace's entire technical and 
price proposals under a protective order issued by our Office.

7. The SSP stated that a rating of "satisfactory" indicates that the 
proposal "[m]eets minimum requirements of the solicitation; [deleted]; 
[a]ward made with detailed discussion and revised proposal."  
[Deleted].

8. Stroh requested and received an extension for filing its comments 
with our Office; this does not toll the requirement to timely file any 
additional basis or bases of protest that are revealed by the agency 
report.  See Dial Page, Inc., B-256210,
May 16, 1994, 94-1 CPD  para.  311.  Additionally, we note that a 
contracting agency's failure to follow an SSP does not provide a basis 
for questioning the validity of an award selection because the SSP is 
an internal agency instruction and, as such, does not give outside 
parties any rights.  See Johnson Controls World Servs., Inc., 72 Comp. 
Gen. 91 (1993), 93-1 CPD  para.  72.

9. Stroh also alleged that the award was not preceded by a 
cost/technical tradeoff. While the contracting officer did not execute 
any formal document denominated as a cost/technical tradeoff or 
otherwise explicitly set forth a tradeoff determination, it is clear 
from the record that in determining that discussions were not 
necessary the contracting officer did determine that Ace's significant 
technical superiority was worth its price, even though that price was 
appropriately 10-percent higher than the protester's.