BNUMBER:  B-274785
DATE:  January 6, 1997
TITLE:  National Office Systems, Inc.

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Matter of:National Office Systems, Inc.

File:     B-274785

Date:January 6, 1997

Dan Harbison for the protester.
David W. Craig for Spacesaver Systems, Inc., an intervenor.
Dennis J. Gallagher, Esq., Department of State, for the agency.
Paula A. Williams, Esq., and Michael R. Golden, Esq., Office of the 
General Counsel, GAO, participated in the preparation of the decision.

DIGEST

Under regulations governing Federal Supply Schedule (FSS) use, 
procuring agency met its responsibility to select the best value items 
at the lowest overall price after reviewing the General Services 
Administration's automated pricing and product information system and 
reasonably determining that the selected FSS contractor's product 
meets the agency's needs.  

DECISION

National Office Systems, Inc. (NOS) protests the issuance of delivery 
order 
No. S-FBOAD-96-F-0246 to Spacesaver Systems, Inc. by the Department of 
State for high density filing systems to be installed at the State 
Department Annex.  The delivery order was placed under Spacesaver's 
Federal Supply Schedule (FSS) contract No. GS-28F-1003C, for a total 
price of $173,399.67.  NOS, an authorized dealer for White Systems, 
Inc. (the  schedule contractor), alleges that the agency failed to 
solicit a quotation from the firm, thereby depriving it of an 
opportunity to compete.  NOS also alleges that the agency's best value 
determination was flawed as it was based on an inaccurate assessment 
of NOS's product line and past performance.

We deny the protest.

The procurement was initiated in July 1996 when a purchase request for 
the filing systems was placed with the agency's General Acquisition 
Division.  The agency used the Spacesaver specifications to define its 
requirements and the contracting officer orally solicited price 
quotations from Spacesaver and NOS.  Since NOS was the authorized 
dealer for the White product line, NOS indicated that it could only 
submit a price quote if the specifications were not specific to the 
Spacesaver brand system.[1]  Another purchase request was subsequently 
reissued using generic specifications for the filing systems on 
September 9, and the contracting officer reviewed the automated 
information available for several FSS contractors, including the 
catalogs and price lists for Spacesaver and White.  In addition, 
because of the specific interest expressed by NOS in this purchase, 
the contracting officer asked  the requirements office to review the 
White catalog to see if its filing system met the agency's needs and 
to prepare a cost estimate for the NOS/White system.  

The agency estimated the cost for the filing systems offered by 
Spacesaver and NOS/White as essentially the same ($18,000 to $20,000 
per system); however, based on a comparison of each system's major 
line items, the agency evaluators concluded that the Spacesaver filing 
system would best meet the agency's needs.  For example, in comparing 
the Spacesaver rails to the White track, the agency evaluators noted:

     "Spacesaver rails are structurally stronger in profile and are 
     designed to interlock by means of a tongue and groove joint as 
     opposed to a butt joint used in the White track.  This butt joint 
     is a nondesirable feature when considering stress factors with 
     regard to mechanical wear and system integrity.  In addition, the 
     Spacesaver rails are levelled and anchored in a bed of continuous 
     hydraulic grout which disperses the load evenly over the 
     sub-structure.  The White track is leveled with shims that in 
     conjunction with the butt joints has inherent potential to 
     misalign by deflection and fail in performance as well as create 
     point loads on the sub-structure . . .  the White tracks rely on 
     side flanged wheels for carriage guidance which have a tendency 
     to intensify the problem with maintaining track alignment whereas 
     the Spacesaver center guide rail enhances alignment and minimizes 
     carriage binding . . . ."

Similar comparisons were made with regard to elevated floor decking 
and ramp, carriage frame, and end panels offered by the two systems, 
with the Spacesaver design considered superior in overall strength and 
versatility due primarily to its better structural integrity and 
variety of available components.

Finally, the evaluators noted that the agency has both the Spacesaver 
and White systems installed at the State Department Annex, the 
location for installation under the protested delivery order.  The 
agency reports that it has experienced "no problems with the 
Spacesaver installations and only incidental problems with the final 
product" whereas installations for the White systems "were plagued 
with problems ranging from delivery of the wrong product to 
unprofessional workmanship and the final product had several bugs that 
persistently reappear."  After reviewing this product analysis and 
cost comparison, the contracting officer determined that the 
Spacesaver system would best meet its needs and issued a delivery 
order for six filing systems to Spacesaver on September 18.[2]   This 
protest followed.    

NOS challenges the agency's decision to place an order with 
Spacesaver, arguing that the agency failed to properly determine the 
lowest overall price available under the FSS.  The protester contends 
that a valid price comparison could only be performed if the agency 
had received actual quotations from each schedule contractor, 
including NOS, rather than relying on the General Services 
Administration's (GSA) automated catalog/price information.  Simply 
reviewing schedule prices, according to NOS, does not provide the 
agency with a basis for determining installation prices (these prices 
are not included in any FSS contractor's price list) or possible price 
reductions from published schedule prices.

When agency requirements are satisfied through the use of the FSS, an 
agency is not required to seek further competition, synopsize the 
requirement, make a separate determination of fair and reasonable 
pricing, or consider small business set-asides.  Federal Acquisition 
Regulation (FAR)  sec.  8.404(a) (FAC 90-41); Design Contempo, Inc., 
B-270483, Mar. 12, 1996, 96-1 CPD  para.  146.  When placing an order of 
more than $2,500 under the FSS, however, a procuring agency is 
required to reasonably ensure that a selection represents the best 
value and meets the agency's needs at the lowest overall cost by 
considering reasonably available information about products offered 
under Multiple Award Schedule (MAS) contracts.[3]  
FAR  sec.  8.404(b),(c).  This standard can be satisfied if the procuring 
agency reviews GSA's MAS automated information system.  FAR  sec.  
8.404(b)(2)(i)(A).      

We think the agency's actions in selecting a vendor to deliver the 
filing systems were unobjectionable under the FSS procedures.  The 
agency states that since most of its requirements, including services 
such as installation, can be satisfied through the FSS, the 
contracting officer reviewed GSA's MAS automated information system 
for Miscellaneous Furniture, Federal Supply Classification Group 71, 
Part III, Section J, to obtain product information and prices.  While 
the protester is correct that this automated information system does 
not include prices for services such as installation, the FSS schedule 
states that when buying filing cabinet systems, such as the one at 
issue here, the agency must "negotiate installation on a 
project-by-project basis, requesting an installation price quotation 
for each project regardless of dollar value of the project."  This 
schedule language must be interpreted in a manner consistent with FAR  sec.  
8.404(b)(2)(i).  As noted, that provision requires a procuring agency 
to review automated pricing and product information, if such is 
available; it does not require procuring agencies to seek further 
competition by soliciting quotations.  Further, there is no 
requirement under the regulations governing FSS use that the agency 
solicit competitive quotes in order to obtain price reductions from 
schedule contractors.  While schedule contractors are allowed to 
reduce their schedule contract prices to an individual agency for a 
specific order, there is no requirement that they do so.  FAR  sec.  
8.404(b)(3).  Since a formal solicitation process is not contemplated 
for ordering from an FSS--the purpose of the FSS program is to provide 
government agencies with "a simplified process" for obtaining commonly 
used supplies and services at prices associated with volume buying--we 
have no basis to conclude that the agency erred by not competing its 
FSS purchase simply to obtain possible price reductions.[4]  See 
National Mailing Sys., B-251932.3, Aug. 4, 1993, 93-2 CPD  para.  78.   

Finally, NOS maintains that even if the agency's actions were 
otherwise permissible, its best value determination was nonetheless 
flawed because the technical comparisons of the Spacesaver and White 
systems were incorrect and inaccurate.  
We have reviewed all of NOS's contentions in this respect and find 
them without merit.  For example, NOS contends that the design and 
construction of Spacesaver's rails and wheels is less durable and 
reliable than White's as the center guide rail principle is 
"susceptible" to a single pivot line which can cause racking around 
that line, dirt can accumulate in the groove and cause frictional 
problems, and Spacesaver's tongue and groove concept does not "obviate 
vertical movement" of the adjoining track sections.  On the other 
hand, NOS insists that the White system is superior and compares many 
of its design features to those of Spacesaver's.  For instance, the 
protester states that White's use of steel shim under the butt joints 
"obviates" any sagging of the track, White's track is anchored and 
leveled and disperses the load evenly, there is no misalignment nor 
difference in levels of adjoining track at the butt joints since these 
are polished to the same heights, all White wheels are load and guide 
wheels and they install wheels at every splice point--the strongest 
possible solution.  However, none of NOS's responses to the agency's 
assessment of the quality characteristics of the two filing systems 
demonstrates that the agency's assessment and conclusions were 
unreasonable.  While the protester asserts, for example, that its use 
of a steel shim under the butt joints "obviates" any sagging of the 
track and that its track design has other superior features, it does 
not directly rebut the agency's finding that the butt joint design is 
a nondesirable feature which can cause stress and affect mechanical 
wear and system integrity.  NOS has not established that the agency is 
incorrect in its technical conclusion that the design of the White 
system, which NOS basically concedes is different from the Spacesaver 
design, affects the durability and reliability of the White system.  
On this record, NOS's arguments simply represent its disagreement 
which does not itself render the technical comparison and conclusions 
unreasonable.  Litton Sys., Inc., B-237596.3, Aug. 8, 1990, 90-2 CPD  para.  
115.  In light of the above, we find no basis to disturb the agency's 
decision to select the Spacesaver system as the system which best 
meets the needs of the agency.[5] 

The protest is denied.

Comptroller General
of the United States

1. Spacesaver submitted a quotation dated July 11 which it later 
supplemented on July 23.  NOS only submitted a product catalog to the 
agency on September 5. 

2. The delivery order also includes non-FSS items, i.e., front-loading 
blueprint filing  cabinets. 

3. The terms "Federal Supply Schedules" and "Multiple Award Schedules" 
are used interchangeably throughout Subpart 8.4 of the FAR. 

4. NOS also contends that the agency erred in awarding non-FSS items 
under this delivery order.  In a written justification for these open 
market items, the contracting officer noted that front loading 
blueprint cabinets were not available from GSA schedule contractors 
and concluded that it was in the best interest of the government to 
obtain these front loading cabinets from Spacesaver, so that 
Spacesaver would be responsible for integrating them into the high 
density filing system.  An agency may properly procure non-FSS items 
under a single procurement where, as here, the non-FSS items are 
incidental to the items being procured from an FSS vendor.  See Design 
Contempo, Inc., supra.  

5. While we do not specifically address NOS's other bases for protest 
such as the agency's alleged improper evaluation of its past 
performance, we have considered these allegations and consider them to 
be without merit.