BNUMBER:  B-275058.6; B-275058.7 
DATE:  April 14, 1997
TITLE:  Matter of:AVIATE L.L.C.

**********************************************************************

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:AVIATE L.L.C.

File:     B-275058.6; B-275058.7

Date:April 14, 1997

Paralee White, Esq., and Joseph A. Zillo, Esq., Cohen & White, for the 
protester.
James H. Roberts III, Esq., Manatt, Phelps & Phillips, for the 
intervenor.
Vincent A. Salgado, Esq., and Kevin E. Love, Esq., National 
Aeronautics and Space Administration, for the agency.
Denise Benjamin Biddy, Esq., and David R. Kohler, Esq., Small Business 
Administration, for the agency.
Guy R. Pietrovito, Esq., and James A. Spangenberg, Esq., Office of the 
General Counsel, GAO, participated in the preparation of the decision.

DIGEST

1.  A procuring agency may properly include an allegedly unacceptable 
proposal in the competitive range, where the agency reasonably 
concludes that the proposal is susceptible of being made acceptable 
and has a reasonable chance of being selected for award.

2.  In a negotiated procurement for a task order contract, the 
procuring agency reasonably determined that the awardee's proposed 
small disadvantaged business concern (SDB) participation plan 
satisfied the solicitation's 40-percent SDB participation goal, where 
the awardee proposed to subcontract 20 percent of the contract value 
to an SDB subcontractor and to subcontract another 20 percent to other 
to-be-determined SDB concerns from a list of candidate firms 
identified in the awardee's proposal or to award the additional 20 
percent of the contract work to the named SDB subcontractor.

3.  Protest that the procuring agency failed to account in its 
evaluation for 20 percent of the contract work that the awardee 
intended to award to unidentified subcontractors is denied, where the 
awardee's proposal accounted for performance of all the contract work 
to be ordered and the solicitation did not require subcontractor 
commitments. 

4.  A protester's mere disagreement with the agency's assessment of 
weaknesses in its proposal regarding its [REDACTED] and its fragmented 
administrative and management structure does not show the agency's 
evaluation judgment was unreasonable.

5.  Agency reasonably selected a proposal with an "excellent" mission 
suitability rating, instead of the protester's proposal with a 
slightly lower cost and a "very good" mission suitability rating, 
where the protester's lower rating was due to reasonably based major 
weaknesses found in the protester's proposal; in making the award 
selection the agency also reasonably accounted for the protester's 
"excellent" relevant experience and past performance rating, but noted 
that the awardee's "very good" rating was based on highly relevant 
contract experience.  

6.  Request for recovery of costs of pursuing a protest where the 
agency took corrective action in response to the protest is denied 
where the agency did not unduly delay in taking corrective action.

DECISION

AVIATE L.L.C.[1] protests the award of a contract to NYMA, Inc. under 
request for proposals (RFP) No. 1-132-D.1166, issued by the National 
Aeronautics and Space Administration (NASA) for systems analysis and 
engineering research support.  AVIATE challenges the inclusion of 
NYMA's proposal in the competitive range, the evaluation of AVIATE's 
and NYMA's proposals, and the source selection decision, and argues 
that NYMA made material misrepresentations in its proposal.  AVIATE 
also requests that our Office recommend that it recover a portion of 
its costs of filing and pursuing an earlier protest of this award as 
it relates to AVIATE's challenge of NASA's refusal to forward to the 
Small Business Administration (SBA) AVIATE's protest of the small 
disadvantaged business (SDB) status of a subcontractor proposed by 
NYMA as part of the awardee's plan to obtain SDB participation in the 
procurement.  

We deny the protest and the request for recovery of protest costs.

The RFP, issued as a small business set-aside, provided for the award 
of a cost-plus-award-fee task order services contract to support 
aeronautical and space research systems analysis and engineering 
activities at NASA's Langley Research Center for a base year with 4 
option years and six 1-month options.  A detailed statement of work 
was provided that described the services that could be ordered under 
the contract.

The RFP advised that NASA contemplated making award without 
discussions, but reserved the right to conduct discussions if 
determined necessary.  A best value basis for award was stated, and 
the following evaluation factors and subfactors identified:

Factor 1.    Mission Suitability

  Subfactor 1Understanding the Requirements
              and Technical Approach         500 pts.
  Subfactor 2Total Compensation Plan         150 pts.
  Subfactor 3Management Operations           350 pts.
  Subfactor 4Cost Realism                       (300) pts.

Factor 2     Cost

Factor 3     Relevant Experience and Past Performance

The Mission Suitability, Cost, and Relevant Experience and Past 
Performance factors were stated to be of essentially equal importance, 
although only the Mission Suitability factor was to be point scored.  
For the Cost Realism subfactor, offerors were informed that their 
overall Mission Suitability factor score could be reduced where an 
offeror's proposed costs were upwardly adjusted by more than 15 
percent in the agency's cost evaluation.

Information regarding the preparation of proposals, and how they would 
be evaluated, was provided for each of the evaluation factors and 
subfactors.  For example, for the Total Compensation Plan subfactor, 
the RFP informed offerors that proposed salaries and fringe benefits 
for professional and nonprofessional employees would be evaluated, as 
well as an offeror's policies, procedures, and historical basis for 
uncompensated overtime, if proposed.  A total compensation plan was 
required for each offeror and proposed subcontractor whose services 
would exceed $500,000.  For the Management Operations subfactor, 
offerors were informed that their approach to meeting a "mandatory 
goal of 40 [percent] . . . established for SDB participation" would be 
evaluated, as well as the offeror's approach to staffing and 
management.  

For the purposes of the cost evaluation, the RFP provided the 
estimated direct labor hours and skill mix that offerors were to use 
in pricing their proposals for the basic and option periods.  Offerors 
were informed that the contract to be awarded would not contain a 
specified level of effort.  The RFP required offerors to submit a 
separate cost proposal for each subcontractor whose subcontract was 
expected to exceed $500,000.

Proposals were received from seven firms, including AVIATE and NYMA, 
by the February 26, 1996, closing date for receipt of proposals.  
AVIATE's and NYMA's proposals, which were the two highest rated, were 
evaluated as follows:

                    NYMA                AVIATE

Mission Suitability[2]Very Good/        Very Good/
                    [REDACTED] pts.     [REDACTED] pts.
Relevant Experience/
  Past Performance  Very Good           Excellent

Proposed Cost       $[REDACTED]M[3]     $[REDACTED]M
Probable Cost       $[REDACTED]M        $[REDACTED]M

On May 20, the SSO selected NYMA's proposal for award as the most 
advantageous offer to the government.  On May 29, AVIATE protested 
NYMA's SDB status to the contracting officer.[4]  NASA referred the 
protest to the SBA for that agency's determination.  On June 27, the 
SBA determined that NYMA did not qualify as an SDB concern for this 
procurement.  Based upon this determination, NASA reevaluated NYMA's 
proposal, reducing NYMA's Management Operations subfactor rating from 
[REDACTED] to [REDACTED] points to reflect that NYMA had not offered a 
plan that would provide for SDB participation in the procurement.  
NASA established a competitive range consisting of AVIATE's and NYMA's 
proposals, conducted discussions with each firm, and requested best 
and final offers (BAFO).

In response, NYMA revised its proposal to address the RFP's SDB 
participation goal by proposing to subcontract 20 percent of the value 
of the contract to ADF Corporation, a section 8(a) contractor, and to 
subcontract an additional 20 percent of the value to other 
"to-be-determined" SDB concerns, which would be chosen from among a 
number of SDB concerns and "historically black universities and 
colleges" (HBUC) identified in NYMA's proposal.  NYMA further stated 
that if necessary to achieve its planned 40-percent SDB participation 
goal, it would subcontract the additional 20 percent of the value of 
the contract to ADF.  

The BAFOs were evaluated as follows:

                    NYMA                AVIATE

Mission Suitability Excellent/          Very Good/
                    [REDACTED] pts.        [REDACTED] pts.

Relevant Experience/
  Past Performance  Very Good           Excellent

Proposed Cost       $[REDACTED]M        $[REDACTED]M
Probable Cost       $[REDACTED]M        $[REDACTED]M

NYMA's BAFO was found to offer numerous major strengths and no major 
weaknesses under the Mission Suitability Factor and was thus rated 
"excellent."  NYMA's "very good" proposal rating under the Relevant 
Experience and Past Performance factor reflected the evaluators' view 
that although NYMA's experience was limited to a contract for highly 
comparable work at NASA's Lewis Research Center, NYMA also had 
specific experience transitioning to, and managing, a complex 
performance-based contract of greater magnitude than this procurement.

AVIATE's BAFO was rated "very good" under the Mission Suitability 
factor.  Although AVIATE's proposal was found to demonstrate in-depth 
knowledge of all areas of the statement of work, superior 
understanding of the contract requirements, and a superior technical 
approach, the evaluators noted a number of significant weaknesses in 
AVIATE's BAFO under this factor.  Specifically, AVIATE's proposal was 
downgraded for AVIATE's offer of [REDACTED], which AVIATE first 
offered in response to discussions without adequately detailing 
[REDACTED] for this contract.  The evaluators were also concerned that 
AVIATE proposed a distribution of administrative functions [REDACTED] 
without [REDACTED] or discussing how these functions would be 
coordinated.  AVIATE's relevant experience and past performance were 
evaluated as "excellent" based upon the evaluators' finding that 
although AVIATE had no experience managing a contract of the magnitude 
of this procurement, AVIATE and its proposed subcontractors had 
performed extensive technical work in all the statement of work areas 
and primarily at the Langley Research Center.

The evaluators' findings were presented to the SSO, who concluded that 
NYMA's BAFO was the most advantageous to the government.  
Specifically, the SSO stated in her written selection determination:

     "Under Factor 1, Mission Suitability, I noted that NYMA received 
     a rating of 'Excellent' and had no major weaknesses; AVIATE 
     received a rating of 'Very Good' and had several major 
     weaknesses, dealing with their proposed [REDACTED], as well as 
     their proposed plan to [REDACTED].  More specifically, AVIATE's 
     proposed [REDACTED] is not well supported, appears to be based on 
     unrealistic assumptions, and fails to address concerns about how 
     [REDACTED].  Furthermore, AVIATE's [REDACTED].  In general, I 
     considered both of these management issues to be significant 
     discriminators between the NYMA and AVIATE proposals.  I then 
     examined both the proposed and probable costs for both firms 
     under Factor 2, Cost, and noted that they were essentially equal, 
     thereby providing no significant discriminator in this area.  
     Finally, I examined the findings of Factor 3, Relevant Experience 
     and Past Performance.  I noted that AVIATE received a rating of 
     'Excellent' and NYMA received a rating of 'Very Good;' however, I 
     placed significant emphasis on NYMA's experience with 
     transitioning and managing a contract of comparable size and 
     nature (i.e., performance based).  Based on NYMA's excellent 
     mission suitability rating which contained no major weaknesses, 
     essentially equal costs, and very good relevant experience and 
     past performance, I have concluded that the NYMA proposal is the 
     most advantageous to the Government and hereby select them for 
     award.  In making my decision, I have considered all three 
     factors equally."

AVIATE was notified of NASA's selection of NYMA for award, received a 
debriefing, and on October 11, protested to our Office NASA's 
evaluation and source selection.  On November 22, after receipt of the 
agency's report on its initial protest, AVIATE amended its protest to 
our Office to challenge, among other things, ADF's SDB status. 

AVIATE also protested to NASA on December 5 that NYMA's proposed 
subcontractor, ADF, was not an SDB concern.[5]  On December 10, NASA 
informed us that it intended to forward AVIATE's SDB-status protest to 
the SBA, but on December 11 informed us and AVIATE that it would not 
forward the protest to the SBA.  On December 12, AVIATE amended its 
protest to our Office to challenge NASA's refusal to forward AVIATE's 
protest of ADF's SDB status to the SBA.  On December 17, NASA formally 
informed AVIATE that NASA would not forward AVIATE's challenge of 
ADF's SDB status to the SBA because, in NASA's view, the SBA did not 
have jurisdiction to review ADF's SDB status within the context of 
this procurement and because ADF, as an 8(a) contractor, was clearly 
an SDB concern.  On December 23, AVIATE amended its December 12 
protest allegations to address NASA's December 17 letter.  

NASA responded to AVIATE's amended protest on January 2, 1997, 
affirming its view that "SBA lacks regulatory authority to exercise 
its otherwise exclusive jurisdiction to determine SDB status."  On 
January 6, in response to our request, the SBA provided a report 
detailing its views that "it possess[ed] exclusive statutory authority 
to determine the SDB status of NYMA's subcontractor" and "that under 
governing regulations NASA's contracting officer ha[d] the duty to 
promptly forward AVIATE's SDB protest to SBA for adjudication."  On 
January 7, AVIATE filed comments addressing NASA's January 2 report.  
On January 9, in response to the SBA's report, NASA forwarded AVIATE's 
challenge of ADF's SDB status to the SBA and agreed to be bound by the 
SBA's determination in this matter, although NASA maintained "that SBA 
does not have exclusive jurisdiction" to decide ADF's SDB status.  

Because the SBA's determination of ADF's SDB status could render 
academic all or some of AVIATE's protest issues, thus rendering a 
decision from our Office of no practical consequence, we dismissed 
AVIATE's protests on January 10, informing AVIATE that, after the SBA 
had ruled, the protester could timely refile those protest issues 
which the protester believed had continued vitality and for which it 
wished to have our decision.  Within 15 days of the date of our 
dismissal, AVIATE requested that we recommend it be reimbursed those 
costs of filing and pursuing its protest, including reasonable 
attorneys' fees, that relate to its challenge to NASA's refusal to 
forward AVIATE's SDB-status protest to the SBA.  

On February 5, the SBA determined that ADF was an SDB concern for this 
procurement, and on February 6, AVIATE requested that our Office 
decide its remaining protest allegations.  Specifically, AVIATE argued 
that NYMA's initial proposal was technically unacceptable and could 
not properly be included in the competitive range; that NASA 
misevaluated NYMA's and AVIATE's proposals; that in selecting NYMA's 
proposal for award the SSO used improper discriminators; and that NYMA 
made material misrepresentations in its BAFO.  Performance of NYMA's 
contract has been suspended pending our decision in this matter.

AVIATE first protests that, given the SBA's determination regarding 
NYMA's status as an SDB concern, NYMA effectively provided no SDB 
participation plan in its initial proposal and therefore, in AVIATE's 
view, NYMA'S proposal was technically unacceptable and could not 
properly be included in the competitive range.  AVIATE argues that 
allowing NYMA to submit a revised proposal after discussions was 
tantamount to allowing the submission of a new and late proposal, 
which was prohibited by the RFP.  

NASA and NYMA respond that while the RFP provided for the evaluation 
of an offeror's SDB participation plan, it also stated that the 
failure to submit such a plan would not render a proposal 
unacceptable.  In this regard, NASA points outs that the RFP 
specifically provided that "[a]n initial proposal will not be rejected 
as unacceptable solely as a result of an offeror proposing a goal that 
is less than the mandatory goal."  NASA and NYMA argue that, in any 
event, including NYMA's proposal in the competitive range was 
reasonable, given the agency's determination that NYMA's proposal had 
a reasonable chance of being selected for award. 

While the determination of whether a proposal is in the competitive 
range is principally a matter within the reasonable exercise of 
discretion of the procuring agency, see National Sys. Management 
Corp., 70 Comp. Gen. 443, 446 (1991), 91-1 CPD  para.  408 at 4, the FAR 
provides that the competitive range must include all proposals that 
have a reasonable chance of being selected for award and that any 
doubt as to whether a proposal is in the competitive range should be 
resolved by inclusion.  FAR  sec.  15.609(a) (FAC 90-44).  Contrary to 
AVIATE's apparent belief, there is no per se prohibition against the 
inclusion of a technically unacceptable proposal in the competitive 
range.  Rather, a fundamental purpose in conducting discussions is to 
determine whether deficient proposals are reasonably susceptible of 
being made acceptable through discussions.  Construcciones 
Aeronauticas, S.A., 71 Comp. Gen. 82, 85-86 (1991), 91-2 CPD  para.  461 at 
6-7; Scan-Optics, Inc., B-211048, Apr. 24, 1984, 84-1 CPD  para.  464 at 
4-5.  An unacceptable proposal that is reasonably susceptible of being 
made acceptable through discussions and which the agency reasonably 
determines has a reasonable chance of being selected for award 
properly is included in the competitive range.  See SAIC Computer 
Sys., B-258431.2, Mar. 13, 1995, 95-1 CPD  para.  156 at 4.  

Here, although AVIATE argues that NASA did not have a reasonable basis 
to conclude that NYMA's proposal had a reasonable chance of being 
selected for award, the record reflects that, apart from the SDB 
participation plan, NYMA submitted a strong initial proposal that was 
favorably evaluated by NASA.  Moreover, it was apparent that a 
deficient SDB participation plan was easily fixable in response to 
discussions.  We have no basis on this record to find NASA's 
competitive range determination unreasonable.

We also disagree that providing NYMA with the opportunity after 
discussions to submit an SDB participation plan was tantamount to the 
submission of a new and late proposal.  It is axiomatic that 
competitive range offerors may revise any aspect of their proposals 
that they see fit after the conduct of discussions.  FAR  sec.  
15.610(c)(5); American Nucleonics Corp., B-193546, Mar. 22, 1979, 79-1 
CPD  para.  197 at 2.  In this regard, the submission of proposal revisions 
in response to an agency's conduct of discussions is not governed by 
the RFP's late proposal rules, as AVIATE supposes, but are considered 
to be part of the normal negotiation process.  Simmonds Precision 
Prods., Inc., B-244559.3, June 23, 1993, 93-1 CPD  para.  483 at 14-15.

AVIATE also challenges NASA's evaluation of NYMA's BAFO, arguing that 
NASA's evaluation unreasonably found NYMA's SDB participation plan 
acceptable based on the proposed use of unidentified and uncommitted 
SDB subcontractors, and did not account for approximately 20 percent 
of the contract work that NYMA intended to subcontract to these 
unidentified subcontractors.  Specifically, AVIATE complains that 
while NYMA stated in the SDB participation plan submitted with its 
BAFO that it would subcontract approximately 40 percent of the 
contract value to SDB concerns, NYMA specifically identified only one 
SDB concern--ADF, to which NYMA stated it would subcontract 
approximately 20 percent of the contract value.  AVIATE states that 
the remaining 20 percent to be subcontracted--approximately $10 
million of contract value--was undefined in NYMA'S proposal and was 
not accounted for by NASA in its technical and cost evaluation.  
AVIATE contends that without knowing specifically who NYMA would use 
for the remaining 20 percent of the contract NASA did not have a 
reasonable basis to assess the cost realism of NYMA's proposal or to 
evaluate NYMA's proposal under the Management Operations subfactor 
(under which offerors' SDB participation plans were rated), under the 
Total Compensation Plan subfactor, and under the Relevant 
Experience/Past Performance factor.

In considering a challenge to a particular evaluation conclusion, we 
examine the record to determine whether the judgment was reasonable 
and in accord with the evaluation criteria listed in the solicitation.  
Abt Assocs., Inc., B-237060.2, Feb. 26, 1990, 90-1 CPD  para.  223 at 3-4.  
A protester's mere disagreement with the agency's evaluation 
determination does not demonstrate that the evaluation was 
unreasonable.  Brunswick Defense, B-255764, Mar. 30, 1994, 94-1 CPD  para.  
225 at 9.

In its revised proposal, NYMA offered to perform approximately 50.5 
percent of the contract value itself and to subcontract 40 percent to 
SDB concerns and 9.5 percent to a large business subcontractor.[6]  
With regard to obtaining SDB participation, NYMA proposed to 
subcontract between 20 to 40 percent of the contract value to ADF, a 
qualified and experienced SDB concern.  NYMA explained that initially 
it would assign approximately 20 percent of the total contract value 
to ADF to perform, and would endeavor to subcontract an additional 20 
percent of the contract value to other to-be-determined SDB concerns 
or HBUCs, which NYMA identified in its proposal as candidate firms and 
from which NYMA had received expressions of interest and some 
technical and cost information.  NYMA stated that if it was unable to 
subcontract the work to other SDB concerns or if the cost of 
subcontracting with other SDB concerns exceeded a performance-based 
cost ceiling established by NYMA for the work, it would assign up to 
the remaining 20 percent of the contract value to ADF.  As required by 
the RFP, NYMA provided technical information--such as, total 
compensation plans and past performance and relevant experience 
information--and cost proposals for itself, its large business 
subcontractor, and ADF.  NYMA did not provide specific technical 
information or cost information for any of the to-be-determined 
"candidate firms" it identified in its proposal because it did not 
have subcontract agreements with these candidate firms.

In its evaluation of NYMA's BAFO, NASA recognized that NYMA offered to 
subcontract at least 40 percent of the contract value to SDB concerns, 
but provided technical and cost information for only one SDB 
concern--ADF, to which NYMA stated it would initially provide 20 
percent of the technical labor hours.  NASA also recognized that ADF 
might receive the remaining 20 percent of the contract value NYMA was 
assigning to SDB concerns if NYMA could not arrange subcontracts with 
other appropriate SDB concerns within reasonable performance-based 
cost ceilings.  Because NYMA had not identified formal subcontract 
arrangements with any SDB concerns other than ADF, NASA did not 
evaluate (nor could they from the information provided) the "candidate 
firms" under the Total Compensation subfactor and the Past Performance 
and Relevant Experience factor, and did not downgrade NYMA's proposal 
for this reason under these evaluation areas.  However, based on the 
information submitted, NASA credited NYMA's proposal under the 
Management Operations subfactor with providing an SDB participation 
plan that satisfied the RFP's 40-percent participation goal.  In its 
cost realism evaluation, NASA adjusted NYMA's proposed costs upward by 
approximately $1.5 million on the assumption that ADF would perform 40 
percent of the contract value.  The SSO was fully briefed as to these 
evaluation findings.

As noted above, AVIATE objects to NASA's evaluation of NYMA's SDB 
participation plan under the Management Operations subfactor, arguing 
that the agency unreasonably provided NYMA with credit for its SDB 
candidate firms when NYMA did not have commitments from these firms to 
perform work under the contract.  The record shows that NASA in its 
evaluation provided NYMA with full credit for its SDB participation 
plan;[7] in doing so, NASA correctly recognized that NYMA's plan to 
satisfy the agency's 40-percent participation goal was to subcontract 
20 percent of the contract value to ADF and to seek to subcontract 
another 20 percent of the contract to other, to-be-determined 
subcontractors or to ADF if suitable subcontracts could not be 
arranged.

We find the agency's evaluation of NYMA's SDB participation plan to be 
reasonable and in accord with the RFP evaluation criteria.  While 
AVIATE disagrees with the agency's assessment of NYMA's plan, arguing 
that the failure to identify firm commitments/subcontracts for the SDB 
concerns that could receive work under the contract task orders should 
have resulted in either the rejection of NYMA's BAFO or in point 
reductions in NYMA's technical score, the RFP did not require 
subcontractor commitments.  Rather, the RFP sought an offeror's 
proposed best effort to satisfy the agency's stated SDB participation 
goal.  Here, NYMA provided such a plan, which NASA's evaluators and 
SSO found satisfied the RFP requirements.  AVIATE's disagreement with 
NASA's judgment does not show the evaluation to be unreasonable.  
Moreover, any possible reduction in NYMA's total score for this 
subfactor to account for its failure to more specifically identify the 
SDB concerns that could receive contract work would have had only a 
marginal effect on the overall evaluation and no apparent effect on 
the SSO's selection decision,[8] such that we cannot say that AVIATE 
was prejudiced by NASA's evaluation of NYMA's SDB participation plan.

AVIATE nevertheless complains that NYMA made material 
misrepresentations in its proposal regarding its SDB participation 
plan that should compel the rejection of its proposal.  Specifically, 
AVIATE states that while NYMA identified an SDB 
concern--[REDACTED]--as a candidate firm that could receive work under 
the contract, [REDACTED] was informed by NYMA before the date for 
submission of the BAFO that NYMA was not interested in proposing 
[REDACTED] and would not include [REDACTED] in NYMA's offer.  AVIATE 
also argues that because ADF stated in its cost proposal that it 
anticipated receiving 20 percent of the contract work and did not 
specifically commit to performing more than 20 percent of the contract 
work that NYMA misrepresented ADF's availability in its SDB 
participation plan.

An offeror's material misrepresentation could provide a basis for 
disqualification of the proposal and cancellation of the contract 
award based upon the proposal.  Universal Technologies Inc.; 
Spacecraft, Inc., B-248808.2 et al., Sept. 28, 1992, 92-2 CPD  para.  212 at 
13.  A misrepresentation is material where an agency has relied upon 
the misrepresentation and that misrepresentation likely had a 
significant impact upon the evaluation.  ManTech Advanced Sys. Int'l, 
Inc., B-255719.2, May 11, 1994, 94-1 CPD  para.  326 at 5.  We find that 
NYMA did not make material misrepresentations concerning its SDB 
participation plans.

Regarding [REDACTED], NYMA merely identified [REDACTED] as one of 
several SDB concerns from which NYMA had received "expressions of 
interest" and stated that NYMA "plan[ned] to add them to the list of 
candidate firms."  NYMA made no representations concerning any 
commitment or formal arrangement with [REDACTED]; rather, NYMA merely 
informed NASA that [REDACTED] was one of a number of SDB concerns with 
which NYMA might seek to negotiate work.  Even though AVIATE argues 
that NYMA had no intention of negotiating work with [REDACTED], the 
record does not establish that NYMA's identification of [REDACTED] on 
its list of candidate firms was relied upon by NASA in its evaluation 
of NYMA's SDB participation plan or had any impact on NASA's 
evaluation.

Regarding ADF's availability to perform work under the contract, ADF 
did not, as AVIATE supposes, limit the amount of work it would perform 
to 20 percent of the contract value.  Consistent with NYMA's 
representations that it would initially subcontract 20 percent of the 
contract value to ADF and seek to subcontract the remaining 20 percent 
to other SDB concerns, ADF stated that it "anticipates" receiving 20 
percent of the contract work.  While ADF's cost proposal is silent 
about receiving additional contract work, there is nothing in ADF's 
proposal that contradicts NYMA representations that ADF may perform up 
to 40 percent of the contract value.  In sum, the record does not show 
that NYMA misrepresented ADF's proposed participation.

As indicated above, AVIATE also asserts that NASA had no basis to 
evaluate NYMA's probable cost because that firm did not submit cost 
information for the to-be-determined subcontractors, which represented 
20 percent of the contract value.  The record shows that NYMA's 
proposed costs for the hours to be worked by the to-be-determined SDB 
subcontractors were based on the lower rates of AVIATE's own 
personnel.  NASA, in performing the cost realism evaluation, projected 
NYMA's costs for these subcontractors to the higher rates paid by ADF 
because NYMA's proposal stated that ADF, whose costs were submitted, 
would perform this portion of the contract work if NYMA were unable to 
find other qualified SDB contractors within performance-based cost 
ceilings.  Where, as here, an agency is evaluating proposals for the 
award of a cost reimbursement contract, the agency should determine 
the extent to which an offeror's proposed costs represent what the 
contract should cost, assuming reasonable economy and efficiency.  
Purvis  Sys. Inc., 71 Comp. Gen. 203, 209 (1992), 92-1 CPD  para.  132 at 7; 
CACI, Inc.-Fed., 64 Comp. Gen. 71, 75 (1984), 84-2 CPD  para.  542 at 5-6.  
Since NYMA's proposal indicated that it would only employ SDB 
subcontractors within performance-based cost ceilings, we find that 
NASA reasonably projected NYMA's probable costs for this aspect of the 
contract work to the rates identified for ADF.  Purvis  Sys. Inc., 
supra at 7.

AVIATE also asserts that the agency's technical evaluation of NYMA's 
BAFO was rendered unreasonable by NYMA's failure to provide sufficient 
information in its BAFO, contrary to specific RFP instructions, to 
allow NASA to reasonably assess NYMA's offer under the Past 
Performance/Relevant Experience factor and Total Compensation Plan 
subfactor.

We cannot, on this record, find unreasonable NASA's decision not to 
downgrade NYMA's proposal under the Past Performance/Relevant 
Experience factor and Total Compensation Plan subfactor.  While it is 
true that the RFP requested offerors to provide total compensation 
plans and past performance/relevant experience information proposals 
for all significant subcontractors, NYMA complied with these 
instructions when it offered the requested information for ADF and its 
large business subcontractor.  The "candidate firms" for which AVIATE 
complains that NYMA failed to provide information concerning relevant 
experience, past performance, or total compensation plans were only 
identified by NYMA as SDB concerns with which NYMA might subcontract; 
these firms were not represented to be subcontractors nor were they 
evaluated as such by the agency.  We find no requirement that NYMA 
include such information in its proposal for potential subcontractors 
that NYMA had not yet specifically identified.  Moreover, NASA 
identified no problems with NYMA's reserving 20 percent of contract 
value for qualified "to-be-determined" SDB or HBUC subcontractors, and 
had no problems with NYMA's "fallback position" of using ADF.  As 
discussed above, there is no suggestion in the record that ADF, whose 
past performance, relevant experience, and total compensation plan 
were evaluated and found to be a strength of NYMA's proposal, could 
not or would not perform this portion of the work.

AVIATE also challenges the evaluation of its own proposal, arguing 
that NASA misevaluated its offered uncompensated overtime and its 
planned performance of administrative functions by both the joint 
venture owners.  

The record shows that AVIATE first offered [REDACTED] in its response 
to the agency's discussions.  Specifically, AVIATE proposed to provide 
[REDACTED].  NASA considered AVIATE's offer of [REDACTED], which was 
first offered in AVIATE's revised proposal, to be a major weakness 
[REDACTED] and, contrary to the specific RFP instructions, had not 
[REDACTED].  AVIATE admits that it [REDACTED].[9] 

We find from our review of AVIATE's revised proposal that AVIATE did 
not provide a detailed discussion supporting the offer of [REDACTED], 
as was required by the RFP.  Given this failure and that AVIATE had 
[REDACTED], we find that NASA was justifiably concerned by AVIATE's 
[REDACTED].  While AVIATE disagrees with NASA's judgment concerning 
the risks entailed in AVIATE's offered [REDACTED], this does not show 
NASA' s evaluation to be unreasonable.  Brunswick Defense, supra at 9.

AVIATE also objects to the evaluation of its proposal under the 
Management Operations subfactor, for which AVIATE was evaluated as 
"good."  The record shows that AVIATE proposed to divide the 
administrative and management functions, [REDACTED].  NASA assessed 
AVIATE's planned management structure as a major weakness because 
AVIATE did not propose [REDACTED] or discuss how [REDACTED].  The 
evaluators concluded that "[REDACTED]."[10]  

We find NASA's evaluation of this subfactor to be reasonable. 
[REDACTED].  AVIATE does not explain how this administrative 
structure, which AVIATE describes as "unique and cost-effective," 
would result in [REDACTED].  Nor does AVIATE address NASA's concerns 
that AVIATE's unique administrative structure would cause [REDACTED] 
and result in administrative inefficiencies.  In short, AVIATE has not 
shown NASA's concerns in this regard to be invalid.

AVIATE also objects to the SSO's source selection decision, arguing 
that the SSO used improper discriminators in determining that NYMA's 
higher cost proposal was more advantageous to the government than 
AVIATE's proposal.  

The SSO noted that in contrast to NYMA's proposal, which was rated 
"excellent" under the Mission Suitability factor with many strengths 
and no major weaknesses, AVIATE's proposal, which was rated "very 
good" under the Mission Suitability factor, contained several major 
weaknesses, most notably AVIATE's offer of uncompensated overtime and 
proposed division of administrative functions.  The SSO "considered 
both of these management issues to be significant discriminators 
between the NYMA and AVIATE proposals."  Since, as noted above, we 
find that NASA's evaluation of AVIATE's proposal in these regards was 
reasonable, we have no basis to question the SSO's conclusion that 
these major weaknesses were significant discriminators, particularly 
where, as here, the evaluated costs of the offerors were reasonably 
determined to be essentially equal.

AVIATE also complains that the SSO discounted AVIATE's "excellent" 
rating under the Relevant Experience/Past Performance factor in favor 
of NYMA's "very good" rating because NYMA had "experience with 
transitioning and managing a contract of comparable size and nature 
(i.e., performance-based)."  AVIATE argues that "transitioning and 
managing a performance-based contract" is not a stated evaluation 
factor and that, in any event, AS&M and Vigyan also have experience 
performing performance-based contracts.

We disagree with AVIATE that experience in transitioning and managing 
performance-based contracts could not be considered under the RFP's 
stated Relevant Experience/Past Performance factor.  Specifically, the 
RFP informed offerors that in evaluating proposals under this factor 
the agency would consider experience performing work that was 
comparable or related to the work or effort required by the RFP, and 
past performance of contracts of similar size, content, and 
complexity.  Given that the support contract to be awarded as a result 
of this RFP is a performance-based contract, experience with and past 
performance of performance-based contracts is comparable to, and of 
similar content with, the work sought by the RFP.  Accordingly, 
evaluation of performance and/or experience with performance-based 
contracts was provided for by the RFP.

We also disagree with AVIATE that the SSO gave improper consideration 
to NYMA's experience in transitioning and managing a performance-based 
contract of comparable size and nature, and ignored or improperly 
discounted AVIATE's "excellent" rating for the Relevant Experience and 
Past Performance factor.  The SSO specifically accepted AVIATE's 
"excellent" proposal rating under this factor, which was based upon 
the two joint venturers' experience performing similar contract work, 
although NASA's evaluators' noted that AVIATE itself did not have 
experience managing a contract of the size of the contract to be 
awarded here.  The SSO's comment concerning NYMA's specific experience 
with transitioning and managing a contract of comparable size and 
nature was made in the context of the SSO's weighing of the difference 
between AVIATE's "excellent" rating and NYMA's "very good" rating.  We 
find the SSO was appropriately considering NYMA's past 
performance/relevant experience in assessing the possible risks of 
NYMA's performance of this contract.  As the SSO's decision makes 
clear, AVIATE's and NYMA's respective evaluation ratings for the 
Relevant Experience/Past Performance factor formed only one part of 
the SSO's overall weighing of the benefits of the two offers, and 
AVIATE's higher rating for this factor did not offset the "significant 
discriminators" between the proposals under the Mission Suitability 
factor.  In short, we find no basis to question the SSO's decision in 
this regard.

The protest is denied.

AVIATE also contends that, pursuant to 4 C.F.R.  sec.  21.8(e) (1997), it 
is entitled to recover the costs of filing and pursuing its protest 
that NASA was required to forward AVIATE's challenge to the SDB status 
of NYMA's subcontractor ADF to the SBA.  

Pursuant to 4 C.F.R.  sec.  21.8(e), we may recommend that a protester be 
reimbursed its costs of pursuing a protest, including reasonable 
attorneys' fees, where, based on the circumstances of the case, we 
determine that the agency unduly delayed taking corrective action in 
the face of a clearly meritorious protest.  Oklahoma Indian 
Corp.--Claim for Costs, 70 Comp. Gen. 558, 559 (1991), 91-1 CPD  para.  558 
at 2.  Thus, as a prerequisite to costs where a protest has been 
settled by corrective action, not only must the protest have been 
meritorious, but it also must have been clearly meritorious.  J.F. 
Taylor, Inc.--Entitlement to Costs, B-266039.3, July 5, 1996, 96-2 CPD  para.  
5 at 3.  A protest allegation is clearly meritorious where it is not a 
close question.  GVC Cos.--Entitlement to Costs, B-254670.4, May 3, 
1994, 94-1 CPD  para.  292 at 3.  That is, a protest is clearly meritorious 
where a reasonable agency inquiry into the protester's allegations 
establishes the absence of a defensible legal position.  Baxter 
Healthcare Corp.--Entitlement to Costs, B-259811.3, Oct. 16, 1995, 
95-2 CPD  para.  174 at 5.

NASA asserts that AVIATE's protest was not clearly meritorious, 
arguing that while it agreed to forward AVIATE's SDB-status protest to 
the SBA for that agency's determination, there was no legal 
requirement, within the context of this procurement, compelling NASA 
to forward the protest to the SBA.  Specifically, NASA argues that the 
SBA's regulations--specifically, 13 C.F.R.  sec.  124.601 (1996)--identify 
the procurements for which the SBA will resolve SDB-status questions 
and this procurement is not within the identified programs.  NASA also 
argues that the contracting officer was not persuaded by AVIATE's 
agency-level protest that ADF was not an SDB concern and therefore the 
contracting officer was not required to file his own SDB-status 
protest with the SBA.  See 13 C.F.R.  sec.  124.603(b).[11]  NASA 
alternatively contends that, because it forwarded AVIATE's SDB-status 
protest to the SBA within 30 days of the date of AVIATE's protest of 
this issue to our Office, NASA did not act with undue delay in any 
case.

AVIATE and the SBA respond, citing Y.S.K. Constr. Co., Inc. v. United 
States, 30 Fed. Cl. 449 (1994), that the statutory and regulatory 
framework established to foster SDB participation in federal 
procurements evidences the Congressional intent that only the SBA 
determine the SDB status of a concern under any program that employs 
the SBA's definition of an SDB.  Specifically, the SBA cites 15 U.S.C  sec.  
636(j)(11)(F)(vii) (1994), as providing it with broad authority to 
decide challenges to a concern's SDB status.  That section provides 
the SBA with the responsibility to

     "decide protests regarding the status of a concern as a 
     disadvantaged business concern for purposes of any program or 
     activity conducted under the authority of subsection (d) of 
     section 637 of this title, or any other provision of Federal law 
     that references such subsection for a definition of program 
     eligibility."  

Section 8(d) of the Small Business Act, 15 U.S.C.  sec.  637(d)(1), states 
the general policy of the federal government to provide the maximum 
practicable opportunity to small business concerns, SDBs, and small 
business concerns owned and controlled by women to participate in 
federal procurements.  The SBA notes that this RFP incorporated by 
reference the standard FAR  sec.  52-219-8, "Utilization of Small, Small 
Disadvantaged and Women-Owned Small Business Concerns," clause that 
implements the section 637(d) requirements.  The SBA also states, 
citing 13 C.F.R.  sec.  124.605(c), 124.607(b), that the contracting 
officer has no discretion to dismiss or otherwise decline to forward 
any timely SDB-status protest to the SBA, but rather is required to 
"forward all protests received to the SBA for a decision on whether to 
pursue the determination of disadvantaged status."

We cannot say from this record that NASA unduly delayed taking 
corrective action in response to AVIATE's protest.  The determination 
of the merits of AVIATE's protest involves the relationship between 
federal statutes and regulations.  For example, the National 
Aeronautics and Space Act of 1958, as amended, 42 U.S.C.  sec.  2473b 
(1994), requires NASA to annually establish a goal of at least 8 
percent of the total value of prime contracts and subcontracts awarded 
in support of authorized programs be awarded to small business 
concerns or other organizations owned or controlled by socially and 
economically disadvantaged individuals, as defined by section 8(a) of 
the Small Business Act.[12]  This grant of authority to the NASA 
administrator, however, does not reference subsection (d) of section 
637, from which the SBA states it derives authority to resolve 
SDB-status challenges.  Given the complex legal analysis necessary to 
resolve this protest allegation, we cannot say that NASA unduly 
delayed taking corrective action.  Although we recognize that NASA's 
corrective action was taken after AVIATE had filed its comments on 
NASA's report, and had thus incurred further costs in support of its 
protest allegation, NASA's corrective action was taken within 30 days 
of AVIATE's protest of this issue to our Office and within 3 days of 
receipt of the SBA's report detailing its legal authority for 
asserting jurisdiction over this matter.  Under the circumstances, we 
find that NASA did not unduly delay in taking corrective action.  
Compare Control Corp.; Control Data Sys., Inc.--Protest and 
Entitlement to Costs, B-251224 et al., May 3, 1993, 93-1 CPD  para.  353 at 
6-7 (corrective action after filing of comments on the agency's 
expedited report was unduly delayed where resolution of protest 
allegation only required review of the solicitation's statement of 
work).  

The protest and request for recovery of protest costs are denied.

Comptroller General
of the United States

1. AVIATE was established as a Virginia limited liability corporation 
by Analytical Services & Material, Inc. (AS&M) and Vigyan, Inc. for 
the sole purpose of seeking and performing this contract.

2. In response to concerns raised by the SSO in the initial source 
selection briefing, several aspects of NYMA's and AVIATE's proposal 
were reevaluated, which resulted in a reduction in the firms' 
evaluation scores under the Mission Suitability factor to [REDACTED] 
for NYMA and [REDACTED] for AVIATE.  The reduction in AVIATE's score 
reflected the SSO's and evaluators' concerns with AVIATE's proposed 
division of adminstrative and management functions [REDACTED].

3."M" is a million.

4. NYMA certified itself as an SDB concern and proposed to satisfy the 
40-percent SDB participation goal through its own participation.

5. Protests to the SBA of a subcontractor's SDB status can be 
initiated only by the contracting officer or the SBA, although firms 
may submit information to the contracting officer, which can be used 
to initiate a contracting officer's protest.  Federal Acquisition 
Regulation (FAR)  sec.  19.703(a) (FAC 90-45); 13 C.F.R.  sec.  124.603(b) 
(1996). 

6. As AVIATE notes, NYMA indicated in one place in its responses to 
the agency's discussions that it intended to subcontract 41 percent of 
the contract value to SDB concerns.  In other places in its 
discussions responses and in its revised cost proposal, NYMA stated 
that it would subcontract approximately 40 percent to SDB concerns.  
We think that this discrepancy is immaterial.

7. After the SBA determination that NYMA was not an SDB concern, NASA 
deducted [REDACTED] points from NYMA's Management Operations subfactor 
rating of [REDACTED] points, reducing NYMA's rating for this subfactor 
from "excellent" to "very good."  After the submission of NYMA's 
revised SDB participation plan, NYMA's BAFO again received [REDACTED] 
points and was assessed as excellent.  Thus, the record indicates that 
NASA gave NYMA full credit for its plan to obtain 40-percent SDB 
participation.

8. As noted above, NYMA's BAFO received [REDACTED] points under the 
Mission Suitability factor while AVIATE's BAFO received only 
[REDACTED] points, a difference of [REDACTED] points.  Accepting 
AVIATE's arguments concerning a reduction in NYMA's technical score, 
NYMA's BAFO would at best would only be reduced by [REDACTED] points 
to a total score of [REDACTED] points.  Moreover, the technical 
discriminators the SSO found important in selecting NYMA's higher cost 
proposal for award did not relate at all to the SDB participation 
plan.

9. AVIATE also admits that [REDACTED].

10. This weakness, which, as stated above, was first noted at the 
initial source selection prior to discussions and resulted in a 
reduction in AVIATE's score for this subfactor, was expressly raised 
with AVIATE during discussions.

11. 13 C.F.R.  sec.  124.603(b) provides

            "(b) In connection with an 8(d) subcontract, the procuring 
            agency contracting officer or SBA may protest the 
            disadvantaged status of a proposed subcontractor.  Other 
            small business subcontractors and the
            prime contractor may submit information to the contracting 
            officer in an effort to persuade the contracting officer 
            to initiate a protest."
             
12. The RFP also incorporated by reference NASA's Small Disadvantaged 
Business Goal clause, as set forth in the NASA FAR Supplement, 48 
C.F.R.  sec.  1852.219-76 (1996), which implements 42 U.S.C.  sec.  2473b.