BNUMBER:  B-275062
DATE:  January 21, 1997
TITLE:  Eagle Design & Management, Inc.

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

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:Eagle Design & Management, Inc.

File:     B-275062

Date:January 21, 1997

David M. Nadler, Esq., and Karen Lau, Esq., Dickstein, Shapiro, Morin 
& Oshinsky LLP, for the protester.
Barbara S. Kinosky, Esq., Bean, Kinney & Korman, Leigh H. Turner, 
Esq., and 
James S. Phillips, P.C., for Herner & Company, an intervenor.
Terrence J. Tychan, Department of Health & Human Services, for the 
agency.
Linda C. Glass, Esq., and Paul I. Lieberman, Esq., Office of the 
General Counsel, GAO, participated in the preparation of the decision.

DIGEST

1.  Protest concerning the evaluation of proposals is denied where the 
evaluation had a reasonable basis and was consistent with the 
solicitation evaluation criteria.  The fact that the protester does 
not agree with the agency's evaluation does not render the evaluation 
unreasonable.

2.  Protest of best value analysis is denied where the protest is 
predicated on the assumption that the underlying technical and price 
evaluations were erroneous, but the record shows that the evaluation 
results were reasonable. 

DECISION

Eagle Design & Management, Inc. protests the award of a contract, on 
the basis of initial proposals, to Herner & Company under request for 
proposals (RFP) No. 263-96-P(AH)-0012, issued by the National 
Institutes of Health (NIH) as a total small business set-aside for the 
operation of a public clearinghouse for NIH's Office of Alternative 
Medicine (OAM), and the development of a scientific and research 
database for OAM.  Eagle contends that the agency improperly evaluated 
its proposal by failing to evaluate Eagle's alternate proposal in 
accordance with the RFP and by applying undisclosed evaluation 
factors, and that the agency conducted a flawed best value analysis.

We deny the protest.

The OAM was created to facilitate the evaluation of alternative 
medical treatments such as homeopathic medicine, physical 
manipulation, and mind-body therapies.  OAM's responsibilities include 
establishing an alternative medicine information clearinghouse and 
providing a database of information and resources that will be readily 
available to researchers, practitioners, and the general public.

The RFP, issued on April 12, 1996, sought proposals for the furnishing 
of services in two principal areas, the operation of a public 
clearinghouse for OAM and the development of a scientific and research 
database.  The RFP contemplated the award of a fixed hourly price 
requirements contract for 1 year with four 1-year options.  The RFP 
advised offerors that their technical proposals would be evaluated 
separately in the two main areas, and that their proposals should be 
severable in that regard since, although the agency stated that it 
preferred to make a single award, split awards might be made.  
Offerors were instructed to provide pricing based upon the assumption 
that a firm would receive award for only one section, but that an 
offeror also could provide a formula for alternate pricing in the 
event of award for both sections.  Offerors were further advised that 
while the RFP contained an estimated staffing plan, they could present 
alternative staffing plans, but that if a firm did so the estimated 
hours set forth in the RFP would be used to normalize the proposals 
for price comparison purposes.

The RFP stated that the technical portion of the proposals was the 
most important consideration in making the award, and that award 
without discussions was contemplated.  A best-buy analysis was to be 
performed that would take into consideration the results of the 
technical evaluation, cost analysis, and ability of the contractor to 
complete the work within the government's required schedule.  Award 
was to be made on the basis of the proposal providing the best value 
to the government, all factors considered.  The technical evaluation 
factors and subfactors (worth a total of 130 points) were listed in 
the RFP in descending order of importance, and are summarized as 
follows:

     1.  Technical Approach             (45 points)
     2.  Staffing and Personnel         (40 points)
     3.  Corporate Experience/Past Performance(35 points)
        A.  Relevant experience         (20 points)
        B.  Past performance            (15 points)
     4.  Facilities                     (10 points)

Cost was worth 35 points. 

Proposals were received from six firms by June 4, 1996.  The technical 
proposals were evaluated by two separate technical evaluation 
committees, which determined that only the Eagle and Herner proposals 
were technically acceptable.  The results of the evaluation were as 
follows:

CLEARINGHOUSE

FIRM            TECH PTS        PRICE           TOTAL

Eagle           [deleted]       [deleted]       [deleted]

Herner          [deleted]       [deleted]       [deleted]
PUBLICATION/DATABASE

FIRM            TECH PTS        PRICE           TOTAL

Eagle           [deleted]       [deleted]       [deleted]

Herner          [deleted]       [deleted]       [deleted]
Both firms provided pricing for a combined award; however, the 
assumptions regarding the total number of hours were vastly different.  
Eagle proposed approximately [deleted] fewer hours than did Herner, 
and both proposals were substantially below the government's 
estimate.[1]  The proposals were normalized by developing average 
hourly prices for Eagle ([deleted]) and for Herner ([deleted]) and 
applying these prices to a number of hours close to that proposed by 
Herner.[2]  This analysis resulted in the following total scores:

           CLEARINGHOUSEPUBLCN   TECH       PRICE      TOTAL

Eagle      [deleted]  [deleted]  [deleted]  [deleted]  [deleted]

Herner     [deleted]  [deleted]  [deleted]  [deleted]  [deleted]
After reviewing the evaluation results, the project officer 
recommended that a single award be made to Herner on the basis that 
the strengths of the Herner proposal in addressing database and 
scientific publications components of the requirements exceeded those 
of Eagle's.  Concerns about Eagle's staff turnover and lower employee 
pay contributed to the recommendation of award to Herner.  The 
contracting officer determined that Herner offered the best 
combination of technical capability and appropriate pricing.  On 
September 30, award was made to Herner.  This protest followed. 

Eagle protests that the agency improperly evaluated Eagle's proposal 
because it failed to evaluate Eagle's alternate combined proposal 
independently, arbitrarily combining the separate technical scores for 
the two sections of the basic proposal and comparing the results for 
Eagle and Herner.  Eagle also argues that the agency evaluated Eagle's 
proposal improperly by arbitrarily normalizing Eagle's staffing plans 
and labor hours and by using an undisclosed method to adjust Eagle's 
proposed labor hours for comparison with Herner's.  Lastly, Eagle 
contends that because the agency's best value analysis was based on 
the flawed evaluation, the best value analysis itself is without 
foundation and does not reasonably support a contract award to Herner.

In reviewing protests concerning the evaluation of proposals, we will 
examine the agency's evaluation to ensure that it had a reasonable 
basis and was consistent with the evaluation criteria listed in the 
RFP.  Pemco Aeroplex Inc., B-239672.5, Apr. 12, 1991, 91-1 CPD  para.  367.  
A protester's disagreement with the agency's evaluation is not itself 
sufficient to establish that the agency acted unreasonably.  Correa 
Enters., Inc., B-241912, Mar. 5, 1991, 91-1 CPD  para.  249.  Here, after 
reviewing the record, we find that the evaluation was reasonable and 
in accordance with the RFP's stated evaluation criteria.

The essence of Eagle's protest is that a separate and distinct 
evaluation of the alternate combined proposals should have been 
performed by the agency in accordance with the listed evaluation 
factors.  However, Eagle does not show that there is anything 
inherently improper in the agency's combining the two technical scores 
and then using a normalization process for evaluating alternate price 
proposals.  As stated above, the RFP required the submission of 
separate proposals for the two separate requirements but indicated 
that the agency would prefer to make a combined award.  (Both offerors 
also indicated in their proposals that a single combined award was 
preferable to split awards.)  The RFP also provided that offerors were 
to provide pricing based upon the assumption of award for only one 
section of the requirement, but that an offeror could provide a 
formula for alternate pricing in the event of award for both sections.  
Nowhere does the RFP provide that alternate proposals would be 
separately evaluated based on the technical evaluation factors.  In 
this regard, Herner's alternate proposal also was not separately 
evaluated.  Moreover, while Eagle maintains that if the agency had not 
normalized Eagle's price in the evaluation Herner would have received 
a price score of only [deleted], we note that Herner's combined total 
score would still be higher than Eagle's.  In these circumstances, the 
agency properly evaluated both proposals similarly, and in a manner 
consistent with the RFP evaluation scheme.

The protester argues that the agency improperly and arbitrarily 
normalized costs by using an undisclosed method to adjust Eagle's 
proposed labor hours for comparison with Herner's.  The RFP, however, 
advised offerors that while alternate staffing plans would be 
acceptable, prices would be normalized, but did not detail the 
normalization process to be used.  The purpose of the normalization 
was to ensure a fair price comparison of offers that were founded on 
staffing bases different from those set out in the RFP, and was 
particularly necessary in view of the agency's expectation of changing 
requirements and related concerns about offerors' staffing 
assumptions.  Given the RFP's provisions, we see no legal basis to 
object to the normalization decision or approach.

Eagle also challenges the propriety of the agency's best value 
analysis, maintaining that it was based on a flawed evaluation.  As 
already discussed, we find nothing objectionable in the evaluation of 
the Eagle's proposal.  Since Eagle does not challenge the evaluation 
of the awardee's proposal from either a cost or technical standpoint, 
it follows that the overall evaluation was reasonable.  In making the 
award to Herner, the agency concluded that Herner demonstrated greater 
experience with abstracting in general and particularly in the 
"structured-type" approach.  The agency recognized that both firms had 
recent experience with producing scientific journals; Herner was 
producing a publication, Alcohol Health and Research Work, that was 
more closely related to the envisioned OAM publication and Herner 
presented a much clearer process to develop a new scientific journal.  
The agency concluded that the Herner proposal demonstrated a better 
understanding and experience with structured abstracts, a 
scientific/medical database and scientific publications, which 
outweighed the apparent minor difference in price and Eagle's 
technical advantage on the clearinghouse activity.  We see no basis to 
object to the agency's methodology in evaluating the proposals and in 
selecting Herner as the awardee.

The protest is denied.

Comptroller General 
of the United States

1. The government estimate for total number of hours was 171,600.  
Herner proposed [deleted] and Eagle proposed [deleted].  In this 
respect, the agency reports that "because these are new tasks with an 
uncertain future, the government viewed the staffing positions and 
estimates of hours as simply that, estimates.  It is expected that 
with implementation, these estimates will probably need to be 
readjusted."

2. The agency reports that it used Eagle's proposed number of hours in 
its normalization process.  Our calculations, however, show that the 
agency actually used Herner's proposed hours in the price comparison.