BNUMBER:  B-275299.2 
DATE:  June 23, 1997
TITLE: IGIT, Inc., B-275299.2, June 23, 1997
**********************************************************************

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:IGIT, Inc.

File:     B-275299.2

Date:June 23, 1997

Darcy V. Hennessy, Esq., Moore, Brower, Hennessy & Freeman, P.C., for 
the protester.
Lynn Hawkins Patton, Esq., and Christopher Solop, Esq., Ott & Purdy, 
for Penn Enterprises, Inc., an intervenor.
Col. Nicholas P. Retson and Maj. Michael J. O'Farrell, Jr., Department 
of the Army, for the agency.
Ralph O. White, 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 conducted an unreasonable 
evaluation of past performance is denied where the record shows that 
the agency evaluation was fair, comprehensive and generally in 
accordance with the solicitation's stated evaluation criteria.  In 
instance where evaluation appeared to deviate from the stated 
criteria, the result of the deviation was minimal and protester was 
not prejudiced.

2.  Protester's claim that agency failed to advise it during 
discussions of perceived problems with its past performance is denied 
where the record shows that the protester was clearly aware of the 
agency's concerns and shows that the agency expressly asked about 
protester's alleged poor performance of the earlier contract during 
written discussions.

DECISION

IGIT, Inc. protests the decision of the Department of the Army to 
award a contract to Penn Enterprises, Inc., pursuant to request for 
proposals (RFP) No. DABT31-95-R-0017, for laundry and dry cleaning 
services at Fort Leonard Wood, Missouri.  IGIT argues that the Army's 
decision to award to Penn is based on bias against IGIT, which 
translated to an unreasonable evaluation of the past performance 
portion of each offeror's proposal.  IGIT also claims that the Army 
failed to hold meaningful discussions with it regarding its proposal.

We deny the protest.

BACKGROUND

This protest is the third challenge by IGIT to the Army's procurement 
of laundry and dry cleaning services at Fort Leonard Wood.  A brief 
history of the procurement is set forth below.

IGIT was the incumbent contractor performing these services under a 
contract awarded January 31, 1995, pursuant to sealed bidding 
procedures.  Although IGIT's initial contract was awarded for a period 
of 1 year with four 1-year options, the Army decided shortly after 
award to refrain from exercising the options.  Instead, the Army 
issued an RFP for the services on December 10, 1995.

IGIT concluded that the decision not to continue its contract after 
the base year period was based on improper racial bias and sought to 
bring the matter to the attention of its congressional representative.  
When the Fort Leonard Wood contracting officials became aware that 
IGIT had furnished its congressman an entry from the facility's 
internal solicitation register--showing a lump-sum government estimate 
for the cost of the laundry and dry cleaning services--the Army 
concluded that IGIT had an unfair competitive advantage over other 
offerors and barred the company's proposal from further consideration.  
IGIT protested the Army's exclusion of its proposal and claimed that 
the exclusion was in retaliation for IGIT's efforts to pursue its 
discrimination claim.  While our Office did not reach the issue of 
racial bias, we concluded that, under the circumstances, excluding 
IGIT from the competition was unreasonable.  We recommended that the 
lump-sum estimate be provided to all offerors and that IGIT be 
permitted to compete.  IGIT, Inc., B-271823, Aug. 1, 1996, 96-2 CPD  para.  
51.

After reinstating IGIT to the competition, the Army held written and 
oral discussions with the company, and permitted it to submit a best 
and final offer (BAFO).  The competition to which IGIT was reinstated 
was conducted in accordance with the terms of the RFP issued on 
December 10, 1995.  Section M of the RFP, as modified by amendment 
0006, advised offerors that proposals would be evaluated for past 
performance, technical merit, and price.  The RFP explained that the 
past performance evaluation factor would be significantly more 
important than the technical and price factors, which would be 
weighted equally.  At the conclusion of the evaluation, both IGIT's 
and Penn's proposals--the only two in the competitive range--received 
very favorable technical scores and were viewed as essentially equal 
with respect to technical and price, but Penn's proposal was evaluated 
significantly higher under the past performance factor.[1]  On October 
18, 1996, Penn received award of the contract after the source 
selection official at Fort Leonard Wood determined that Penn's 
proposal offered the best value to the government.

On October 28, IGIT again protested to our Office, arguing that the 
Army failed to conduct adequate discussions regarding certain areas of 
its past performance and failed to permit it to submit a revised 
proposal after allowing it an opportunity to comment on other areas.  
The protest also renewed IGIT's claim that Fort Leonard Wood 
contracting officials were biased against the company.  In response, 
the Army agreed to conduct a new round of discussions concerning past 
performance only, and agreed to transfer responsibility for evaluating 
the past performance of IGIT and Penn to another facility--i.e., Fort 
Knox, Kentucky.  Since the Army's corrective action rendered the 
protest academic, our Office dismissed the case.  IGIT, Inc., 
B-275299, Dec. 3, 1996.

By identical letters dated January 23, 1997, Fort Knox contracting 
officials invited IGIT and Penn to submit new past performance 
packages for review.  The letters explained that the offerors could 
include any information previously submitted, plus any additional 
information the offerors might want to submit, including any further 
response to discussion questions asked by the Fort Leonard Wood 
evaluators.  The letters also advised that the technical and price 
evaluations performed by Fort Leonard Wood--wherein the offers were 
viewed as essentially equal--would not be revisited. 

After conducting discussions with both offerors, and permitting each 
offeror to submit additional information in response to evaluator 
concerns, the Fort Knox evaluators assigned IGIT a past performance 
score of [deleted] points, out of 50 possible points, and assigned 
Penn a score of [deleted].  The past performance scores together with 
the technical ratings were used to calculate a risk assessment.  Penn 
received a risk assessment of [deleted], with 1.00 being the maximum 
possible score.[2]  IGIT received a risk assessment of [deleted].  
Using the past performance score and the numerical risk assessment, 
the Fort Knox selection official decided that Penn's proposal 
represented the best value to the government, given the relative 
equality between Penn and IGIT in technical scores and prices.  By 
letters dated February 26, both offerors were advised of the agency's 
findings, and this protest followed.

ANALYSIS

IGIT's primary criticism of this procurement is that the Army is 
biased against it.  Essentially, IGIT argues that the Army's ongoing 
bias in this case resulted in an unreasonable evaluation of proposals 
and in a failure to hold meaningful discussions with it regarding its 
proposal.  IGIT also complains that our two prior decisions failed to 
reach the issue of bias, and it resubmits the claims of bias presented 
in those two earlier cases--one of which was sustained on other 
grounds, one of which was dismissed as academic after the Army took 
corrective action.  

As a preliminary matter, we note that, at this juncture, the issues 
before our Office related to bias are limited.  First, in response to 
IGIT's second protest--most of which focused on the evaluation of past 
performance--the Army elected to permit IGIT and Penn to submit new 
past performance packages which would be evaluated afresh by 
contracting officials from another Army installation.  For the portion 
of the review related to the other two evaluation factors--i.e., 
technical merit and price--the Army's letters of January 23, 1997, 
expressly advised both offerors that the existing evaluation would 
remain intact.  If IGIT disagreed with that decision, it was required 
to protest within 10 days of its receipt of the Army's letter.  Any 
complaint related to the evaluation of technical merit or price is now 
untimely.[3]  4 C.F.R.  sec.  21.2(a)(2) (1997).  

In addition, we note that IGIT's remaining claim of bias has been 
largely addressed by the Army's decision to move the evaluation of 
past performance from Fort Leonard Wood to Fort Knox.  Since IGIT 
expressly states that it is not accusing the Fort Knox evaluators of 
bad faith or racial bias, IGIT Comments on the Agency Report, Apr. 30, 
1997, at 1, its only remaining concern is that the Fort Knox 
evaluators relied on allegedly tainted information when they solicited 
the views of Fort Leonard Wood officials familiar with IGIT's 
performance of the contract there.  We will discuss this issue after 
reviewing the specific challenges to the Army's reevaluation.

Although IGIT challenges nearly every facet of the Army's past 
performance review, its complaints generally raise the following 
issues:  (1) the Army unfairly performed a more detailed review of its 
past performance than it did of Penn's, including placing undue 
reliance on problems in IGIT's past performance; (2) the evaluators 
unreasonably concluded that IGIT lacked financial stability, and 
wrongly made several negative evaluation comments about staffing 
changes despite IGIT's high ratings for proposed staff; and (3) the 
Fort Knox evaluators deviated from the stated evaluation weight of 
certain elements of the past performance evaluation plan enunciated in 
the solicitation as issued by Fort Leonard Wood.[4] 

We review an agency's evaluation of proposals to ensure that it is 
fair, reasonable, and consistent with the evaluation criteria stated 
in the solicitation.  Wind Gap Knitwear, Inc., B-261045, June 20, 
1995, 95-2 CPD  para.  124 at 3.  Where a solicitation requires the 
evaluation of offerors' past performance, an agency has discretion to 
determine the scope of the offerors' performance histories to be 
considered, provided all proposals are evaluated on the same basis and 
consistent with the solicitation requirements.  Federal Envtl. Servs., 
Inc., B-250135.4, May 24, 1993, 93-1 CPD  para.  398 at 12.

IGIT's first general complaint is that the Fort Knox evaluators used 
different levels of scrutiny in reviewing the two proposals.  In this 
regard, IGIT claims that the Army inappropriately contacted its 
creditors and suppliers, in addition to its prior customers, but 
performed a more limited review of Penn, focusing just on that 
company's named references.  IGIT also claims that the Army failed to 
contact more than 50 IGIT references who would have provided favorable 
reports, although IGIT concedes that none of those references are 
associated with contracts of the size and magnitude of the prior Fort 
Leonard Wood contract.  In response, the Army concedes that its review 
of IGIT's past performance led it to contact more sources of 
information than it did in its review of Penn, but explains that 
IGIT's submission, on its face, required a more thorough review 
because of the significant negative information included therein.  The 
Army also argues that it appropriately focused on IGIT's prior 
performance of the Fort Leonard Wood contract and on its subcontract 
with ITT Federal Services Corporation because those contracts were 
most analogous to the contract here. 

The record shows that in their new past performance submissions, both 
offerors provided references and in the case of IGIT, the package 
included a substantial amount of negative financial information.  Upon 
receipt of the submissions, the Fort Knox evaluators began a new and 
independent review of each offeror's past performance.  To implement 
the evaluation, the evaluators prepared their own past performance 
questionnaire and contacted references with respect to each 
contractor's performance of its prior contract, payment of suppliers, 
and any general problems or difficulties encountered.  For Penn, the 
references contacted provided the kind of information sufficient to 
support a conclusion that Penn's past performance had been relatively 
smooth and without incident.  For IGIT, even its own submission showed 
otherwise.  Specifically, IGIT's own submission included financial 
statements showing substantial losses, and revealed that there had 
been difficulties meeting payroll obligations, late supplier payments, 
and a failure to pay utility bills.  
 
With respect to IGIT's claim that the agency's review of its past 
performance was more thorough than its review of Penn's, we see 
nothing unreasonable in the Army's approach to investigating the past 
performance history of these two offerors.  First, although agencies 
are required to evaluate the past performance of all offerors on the 
same basis, Federal Envtl. Servs., Inc., supra, there is no 
requirement that an agency contact all of an offeror's references, 
Dragon Servs., Inc., B-255354, Feb. 25, 1994, 94-1 CPD  para.  151 at 8, and 
we are aware of no requirement that an agency contact the same number 
of references for each offeror.  In fact, given that the performance 
controversies at Fort Leonard Wood involve the same facility and the 
same services, we fail to see how the Army could have reasonably 
overlooked the matter.  International Bus. Sys., Inc., B-275554, Mar. 
3, 1997, 97-1 CPD  para.  114 at 5.

With respect to IGIT's claims that the agency overlooked numerous 
other past contracts in order to investigate controversies that arose 
during IGIT's performance of the previous Fort Leonard Wood contract 
and a major subcontract IGIT performed for ITT, IGIT itself concedes 
that its other contract references did not involve contracts as large 
as this one, and that the Fort Leonard Wood and ITT contracts were the 
ones most similar to the contract at issue here.  It is hard to 
imagine information more relevant than IGIT's previous performance of 
these same services for the same installation.  See Questech, Inc., 
B-236028, Nov. 1, 1989, 89-2 CPD  para.  407 at 3-4.  In addition, we see no 
basis for IGIT's complaint that the agency placed undue reliance on 
problems that arose during performance of these two contracts.  While 
IGIT might dispute the cause for the performance problems, it does not 
deny that the problems arose, or that they should be part of a valid 
past performance assessment.  Id.

IGIT's second general complaint is that the agency wrongly concluded 
the company lacked financial stability and wrongly made several 
negative comments about its staffing changes even though the proposal 
received high marks for proposed staff. 

As stated above, IGIT's own submission highlighted numerous problems, 
including unfavorable profit and loss statements, and difficulties in 
meeting ongoing financial commitments.  Consideration of these issues 
as set forth by IGIT, together with the responses generated from those 
contacted by the Fort Knox evaluators, were clearly sufficient to 
support the Army's conclusions about IGIT's financial stability.  In 
addition, during the course of this protest, the record shows that 
IGIT had received a tax levy from the Internal Revenue Service (IRS) 
for payroll taxes unpaid since March 1996, a levy from the Department 
of Labor for unpaid unemployment insurance, and additional written 
complaints from union employees regarding bounced paychecks.  Further, 
in its final submission, IGIT itself advised our Office that it had 
filed for chapter 7 bankruptcy, and that the future of the company was 
uncertain.[5]  Under these circumstances, we see no basis to conclude 
that the agency unreasonably expressed concerns about IGIT's financial 
stability.   

IGIT's next contention--that the evaluators wrongly made several 
negative comments about IGIT's staffing changes even though the 
proposal received high marks for proposed staff--confuses the 
technical review with the review of its past performance.  Under the 
technical review, IGIT's proposed staff received the highest possible 
rating; however, in the review of past performance, references stated 
that IGIT had, in some instances, not provided the personnel proposed, 
and had substituted less qualified individuals.  Since the technical 
assessment focused on the proposal as written, while the past 
performance assessment focused on IGIT's actions during performance, 
there is nothing about the Army's criticism on this point that is 
inconsistent with the technical review.

IGIT's third contention is that the Fort Knox evaluation of past 
performance deviated in two ways from the evaluation set forth in the 
solicitation.  For the reasons below, we agree with IGIT that there 
may have been some small differences between Fort Knox's approach and 
the solicitation's approach, but we conclude that any deviation was de 
minimis, and that the company was not prejudiced by the agency's 
actions.  As an example, we discuss below the stronger of IGIT's two 
arguments in this area.

IGIT correctly points out that the solicitation as issued by Fort 
Leonard Wood provided that the agency would consider the offeror's 
financial statements in its past performance assessment, but the Fort 
Knox evaluation worksheets instead contain a category titled 
"financial history."  While we are aware that the Fort Knox evaluators 
reviewed IGIT's financial statements--for example, the conclusions on 
financial stability discussed above included a review of the financial 
statements--there is no specific place on the evaluation worksheets to 
consider financial statements, and the record shows that the financial 
history evaluation element entailed a slightly broader review than 
consideration of financial statements alone.  Nonetheless, even if we 
assume that this represents a slight deviation from the stated 
solicitation criteria, we cannot see how IGIT was prejudiced by the 
deviation, nor does IGIT attempt to establish any prejudice.  Instead, 
IGIT claims that it is impossible to calculate the harm springing from 
either this or the other alleged deviation.  IGIT Comments on the 
Agency Report, Apr. 30, 1997, at 5.  

Despite IGIT's claim that the Army failed to follow the solicitation's 
evaluation criteria, our Office will not sustain a protest unless the 
protester demonstrates a reasonable possibility that it was prejudiced 
by the agency's actions, that is, unless the protester demonstrates 
that, but for the agency's actions, it would have a substantial chance 
of receiving the award.  McDonald-Bradley, B-270126, Feb. 8, 1996, 
96-1 CPD  para.  54 at 3; see Statistica, Inc. v. Christopher, 102 F.3d 
1577, 1581 (Fed. Cir. 1996).  Nothing in the record here suggests that 
the evaluation results would have been different had the agency 
limited its past performance review to financial statements rather 
than financial history.

In addition to its challenge to the evaluation itself, IGIT argues 
that the Army held inadequate discussions with it regarding its prior 
contract with ITT.  In this regard, IGIT disputes the Army's 
conclusion that its contract with ITT was terminated for poor 
performance, claims instead that the contract was terminated for 
convenience, and argues that it would have addressed this issue if the 
agency had properly identified its concerns during discussions.

Our review of the record shows that IGIT's own submission to Fort Knox 
included a substantial amount of material exchanged with Fort Leonard 
Wood officials on the subject of whether IGIT's contract with ITT was 
terminated for poor performance.  IGIT Past Performance Submission, 
January 31, 1997, at 7, 14, 31-34, 83-84, 87-88.  Presumably this 
information was presented because IGIT knew that there was an issue 
about its performance of that contract.  After reviewing the 
submission, the Fort Knox evaluators forwarded the following question 
to IGIT by letter dated February 11, 1997:

     "Notwithstanding your letter from ITT dated 5 Oct 93, do you have 
     anything from ITT that specifically states that your subcontract 
     for alterations and repairs was not terminated for poor 
     performance?"

This question was clearly sufficient to put IGIT on notice that the 
Army was considering a conclusion that IGIT's prior contract with ITT 
was terminated for poor performance.  See Rockwell Int'l Corp., 
B-261953.2; B-261953.6, Nov. 22, 1995, 96-1 CPD  para.  34 at 12-13.

As a final matter, we turn to the question of whether the Army took 
sufficient steps to eradicate the bias that IGIT says exists on the 
part of Fort Leonard Wood contracting officials.  As explained above, 
given the steps already taken in response to IGIT's earlier protests, 
the only remaining unaddressed allegation of bias is that the current 
evaluation was tainted by the reliance on comments by Fort Leonard 
Wood officials about IGIT's performance of the prior contract.    

The current posture of this procurement reflects unusual and 
extraordinary steps by the Army to address the protester's 
earlier-stated concerns regarding its acrimonious relationship with 
officials at Fort Leonard Wood.  While we appreciate IGIT's remaining 
concern, we conclude that the decision of the Fort Knox contracting 
officials to review the performance issues that arose in the prior 
Fort Leonard Wood contract was appropriate, and we agree that 
obtaining the views of those officials was a requisite part of that 
process.  In this regard, even if we assume the protester could 
present credible evidence of bias on the part of Fort Leonard Wood 
officials, our review of the past performance evaluation performed by 
the Fort Knox contracting officials must focus on whether the limited 
input of Fort Leonard Wood officials unfairly affected the protester's 
competitive position.  Executive Sec. & Eng'g Tech., Inc., B-270518 et 
al., Mar. 15, 1996, 96-1 CPD  para.  156 at 4.

The record here shows that after receiving the views of the Fort 
Leonard Wood officials, and after performing their own evaluation, the 
Fort Knox contracting officials gave IGIT significantly lower scores 
for past performance than they gave Penn, and concluded that Penn had 
submitted the proposal offering the greatest benefit to the 
government.  All of the materials that formed the basis of this 
decision--including the remarks of the Fort Leonard Wood 
officials--were provided to IGIT's counsel, under a protective order 
issued by our Office, and IGIT was given every opportunity to point 
out inaccuracies or errors in those materials.  While IGIT may 
disagree with many of the conclusions in the record, it has not shown 
that statements provided there were inaccurate or false.  Since we 
generally presume that contracting officials act in good faith, Indian 
Affiliates, Inc., B-243420, Aug. 1, 1991, 91-2 CPD  para.  109 at 5, and 
since IGIT has been given every reasonable opportunity to demonstrate 
that it was harmed by unfair or improper bias--and has failed to make 
that showing--we conclude that the protester was treated fairly by the 
Army in this procurement.  Telestar Int'l Corp., B-247557.2, June 18, 
1992, 92-1 CPD  para.  530 at 3.

The protest is denied.

Comptroller General
of the United States

1. The Army's conclusion that the two offers were essentially equal 
with respect to technical merit and price is based on the fact that 
IGIT received [deleted] of 25 available points under the technical 
factor, while Penn received [deleted] points.  With respect to price, 
IGIT's total price of [deleted] million was slightly lower than Penn's 
total price of $5.589 million, a difference of approximately 
[deleted].

2. The Fort Knox evaluators explain that a risk assessment of 1.00 is 
equal to a 100 percent certainty that the contract will be performed 
as stated without problems.

3. For the record, it is difficult to see how IGIT was treated 
unfairly under the technical evaluation factor, given the evaluators' 
conclusion that IGIT should receive the maximum number of available 
points for its technical proposal.

4. In addition to these general challenges, IGIT alleges--in its final 
protest filing dated May 21, 1997--that Penn's BAFO was not received 
by the closing time for receipt of BAFOs--i.e., by 12:30 p.m. on 
September 12, 1996.  IGIT's allegation is based on an affidavit from a 
contract specialist at Fort Leonard Wood who states that there is no 
entry in the Bid/Proposal Logbook maintained by a receptionist at the 
facility.  Although there are serious questions about the timeliness 
of this allegation--for example, IGIT does not explain why it first 
raises this question some 8 months after the incident, when the 
information was known to the affiant at closing time, and the record 
shows that the affiant and IGIT are sufficiently close that the 
affiant has disqualified himself from any matter involving IGIT 
because of a conflict of interest--we have nonetheless reviewed this 
allegation.  The record includes statements from Penn and other 
contracting officials explaining that Penn's BAFO was hand-delivered 
directly to the contracting shop and was not received by the 
receptionist.  In addition, the record includes a copy of the cover of 
the BAFO wherein the contracting officer has handwritten the date and 
time of receipt.  Under these circumstances, we have no basis to 
conclude that Penn's BAFO was received late.

5. On the subject of the IRS lien, the final submission from IGIT's 
counsel states that "IGIT informs me that the IRS has removed the tax 
lien imposed by IRS upon IGIT's contract payments, according to what 
Mr. Reeves understands from a meeting held with IRS representatives 
last week."  IGIT's Final Reply, May 21, 1997, at 3.