BNUMBER:  B-275334; B-275334.2
DATE:  February 10, 1997
TITLE:  EastCo Building Services, Inc.

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DOCUMENT FOR PUBLIC RELEASE
A protected decision was issued on the date below and was subject to a 
GAO Protective Order.  This version has been redacted or approved by 
the parties involved for public release.
Matter of:EastCo Building Services, Inc.

File:     B-275334; B-275334.2

Date:February 10, 1997

Donald E. Barnhill, Esq., and Joan K. Fiorino, Esq., East & Barnhill, 
for the protester.
Lee W. Crook, Esq., and Emily C. Hewitt, Esq., General Services 
Administration, for the agency.
Sylvia Schatz, Esq., and John M. Melody, Esq., Office of the General 
Counsel, GAO, participated in the preparation of the decision.

DIGEST

1.  Protest that agency improperly applied undisclosed evaluation 
criteria--whether prior contracts had been of 3-year duration and 
whether prior buildings serviced were at least 500,000 square feet in 
size--is denied where solicitation reasonably put offerors on notice 
of these considerations would be included in the evaluation.

2.  Protest that agency improperly downgraded protester's proposal 
based on its mechanical application of an undisclosed estimate of 
full-time equivalents (FTE) rather than considering protester's 
overall unique approach to cost efficient staffing is denied where, 
although agency used its staffing estimates as a starting point for 
evaluation, agency fully considered and reasonably evaluated 
protester's staffing approach.

3.  Discussions with protester were adequate where agency advised 
protester that its proposed staffing for mechanical requirements was 
inadequate, and discussions with awardee were virtually identical.

4.  Agency's post-best and final offer communications with awardee 
constituted discussions, since the awardee revised its staffing and 
price in response, but this does not provide basis for sustaining 
protest, since there is no showing of competitive prejudice to 
protester.

DECISION

EastCo Building Services, Inc. protests the General Services 
Administration's (GSA) award of a contract to TECOM under request for 
proposals (RFP) No. GS-079-96-DRC-0110, for commercial facility 
management services at seven federal buildings in Houston and 
Galveston, Texas.

We deny the protest.

The RFP, issued on May 30, 1996, contemplated the award of a 4-year--1 
base year with 3 option years--fixed-price contract to furnish all 
supplies and services for commercial facility management, operations 
and maintenance, and custodial services for the seven buildings.  The 
RFP required offerors to demonstrate that within the last 5 years, 
they had satisfactorily performed all the commercial facility 
management services required by the RFP, under one or more contracts.  
Offerors  satisfying this minimum requirement were to have their 
proposals evaluated based on the following technical evaluation 
factors:  (1) past performance/experience on similar projects and (2) 
staffing and work schedules, which were of equal importance and more 
important than (3) management controls.  The staffing and work 
schedules factor consisted of three subfactors:  (a) productive and 
supervisory operation, maintenance, and repair staff, work schedules, 
and subcontracting list (hereinafter the "mechanical" subfactor); (b) 
productive and supervisory custodial staffing, work schedules and 
subcontracting list; and (c) proposed facility management staff and 
work schedules.  Price, which was less important than the technical 
factors, was to be evaluated for realism, overall value, and 
reasonableness.  Award was to be made to the responsible offeror whose 
offer conformed to the RFP and was most advantageous to the 
government. 

Eleven proposals were received, five of which--not including EastCo's 
and TECOM's--were included in the competitive range.  After EastCo 
filed a protest in our Office (B-273019), however, GSA reevaluated the 
proposals and included both EastCo's and TECOM's in the competitive 
range.  Following written technical and price discussions with the 
offerors, revised proposals were requested, received, and evaluated as 
follows:

                     Price                Score (7-point scale)

TECOM                $24,143,226.47[1]    5.25

EastCo               $23,521,203.25       3.8

Offeror A            [deleted]            [deleted]

Offeror B            [deleted]            [deleted]

Offeror C            [deleted]            [deleted]

Offeror D            [deleted]            [deleted]

Offeror E            [deleted]            [deleted]
The agency determined in conducting its price/technical tradeoff that 
TECOM's lower price made its proposal the best value compared to the 
higher technically rated proposals, and that, although EastCo's price 
was low, its lowest-rated proposal was so technically 
deficient--"especially in key factors"--that it was last among the 
seven proposals, and not in line for award.  

EastCo challenges numerous aspects of the evaluation.  We find all of 
EastCo's arguments to be without merit, and discuss several of them 
below.

PAST PERFORMANCE/EXPERIENCE ON SIMILAR PROJECTS

EastCo argues that the agency improperly applied--and downgraded its 
proposal under the past performance/experience on similar projects 
factor based on--two undisclosed criteria:  whether previously 
performed contracts were of at least a     3-year duration, and 
whether the areas of the buildings maintained under prior contracts 
had been at least 500,000 square feet.  

This argument is without merit.  The RFP required offerors to list 
prior contracts, which would be evaluated for past 
performance/experience, and to indicate for each contract (among other 
things) the type of facility, gross square footage, services 
performed, and duration.  EastCo and the other offerors were on notice 
from these requirements that, in judging whether a prior contract 
would be deemed a "similar project," the agency would consider the 
similarity of the contracts to the RFP requirement in these areas, and 
reading these requirements together with the rest of the RFP should 
have put EastCo on notice of the agency's intent to consider these 
specific elements of its listed contracts.  See ORI Servs. Corp., 
B-261225, July 28, 1995, 95-2 CPD  para.  55.  In this regard, since a 
3-year contract term is similar to the potential duration of the 
contract under the RFP (1 year with 3 option years), we think offerors 
reasonably could anticipate that experience performing contracts of 
such a duration would be viewed favorably in the evaluation.  
Similarly, since the RFP showed that the areas of 4 of the 7 buildings 
to be maintained were about or in excess of 500,000 square feet, 
EastCo and other offerors should have been aware that the agency would 
more favorably evaluate experience operating and maintaining areas in 
this size range.[2]  In any case, we note that, while EastCo's 
proposal was downgraded somewhat based on a lack of certain experience 
under 3-year contracts, or in similarly sized areas, the agency's 
greatest concern was that EastCo lacked experience performing 
commercial facility management services, as required by the RFP.

MECHANICAL STAFFING

EastCo argues that GSA improperly downgraded its proposal under the 
mechanical subfactor (under the staffing and work schedules factor) 
based on its mechanical application of an undisclosed estimate that 
[deleted] full-time equivalents (FTE)--[deleted]--were necessary for 
adequate performance.  [Deleted].
  
This argument also is without merit.  While GSA used its staffing 
estimates as a starting point for the evaluation, it fully considered 
EastCo's staffing approach.  GSA downgraded EastCo's proposed 
staffing--[deleted]--not merely because it deviated from the agency's 
staffing plan, but because the staffing was viewed as inadequate on 
its own merits.  For example, although the RFP specifically stated 
that offerors should propose both productive and supervisory staffing, 
EastCo's proposal included no supervisors for the mechanical work.[3]  
In addition, noting that 3 full-time mechanics--including numerous 
overtime hours and use of subcontractors--currently were required to 
maintain one of the seven buildings, GSA concluded that [deleted] 
mechanics simply could not perform all required work, which included 
preventive maintenance, operation, maintenance and repair of a 
significant amount of extremely complex technical equipment, including 
a computerized energy management system.[4]  

GSA also concluded that there was nothing in EastCo's proposal showing 
that its proposed staffing was adequate in light of its overall 
approach.  For example, GSA found that EastCo's offer of [deleted] did 
not address or mitigate the general understaffing problem, since the 
RFP specifically required the contractor to respond to emergency 
service calls at all times, including normal working hours, weekends, 
and holidays.  Similarly, while EastCo proposed using [deleted], 
nothing in the proposal explained how their use would expand the 
workforce sufficiently to eliminate the agency's concerns.  Finally, 
EastCo's proposal did not contain any information regarding [deleted] 
of its personnel.  We conclude that GSA reasonably downgraded EastCo's 
proposal under this subfactor. 

DISCUSSIONS

EastCo maintains that discussions concerning its proposal were 
inadequate because GSA failed to specifically inform the firm that its 
mechanical staffing needed fewer helpers and more mechanics.  EastCo 
maintains that, in contrast, TECOM was presented with more specific 
questions in this area.

In negotiated procurements, contracting officers generally are 
required to conduct discussions with all offerors whose proposals are 
within the competitive range, Federal Acquisition Regulation (FAR)  sec.  
15.610(b) (FAC 90-31), and the competitive range must include all 
proposals that have a reasonable chance of being selected for award.  
FAR  sec.  15.609(a); Northrop Worldwide Aircraft Servs., Inc., B-262181, 
Oct. 27, 1995, 95-2 CPD  para.  196.  Discussions with offerors whose 
proposals are in the competitive range must be meaningful--the 
offerors must be advised of proposal deficiencies.  FAR  sec.  15.610(c)(2) 
and (5).  However, there is no requirement that discussions be 
all-encompassing; agencies need only lead offerors into the areas of 
their proposals considered deficient.  Honeywell Regelsysteme GmbH, 
B-237248, Feb. 2, 1990, 90-1 CPD  para.  149.

GSA met this standard.  Specifically, the agency advised EastCo that 
"[s]taffing for mechanical requirements appears to be inadequate," and 
that it should review and clarify the staffing.  Since the RFP 
contained detailed specifications covering all work required to be 
performed, this advice provided EastCo with adequate notice of the 
area of the deficiency.  The agency was not required to be more 
specific than this.  Further, EastCo's argument that the questions 
provided to TECOM regarding its staffing were more specific is without 
merit; GSA's advice to TECOM in this area--that its "[s]taffing for 
mechanical requirements appears to be slightly inadequate," and to 
review its staffing--was virtually identical to that given EastCo.
    
EastCo argues that GSA labeled and treated the written discussion 
questions as clarifications--which are for the sole purpose of 
allowing an offeror to eliminate minor irregularities, informalities 
or clerical mistakes--rather than discussions, in only allowing the 
firm to explain or substantiate the information in its proposal, and 
not to add new information.  Specifically, EastCo complains that GSA 
excluded from review EastCo's response to the clarifications under the 
management controls factor on the basis that it was new information.  

This argument is without merit.  Notwithstanding its use of the term 
"clarifications," GSA permitted offerors to revise their proposals in 
response to the questions presented.  The questions therefore 
constituted discussions.  FAR  sec.  15.601.  As for the management 
controls factor, portions of EastCo's initial proposal in this area 
were ignored because EastCo's proposal exceeded the RFP's stated 
75-page limit; the agency removed the last 8 pages of EastCo's initial 
proposal, which concerned management controls.  See U.S. Envtl. & 
Indus., Inc., B-257349, July 28, 1994, 94-2 CPD  para.  51 (offerors are 
bound to comply with an RFP's page limitation).  GSA informed EastCo 
in two separate clarification letters that these pages "were removed 
and not evaluated due to the page limitations," but that EastCo could 
include new information by revising the information within the 75 
pages of EastCo's proposal; EastCo did in fact include new information 
under the management control portion of its proposal by revising the 
first 75 pages of its BAFO, and the agency evaluated this information.  
There thus is no basis for finding that the agency's use of the term 
"clarifications" somehow precluded EastCo from revising its proposal 
as it desired after discussions.   

POST-BAFO DISCUSSIONS

EastCo argues that GSA held improper post-BAFO discussions with TECOM, 
because it allowed only TECOM to revise its BAFO by adding [deleted].

The record shows that, after the consensus evaluation was completed on  
September 18, but before the source selection decision had been made, 
the agency determined that TECOM's [deleted], and suspected TECOM may 
have made a mistake in calculating its price.  The SSEB therefore 
telephoned TECOM on September 23 and requested that the firm either 
verify or revise its price.  (The record contains a spreadsheet 
showing that the contracting officer recalculated, for purposes of 
comparison, the labor hours and the payroll taxes in the government 
estimate in order to determine whether mistakes had been made, either 
in TECOM's calculations or in the entering of figures for certain line 
items.)  The SSEB again telephoned TECOM on September 24, and 
suggested (as indicated in a contemporaneous telephone record of a 
message left on TECOM's answering machine) that perhaps TECOM had not 
considered that some of the buildings were historical, and had older 
equipment, and that some work would have to be performed in secured 
areas, all of which could increase performance time.  In response, by 
letter of September 25, TECOM submitted a revised BAFO adding 
[deleted]. GSA raised TECOM's evaluation score by .15 points, for a 
new total of 5.25 points.

Discussions occur when an offeror is given an opportunity to revise or 
modify its proposal, or when information requested from and provided 
by an offeror is essential for determining the acceptability of its 
proposal.  FAR  sec.  15.601; HFS, Inc., B-248204.2, Sept. 18, 1992, 92-2 
CPD  para.  188.  Since TECOM revised its proposal, and the agency evaluated 
the revisions, discussions occurred and should have been held with all 
competitive range offerors.

However, prejudice is an element of every viable protest, and where 
none is shown, our Office will not sustain a protest, even where the 
agency's actions may have been improper.  Amcare Medical Servs., Inc., 
B-271595, July 11, 1996, 96-2 CPD  para.  10.  There is  no showing of 
prejudice here.  

EastCo alleges that it would have made appropriate changes to its 
proposal  that would have significantly improved it had the agency 
pointed out, in further detailed discussions,  the specific 
deficiencies and weaknesses remaining in its proposal.  However,  the 
agency, upon reopening discussions with EastCo, would have been under 
no obligation to be any more specific regarding its concerns than it 
was in conducting initial discussions. As indicated above, the level 
of detail provided by the agency in its prior round of discussions 
satisfied the requirement for meaningful discussions, and the record 
reflects that the agency intended to limit discusions as it did.[5]  
There is no reason to believe, and EastCo does not assert, that it 
would have made extensive proposal changes in response to a mere 
reiteration of the agency's concerns.  

EastCo asserts that it would be entitled to more detailed discussions 
if negotiations were reopened because TECOM's post-BAFO discussions 
were detailed.  The record does not support this assertion.  As 
indicated, the record shows that the agency advised TECOM only that 
its [deleted] and asked whether TECOM had considered the age of the 
building and equipment in determining the time required to perform.  
We do not see any reason why these discussions with TECOM[6] would 
require extensive specific discussions with EastCo if negotiations 
were reopened with all offerors.  Accordingly, there is no basis for 
concluding that EastCo was in any way competitively prejudiced by the 
post-BAFO communications with TECOM.  See IT Corp., B-258636 et al., 
Feb. 10, 1995, 95-1 CPD  para.  78 at 12-13. 

DOCUMENTATION OF TRADEOFF

EastCo asserts that the price/technical tradeoff decision is not 
adequately documented, and that in fact there was no proper basis for 
selecting TECOM's higher-priced, higher technically rated proposal for 
award.  This argument is without merit.  The contracting officer was 
provided with all evaluation materials, scores and prices, and used 
this information in performing an explicit tradeoff among all 
competitive range proposals.  The contracting officer documented his 
tradeoff decision, concluding, in sum, that TECOM's lower price offset 
higher-rated proposals' technical advantages, and that EastCo's 
proposal's significant deficiencies in key areas essentially 
eliminated EastCo's offer from being selected vis-a-vis the other 
offers.  This tradeoff was consistent with the RFP, and no more 
extensive documentation was required.[7]

The protest is denied.

Comptroller General
of the United States

1. In response to EastCo's protest, the agency discovered a 
                     mathematical error in its calculations with 
                     regard to TECOM's price such that its price 
                     should be $238,127.56 less than stated above, or 
                     $23,759,330.81.

2. In any case, EastCo does not indicate--and it is not apparent--how 
it was prejudiced by these considerations; it does not state, for 
example, that it omitted 3-year duration contracts from its list of 
prior projects and would have included them had it been aware of this 
consideration.

3. The agency required supervisors at the buildings to ensure the 
successful operation and maintenance of the buildings/equipment 
(supervisors are skilled in several mechanical trades), and to handle 
personnel problems, tenant relations, and quality control. 

4. In contrast, TECOM offered [deleted] resulting in a score of 5.25 
(compared to EastCo's score of 2) under this subfactor.

5. The agency states that it did not engage in extensive, specific 
discussions because doing so would undermine its ability to determine 
how well offerors understood the requirements--for example, EastCo's 
failure to propose mechanical supervisors suggested a lack of 
understanding in this area.  

6. TECOM's proposal was considered acceptable at all times, and was 
rated significantly technically superior to EastCo's before the 
post-BAFO communication.  The addition of [deleted] increased TECOM's 
score by only [deleted] points, and the [deleted] clearly did not 
benefit TECOM in the evaluation.

7. EastCo also asserts that the analysis of TECOM's offered price was 
improper.  However, since EastCo's proposal was evaluated as last in 
line for award, and we have found nothing objectionable in the 
evaluation, one of the other competitive range offerors, not EastCo, 
would be in line for award if this protest ground were sustained.  
Under our Bid Protest Regulations, a protester is not an interested 
party for purposes of challenging an award under these circumstances.  
Bid Protest Regulations, section 21.0(a), 61 Fed. Reg. 39039, 39042 
(1996) (to be codified at 4 C.F.R.  sec.  21.0(a)); Cyber Digital, Inc., 
B-270107, Jan. 24, 1996, 96-1 CPD  para.  20.