BNUMBER:  B-275725.3 
DATE:  October 17, 1997
TITLE: ST Aerospace Engines Pte. Ltd., B-275725.3, October 17, 1997
**********************************************************************

Matter of:ST Aerospace Engines Pte. Ltd.

File:     B-275725.3

Date:October 17, 1997

Arthur I. Leaderman, Esq., and Claire E. Kresse, Esq., Smith, Pachter, 
McWhorter & D'Ambrosio, P.L.C., for the protester.
Karl A. Oliver, Esq., Mahoney, Hagberg & Rice, for Standard Aero Ltd., 
and David R. Johnson, Esq., and James C. Dougherty, Esq., Gibson, Dunn 
& Crutcher, for National Airmotive Corporation, the intervenors.
B. J. Braun, Esq., U. S. Coast Guard, for the agency.
Jennifer Westfall-McGrail, Esq., and Christine S. Melody, Esq., Office 
of the General Counsel, GAO, participated in the preparation of the 
decision.

DIGEST

1.  Where, in response to General Accounting Office decision 
sustaining protest, discussions are reopened after offerors' prices 
have been revealed, agency may properly limit the scope of revisions 
offerors may make to their proposals and not allow offerors to revise 
their prices.

2.   Agency reasonably reopened limited technical discussions with, 
and requested new limited best and final offers (BAFO) from, all 
offerors in the competitive range in response to General Accounting 
Office decision sustaining protest and recommending a reopening of 
limited technical discussions with, and the solicitation of a new 
limited BAFO from, one of the offerors.

DECISION

ST Aerospace Engines Pte. Ltd. (STA Engines) protests the decision of 
the U.S. Coast Guard to reopen technical discussions with, but not to 
allow the submission of revised price proposals from, all competitive 
range offerors under request for proposals (RFP) No. 
DTCG38-94-R-30006, for the overhaul and repair of C-130 T56 engine 
reduction gearboxes and torquemeters.  The protester contends that, if 
offerors are allowed to revise their technical proposals, they should 
also be allowed to revise their prices.

We deny the protest.

BACKGROUND

On March 19, 1997, we sustained a protest by STA Engines against award 
under this solicitation to Standard Aero Ltd., whose proposal had been 
selected as representing the best value to the government.  ST 
Aerospace Engines Pte. Ltd.,
B-275725, Mar. 19, 1997, 97-1 CPD  para.  161.  We found that the agency had 
improperly downgraded STA Engines' proposal, to its competitive 
prejudice, based on past performance information[1] pertaining to one 
of its affiliates, ST Aerospace Systems, without clarifying the 
relationship between the companies and without affording STA Engines 
an opportunity to comment on the information during discussions.  We 
recommended that the agency reopen discussions with STA Engines to 
clarify the extent of involvement of STA Systems in its proposed 
effort, and that it then solicit another round of best and final 
offers (BAFO) and evaluate them to determine which offer represented 
the best combination of technical merit and price.

STA Engines subsequently requested that we modify our decision to 
delete the recommendation for another round of BAFOs.  The protester 
argued that a reopening of the price competition would create the risk 
of an auction since offerors' prices had been disclosed by the agency 
during the debriefing process; it also argued that the impropriety 
could otherwise be remedied without impairment to the integrity of the 
procurement process by limiting the scope of reopened negotiations.  
We agreed with the protester, and, accordingly, modified our decision 
to recommend that discussions with the protester be confined to 
clarifying the extent of involvement of STA Systems in STA Engines' 
proposed effort (i.e., that the protester not be allowed to revise 
other aspects of its technical proposal or its price), and that a new 
BAFO then be solicited from STA Engines only.

The agency decided to reopen discussions addressing past performance 
issues with all offerors in the competitive range and to solicit BAFOs 
from all addressing this area only.  The contracting officer explains, 
in responding to the protest, that another offeror whose proposal was 
in the competitive range had experienced the same lack of opportunity 
to discuss past performance as the protester, and that to remedy this 
error and to ensure maximum fairness to all competitors, he had 
determined that our recommendation should be expanded.  By letter 
dated June 12, the contracting officer advised offerors that 
discussions bearing on past performance would be reopened and that 
they could submit updated past performance information, but that they 
would not be permitted to revise other aspects of their technical 
proposals or their prices.  The letter also asked offerors to 
revalidate their offers (which had expired), and advised them that if 
they had not done so by June 20, the offers would not be considered 
during the reevaluation process.

STA Engines responded to the agency's communication by letter dated 
June 20.  The protester objected to the agency decision to reopen 
discussions with all offerors in the competitive range, but stated 
that it would participate in the competition if the agency would allow 
offerors to revise their prices as well as their technical proposals.  
The protester argued that the agency should adhere to either the 
original recommendation (which called for the submission of new BAFOs 
from all competitive range offerors) or to the revised recommendation 
(which called for the submission of a new limited BAFO from STA 
Engines only), but that it should not develop a hybrid calling for the 
submission of new limited BAFOs by all competitive range offerors.  
All of the other competitive range offerors responded by revalidating 
their BAFOs.

By letter dated July 3, the Coast Guard notified STA Engines that, 
because it had failed to revalidate its BAFO, the agency did not have 
a valid offer from it, and that its offer was therefore excluded from 
the competitive range.  On July 10, STA Engines protested to our 
Office.

DISCUSSION

STA Engines argues that the agency should allow offerors to revise 
their prices if it allows them to revise their technical proposals.  
The protester maintains that "[a] contemporary technical submittal 
should, as a matter of law, be correlated with contemporary prices."  
Protest, July 10, 1997, at 6.

As a preliminary matter, the agency argues that STA Engines' protest 
is untimely since STA Engines was informed of the agency decision to 
reopen discussions with, and to solicit limited BAFOs from, all 
offerors on June 12, but did not file its protest with our Office 
until July 10.  In this regard, our Bid Protest Regulations require 
that protests based on other than solicitation improprieties be filed 
within 10 days after the basis of protest is, or should have been, 
known.  4 C.F.R.  sec.  21.2(a)(2) (1997).  The Coast Guard argues that the 
only way that STA Engines' protest would be timely would be if we 
considered the protester's June 20 letter to the agency an 
agency-level protest.  The agency insists that we should not regard 
the June 20 letter as such because STA Engines emphasized throughout 
the letter that it hoped to avoid a protest.  Rather than a protest, 
the Coast Guard contends, the letter should be viewed as an attempt by 
the protester to have its concerns resolved informally, consistent 
with the mandate of Federal Acquisition Regulation (FAR)  sec.  33.103(b) 
that "[p]rior to submission of an agency protest, all parties shall 
use their best efforts to resolve concerns raised by an interested 
party at the contracting officer level through open and frank 
discussions."

We think that the protester's letter of June 20 effectively 
constituted an agency-level protest.  A letter does not have to state 
explicitly that it is intended as a protest--and indeed may contain 
references to a forthcoming protest--for it to be so considered; it 
need only express dissatisfaction with an agency decision and request 
corrective action.  Mammoth Firewood Co., B-223705, Sept. 4, 1986, 
86-2 CPD  para.  261 at 2.  STA Engines' letter of June 20 did both; thus, 
in our view, it may properly be characterized as an agency-level 
protest.  Since STA Engines filed its protest with our Office within 
10 days of the adverse agency action on its June 20 letter, its 
protest is timely.  4 C.F.R.  sec.  21.2(a)(3).

Regarding the protester's argument that an agency must allow offerors 
to revise their prices if it allows them to revise aspects of their 
technical proposals, it is true that, as a general rule, offerors may 
revise any aspect of their proposals in response to discussions, 
including portions of their proposals that were not the subject of 
discussions.  Krueger Int'l, Inc., B-260953.4, Oct. 4, 1995, 96-1 CPD  para.  
235 at 4.  Where discussions are reopened after an award has been made 
to remedy a defect in the procurement process, and aspects of 
offerors' technical and/or price proposals have been revealed, the 
scope of discussions and proposal revisions may be limited, however.  
Serv-Air, Inc., B-258243.4, Mar. 3, 1995, 95-1 CPD  para.  125 at 2-3; 
System Planning Corp., B-244697.4, June 15, 1992, 92-1 CPD  para.  516 at 
3-4; URS Int'l, Inc., et al., B-232500, B-232500.2, Jan. 10, 1989, 
89-1 CPD  para.  21 at 6-7.  For example, where the awardee's price has been 
revealed (so that a reopening of the price competition would lead to 
the risk of an auction), and where the technical matters to be 
discussed during the reopened negotiations are unlikely to have an 
impact on price, offerors may be prohibited from revising their 
prices.  Krueger Int'l, Inc., supra, at 4-5. 

The Coast Guard maintains that this is such a case:  offerors' prices 
have been revealed, meaning that a reopening of the price competition 
would lead to the risk of an auction, whereas permitting offerors to 
discuss and update their past performance information is unlikely to 
have a material impact on their prices.  The protester has offered no 
rebuttal to the agency position.  Although it asserted in its initial 
letter of protest that offerors' prices are now stale, it has offered 
no support for this argument in any of its submissions; thus, we have 
no basis upon which to conclude that prices are now so stale as to 
outweigh concern over the possibility of an auction.  Further, the 
protester has offered no explanation as to why discussing and updating 
past performance information should be expected to have an impact on 
prices.  Absent evidence that either of the agency's conclusions is 
unfounded, we see no basis for questioning the agency determination 
that not reopening the price competition would best preserve the 
integrity of the procurement process.

In commenting on the agency report, STA Engines raises an additional 
argument:  that the contracting officer's justification for reopening 
discussions with, and requesting revised BAFOs from, all offerors in 
the competitive range is merely a pretext, and that his real goal is 
to circumvent our recommendation in order to undermine the ascendant 
position that STA Engines would allegedly achieve in the competition 
if our recommendation were implemented.  The protester insists that 
the sole infirmity in the process was the agency's failure to discuss 
with it the nature of its affiliation with STA Systems, and that the 
agency should therefore have implemented the corrective action that we 
recommended, which was tailored to remedy this defect.

First, to the extent the protester is now objecting to the agency's 
failure to implement the precise corrective action that we 
recommended, its protest is untimely.  Although the protester 
complained about the agency's failure to adhere to our recommendation 
in its agency-level protest, it did not raise the issue in its July 10 
protest to our Office; in the latter letter, it argued only that, if 
offerors were to be permitted to revise their technical proposals, 
they should also be permitted to revise their prices.  Since the 
protester did not object to the agency's failure to implement the 
corrective action that we recommended within 10 days after receiving 
the agency's letter of July 3, which placed it on constructive notice 
that its agency-level protest had been denied, but instead waited 
until it filed its comments on the agency report on August 21, its 
protest on this issue is untimely.  See 4 C.F.R.  sec.  21.2(a)(3).

In any event, the contracting officer emphatically denies that his 
purpose in reopening discussions with, and requesting an additional 
round of BAFOs from, all competitive range offerors was to undermine 
the protester's competitive position, and we find no support in the 
record for the protester's allegation.  Moreover, we think that it was 
within the agency's discretion to go beyond our recommendation and 
reopen discussions with all offerors in the competitive range, 
regardless of whether or not there was a defect in the process 
relating to another offeror.  In this regard, we have held that the 
details of implementing our recommendations for corrective action are 
within the sound discretion and judgment of the contracting agency, 
and we will not question an agency's ultimate manner of compliance, so 
long as it remedies the procurement impropriety that was the basis for 
the decision's recommendation.  QuanTech, Inc., B-265869.2, Mar. 20, 
1996, 96-1 CPD  para.  160 at 2.  Further, the solicitation of an additional 
round of BAFO from all offerors in the competitive range is consistent 
with our original recommendation for corrective action and with the 
guidance in the FAR on which that original recommendation was based.  
See FAR  sec.  15.611(c) ("If discussions are reopened [after receipt of 
BAFOs], the contracting officer shall issue an additional request for 
[BAFOs] to all offerors still within the competitive range.")  We 
revised our original decision to delete the recommendation for another 
round of BAFOs and to instead recommend the reopening of discussions 
with, and the solicitation of a new limited BAFO from, STA Engines 
only, not because we thought that it would be improper to solicit new 
limited BAFOs from all offerors in the competitive range, but rather 
to avoid a price auction and because a reopening of discussions with, 
and the solicitation of a new limited BAFO from, STA Engines was the 
minimum that was required to remedy the defect in the process.  To the 
extent that the agency wishes to do more than the minimum, we see no 
basis for objecting to its actions. 

The protest is denied.

Comptroller General
of the United States

1. Past performance was the most important of five technical 
evaluation factors.