BNUMBER:  B-275756 
DATE:  March 25, 1997
TITLE: Matter of:Theisinger und Probst Bauunternehmung GmbH 

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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:Theisinger und Probst Bauunternehmung GmbH

File:     B-275756

Date:March 25, 1997

Daniel F. Crowley, Esq., and Leodis C. Matthews, Esq., for the 
protester.
John E. Lariccia, Esq., Department of the Air Force, for the agency.
Jacqueline Maeder, Esq., and Paul Lieberman, Esq., Office of the 
General Counsel, GAO, participated in the preparation of the decision.

DIGEST

Award of a fixed-price contract to a higher-priced, technically 
superior offeror is unobjectionable where it is consistent with the 
solicitation evaluation criteria, the agency reasonably determined 
that the difference in technical merit was sufficiently significant to 
justify the marginal cost difference, and the record does not support 
the protester's theory that the agency's source selection authority 
must have confused proposals in making his selection.

DECISION

Theisinger und Probst Bauunternehmung GmbH protests the award of a 
contract to SKE/Klee under request for proposals (RFP) No. 
F61521-96-R2101, issued by the Department of the Air Force as a 
Simplified Acquisition of Base Engineering Requirements (SABER) 
procurement for alteration, maintenance, repair and minor construction 
work at various facilities in the Kaiserslautern Military Community, 
Germany.  Theisinger contends that the award to a higher-priced 
offeror was improper because the agency's technical and past 
performance evaluations were flawed and the agency did not make a 
proper best value determination.

We deny the protest.

The solicitation, issued April 23, 1996, contemplated the award of an 
indefinite quantity, indefinite delivery, firm fixed-price 12-month 
contract with three 1-year options and a total ceiling of $25 million.  

The RFP provided for award to the responsible offeror whose offer was 
found most advantageous to the government considering, in descending 
order of importance, technical factors, past performance and cost.  
The solicitation set forth four technical evaluation factors, in 
descending order of importance:  (1) project management; (2) project 
execution; (3) subcontracting support; and (4) experience.  Under each 
of these four factors, proposals were evaluated against the following 
assessment criteria, also in descending order of importance:  
soundness of management approach, understanding the technical 
requirement, and identification and use of resources.  The RFP 
provided that past performance would be measured using four evaluation 
factors in descending order of importance, including: (1) quality of 
service; (2) cost control; (3) timeliness of performance; and (4) 
customer satisfaction.  Each of these past performance factors was to 
be measured using two assessment criteria, in descending order of 
importance:  compliance with technical requirements and management 
approach.  Cost was to be evaluated for completeness, realism and 
reasonableness, using weighted coefficients for various jobs within 
the construction industry and as identified by the RFP.  

The RFP instructed offerors to submit with their proposals information 
on relevant contracts.  The solicitation provided that the agency 
"shall place emphasis on the relevance of the prior performance in 
relation to this requirement, rather than on the number of contracts 
performed."  Offerors were also instructed to "explain clearly why the 
identified contracts [were] deemed to be relevant to the SABER 
[c]ontract."

The Air Force received six offers by the RFP's June 6, 1996, closing 
date.  Proposals were assessed under each evaluation factor using four 
color/adjectival ratings:  (1) blue/exceptional (exceeds specified 
performance or capability in a beneficial way and has no significant 
weaknesses); (2) green/acceptable (meets evaluation standards and any 
weaknesses can be corrected); (3) yellow/marginal (fails to meet 
evaluation standards, but any significant deficiencies are 
correctable); and (4) red/unacceptable (fails to meet a minimum 
requirement of the RFP and the deficiency is uncorrectable without a 
major revision of the proposal).  The technical evaluation team also 
assigned a proposal risk rating according to the following risk 
definitions:  (1) high (likely to cause significant serious disruption 
of schedule, increase in cost, or degradation of performance even with 
special contractor emphasis and close government monitoring); (2) 
moderate (can potentially cause some disruption of schedule, increase 
in cost, or degradation of performance; special contractor emphasis 
and close government monitoring will probably be able to overcome 
difficulties); and (3) low (has little potential to cause disruption 
of schedule, increase in cost, or degradation of performance; normal 
contractor emphasis and normal government monitoring will probably be 
able to overcome difficulties).    

The Air Force issued clarification and deficiency reports on August 
13; offerors submitted responses to these reports by August 27.  On 
October 9, the agency requested best and final offers (BAFO), and five 
were received.  Based on BAFOs, three firms were determined eligible 
for award, including Theisinger, SKE, and the incumbent Bilfinger and 
Berger (B&B).  Theisinger offered the lowest evaluated  price 
coefficient of [deleted];[1] SKE submitted the second lowest 
coefficient of [deleted], and B&B submitted the highest evaluated 
coefficient.  In the technical area, all three proposals were rated 
green/acceptable overall with low risk.  However, SKE's proposal 
received blue/exceptional ratings in two technical assessment criteria 
(soundness of management approach and understanding the technical 
requirement) under subcontracting support, resulting in a 
blue/exceptional rating for this technical factor.  B&B's proposal 
received blue/exceptional ratings on three technical assessment 
criteria, including soundness of management approach and understanding 
the technical requirement, resulting in one blue/exceptional rating 
under the subcontracting support factor, and a blue/exceptional rating 
on the project management assessment criterion under project 
execution.  Theisinger's proposal received only one blue/exceptional 
rating on one technical assessment criterion (understanding the 
technical requirement) under subcontracting support, and its overall 
rating on the subcontracting factor was green/acceptable.  SKE's 
proposal was rated as moderate risk under experience.  A summary of 
the ratings for all three offerors is given below.
                           Theisinger

             Management
             Ability      Project
                          Execution    Subcontract  Experience

Project
Management   green/low    green/low    green/low    green/low

Understand
Technical
Requirement  green/low    green/low    blue/low     green/low

Use of
Resources    green/low    green/low    green/low    green/low

Overall      green/low    green/low    green/low    green/low
                               SKE

             Management
             Ability      Project
                          Execution    Subcontract  Experience

Project
Management   green/low    green/low    blue/low     green/
                                                    moderate

Understand
Technical
Requirement  green/low    green/low    blue/low     green/low

Use of
Resources    green/low    green/low    green/low    green/low

Overall      green/low    green/low    blue/low     green/
                                                    moderate
                               B&B

             Management
             Ability      Project
                          Execution    Subcontract  Experience

Project
Management   green/low    blue/low     blue/low     green/low

Understand
Technical
Requirement  green/low    green/low    blue/low     green/low

Use of
Resources    green/low    green/low    green/low    green/low

Overall      green/low    green/low    blue/low     green/low
All three proposals were rated essentially equal under past 
performance, each receiving a green/acceptable rating.  However, SKE 
and B&B were recognized as having had previous SABER contracts; 
Theisinger was not.

After a review of the each proposal's strengths and weaknesses, costs, 
and risks, the source selection authority (SSA) determined that SKE's 
proposal provided the best value to the government.  The agency 
awarded the contract to SKE on December 9, and this protest followed.

The protester alleges that the SSA's decision is irrational and 
contains errors of fact and logic.  Specifically, Theisinger contends 
that, because the SSA decision states that the SKE proposal "exceeds 
government requirements in two separate criteria," the SSA has 
confused SKE's proposal with B&B's proposal, which Theisinger alleges 
"was the only [proposal] to exceed two criteria."  Theisinger then 
argues that the SSA used "this ostensibly superior SKE proposal to 
outweigh [Theisinger's] proposal. . . ."  The protester argues that 
because Theisinger's proposal and SKE's were actually evaluated as 
essentially technically equal, cost should have been determinative and 
Theisinger should have been awarded the contract.

Theisinger bases its allegation that the SSA confused the SKE and B&B 
proposals on one sentence in the SSA decision, which reads "Within the 
technical area, SKE/KLEE offers a proposal which exceeds government 
requirements in two separate criteria."  The Air Force explains, 
however, that the SSA inadvertently omitted the word "assessment," and 
that the sentence therefore should actually read, "[w]ithin the 
technical area, SKE/KLEE offers a proposal which exceeds government 
requirements in two separate assessment criteria."  This explanation 
is reasonable and, indeed, reflects the fact, noted above, that SKE's 
proposal was evaluated as exceeding the government's requirements on 
two "assessment criteria" under the subcontracting evaluation factor.

Theisinger, in its submissions to our Office, concedes that both the 
SKE and the B&B proposals were rated blue/exceptional on two 
assessment criteria under the subcontracting factor and therefore 
rated blue/exceptional on this subcontracting factor, and that B&B was 
rated blue/exceptional on one additional assessment criterion.  The 
protester nevertheless continues to argue that the SSA confused the 
two proposals, because "B&B's proposal with three blues, not 
SKE/Klee's with only two, was the only one to exceed two criteria. . . 
."

We believe that the protester misconstrues the SSA's decision.  As 
noted above, the SSA correctly indicates that SKE's proposal exceeds 
government requirements--meaning it earned better than acceptable 
ratings--on two assessment criteria.  If the SSA had, in fact, 
confused SKE's and B&B's proposals, as the protester alleges, his 
decision would have stated that SKE exceeded government requirements 
under three criteria.  The SSA decision goes on to state that although 
B&B's proposal "had one criterion judged technically superior to 
SKE/KLEE; their proposal was significantly more expensive than that 
submitted by SKE/KLEE."  This clearly shows that the SSA was aware 
that B&B's proposal was judged blue/exceptional on three assessment 
criteria while SKE's proposal was judged blue/exceptional on only two 
assessment criteria.  Contrary to the protester's allegation, there is 
no evidence in the record which suggests that the SSA confused the two 
proposals.  

Theisinger next argues that the agency improperly evaluated its and 
the awardee's past performance, stating that although it and SKE were 
rated essentially equal on past performance, the SSA put too great a 
weight on SKE's SABER experience while discounting Theisinger's 
SABER-like experience under a contract with the city of Pirmasens.[2]  
Also, Theisinger argues that the SSA's decision does not reflect an 
integrated assessment of the proposals and fails to provide a clear 
rationale for the selection decision.

Source selection officials in negotiated procurements have broad 
discretion in determining the manner and extent to which they will 
make use of technical and cost evaluation results.  Grey Advertising, 
Inc., 55 Comp. Gen. 1111, 1120 (1976), 76-1 CPD  para.  325; Mevatec Corp., 
B-260419, May 26, 1995, 95-2 CPD  para.  33.  Agencies may make 
cost/technical tradeoffs in deciding between competing proposals and 
the propriety of such tradeoffs turns not on the difference in 
technical scores or ratings per se, but on whether the selection 
official's judgment concerning the significance of that difference was 
reasonable and adequately justified in light of the RFP evaluation 
scheme.  See Wyle Labs., Inc.; Latecoere Int'l, Inc., 69 Comp. Gen. 
648 (1990), 90-2 CPD  para.  107.

Here, the SSA report states that the past performance proposals of all 
three offerors were determined to be essentially equal, with all three 
receiving green/acceptable ratings.  The report also states that both 
SKE and B&B had previous SABER contracts in the Kaiserslautern 
Military Community, while Theisinger had no prior SABER experience.  

We disagree with the protester that the SSA put too great an emphasis 
on SKE's SABER experience.  While the record indicates that the SSA 
did recognize that SKE had SABER experience, comparable to the $25 
million anticipated cost of this procurement, and in the same 
geographical area and administered by the same contracting activity, 
it is also clear that the SSA understood that the past performance 
evaluations for all three offerors were essentially equal.  To the 
extent SKE's SABER experience gave SKE a slight edge over the 
protester, it was because the experience was directly relevant to the 
work to be performed under this solicitation.  Moreover, the record 
shows that the Air Force did consider Theisinger's contract with the 
city of Pirmasens.  However, contrary to the protester's assertions 
that this contract was primarily a design and construction 
requirements contracts, the agency points out that it was limited to 
road construction.  In contrast, the SABER contract here will require 
up to 30 design and construction disciplines.  Moreover, Theisinger's 
Pirmasens's contract is valued at approximately [deleted], 
significantly less than the contract at issue or SKE's SABER contract.  
Under these circumstances, we find nothing improper in the SSA's 
slight emphasis on SKE's SABER experience.

Contrary to the protester's allegation, the record shows that the 
source selection official reviewed the full technical evaluation 
record (including strengths, weaknesses, and concerns cited for the 
proposals), as well as the resulting adjectival ratings and cost 
evaluation results.  The award determination statement describes the 
differences in the evaluations of the three proposals and concludes 
that SKE offered the most advantageous proposal to the government 
pointing out, for example, that SKE's proposal exceeded the 
government's requirements in subcontracting, that SKE has a solid past 
performance record, including SABER experience, and that SKE's 
proposed costs are only marginally higher than the lowest-cost 
proposal.  The award determination also notes that this marginally 
higher cost is outweighed by the superior technical proposal offered 
by SKE.[3]  Moreover, the protester does not question the technical 
ratings for its own or for SKE's proposal.[4]  In our view, the SSA 
report reflects an appropriate comparison of the competing proposals 
and includes a reasoned determination for selection of the second 
lowest cost offer.  The crux of Theisinger's argument regarding the 
allegedly improper tradeoff determination stems from its view that 
SKE's evaluation reflects the agency's confusion of SKE's proposal 
with that of B&B.  However, as explained above, that assertion is 
contradicted by the record.  Under these circumstances, and given that 
technical factors were more important than price, we have no basis to 
object to the selection decision.[5]
  
The protest is denied.

Comptroller General
of the United States

1. Under a SABER contract, services are accomplished by the use of 
individual delivery orders.  The cost of an individual project is 
computed by using prices from a unit price book (UPB), which lists 
25,000 line items of pre-priced construction tasks.  The appropriate 
line items required for completing the project are added together and 
multiplied by a coefficient that represents the contractor's overhead 
and profit.  Offerors competing for a SABER contract submit their 
prices as coefficients, which are percentage factors representing an 
increase or a decrease to the UPB prices.  For example, a coefficient 
of 1.0 would represent a price that matches the UPB price; a 
coefficient of 1.2 represents a price that is 20 percent more than the 
UPB's unit prices. 

2. The protester also alleges that the Air Force improperly evaluated 
SKE's past performance by crediting SKE for SABER experience.  
Theisinger contends that the awardee's SABER experience was in a joint 
venture, that the other joint venture firm was the lead partner, and 
that the experience of the joint venture properly belongs only to the 
lead partner.  The protester argues that since SKE should not be 
credited with SABER experience, the past experiences of SKE and 
Theisinger are essentially equal.  The agency responded to this issue 
in its January 15, 1997 report, but Theisinger, in its comments filed 
on that report, did not rebut the agency's position.  Therefore, we 
regard this issue as abandoned.  Marquette Elecs., Inc., B-262016.2; 
B-262016.3, Feb. 15, 1996, 96-1 CPD  para.  98.

3. The SKE offer is approximately only [deleted] percent higher than 
Theisinger's lowest-cost proposal.

4. Theisinger first protested on December 16, 1996, alleging that the 
agency's technical evaluation of proposals was flawed.  The only 
specific allegation raised in this regard concerned the SSA's alleged 
confusion of the SKE and B&B proposals, discussed above.  On January 
15, 1997, counsel for the protester received the agency's report on 
the protest, which included the awardee's proposal and the agency's 
evaluations.  Theisinger requested and was granted three  extensions 
of time in which to file its comments, and did so on February 5.  In 
those comments, for the first time, Theisinger argued that the 
agency's evaluation of SKE's proposal under the experience factor was 
improper.  We decline to consider this issue because it is untimely.  
Under our Bid Protest Regulations, protests based on other than 
apparent solicitation improprieties must be filed within 10 days of 
when the protester knew or should have known the basis for protest.  
Bid Protest Regulations,  sec.  21.2(a)(2), 61 Fed. Reg. 39039, 39043 
(1996) (to be codified at 4 C.F.R.  sec.  21.2(a)(2)).  Theisinger had been 
provided the information that should have put it on notice of this 
protest ground on January 15, upon receipt of the agency report, but 
did not raise the issue until its comments were filed 21 days later.  
In this respect, Theisinger argues that its initial protest 
encompassed this issue because it alleged generally that the agency 
failed to follow specified evaluation criteria and misevaluated 
proposals.  We do not agree.  Those allegations were broad in nature 
and the initial protest otherwise lacked any reference whatsoever to 
the evaluation of SKE's experience.  See Ralph G. Moore & 
Assocs.--Recon., B-270686.3, Jan. 5, 1996, 96-1 CPD  para.  268. 

5. In its comments on the agency report, Theisinger protests, for the 
first time, that since the solicitation stated that offerors' past 
performance would be evaluated based on contracts awarded within the 
past 3 years, SKE's SABER contract, awarded in 1992 (outside the 
3-year period), should not be considered by the agency.  The protester 
also argues for the first time that the agency applied a new, unstated 
evaluation criterion regarding geographic location in evaluating past 
performance, and that the agency erred in evaluating costs.  As noted 
above, our Bid Protest Regulations require that protests based on 
other than apparent solicitation improprieties be filed within 10 days 
of when the protester knew or should have known the protest basis.  
Here, Theisinger had been provided the information that should have 
put it on notice of these protest grounds on January 15, yet did not 
raise them until its comments were filed 21 days later.  Thus, these 
issues are untimely and not for our consideration.  Bid Protest 
Regulations, supra.