BNUMBER: B-277250
DATE: September 18, 1997
TITLE: Shel-Ken Properties, Inc., B-277250, September 18, 1997
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Matter of:Shel-Ken Properties, Inc.
File: B-277250
Date:September 18, 1997
Charlotte C. Jenkins for the protester.
Virginia Kelly Stephens, Esq., Department of Housing & Urban
Development, for the agency.
Christina Sklarew, Esq., and Paul I. Lieberman, Esq., Office of the
General Counsel, GAO, participated in the preparation of the decision.
DIGEST
Protest of elimination of proposal from the competitive range based on
disagreement with agency's evaluation of the protester's proposal is
denied where the evaluation was conducted in accordance with the
criteria announced in the solicitation, and the record supports the
evaluators' conclusions.
DECISION
Shel-Ken Properties, Inc. protests the exclusion of its proposal from
the competitive range under request for proposals (RFP) No.
H03R96015600000, issued by the Department of Housing and Urban
Development (HUD) for real estate asset management (REAM) services for
single-family properties owned by HUD in its District of Columbia
Office jurisdiction. Shel-Ken alleges that its proposal was
improperly evaluated, that the contracting officer was biased against
the firm, and that HUD was required to make a referral to the Small
Business Administration for certificate of competency consideration
before the agency could exclude Shel-Ken's proposal from the
competitive range.
We deny the protest.
The RFP was issued on July 24, 1996, as a total small business
set-aside for the acquisition of management and other related
services. The RFP listed the following evaluation factors, with their
relative weights, to be scored on a 100-point scale: prior management
experience (30 points); past performance (25 points); office
location(s) (20 points); and management capability (25 points). Award
was to be made to the offeror submitting "the proposal that best
conforms to the solicitation, and is most advantageous to the
Government (that proposal which represents the best value.)"
The agency received 17 timely submitted proposals, including the
protester's. After the proposals had been scored by individual
technical evaluation panel (TEP) members, the TEP developed a
consensus score for each proposal. Five offers were rated as
technically acceptable, and seven offers, including Shel-Ken's, were
deemed technically unacceptable in their current form but capable of
being made acceptable through clarifications/discussions. These 12
proposals were included in the competitive range.
On February 3, the contracting officer notified Shel-Ken by letter
that its proposal was considered to be within the competitive range
for further negotiations, and identified areas in the proposal that
required additional information and/or clarification. The letter
requested further detail or specific information regarding Shel-Ken's
experience, especially the property management experience of proposed
employees; past performance (such as complete mailing addresses for
references); proposed satellite offices; equipment to be provided; and
responsibilities of the various proposed employees. The letter also
transmitted an amendment to the RFP. HUD instructed Shel-Ken to
submit an amended proposal and to complete a pricing schedule that was
included in the solicitation amendment.
Shel-Ken submitted an amended proposal which was evaluated with the
result that the protester's overall score improved by a total of 9
points. Nonetheless, the TEP concluded that the additional
information and changes that Shel-Ken had provided were not sufficient
to make its proposal acceptable. For example, the TEP continued to
have concerns regarding the level of the firm's relevant experience
and to question whether Shel-Ken proposed to provide fully equipped
main and satellite offices.
Five amended technical proposals were considered superior to
Shel-Ken's. Among these five, three offered a lower price. The
contracting officer concluded that Shel-Ken's proposal did not have a
reasonable chance of being selected for award and excluded it from the
competitive range. Shel-Ken was notified of its exclusion, and this
protest followed. The contract award has been stayed pending
resolution of the protest.
Shel-Ken alleges that its proposal was excluded from the competitive
range as the result of an improper evaluation. First, Shel-Ken
essentially argues that its prior experience was not given the credit
to which it was entitled under the evaluation criterion.
The RFP lists "prior management experience" as the most
heavily-weighted single technical evaluation factor, and states:
The offeror shall provide evidence of the offeror's experience in
the management of single family properties similar to the type of
inventory covered by this solicitation. Prior management
experience must demonstrate the offeror's ability to perform the
duties required under this RFP. If the offeror's property
management experience is in areas other than single family
property management, the offeror's proposal must demonstrate, to
the satisfaction of HUD, that the experience relates to the
duties required by this RFP. Include a description of work
currently in progress and/or completed within the last three to
five years that is relevant to this procurement. Include names,
addresses, and telephone numbers of contact points for these
clients. The government reserves the right to request
information from any source so named. The government also
reserves the right to obtain information from sources not named
in the proposal.
In Shel-Ken's initial proposal, under the caption of "corporate
history," Shel-Ken lists the dates, inventories, and references for
its past and current contracts. The previously completed contracts
consist of three HUD contracts that Shel-Ken performed between 1987
and 1993, including 600 single-family homes between 1987 and 1989, 150
homes between 1989 and 1990, and a range of 18 to 100 homes between
1990 and 1993. The list of current contracts is comprised of four
private-sector contracts, with inventories ranging from 1 townhouse to
58 townhouses. Although the lists include references for these
contracts, as well as a list of each property that was covered under
the HUD contracts, Shel-Ken's initial proposal provided no narrative
or other information concerning the type of contract or the nature of
the work that was actually performed.
In response to the discussion request to provide additional
information concerning its experience, Shel-Ken responded with a
narrative account of the services provided. The TEP considered this
response to be a "better, more detailed explanation of the company's
experience," and increased Shel-Ken's score in this area from 16 to 21
points (out of a possible 30 points). The agency noted that the level
of inventory that Shel-Ken has managed in the past is significantly
lower than required under the current procurement, which is projected
to be approximately
100 new homes per month, and questioned whether the protester's
experience is comparable to this requirement. In addition, the RFP
sought information regarding offerors' experience during the past 3 to
5 years, and Shel-Ken's only comparable-volume contract was performed
8 to 10 years ago.
Shel-Ken contends that its experience under Area Management Broker
contracts involved more difficult management responsibilities than
would be the case under the REAM contract at issue here, and therefore
should have received more credit. The protester takes the position
that its expertise would allow it to "manage the entire inventory
Nationwide of approximately 29,000 with the same precision and speed
as 200."
The evaluation of proposals is primarily a matter within the agency's
discretion since it is responsible for defining its needs and for
deciding on the best methods for accommodating them. Seair Transport
Servs., Inc., B-252266, June 14, 1993, 93-1 CPD para. 458 at 4. Thus, we
question the evaluation only if the record demonstrates that it was
unreasonable or inconsistent with the RFP's evaluation criteria. Id.
Here, the record establishes that HUD's evaluation was reasonable.
The RFP instructed offerors to provide evidence of their experience in
the management of single family properties "similar to the type of
inventory covered by this solicitation." (Emphasis added.) The
volume of houses managed by Shel-Ken under its current contracts does
not approach the volume involved in this procurement. Further, the
solicitation calls for a description of relevant work completed within
the last 3 to 5 years; Shel-Ken's proposal described experience with
comparable-volume contracts which occurred 8 to 10 years ago. The
TEP's downgrading of Shel-Ken's proposal in this area was consistent
with the RFP evaluation criterion. The evaluation factor at issue
here pertains to the value of the offeror's actual past experience.
Thus, the protester's mere assertion that it is capable of managing a
significantly higher volume of properties than it has in the past does
not entitle its technical proposal to receive an enhanced score under
an evaluation factor intended to assess a firm's actual experience.
While the additional information elicited from Shel-Ken during
discussions permitted the evaluators to increase the protester's score
in this area, the agency properly discounted Shel-Ken's most relevant
experience as stale and downgraded the more recent experience because
of the lack of comparable volume. Shel-Ken's mere disagreement with
the agency does not in itself render the evaluation unreasonable.
Seair Transport Servs., supra.
Shel-Ken also objects to the agency's evaluation of its proposal under
each of the remaining evaluation factors. For example, under the
"past performance" evaluation factor, the RFP required offerors to
provide evidence of their past similar performance, including points
of contact and references that the agency could contact. When the
agency attempted to contact the protester's listed references, only
one firm responded. Shel-Ken alleges, in essence, that the agency did
not make a sufficient effort to contact the references. However,
Shel-Ken's score for this factor was in the "excellent" range,
notwithstanding the paucity of information available to the agency,
and Shel-Ken does not allege any deviation from the evaluation
criteria or otherwise show why it believes this factor was improperly
scored. In these circumstances, there is no basis to object to the
agency's evaluation in this area.
Under the "office location" evaluation factor, the RFP required
offerors to "provide evidence of an adequately staffed and equipped
office (or offices) - or the ability to establish such an office in a
timely manner - reasonably located to provide convenient service to
HUD and its clients in the geographical area to be served, and to
efficiently perform all contractual requirements." Shel-Ken stated in
its initial proposal that it would establish a main office and two
satellite offices. In written discussions, the contracting officer
requested additional details concerning the offices and the specific
property management experience of the proposed staff. Shel-Ken
provided some additional information, and its score in this area was
increased by 4 points. Shel-Ken takes the position that because the
RFP referred to "office (or offices)," and Shel-Ken's proposed main
office satisfied the minimum of one office, its proposal was entitled
to essentially a maximum score without taking the satellite offices
into consideration. The premise that satisfaction of a minimum
requirement entitles a proposal to a perfect score is meritless on its
face, and we conclude that the agency's evaluation was consistent with
the terms of the RFP.
Under the "management capability" evaluation factor, offerors were to
describe their organization and, among other things, "provide the
names, position descriptions and resumes to support the
qualifications, including relevant experience, specialized training
and education, of all proposed key personnel." The agency report
shows that throughout the evaluation process, and as indicated to
Shel-Ken during discussion, the TEP had concerns regarding the
property management experience of the proposed staff. Further, the
TEP considered the protester's plan to have required weekly
inspections performed by subcontractors to be a weakness. Shel-Ken
objects, pointing out that its amended proposal stated that three of
its staff members "have more than eight (8) years experience in the
field of property management." However, the information provided in
Shel-Ken's proposal did not disclose the nature of the experience and
was too vague to permit favorable evaluation. For example, for one
employee, the proposal stated that an employee had worked for Shel-Ken
"on a part-time basis, for the past several years." It neither
described the type of work performed nor the actual length of
experience. For the proposed field operations director, the proposal
described only the duties that the proposed employee would perform,
and listed no experience at all. We see no basis to object to the
agency's downgrading of Shel-Ken's proposal in this area. The
technical evaluation of a proposal is based on information submitted
in it and an offeror runs the risk of having its proposal rejected or
downgraded if the proposal submitted is inadequately written. See
Research Analysis and Maintenance, Inc., B-242836.4, Oct. 29, 1991,
91-2 CPD para. 387 at 5.
In its summary of its protest comments, Shel-Ken also lists a number
of instances in which the agency allegedly applied evaluation factors
that were not disclosed in the solicitation. For example, the
protester alleges that the TEP required the entire proposed staff to
have more than 10 years property management experience rather than the
key personnel only; that offerors had to be currently managing a
particular number of properties; that staff experience had to date
from no earlier than 1993; and that the CEO had to have extensive
experience in the operation of computers. In each instance, Shel-Ken
is either mistaken with respect to the requirements as they appeared
in the RFP, or mistaken as to the basis for the evaluation
conclusions. The TEP questioned the exact length and type of
experience of the proposed personnel, which was not discernible from
Shel-Ken's proposal; the evaluation scheme in the RFP required
experience in the management of an inventory (i.e., number and type of
properties) similar to the requirement here; the RFP asked for
relevant experience completed within the last 3 to 5 years; and the
CEO's qualifications were questioned because of the type of work for
which she was proposed to have responsibility in the proposal. In
short, these allegations are refuted by the record.
Shel-Ken mistakenly asserts that its proposal cannot be eliminated
from the competitive range without referral of the matter to the Small
Business Administration (SBA) for consideration under that agency's
certificate of competency (COC) proceedings. Where an agency finds
that a small business is nonresponsible, the agency is required to
refer the matter to the SBA for consideration under the COC
procedures. Federal Acquisition Regulation Subpart 19.6. In a
negotiated procurement, SBA referral is mandatory where the
solicitation includes for evaluation on a pass/fail basis a criterion
that is traditionally a responsibility-type factor, and the
contracting agency determines that a small business's proposal should
be rejected for failing that criterion. This is so because, in these
circumstances, the agency is viewed as having made a nonresponsibility
determination notwithstanding its use of and reliance on a technical
evaluation criterion. Docusort, Inc., B-254852, Jan. 25, 1994, 94-1
CPD para. 38 at 5-7. However, the requirement for referral does not apply
where, as here, proposals are comparatively evaluated and assigned a
comparative adjectival rating. In these circumstances, the agency
does not make a responsibility determination, but simply integrates
its relative assessment of past performance into the overall
determination of which proposal is most advantageous to the
government, and there is no requirement for referral to the SBA.
Tri-Servs., Inc., B-256196.4, Sept. 30, 1994, 94-2 CPD para. 121 at 3-4.
Shel-Ken also makes various allegations of agency bias against the
protester and dishonesty on the part of HUD personnel. Government
officials are presumed to act in good faith; we will not attribute
unfair or prejudicial motives to procurement officials on the basis of
inference or supposition. Triton Marine Constr. Corp., B-250856, Feb.
23, 1993, 93-1 CPD para. 171 at 6. In addition to producing credible
evidence showing bias, the protester must demonstrate that the agency
bias translated into action that unfairly affected the protester's
competitive position. Id. Shel-Ken has furnished no credible
evidence to support its allegation; moreover, since the record
supports HUD's evaluation of Shel-Ken's proposal (and its consequent
exclusion from the competition), it provides no basis upon which to
question the motives of the evaluators.[1]
The protest is denied.
Comptroller General
of the United States
1. Shel-Ken also alleges in its protest comments that the agency
"tampered" with documents. Shel-Ken received two copies of the agency
report and contracting officer's statement from which source-selection
sensitive materials had been redacted. Because the two copies
differed slightly from each other, Shel-Ken accuses the agency of
malice and deception. The agency explains that when the protester
complained that it had not received a legible copy of these documents,
the agency took that opportunity to revise its previous redactions
slightly. We have reviewed the documents; the variations are minor
and insignificant, and they provide no basis for protest.