BNUMBER:  B-277808; B-277808.2 
DATE:  November 21, 1997
TITLE: Ricards International, Inc. T-A INFOTEQ, B-277808; B-
277808.2, November 21, 1997
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DOCUMENT FOR PUBLIC RELEASE
The decision issued on the date below was subject to a GAO Protective 
Order.  This redacted version has been approved for public release.
Matter of:Ricards International, Inc. T-A INFOTEQ

File:     B-277808; B-277808.2

Date:November 21, 1997

Pamela J. Mazza, Esq., Andrew P. Hallowell, Esq., and Antonio R. 
Franco, Esq., Piliero, Mazza & Pargament, for the protester.
Richard S. Brown, Esq., and Michael Colvin, Department of Health and 
Human Services, for the agency.
Susan K. McAuliffe, Esq., and Christine S. Melody, Esq., Office of the 
General Counsel, GAO, participated in the preparation of the decision.

DIGEST

1.  Where protester disagrees with the agency's technical evaluation 
of its proposal, but the record does not show that the agency's 
determinations lack a reasonable basis, protest allegations that the 
procuring agency improperly evaluated the proposal are denied.

2.  Contracting agency misled the protester in discussions by 
informing the protester that it must use the higher indirect cost 
rates contained in the firm's current rate agreement, which had the 
effect of increasing the firm's proposed price in its best and final 
offer, rather than informing the protester of the agency's actual 
concern about the lack of support provided by the protester for the 
lower rates contained in the firm's initial proposal.  The protest of 
misleading discussions is denied, however, since the record does not 
show that, but for the agency's misleading discussions, the protester 
would have had a reasonable chance of receiving the award. 

DECISION

Ricards International, Inc. T-A INFOTEQ protests the award of a 
contract to B.L. Seamon & Associates, Inc. under solicitation No. 
NIH-NIAID-DAIDS-97-03, issued by the Department of Health and Human 
Services (HHS) for research support services to the Division of 
Acquired Immune Deficiency Syndrome of the National Institute of 
Allergy and Infectious Diseases.  INFOTEQ, the incumbent contractor 
for these services, challenges the propriety of the agency's 
evaluation of its technical proposal and discussions held with the 
firm.

We deny the protest.

The streamlined electronic solicitation, issued on November 12, 1996, 
contemplates the award of a 5-year, cost-reimbursement, 
level-of-effort contract.  The solicitation's statement of work 
explains that the required services are in the following areas:  
scientific meeting and conference support (e.g., the provision of 
planning, logistical, and technical support for meetings/conferences, 
including site selection and accommodations); support for a variety of 
non-meeting associated tasks (e.g., teleconferences and 
preparation/production of manuals and other documents); project 
management and administrative support (e.g., technical and budgetary 
management of multiple concurrent projects, and assurance of quality 
control in contract performance, including writing/editing in the 
preparation of scientific meeting summaries); and an orderly 
transition to a subsequent contractor.  The solicitation advises all 
offerors that proposal evaluation for award will be based solely on 
the contents of the proposals (including evaluation of proposal 
responsiveness, thoroughness, and feasibility) and information 
gathered regarding past performance.  The solicitation instructs 
offerors that their proposals must discuss, in more detail than 
previously required, how the services are to be provided, including 
detailed documentation of the methodologies proposed to meet the 
statement of work requirements, and any proposed costs (to include 
verifiable, factual cost or pricing data to explain proposed indirect 
cost rates).

The solicitation provides the following technical evaluation criteria 
for award, listed in descending order of importance:  technical 
competency (soundness and practicality of technical approach, adequacy 
of administrative framework for timely and accurate performance of 
services, and understanding of the project); personnel (project 
director and other staff); and corporate expertise, experience, 
facilities, and structure.  In the evaluation for award, paramount 
consideration is to be given to technical merit (90 percent), with 
past performance (10 percent) and cost to be considered in the 
determination of which proposal is most advantageous to the 
government--the solicitation states that estimated cost may be the 
determinative factor among technically equal proposals.

Initial proposals were received and reviewed, and discussions were 
conducted with those offerors whose proposals were included in the 
competitive range, including INFOTEQ and Seamon.  INFOTEQ submitted an 
initial proposal at the estimated cost of [DELETED]; Seamon's initial 
proposal's estimated cost was [DELETED].  Discussions held with 
INFOTEQ regarding its technical proposal focused mainly on the need 
for additional support and discussion regarding the protester's 
claimed capability and experience; the experience and employment 
status of proposed personnel; and site selection, hotel negotiations, 
budget reporting, and quality assurance.  INFOTEQ was instructed 
during discussions that it must use the higher indirect cost rates of 
its current rate agreement, signed 2 months earlier, throughout the 
contract period.[1]  As discussed further below, although the agency 
in fact was concerned about the protester's proposal's lack of support 
for its lower proposed rates which, in the absence of such support, 
seemed unrealistically low, Hearing Transcript (Tr.) at 104, 159, this 
concern was not conveyed to the protester.

During discussions between the agency and the awardee, Seamon, the 
agency pointed out that Seamon's proposed indirect cost rates were 
considerably lower than the rates included in Seamon's previous rate 
agreement.  In contrast to what was said to the protester, however, 
Seamon was told that it needed to present further support (concerning 
information on current rates/costs) to be analyzed for reasonableness.

Revised proposals and best and final offers (BAFO) were received and 
evaluated.  Seamon's BAFO proposed the lowest cost (at $3,001,413) of 
the BAFOs received; INFOTEQ submitted a BAFO of [DELETED], based upon 
the use of its higher rate agreement rates.  Three of the BAFOs 
received (including Seamon's, which received the highest technical 
point score) were considered to be technically equivalent and 
technically superior to INFOTEQ's proposal.  Award was made to Seamon 
on August 8.  Subsequent to a debriefing by the agency, INFOTEQ filed 
this protest.

The protester contends that the technical evaluation of its proposal 
was improper.  Specifically, the protester contends that the 
evaluation team which reviewed the offerors' discussion responses and 
BAFOs used unstated evaluation criteria, unreasonably lowered the 
initial technical point score assigned to the protester's proposal in 
certain areas, and unreasonably failed to increase its proposal's 
score in other areas, despite additional information submitted by 
INFOTEQ in response to discussions held with the firm.

The determination of the relative merits of proposals is primarily a 
matter of agency discretion which we will not disturb unless it is 
shown to be unreasonable or inconsistent with the stated evaluation 
criteria.  Systems & Processes Eng'g Corp., B-234142, May 10, 1989, 
89-1 CPD  para.  441 at 5.  We have reviewed the terms of the solicitation, 
the full evaluation record, all proposal submissions, and the protest 
record, including the transcript of a hearing held on the merits of 
the protest, and find that the record does not demonstrate that the 
agency's determinations lack a reasonable basis or resulted from the 
use of unstated evaluation criteria.

Our review of the record supports the reasonableness of the slight 
downgrades assigned under the most important technical factor, 
technical competency.  First, the agency had a reasonable basis to 
conclude that the protester failed to fully discuss, as instructed 
during discussions, its site selection and hotel accommodations 
proposals.  The solicitation requires the contractor to provide 
appropriate space to meet contract requirements, which, depending upon 
the nature of the meeting to be held, may include a variety of agency 
needs and conveniences to be provided by the contractor at its chosen 
site.  The protester's initial proposal provided a detailed discussion 
of facilities available in only one National Institutes of Health 
building.  During discussions, INFOTEQ was specifically told to 
discuss in its revised proposal additional available facilities to 
meet the site selection requirements.  In its response to discussions, 
the protester simply listed some of the available agency facilities 
and certain hotels, but did not adequately discuss the sites' features 
or elaborate as to why a particular site (beyond occupancy 
considerations) might be appropriate.  See Tr. at 17-18.  In our view, 
the protester's cursory response in its revised proposal to the site 
selection concern expressed by the agency during discussions 
reasonably supports the slight downgrade assigned to the revised 
proposal.  Our review also confirms that the agency had reasonable 
grounds to find that the protester failed to adequately discuss in its 
proposal revisions, in the detail required by the solicitation, 
potential hotel negotiation problems and solutions, and provided only 
a minimal description of its budget reporting methodologies; these too 
were concerns raised with the protester during discussions.[2] 

Second, our review of the record also confirms the reasonableness of 
the slight downgrade assigned to the protester's proposal after 
discussions regarding the substantive quality of a writing sample 
(regarding scientific meeting minutes) submitted by the protester.  
The evaluators here, in reviewing substantive content, [DELETED].  See 
Tr. at 19-23.  The protester does not refute the specific writing 
sample weaknesses cited by the evaluators, but rather states that this 
writing sample was submitted and found to be acceptable under its 
current contract for the same services.  Neither the fact that the 
writing sample had been accepted under the protester's incumbent 
contract nor the protester's continued unsupported allegations that 
the agency may have been responsible for certain typographical errors 
in that sample undermines the reasonableness of the agency's 
evaluation.  On the contrary, our review of the record supports the 
evaluators' concerns about the meaning and accuracy of certain 
statements in the writing sample--for instance, the writing sample 
failed to quote statements attributed to a speaker at a scientific 
meeting (leaving the reader unsure if the actual words of the speaker 
were being reported).  See Tr. at 21-22.  Another example of 
reasonable concern about the adequacy of the writing sample is its 
inclusion of several general statements lacking meaningful 
identification of the subject of the statements--for instance, one 
phrase states that "[t]he committee . . . should be open to old ideas 
that have had a hard time recently as well as new ideas," without 
giving any substantive information as to what scientific ideas are 
being referenced; another statement credits a particular report as a 
"successful attempt to look at AIDS research," but no indication of 
the precise meaning of, or actual method of measuring, the "success" 
is provided.  See Tr. at 22.  Further, we have also reviewed the 
writing samples submitted by both the protester and the awardee, and 
we believe there are qualitative differences in terms of the 
professionalism and precision of the reporting of scientific 
information, as noted by the evaluators, which further support the 
slight downgrade in evaluation score assigned to the protester's 
proposal in this area.  Given the importance of professional, precise 
scientific reporting under this contract, we believe the evaluators' 
concerns about the technical quality of the writing sample were 
reasonably based.

Third, although the protester was asked during discussions to discuss 
its proposed quality control measures, the firm's response reasonably 
was found to lack explanatory detail--the protester's response 
generally explained that the firm proposed training and performance of 
periodic reviews, but no detailed methodology was provided.  The 
agency's concerns about the lack of a quality assurance system in 
place were confirmed by the numerous typographical errors in a writing 
sample voluntarily submitted by the firm as an example of its work 
under its current contract for the same services.  See Tr. at 23-24.  
Similarly, although concerns about the firm's budget iterations and 
reporting systems were expressed by the agency during discussions, 
neither the protester's proposal nor its proposal revisions provide a 
detailed presentation of the steps of the actual 
methodologies/procedures proposed or those to be performed by the 
firm's proposed software system.  Accordingly, we believe the slight 
downgrades and resulting evaluation point scores in the technical 
competency area were reasonable.

The protester also questions why its technical point score did not 
increase under the "other staff" subfactor of the personnel factor, 
despite its responses to discussion questions, including the 
submission of scientific writing samples of its proposed medical 
writer, and its BAFO substitution of personnel.  Our review of the 
record shows that the agency had a reasonable basis for not raising 
the proposal's  score in this area.  The record shows that the 
evaluators' primary concern in the "other staff" area involved a 
proposed graduate student's limited field/employment experience as a 
medical writer, the position for which she was proposed.  Tr. at 84.  
We believe this individual's limited experience performing services 
required under the contract was a reasonable consideration in the 
evaluation.  See Tr. at 92.  We also believe it was reasonable for the 
evaluators to give less credit on the basis of the student project 
writing samples provided than may have been assigned for an individual 
with additional, more relevant, professional work experience producing 
scientific-reporting/medical documents more directly related to 
performance of the contract.[3]  In sum, although the protester 
contends that the evaluation of its technical proposal was improper, 
and that its overall proposal should have at least been found 
technically equivalent to that of the awardee, the record does not 
support the protester's contentions.  

The protester next challenges the propriety of the discussions held 
with the firm regarding its cost proposal, specifically regarding the 
agency's instruction that the firm must use its current rate 
agreement's indirect cost rates throughout the contract period.  The 
protester contends that it was misled by that direction since the 
record shows that the agency's actual concern was about the lack of 
support for the lower rates in the protester's initial proposal.

In negotiated procurements, procuring agencies are generally required 
to conduct meaningful discussions so that sufficient information is 
furnished to offerors in the competitive range as to the areas in 
which their proposals are believed to be deficient so that offerors 
may have an opportunity to revise their proposals to fully satisfy 
agency requirements.  The government does not satisfy its obligation 
by misleading an offeror or by conducting prejudicially unequal 
discussions.  Lucas Place, Ltd., B-238008, B-238008.2, Apr. 18, 1990, 
90-1 CPD  para.  398 at 4.  However, competitive prejudice is an essential 
element of every viable protest.  See Diverco, Inc., B-259734, Apr. 
21, 1995, 95-1 CPD  para.  209 at 3-4.  Where the record does not 
demonstrate that, but for the agency's actions, the protester would 
have had a reasonable chance of receiving the award, our Office will 
not sustain a protest, even if a deficiency in the procurement, such 
as an impropriety in the conduct of discussions, is found.  
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).

We find that the agency misled INFOTEQ during discussions by directing 
it to use its higher rate agreement rates, given that the record shows 
that the agency's primary concern was the lack of documentation to 
support those rates and that the lower rates may have been acceptable, 
had the requisite additional support been provided.  We believe 
discussions were also unequal to the extent that INFOTEQ was directed 
to use its higher rate agreement rates, while the awardee was merely 
advised that, since its proposed rates were substantially lower than 
its most recent rate agreement, additional support for the lower rates 
should be provided.  Despite this conclusion, however, the record here 
does not show a reasonable possibility that INFOTEQ was prejudiced by 
the agency's improper discussions regarding indirect cost rates.

The agency has provided documentation of a post-protest cost 
evaluation it conducted of the protester's BAFO using the firm's 
initially proposed lower rates (fluctuating over the 5-year contract 
period, as initially proposed by INFOTEQ).  That evaluation shows that 
the awardee's technically superior proposal would remain lower in cost 
by [DELETED].  At the hearing on the protest, INFOTEQ's chief 
operating officer criticized this agency analysis because it included 
the firm's BAFO's proposed fixed fee of [DELETED].  This witness 
testified that the analysis failed to recognize that it is the 
offeror's option to reduce its proposed fixed fee, and that the 
witness was authorized by INFOTEQ management to reduce the firm's BAFO 
fixed fee to as low as [DELETED] to remain competitive.  Tr. at 249.  
In response to questioning by the agency at the hearing about 
INFOTEQ's failure to more substantially lower its BAFO fee despite the 
opportunity to do so, this witness testified that in light of the 
agency's direction to use the firm's higher rate agreement indirect 
cost rates, which substantially increased the firm's BAFO costs, the 
firm saw no reason to further decrease its proposed fixed fee.  Tr. at 
268-269.  The agency asserts that INFOTEQ's current protest position 
that it would have lowered its fixed fee to be competitive should be 
dismissed as speculative, self-serving, and offered by the protester 
with the benefit of knowing the awardee's lower cost estimate.

The record shows that INFOTEQ at all times had the opportunity to 
lower its fixed fee to the extent it now alleges it was prepared to do 
to win the contract.[4]  The protester, however, chose not to do so, 
even though it knew that the use of its higher rate agreement rates 
increased its BAFO costs; the firm thus had a particularly strong 
incentive to lower its fee as much as possible, precisely because it 
felt that the higher rates would hamper its competitive standing.  In 
our view, there is no logical support for the firm's post-protest 
contention that, had INFOTEQ been allowed to use its initially 
proposed lower rates, it might have also lowered its fixed fee to an 
amount that would have rendered its cost proposal lower than Seamon's.

In addressing the issue of prejudice, INFOTEQ does not contend that it 
would have lowered its initial proposal rates in its BAFO; its 
position is limited to the assertion that it might have lowered its 
fee.  We recognize that one of INFOTEQ's employees stated at the 
hearing that the firm's initial rates might have been lowered in the 
firm's BAFO.  This testimony is not persuasive.  The employee, 
INFOTEQ's contracts manager, was testifying only as to whether he 
would have expected INFOTEQ's chief operating officer to lower the 
rates in the firm's BAFO.[5]  Further, the most recent available 
actual cost figures provided by the protester, although [DELETED], 
simply do not support any such decrease.  Finally, in discussing this 
issue in its post-hearing comments, INFOTEQ contends that it was 
prejudiced by being denied the opportunity to offer its initial rates 
in its BAFO, rather than contending that the BAFO rates may have been 
lower than the initial rates.

We must therefore discount as speculative and unsupported the firm's 
position in this regard--the record does not show any reasonable basis 
to assume that INFOTEQ would have further lowered its fee or lowered 
its initial rates in its BAFO.  Given the higher technical evaluation 
score of Seamon's proposal and the terms of the solicitation giving 
greater importance to technical factors, and since the protester's 
BAFO costs, even using the firm's initially proposed rates, would   
have been higher than the awardee's proposed costs, we see no 
reasonable possibility that the protester was competitively prejudiced 
by the agency's misleading discussions regarding the use of the firm's 
rate agreement terms--that is, the record provides no showing that, 
but for the agency's actions, INFOTEQ would have had a reasonable 
chance of receiving the award.  

The protest is denied.

Comptroller General
of the United States

1. The referenced rate agreement was negotiated between the contractor 
and the agency for billing purposes for work performed during a stated 
(15-month) time period.  The protester has explained, during the 
course of the protest, that the agreement's rates are higher than the 
firm's initial proposal rates because the agreement's rates were based 
on post-bankruptcy actual annual cost data through September 1996 
(submitted to the agency in October 1996), which does not reflect cost 
control measures put into effect by the company after those figures 
were calculated.

2. The protester contends that it should have been given additional 
credit in the overall evaluation of its proposal for its experience as 
the incumbent.  As stated above, however, all offerors were on notice 
that the technical evaluation would be conducted solely on the 
information submitted in the proposals.  Given the terms of the 
solicitation, it was unreasonable for INFOTEQ to assume additional 
evaluation credit would result for knowledge or experience not 
adequately detailed in its proposal--in fact, some of the evaluators 
were not familiar with the firm's experience as the incumbent.  Tr. at 
57.

3. Although the record does not contain contemporaneous evaluation 
documentation regarding the evaluation of the protester's BAFO 
substitution of an individual previously evaluated under the "other 
staff" criterion (which the protester contends is evidence of an 
improper evaluation and lack of meaningful discussions), the agency 
explains in its contracting officer's report that the substitution was 
in fact evaluated, and that it did not provide a basis to adjust the 
firm's personnel score.  In any case, the record shows that the agency 
had favorably evaluated the initially proposed individual, so that any 
proposal point score change as a result of the substitution would be 
de minimis and would not materially affect either the relative ranking 
of the overall proposals or the documented overall technical 
superiority of the awardee's proposal.

4. The record shows that INFOTEQ was not instructed to use [DELETED] 
fee in its BAFO, but rather that, at the time of discussions, the 
agency considered a [DELETED] fixed fee more reasonable for the effort 
proposed rather than the [DELETED] fixed fee initially proposed by the 
firm; the firm, however, was free to further lower its fixed fee.  Tr. 
at 269.

5. The witness stated, "I think [the chief operating officer] would 
have gone with [the initial] rates, maybe even lower rates."  Tr. at 
204.