BNUMBER: B-277916
DATE: October 27, 1997
TITLE: Mechanical Contractors, S.A., B-277916, October 27, 1997
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Matter of:Mechanical Contractors, S.A.
File: B-277916
Date:October 27, 1997
Carlton G. Opel for the protester.
Carlos A. De Obaldia, Esq., De Obaldia & Garcia de Parades, for Formal
Management Systems, Inc., an intervenor.
Theodore G. Lucas, Esq., Panama Canal Commission, for the agency.
David Hasfurther, Esq., and Michael R. Golden, Esq., Office of the
General Counsel, GAO, participated in the preparation of the decision.
DIGEST
Source selection decision cannot be determined reasonable where it is
based on a misevaluation of the proposals of the protester and
awardee.
DECISION
Mechanical Contractors, S.A. (MECSA) protests the award of a contract
to a higher-priced offeror, Formal Management Systems, Inc. (FMS),
under request for proposals (RFP) No. CC-97-33, issued by the Panama
Canal Commission (PCC) for cleaning and painting of four miter gate
leaves in the Panama Canal. The RFP calls for abrasive blast cleaning
and exterior painting above the water line using inorganic zinc primer
and coal tar polyurethane and below the water line using hot-applied
coal tar enamel (CTE). The RFP also requires the performance of
mechanical, electrical, and other necessary work. MECSA contends that
the proposals of both MECSA and FMS were improperly evaluated under
the specialized experience and past performance evaluation subfactors.
MECSA contends that the evaluation board (EB) intentionally and
unfairly evaluated the proposals with the result that this allegedly
competitive procurement was actually a "sole source" to FMS, which has
been performing this work for the last 10 years.
We sustain the protest.
The RFP, issued on May 12, 1997, required an offeror to submit a
technical proposal and a price schedule. Technical proposals were to
be evaluated on the basis of two equally weighted technical factors:
technical approach and performance capability. The technical approach
factor listed seven specific subfactors; the performance capability
factor listed five specific subfactors, including specialized
experience and past performance. These two subfactors each were
assigned a possible 30 points, for a total of 60 points out of 100
points that could be given under the performance capability factor.
Under the specialized experience subfactor, offerors were to identify
contracts performed by "prime and subcontractors" within approximately
3 years preceding the proposal due date. Under this subfactor, the
RFP provided that contracts involving confined space removal/painting
requiring forced ventilation would be relevant and "[s]pecialized
experience in applying coal tar enamel or SSPC [Steel Structures
Painting Council] certification at QP-2 will be favorably evaluated. .
. ." (Emphasis added.) The past performance subfactor provided that
the quality and timeliness of the offeror's past performance with
similar projects would be considered, and offerors were asked to
submit a list of similar projects they had performed within the past 3
years. An offeror's total technical evaluation score was to be
equally weighted with the offeror's firm, fixed-price. Under the RFP,
award was to be made to the offeror whose proposal was most
advantageous to the government--technical, price, and other factors
considered.
Three proposals, including those of MECSA and FMS, were received by
the July 3, 1997, deadline for submission. After evaluation of the
technical portion of each proposal by the EB, all three proposals were
included in the competitive range.[1] Subsequently, each offeror was
advised of areas of its proposal which needed to be further addressed
and each was requested to submit a best and final offer (BAFO). The
BAFO scores were as follows:
Technical
Approach Performance
Capability Total Points
MECSA 60.85 points 66.2 points 127.05 points
FMS 72.7 points 81.55 points 154.25 points
Within the performance capability factor, MECSA received 19.5 points
out of 30 under specialized experience and 15 points out of 30 under
past performance. In contrast, FMS received 30 points out of 30 for
specialized experience and 23.4 points out of 30 for past performance.
The evaluation record shows that under the specialized experience
subfactor, the EB noted that FMS had successfully cleaned and coated
all PCC miter gates for the last 3 years and that it had "abundant
confined space experience." Under the past performance subfactor, the
EB stated that the FMS projects were either timely completed or
completed ahead of time. For MECSA, under the specialized experience
subfactor, the EB noted as a weakness that MECSA had "listed very
little CTE application experiences during the last 3 years" and under
the past performance subfactor the EB noted that "late completion was
detected on various projects listed. Liquidated damages [were] cited
on some."
While MECSA's price of $2,564,500 was lower than the FMS price of
$2,640,000, the EB performed a price/technical tradeoff analysis. The
EB determined that the FMS technical evaluation score of 154.25 points
out of 200, as compared to MECSA's score of 127.05 points, overcame
the price differential because the FMS proposal cost $17,115.02 per
technical point and the MECSA proposal cost $20,507.80 per point. On
that basis, the EB concluded that the FMS proposal was the most
advantageous to the government. The EB's recommendation was adopted
by the source selection official, and award was made to FMS. In its
award letter, the PCC listed MECSA's lack of recent CTE application
experience and late completion on various projects as weaknesses in
the firm's proposal. After its debriefing, MECSA filed this protest.
Contract performance has been suspended pending our resolution of the
protest.
MECSA challenges the evaluation of both its own proposal and that of
FMS. In reviewing protests against allegedly improper evaluations, it
is not our role to reevaluate proposals. Rather, our Office examines
the record to determine whether the agency's judgment was reasonable
and in accord with the RFP's stated evaluation criteria. Abt Assocs.,
Inc., B-237060.2, Feb. 26, 1990, 90-1 CPD para. 223 at 4. After reviewing
all of the supporting documentation submitted by the PCC, we conclude
that the technical evaluation in this procurement is not adequately
supported. We also conclude that without adequate support for the
technical evaluation, the award determination lacked a reasonable
basis. See Redstone Technical Servs.; Dynamic Science, Inc., B-259222
et al., Mar. 17, 1995, 95-1 CPD para. 181 at 8-9.
The only contemporaneous supporting documentation showing the reasons
for the scoring of MECSA's proposal are the evaluation sheets and the
summary of findings of the EB. These documents identify only one
weakness for MECSA under the specialized experience subfactor (little
CTE experience over the last 3 years) and one weakness under the past
performance subfactor (late completion on various projects). Our
review of the record raises concern about the reasonableness of the
evaluation regarding both perceived weaknesses.
Regarding the lack of CTE experience over the last 3 years, MECSA
contends that the PCC failed to evaluate proposals in accordance with
the RFP, which, in MECSA's view, indicated that substantially equal
importance would be given to an offeror's CTE experience "or" an
offeror's possession of SSPC certification at QP-2. MECSA proposed a
subcontractor with certifications at QP-1 and QP-2 to perform the CTE
work. The protester states that the certification is given by the
national council that publishes a number of standards on the cleaning
of steel and the application of protective coatings (standards which
are incorporated into contracts by various governmental agencies,
including the PCC), and that the PCC's stated intent in considering
CTE experience "or" SSPC certifications was to permit competition for
this procurement. MECSA contends that the EB's failure to give its
proposed subcontractor's QP-2 certification substantial equality with
CTE experience was unreasonable. MECSA argues, in effect, that the
EB's preference for CTE work over QP-2 certification in its evaluation
of specialized experience favored FMS, the only contractor performing
CTE work on the PCC's miter gate leaves for the past 10 years.
While the PCC states in its report to our Office that the solicitation
"did not guarantee equal or equivalent treatment" of CTE experience
and QP-2 certification, the PCC states that the EB did, in fact, give
favorable consideration during the evaluation to the certification
possessed by MECSA's subcontractor. The PCC also states that
favorable consideration was given to the CTE experience gained by
MECSA during performance of a contract for the painting and cleaning
of cylindrical valves.
Notwithstanding these post-protest statements by the PCC, there is no
indication in the contemporaneous evaluation record that MECSA was
given any credit for its QP-2 certification. Instead, the record
indicates only that, as noted above, the EB found as a weakness under
this subfactor that MECSA's proposal listed very little CTE
application experience. It thus appears from the evaluation record
that, as the protester has alleged, MECSA was downgraded for a lack of
CTE experience with no weight given to the proposed subcontractor's
certification. While the RFP would certainly permit the EB to
downgrade MECSA to some degree for its lack of CTE experience, there
is nothing in the contemporaneous record to establish that the
offeror's possession of the requisite certification, through its
proposed subcontractor, was considered at all. The failure to address
this issue in the evaluation record was unreasonable and inconsistent
with the RFP language that QP-2 certification would be favorably
evaluated under the specialized experience subfactor.
Regarding the evaluation of MECSA's proposal under the past
performance subfactor, as noted above, offerors were to list similar
projects for the past 3 years. The EB reviewed 17 contracts performed
by MECSA in the past 3 years and concluded that 3 of those contracts
showed either late completion or liquidated damages; that conclusion
was the basis of the EB's determining that there had been late
completion on "various projects" and therefore awarding MECSA a score
of only 50 percent on past performance. Upon review of the entire
record, including the parties' post-protest pleadings, we find that
the reasonableness of that score is in doubt. The PCC itself now
concedes that the EB looked at the incorrect universe of projects,
since most of the 17 contracts that the EB reviewed were not similar
to the work to be performed under this procurement. According to the
PCC's post-protest submissions, only 5 contracts should have been
considered similar (and within the past 3 years), of which one was
completed late.[2] The contracting officer now contends that the EB's
mistaken consideration of nonsimilar contracts did not affect MECSA's
50-percent past performance score, since the percentage of the
contracts completed late is now slightly higher (one out of 5, or 20
percent) than was the case under the EB's evaluation (3 out of 17, or
18 percent). While the percentages may not have shifted
substantially, however, the absolute number of contracts considered
late was actually smaller than what the EB believed during the actual
evaluation--indeed, there was only one allegedly similar contract
where lateness was noted, so that, with respect to similar contracts,
the EB's finding that late completion was a concern on "various
projects" was unsupported.
The protester also challenges the PCC's evaluation of the specialized
experience of FMS, because the EB originally failed to consider
certain safety violations under relevant FMS contracts. In
particular, the protester alleges that the PCC failed to take into
account a serious accident, which caused a fatality and which occurred
during the performance within the past 2 years of a similar contract
for the PCC. The PCC admits that the fatal accident occurred and that
the contract was both recent and similar. Indeed, the PCC's Safety
Division determined that the accident was the fault of FMS (a finding
appealed by FMS). While recognizing the importance of safety in the
current evaluation, the PCC states that FMS did not disclose the
accident in its proposal and that (apparently because it was not
mentioned in the proposal) the EB did not consider it.[3]
In response to the protest, the EB reevaluated the original scoring of
the FMS proposal for this subfactor. Upon reevaluation, after
considering this accident, the FMS score for this subfactor was
reduced from 30 points (100 percent) to 15 points (50 percent). The
FMS total evaluation score was reduced from 154.25 to 139.25 points.
The PCC states that even with the lower score, the FMS evaluated price
of $18,958.17 per point was still lower than MECSA's evaluated price
of $20,507.80 per point, and the EB confirmed its prior determination
that the FMS proposal was the most advantageous to the government.
MECSA also points out that on another recent relevant contract for
cleaning and painting miter gates identified in the FMS proposal, FMS
received an unsatisfactory performance rating in the safety area. The
PCC argues that, since it gave FMS a satisfactory performance rating
for the contract, it was reasonable that this safety issue should have
no effect on the past performance rating. This approach appears
inconsistent with the PCC's downgrading of MECSA for the lateness of
its performance under another contract, where MECSA apparently
received an overall satisfactory rating.
Our Office will not sustain a protest unless the protester
demonstrates a reasonable possibility that it was prejudiced by the
agency's actions, that is, unless the protester demonstrates that, but
for the agency's actions, it would have had a substantial chance of
receiving the award. 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).
While the PCC argues that the errors which occurred would not have
affected its source selection, we conclude, particularly in light of
the multiple, material errors explained above, that the protester was
prejudiced by the agency's actions. As a result of the PCC's
reevaluation of the specialized experience of FMS (to take into
account the fatal accident which occurred during performance of a
recent, similar contract), the difference in point scores between the
two competing proposals is quite small. In light of its proposal's
lower price, we think that, but for the agency's actions, MECSA would
have had a substantial chance of receiving the award.
Regarding the PCC's reevaluation of the proposals to correct errors
identified by the protester, while we consider the entire record,
including statements and arguments made in response to a protest in
determining whether a selection decision is supportable, we accord
much greater weight to contemporaneous source selection materials than
to judgments, such as the selection officials' reevaluation here, made
in response to protest contentions. Dyncorp, 71 Comp. Gen. 129, 134
n.12 (1991), 91-2 CPD para. 575 at 7 n.13; Southwest Marine, Inc.;
American Sys. Eng'g Corp., B-265865.3, B-265865.4, Jan. 23, 1996, 96-1
CPD para. 56 at 10. This reflects our concern that reevaluations and
redeterminations prepared in the heat of an adversarial process may
not represent the fair and considered judgment of the agency, which is
a prerequisite of a rational evaluation and source selection process.
Boeing Sikorsky Aircraft Support, B-277263.2, B-277263.3, Sept. 29,
1997, 97-2 CPD para. ___ at 15.
The protest is sustained.
We recommend that both proposals be reevaluated, that the reevaluation
be documented, and that a new selection decision be made. If the PCC
determines that MECSA is in line for the award, the award made to FMS
should be terminated and award made to MECSA. We also find that MECSA
is entitled to the costs of filing and pursuing its protest, including
reasonable attorneys' fees. Bid Protest Regulations, 4 C.F.R. sec.
21.8(d)(1) (1997). MECSA should submit its certified claim for such
costs, detailing the time expended and costs incurred, directly to the
agency within 60 days after receipt of this decision. 4 C.F.R. sec.
21.8(f)(1).
Comptroller General
of the United States
1. The proposal by the third offeror is not relevant to this protest,
and we therefore do not discuss it further.
2. The protester suggests that, among the 17 contracts that the EB
actually reviewed, there may have been fewer than 3 which were
actually completed late because of the possibility that the notation
in the records regarding liquidated damages merely indicated that the
contract included a liquidated damages provision, not that such
damages were actually assessed. The protester also denies the
"similarity" of the one contract of the 5 that the PCC now contends
were similar and recent. Although the disputes regarding these
matters could have been clarified during discussions, in light of our
recommendation we need not resolve the disputes here.
3. At the debriefing, when asked if the EB was aware of, and had
considered, the accident in the evaluation, the answer from the
debriefing officials was "yes." The PCC now reports that the EB had
not, in fact, considered the accident in its evaluation.