BNUMBER: B-278030.3
DATE: April 29, 1998
TITLE: Southern Technologies, Inc.--Reconsideration and Costs, B-
278030.3, April 29, 1998
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Matter of:Southern Technologies, Inc.--Reconsideration and Costs
File: B-278030.3
Date:April 29, 1998
James V. Etscorn, Esq., Baker & Hostetler LLP, for the protester.
Lis B. Young, Esq., Naval Facilities Engineering Command, 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. Request for reconsideration is denied where requester fails to
demonstrate errors of law or fact in prior decision.
2. Where agency overrode statutory stay of performance on the basis
of urgent and compelling circumstances, General Accounting Office is
not precluded from considering practicability of a recompetition in
considering whether corrective action proposed by agency is
appropriate.
3. General Accounting Office will not recommend that protester
recover the costs of filing and pursuing its protest where the agency
offered to take corrective action promptly, i.e., by the due date for
the agency report.
DECISION
Southern Technologies, Inc. requests reconsideration of our decision,
Southern Techs., Inc., B-278030, B-278030.2, Dec. 19, 1997, 97-2 CPD para.
167, in which we found that the payment of the protester's proposal
preparation costs was appropriate corrective action for the agency's
admittedly improper actions in conducting the procurement under
request for proposals (RFP) No. N62477-97-R-0041, for power plant
improvements at the Goddard Power Plant in Indian Head, Maryland.[1]
Southern argues that we mischaracterized its protest and failed to
address some of the arguments it raised. Southern also asks that we
recommend that the agency reimburse Southern for its protest costs.
We deny the request for reconsideration and the request for costs.
BACKGROUND
In its original protest, Southern complained that its proposal had
been determined technically unacceptable and excluded from the
competitive range because the burners that it offered to install in
the plant's boilers employed overfire air (OFA) technology. The
protester argued that OFA technology was consistent with the
solicitation's requirements and that its proposal therefore should not
have been excluded from further consideration. The Navy responded
that OFA was not an acceptable technology, but conceded that the RFP's
specifications, as written, could have misled offerors in this regard.
The agency maintained, however, that including the protester in the
competitive range, as Southern had requested, would not be appropriate
corrective action because Southern would have to rewrite its proposal
using a different technical approach to make the proposal susceptible
of award. The Navy instead proposed to reimburse the protester for
its proposal preparation costs, and asked us to dismiss the protest on
the ground that it was taking appropriate corrective action.
We declined to dismiss on the basis of the agency's request since, as
we informed the parties, we did not think that the Navy had
demonstrated that payment of proposal preparation costs was the
appropriate corrective action for the impropriety. We explained that
although, as a general rule, a proposal should not be included in the
competitive range if it would have to be substantially rewritten to
become technically acceptable, that rule did not govern where the
agency conceded that the specifications were misleading and required
revision--and the reasons for the proposal's exclusion related
directly to the misleading provisions that were to be rewritten. In
such circumstances, we noted, unless precluded by the urgency of the
requirement, the agency should amend the solicitation to reflect its
needs accurately, and then reopen the competition and allow offerors
to submit new or revised proposals on the basis of the revised
requirements.
The Navy responded with a supplemental submission arguing that the
urgency of the requirement did indeed preclude a reopening of the
competition. Southern took issue with the agency's representation,
arguing that reopening the competition for all or part of the
solicitation was both feasible and appropriate. The protester further
argued that if the long lead-time status of the burners precluded
recompeting the work relating to their installation, award for the
work on the burners should remain in place with the awardee, Frank
Lill and Son, and the remaining work recompeted in a competition from
which Lill would be excluded.
We found that the Navy had demonstrated that a recompetition of the
RFP would be impracticable since delay in the award would mean that
the plant would not have a boiler with a low NOx burner available for
operation during the peak ozone months of 1998, in violation of the
terms of the plant's operating permit. We also determined that
carving out a portion of the work for Lill and recompeting the rest in
a competition from which Lill would be excluded, as the protester had
proposed, would be inconsistent with the statutory mandate for full
and open competition. See 10 U.S.C. sec. 2305(a)(1)(A) (1994). We
therefore concluded that there was no meaningful remedial action that
the agency could take and that payment of the protester's proposal
preparation costs was the only appropriate corrective action
available. Having concluded that the agency was taking appropriate
corrective action, we dismissed as academic Southern's underlying
protest objecting to the exclusion of its proposal from the
competitive range.
TIMELINESS
As a preliminary matter, the Navy argues that we should dismiss
Southern's request for reconsideration, which was filed on December
31, 1997, as untimely because it was filed more than 10 days after the
decision was issued.
Our Bid Protest Regulations require that a request for reconsideration
be filed not later than 10 days after the basis for reconsideration
is, or should have been, known. 4 C.F.R. sec. 21.14(b) (1997). Thus,
contrary to the agency's position, the critical date for timeliness
purposes is the date that the protester received our decision, not the
date the decision was issued. Accordingly, for the December 31
reconsideration request to be timely, Southern must have received our
decision (dated December 19) no earlier than December 21 (a Sunday).
The protester's counsel states that he did not receive a copy of the
decision until after December 20, a claim that we find fully credible
given that we have no record of having furnished a copy other than by
mail.[2] Since the request for reconsideration was filed within 10
days after the protester received a copy of our decision, it is
timely.
ANALYSIS
Under our Bid Protest Regulations, to obtain reconsideration, the
requesting party must either show that our prior decision contains
errors of fact or law, or present information not previously
considered that warrants reversal or modification of our decision. 4
C.F.R. sec. 21.14 (a); Lovelace Scientific Resources, Inc.--Recon.,
B-256315.2, Nov. 25, 1994, 94-2 CPD para. 209 at 1. As explained below,
Southern's request for reconsideration does not meet this standard.
Southern argues first that we incorrectly characterized its protest as
an objection to the corrective action proposed by the agency when it
was in fact a complaint about the agency's actions in conducting the
underlying procurement. According to the protester, it "never
embraced nor rejected the agency's remedial proposal but declined
acquiescence because it recognized that it [Southern] was in no
position to determine the appropriateness of the agency's motion
without a determination by the Comptroller General of the merits of
Southern's protest." Request for reconsideration at 1.
We understood that the protester's underlying complaint was that the
agency had acted improperly in conducting the procurement. The agency
conceded this point in its initial submission, however, and requested
that we dismiss the protest on the ground that it was prepared to take
corrective action by paying the protester its proposal preparation
costs. Since, as we noted in the decision, we will dismiss a protest
as academic where the agency takes appropriate corrective action, the
issue that remained before us was the appropriateness of the
corrective action proposed. Accordingly, this is the issue on which
our decision properly focused.
Next, Southern argues that we ought not to have considered the
practicability of recompeting the solicitation in considering whether
the proposed corrective action was appropriate. In support of its
argument, the protester cites section 21.8(c) of our Bid Protest
Regulations, 4 C.F.R. sec. 21.8(c), which provides as follows:
If the head of the procuring activity determines that performance
of the contract notwithstanding a pending protest is in the
government's best interest, GAO shall make its recommendation(s)
under paragraph (a) of this section without regard to any cost or
disruption from terminating, recompeting, or reawarding the
contract.
The section cited by the protester addresses situations in which the
agency has overridden the statutory stay of performance on the ground
that performance is in the government's best interests. See 31
U.S.C.A. sec. 3553(d)(3)(C)(i)(I), 3554(b)(2) (West Supp. 1997). The
section does not apply where, as here, the agency determines to
proceed with performance on the ground of urgency, pursuant to 31
U.S.C.A. sec. 3553(d)(3)(C)(i)(II). We are not precluded from
considering the cost or disruption that a recompetition would engender
in fashioning a recommendation for corrective action where the agency
has overridden a stay of performance on the grounds of urgency. See
Astrophysics Research Corp., 66 Comp. Gen. 211, 214 (1987), 87-1 CPD para.
65 at 4. Similarly here, there was no bar on our considering the
practicability of a recompetition in deciding whether the corrective
action proposed by the agency was appropriate.
The protester further argues that we erred in accepting the agency's
argument that only if the award to Lill was left in place would the
plant have a boiler with a low NOx burner available for operation in
time for the peak ozone months of 1998, as required by the plant's
operating permit. Southern contends that even if the award to Lill is
left in place, the plant will not have a low NOx burner by the
beginning of the summer because the contract gives Lill 360 days from
the date of award, i.e., until late September 1998, to complete
installation of the first burner.
We discussed this matter with the parties via conference call at the
time of the initial protest. In response to a question from our
Office regarding Lill's timeline for completing work of the first
boiler, the agency stated that although the contract gives Lill 360
days to complete the work, Lill had represented to it that it would
accelerate its work schedule and complete installation of the first
burner by June. The agency further stated that it had no reason to
think that Lill would not meet this schedule. We likewise have no
reason to question the agency's acceptance of this representation.
Accordingly, we do not think that we erred in considering whether the
work could be completed by another contractor by the beginning of the
summer in determining the feasibility of a recompetition.
Southern also argues that we erred in declining to consider its
argument that the plant could reduce emissions to an acceptable level
for the 1998 season without installing any new NOx burners by reducing
its reliance upon coal as a fuel. We declined to consider this
argument on the ground that it was not within the scope of our
authority to question the agency's pollution abatement strategy. The
protester contends that its argument addressed the urgency of the
agency's requirement for a low NOx burner, and not the agency's
pollution abatement strategy.
Notwithstanding Southern's characterization of its argument, we
believe it clearly focuses on the agency's strategic approach to
abating pollution to meet June 1998 requirements, and not just on how
truly urgent the agency's need is for the items in question. Indeed,
the logical extension of the argument is that the agency does not need
low NOx burners at all because it can continue to attain the lower
levels of pollution required by its operating permit by continuing to
rely more heavily on oil and less heavily on coal for fuel. In sum,
the protester's argument clearly did address the agency's pollution
abatement strategy and, as such, is not a matter for our
consideration.
Southern argues next that we erred in concluding that it had abandoned
its argument regarding the rejection of Lill's proposal as
front-loaded. The protester maintains that it addressed the argument
in both its letter of November 11 and in its response to the agency
report on November 25, and that it therefore cannot be said to have
abandoned the issue.
First, the agency report responding to Southern's supplemental
protest, which addressed the issue of front-loading in Lill's offer,
was not filed until November 19; thus, any discussion of the issue in
Southern's letter of November 11 was clearly not a response to the
agency report. Moreover, although Southern did make reference to
front-loading in its letter of November 25, it was not in the context
of arguing that Lill's offer should have been rejected on that basis;
instead, it was in the context of arguing that recompetition of the
work encompassed in option No. 2 of the RFP would not be a meaningful
remedy because Lill would have an insurmountable advantage over other
offerors due to the front-loaded manner in which it had structured its
pricing. Nowhere in its November 25 response to the agency report did
the protester attempt to rebut the agency's argument that an offer
that is mathematically unbalanced due to the pricing of the base and
option items need not be rejected where the agency reasonably expects
to exercise the options. MCI Constructors, Inc., B-274347,
B-274347.2, Dec. 3, 1996, 96-2 CPD para. 210 at 5. Thus, we think that we
properly viewed the protester as having abandoned the argument.
PROTEST COSTS
The protester requests that we recommend that it recover its protest
costs.
Under section 21.8(e) of our Bid Protest Regulations, we may recommend
that a protester be reimbursed the costs of filing and pursuing a
protest where the contracting agency decides to take corrective action
in response to the protest. 4 C.F.R. sec. 21.8(e). We will make such a
recommendation, however, only where, based on the circumstances of the
case, the agency unduly delayed taking corrective action in the face
of a clearly meritorious protest. Oklahoma Indian Corp.--Claim for
Costs, 70 Comp. Gen. 558, 559 (1991), 91-1 CPD para. 558 at 2. A
protester is not entitled to costs where, under the facts and
circumstances of a given case, the agency has taken reasonably prompt
corrective action. DuraMed Enters., Inc.--Request for Costs,
B-271793.2, Oct. 4, 1996, 96-2 CPD para. 135 at 2.
In general, if an agency takes corrective action in response to a
protest by the due date of its protest report, we consider such action
to be prompt and will not recommend reimbursement of protest costs.
HSQ Tech.--Request for Costs, B-276050.2, June 25, 1997, 97-1 CPD para.
228 at 2. Such was the case here: the agency first offered to take
corrective action on the report due date. Because the agency offered
to take corrective action rather than filing an agency report, the
protester was not put to the time and expense of filing comments in
response to such a report. Thus, the purpose of section 21.8(e)--to
encourage agencies to take corrective action in response to
meritorious protests before protesters have expended additional
unnecessary time and resources pursuing their claims--was served
here.[3] DuraMed Enters., Inc.--Request for Costs, supra, at 2.
The request for reconsideration and the request for costs are denied.
Comptroller General
of the United States
1. The purpose of the improvements is to bring the plant, which is a
major emitter of nitrogen oxides (NOx), into compliance with emission
standards set by the state of Maryland. Work to be performed includes
the installation of low NOx coal/oil fired burners on each of the
plant's three boilers.
2. A copy of the decision was posted on the Internet, but not until
December 22; the protester's counsel states that the protester
retrieved it from the Internet on December 24. Even if the protester
had seen the decision there on the date it was first posted, it would
have had until January 2, 1998 to file its request for
reconsideration.
3. To the extent that the protester incurred additional expenses in
challenging the corrective action offered by the agency, these costs
are not reimbursable since they are not costs incurred in persuading
the agency of the merits of the protest, i.e., in pursuing the
protest. KPMG Peat Marwick--Entitlement to Costs, B-251902.2, June 8,
1993, 93-1 CPD para. 443 at 3.