BNUMBER:  B-278223 
DATE:  January 8, 1998
TITLE: BFI Waste Systems of Nebraska, Inc., B-278223, January 8,
1998
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Matter of:BFI Waste Systems of Nebraska, Inc.

File:     B-278223

Date:January 8, 1998

Kevin Rauber for the protester.
Gary L. Young, Esq., Keating, O'Gara, Davis & Nedved, for 
Environmental Health Systems, Inc., an intervenor.
Jane S. Converse, Esq., Department of Veterans Affairs, for the 
agency.
Paul E. Jordan, Esq., and Paul Lieberman, Esq., Office of the General 
Counsel, GAO, participated in the preparation of the decision.

DIGEST

Agency's evaluation of offeror's past performance is unobjectionable 
where alleged deficiencies in past performance were reasonably 
assessed by the agency as having no negative impact on offeror's 
otherwise excellent past performance record. 

DECISION

BFI Waste Systems of Nebraska, Inc. protests the award of a contract 
to Environmental Health Systems, Inc. (EHS) under request for 
proposals (RFP) 
No. 636-1-98, issued by the Department of Veterans Affairs.  BFI 
challenges the agency's evaluation of EHS' past performance.

We deny the protest. 

The RFP contemplated award of a fixed-price contract for pickup, 
transportation, and disposal of infectious medical waste from the 
Veterans Affairs Medical Centers (VAMC) in Omaha and Lincoln, 
Nebraska.  Proposals were to be evaluated on the basis of quality (40 
points), past performance (30 points), and price (30 points).  Award 
was to be made to the offeror whose proposal was evaluated as most 
advantageous to the government.  

For evaluation purposes, offerors were required to submit specific 
information with regard to the first two evaluation factors.  As to 
quality, offerors were to submit statements as to:  whether the 
offeror was in compliance with Department of Transportation (DOT), 
Environmental Protection Agency (EPA), and Occupational Safety and 
Health Agency (OSHA) regulations, along with the date or copy of the 
offeror's license, permit, or certificates; quality management 
programs or training programs in effect and whether in-service and 
other continual training is provided to employees; and programs or 
training available for reduction of contaminated biomedical waste.  
With regard to past performance, offerors were required to: provide 
references with names and telephone numbers of prior or current 
customers; list hospitals for which the same service had been 
provided; and list "transgressions" from compliance with DOT, EPA, or 
OSHA regulations in the past 
3 years.  

Two offerors, BFI and EHS, submitted proposals by the September 15, 
1997, closing date.  Both proposals were technically evaluated by the 
contracting officer and the Omaha VAMC's industrial hygienist.  Both 
proposals received the maximum number of points for quality and past 
performance.  With regard to the evaluation of EHS' past performance 
and quality, there was no evidence of past violations of DOT, EPA, or 
OSHA regulations.  Further, the contracting officer observed that in 
her direct experience dealing with EHS for the past 5 to 6 years, the 
contractor had always provided service on a prompt, efficient, and 
professional basis.  She also noted that no one at the Omaha or 
Lincoln VAMCs had expressed any dissatisfaction with EHS' performance. 

BFI's proposed price of $198,048 received a score of 20 points, while 
EHS' price of $155,596 was evaluated at 30 points.  Since the agency 
found the two proposals were technically equal, it determined that 
price was the deciding factor.  In accordance with the RFP, the agency 
made the award to EHS on the basis of initial proposals, without 
conducting discussions.  Upon receiving notice of the award, BFI filed 
this protest with our Office.

BFI asserts that the agency's evaluation of EHS' proposal under the 
past performance and quality factors was flawed because it did not 
take into account alleged deficiencies in EHS' performance under the 
incumbent contract.  In this regard, it is not the function of our 
Office to evaluate proposals de novo.  Rather, we will examine an 
agency's evaluation only to ensure that it was reasonable and 
consistent with the stated evaluation criteria and applicable statutes 
and regulations, since the relative merit of competing proposals is 
primarily a matter of administrative discretion.  Information Sys. & 
Networks Corp., 69 Comp. Gen. 284, 285 (1990), 90-1 CPD  para.  203 at 3; 
Advanced Techology and Research Corp., B-257451.2, Dec. 9, 1994, 94-2 
CPD  para.  230 at 3.  An agency may properly consider its own experience 
with an offeror's performance where the solicitation contains past 
performance as an evaluation factor.  Neal R. Gross & Co., Inc., 
B-275066, Jan. 17, 1997, 97-1 CPD  para.  30 at 3.  The protester's mere 
disagreement with the agency's judgment does not establish that an 
evaluation was unreasonable.  Medland Controls, Inc., B-255204, 
B-255204.3, Feb. 17, 1994, 94-1 CPD  para.  260 at 3.  We have reviewed the 
record and find nothing unreasonable in the agency's evaluation of 
EHS' proposal.

BFI bases its challenge to the evaluation on three alleged 
deficiencies in EHS' performance under the predecessor contract.  The 
agency responds that the alleged deficiencies were not directly 
considered in the evaluation of EHS' past performance, but states that 
they would have no negative impact on EHS' evaluation as "superior."

The first deficiency involves EHS' failure to furnish sufficient red 
plastic bags to the Lincoln VAMC.  Under the provision "transport 
containers," the contract calls for the contractor to furnish rigid 
plastic barrels of specified capacity and condition to be "lined with 
2 mil. red plastic bags."  On a site visit to Lincoln, a BFI 
representative allegedly learned that the agency was purchasing these 
bags because EHS was not furnishing them.  By the protester's 
calculation, the cost of these bags could be as much as $1,300 over 
the 86 weeks of contract performance at Lincoln.  Since BFI told the 
Lincoln contracting officer's representative (COTR) that EHS should be 
furnishing the bags, BFI asserts that this aspect of EHS' past 
performance should have been considered as a negative element in the 
evaluation.

The contracting officer explains that she was not aware of the failure 
to furnish red bags at the time she evaluated EHS' past performance 
and thus did not consider it in the evaluation.  Her evaluation was 
instead based on her great satisfaction with EHS' performance overall 
during the past 5 to 6 years, and the absence of any expressed 
dissatisfaction with EHS' performance from either of the VAMCs.  While 
the agency did not consider this matter, it views the evaluation as 
reasonable in any event.  In this regard, it accepts much of the blame 
because of its failure to properly administer EHS' contract by 
ensuring that the COTR was aware of and enforcing this contract 
requirement.  Further, the agency advises that it was never charged 
extra for undelivered bags.  

Moreover, as noted by EHS, there is no evidence that EHS was 
attempting to increase its profits by failing to meet this 
requirement.  In this regard, EHS fully complied with the bag 
requirement at the Omaha VAMC and, upon notice of the Lincoln 
deficiency, immediately complied with the requirement.  In addition, 
according to a statement submitted by the agency to our Office, EHS, 
by deliberately foregoing its option to charge a higher rate for the 
low volume of waste at Lincoln, saved the agency more than $5,000 
during the Lincoln performance period.[1]  Under these circumstances, 
we find nothing objectionable in the agency's evaluation in this 
regard.  Laidlaw Envtl. Servs., Inc., B-256346, June 14, 1994, 94-1 
CPD  para.  365 at 8-9.

BFI next contends that EHS failed to meet its obligation under the 
current contract to submit appropriate invoices.  In this regard, 
section G of the contract requires that a "proper invoice" must 
include the "description, date of pickup of infectious waste for 
disposal, the number of containers for disposal and the gross and net 
weight for that date, at the unit price claimed."  BFI has submitted 
one of EHS' invoices and observes that it does not show the number of 
containers or the gross weight.

The agency acknowledges that it did not consider this matter in its 
evaluation of EHS' proposal and agrees that the invoice does not 
contain all the information specified in section G, "contract 
administration data."  However, the agency notes that section C, 
"description/specifications/work statement," of the current contract 
requires the contractor to provide a certifiable weighing system to 
enable proper billing.  It is the weighing system performance 
requirement with which the agency is concerned with regard to past 
performance.  The agency states that EHS has fully met this 
performance aspect of the contract.  

For each pickup of medical waste, EHS provides the VA with a copy of a 
manifest which shows the number of containers picked up.  When the 
waste is off-loaded at the EHS facility, EHS verifies the number of 
containers received using its copies of the same manifest.  At the 
time of destruction, EHS fills out a destruction log indicating 
complete information about each manifest, including the number of 
containers, gross weight, tare weight, and net weight.  It then totals 
and verifies all the numbers and annotates the net weight on the 
manifest, a copy of which is then returned to the VA.  The invoice 
showing net weight totals for each pickup is generated from the 
manifest and log.  While EHS did not provide all the information on 
its invoice, the agency had the information to verify the accuracy of 
the invoice readily available in the form of the returned manifest.  
It was also free to review EHS' records at any time.  The VA states 
that it is satisfied with EHS' system and its invoices and believes 
that EHS has fulfilled the spirit, if not the letter, of the section G 
contract administration requirement.  Here, while the subject of EHS' 
invoices was not considered in the evaluation, the agency was 
satisfied with the invoicing practice.  Under these circumstances, we 
see nothing objectionable in the agency's determination that EHS' 
practice and the agency's acceptance of that practice did not warrant 
an adverse evaluation.  Laidlaw Envtl. Servs., Inc., supra.

BFI next alleges that EHS has improperly disposed of chemotherapy 
wastes.  As evidence of this, the protester relies on its site visit 
observations, its understanding of EHS' contract responsibilities, and 
various conversations it had with agency representatives.  According 
to BFI's understanding, EHS believes that it receives only "de 
minimis" amounts of chemotherapy waste, which it properly disposes 
after microwaving.  BFI has submitted a document from the Nebraska 
Department of Environmental Quality, which advised EHS that 
microwaving is not approved for treatment of chemotherapeutic, 
radioactive, or gross anatomical wastes.  BFI interprets this 
information as establishing that EHS used unapproved methods for 
disposing of this type of waste.  In BFI's view, EHS' actions in this 
regard should have been considered as an adverse factor in the past 
performance/quality evaluation.

The agency explains that the VA does not send chemotherapeutic, 
radioactive, or gross anatomical waste to EHS for disposal, since the 
firm does not have a permit to dispose of these waste types.  The 
agency further points out that the contract specifications do not 
provide for the contractor to remove and dispose of chemotherapy or 
hazardous waste generated by the VAMCs.  Agency representatives have 
advised the contracting officer that, in fact, no such waste has been 
sent to EHS for disposal.  In this regard, the record contains the 
VA's certification to EHS that specifically enumerated wastes 
generated by the VA have been isolated from the wastes consigned to 
EHS for treatment.  The agency also certified that it had reviewed the 
listing of hazardous wastes, and that, if generated, they are not 
included with the waste sent to EHS. 

Our review of the record confirms that neither the predecessor, nor 
the contract at issue, requires the removal, transportation, or 
disposal of chemotherapy or hazardous wastes.  Since these wastes are 
not within the scope of EHS' contract and the agency avers that no 
such wastes are consigned to EHS, there is no factual basis for BFI's 
allegations.   

Finally, BFI questions whether EHS is properly disposing of infectious 
waste from the Omaha VAMC, located outside Lancaster County, in a 
Lancaster County landfill.  Under a Lincoln, Nebraska ordinance, only 
solid waste generated inside Lancaster County is authorized for 
disposal in the Lancaster landfill.  According to EHS, the Lincoln 
City Council has approved the disposal of medical waste from outside 
Lancaster County, based on the industrial processing of the waste 
inside the county.  In this regard, every year since 1991, EHS has 
received a permit for disposal of the Omaha waste in the Lancaster 
landfill.  BFI has provided no rebuttal to EHS' statements in this 
regard, and we therefore conclude that BFI's argument is without 
merit. 

The protest is denied. 

Comptroller General
of the United States

1. The statement explains that the savings are attributable to EHS' 
voluntary reduction of its rate per pound of waste based on volumes of 
100,000 pounds or more, with the option to charge the original rate if 
volumes were less than 100,000 pounds.  Even though the volume at 
Lincoln was less than 70,000 pounds over
19 months, EHS states that it charged the lower rate.