BNUMBER: B-278904.4
DATE: April 13, 1998
TITLE: Centech Group, Inc., B-278904.4, April 13, 1998
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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:Centech Group, Inc.
File: B-278904.4
Date:April 13, 1998
Kenneth A. Martin, Esq., and Jennifer C. Adams, Esq., Martin Rylander,
for the protester.
Gena E. Cadieux, Esq., Patricia D. Graham, Esq., and Joseph A.
Lenhard, Esq., Department of Energy, for the agency.
Jacqueline Maeder, Esq., and Paul Lieberman, Esq., Office of the
General Counsel, GAO, participated in the preparation of the decision.
DIGEST
1. Where solicitation proposal preparation instructions set forth
type size and a clearly defined page limitation for proposals, agency
appropriately declined to consider those pages of the protester's
proposal which exceeded the specified page limitation.
2. Protest that agency failed to perform proper cost/technical
tradeoff is denied where source selection official balanced technical
merit and price and reasonably determined that the evaluated technical
superiority of the 11 highest technically-rated proposals warranted
payment of the cost premium associated with certain of those
proposals, and determined not to make an award to the protester whose
proposal was ranked 12th of 18 proposals on technical merit and
offered the 9th-low cost of the 12 highest technically-ranked
proposals.
DECISION
Centech Group, Inc. protests the award of contracts to 11 firms under
request for proposals (RFP) No. DE-RP01-97EI30000, issued by the
Department of Energy (DOE) for technical services for the Energy
Information Administration (EIA).[1] Centech argues that DOE
arbitrarily eliminated certain pages of Centech's proposal from
consideration and improperly failed to consider price in making the
award determinations.
We deny the protest.
DOE issued the RFP, referred to as the EIA Omnibus Procurement (EOP),
via the Internet on July 7, 1997. The solicitation, which combined
technical services that were currently being performed for EIA under
11 separate support services contracts, sought separate proposals for
3 functional areas/contract line items (CLIN) consisting of
information management and product production support services (CLIN
001); energy analysis and forecasting support services (CLIN 002); and
information technology (IT) support services (CLIN 003). For each
CLIN, the RFP listed a maximum number of direct productive labor hours
(DPLH), specifically, 528,984 DPLH for CLIN 001, 183,000 DPLH for CLIN
002, and 412,920 DPLH for CLIN 003. The EOP provided for multiple
indefinite-quantity awards with awardees becoming eligible for
post-award competition for task orders for a 3-year base period with
one 2-year option. Since each contract will have cost reimbursement
and fixed-price provisions, task orders will be issued on both a
cost-plus-fixed-fee and a fixed-price basis.
Section L.15 of the RFP stated that DOE would "award contracts
resulting from this solicitation to the responsible offerors whose
offer conforming to the solicitation will be the most advantageous to
the Government, cost or price and other factors, specified elsewhere
in the solicitation, considered" and advised that DOE intended to
award on the basis of initial offers without discussions. Section
M-1(B) reiterated that award would be made to the offerors whose
conforming proposals were determined to be most advantageous to the
government. At section M-3, the RFP identified the following weighted
evaluation factors and subfactors:
1. Business management, technical and organizational approach50
1.1. Business management plan 20
1.2. Technical plan 20
1.3. Organizational Approach 10
2. Past and present experience 20
3. Corporate resource management 20
3.1. Retain labor categories 5
3.2. Additional resources 5
3.3. Staff training and development 5
3.4. Provide automated data processing
hardware, software, facilities 5
4. Videotape response/presentation 10
5. Past performance
Offerors were advised that past performance would be adjectivally
rated, and that the technical proposal was significantly more
important than past performance or cost, and that past performance was
also more important than cost.
In submitting a total estimated price, offerors were advised at
section L.34(2) to include a fixed-price quotation for 50 percent of
the maximum amount of level of effort (LOE) or DPLH for the total
5-year contract term. Section M.4 of the RFP advised offerors that
the proposed fixed price for a particular functional area would be
doubled and that amount would be used as a ceiling amount, indicating
that this amount would provide the basis for the price comparisons of
the proposals.
Section L.31 of the RFP contained the proposal preparation
instructions for the Technical and Business Management proposal.
Section L.31(A)(1) stated that each offeror will provide a Technical
and Business Management proposal for each functional area for which an
offer is being made and that:
All materials submitted shall be in typeface Times New Roman 12
Point, doubled spaced on 8 1/2 inch by 11 inch white paper with
one inch margins all around and printed on one side. The
Technical and Business Management Proposal shall not contain more
than 150 numbered pages inclusive of the table of contents,
charts, exhibits, and any other materials the Offeror deems
required for each functional area for which an offer is being
made.
On August 1, DOE issued amendment No. 001, which answered questions
from
offerors concerning the solicitation. Two questions concerning the
page limitation were asked:
l.31(A)(1) Volume II - Tech & Bus Mgt Proposal. It is our
understanding that the section and subsection tab dividers are
not included in the page count. Is this correct?
The answer provided by DOE stated:
No. 'The page limit is a maximum of 150 pages per functional
area in its entirety'. The '150 numbered pages [is] inclusive of
the table of contents, charts, exhibits, and any other material
the Offeror deems required for each functional area for which an
offer is being made.'
The second question was whether DOE would "consider excluding the
table of contents from the 150 page count?" The agency answered,
"No."
Centech was 1 of 18 offerors that submitted proposals on CLIN 003, IT
support services, under which the contractors are to provide hardware,
software, database, and communications support, including, among other
things, strategic planning, design, development and maintenance of EIA
databases and applications, hardware, communications and software
infrastructure, and life-cycle software development
and maintenance support. When DOE counted the pages in each proposal,
it determined that Centech's proposal exceeded the 150-page limit by 7
pages. By letter dated September 18, the TEC returned these 7 pages
to Centech, informing the protester that "only the first 150 pages of
your Technical and Business Management Proposal will be accepted and
forwarded for review and evaluation by the Technical Evaluation
Committee." Other proposals which exceeded the page limit were
treated in the same manner.
Members of the technical evaluation committee (TEC)[2] individually
evaluated each proposal and, in internal discussions, reached a
consensus on the strengths and weaknesses of each proposal and
assigned a point score of 0, 2, 5, 8, or 10 to each evaluations
criterion.[3] Numerical ratings were multiplied by the weight for the
factors and the scores for each factor were totaled. A proposal that
received scores of 10 on each evaluation factor would receive a
maximum point score of 1,000. Past performance was assigned an
adjectival rating of "excellent," "good," "fair" or "neutral," "poor,"
or "unsatisfactory."
The TEC briefed the source selection official (SSO) and, based on the
SSO's review of the evaluations, the SSO determined to make award to
the 11 companies which submitted the highest technically rated
proposals. Centech, whose proposal was 12th-ranked technically, was
not awarded a contract. In his selection statement, the SSO noted
that "past performance information was received and evaluated, and
price proposals were evaluated. These evaluations were considered."
The Centech proposal received a total score of 595, consisting of 370
on business management, technical, and organizational approach; 100 on
past and present experience; 75 on corporate research management; and
50 on the videotape presentation. The protester's past performance
was rated "excellent" and its proposed cost was 9th low of the top 12
technically-ranked proposals. The relevant technical scores,
adjectival ratings for past performance, and evaluated ceiling prices
for the awardees' and the protester's proposals were as follows:
Offeror Technical/Business Past Proposed Ceiling
Management Score Performance Price and Rank
UNISYS 890 good $35,159,002 (11)
SAIC 840 good $26,818,438 (1)
MSD, Inc. 790 excellent $32,905,478 (8)
Allied Tech. 780 excellent $44,693,504 (17)
BDM 740 excellent $29,864,140 (4)
Abacus Tech. 665 excellent $38,224,828 (12)
Comprehensive665 excellent $30,368,668 (5)
Q Systems 650 excellent $29,399,704 (2)
Troy Systems 650 excellent $32,426,186 (6)
MIL Group 645 excellent $30,115,994 (4)
Z, Inc. 645 excellent $32,873,024 (7)
Centech 595 excellent $34,639,502 (9)
DOE notified Centech that it had not been selected for award and,
after a late December debriefing, Centech filed this protest with our
Office.
Centech argues that DOE improperly and unreasonably excluded from
consideration the five pages from Centech's proposal that exceeded the
150-page limitation. Centech complains that it was unreasonable for
DOE to include such things as a cover sheet, blank section dividers,
and a table of contents in its page calculation.
Offerors are required to prepare their proposals within the format
limitations set out in the solicitation, including the page limits at
issue here, and assume the risk that proposal pages beyond the page
limits will not be considered because consideration of an offeror's
excess proposal pages could give that offeror an unfair competitive
advantage. All Star Maintenance, Inc., B-244143, Sept. 26, 1991, 91-2
CPD para. 294 at 3-4; Infotec Dev., Inc., B-238980, July 20, 1990, 90-2
CPD para. 58 at 4-5.
Here, the RFP clearly provided for a 150-page limit on technical
proposals and in response to specific questions concerning the page
limit, DOE indicated by amendment that any page that an offeror deemed
necessary to include in its proposal would be included in the page
count, including the table of contents and tab dividers. Thus,
offerors were on notice both of the 150-page limitation and that any
and all pages, including coversheets, dividers, and table of contents
pages would be considered in the page calculation. Centech's proposal
clearly failed to comply with the solicitation format requirements.
Centech did not protest the page limits of the RFP, but chose to
exceed the proposal page limitation set forth in the RFP, thereby
assuming the risk that excess pages in its proposal would be rejected
for noncompliance with the page limits. Infotec Dev., Inc., supra, at
4. Under these circumstances, the agency reasonably computed the 150
pages and properly declined to consider the portions of Centech's
proposal that exceeded the stated limits. All Star Maintenance, Inc.,
supra, at 3-4.
Centech argues that DOE did not perform a proper cost/technical
tradeoff, noting that the agency's report on the protest contains no
cost evaluation report and no record of a cost/technical tradeoff
performed prior to award. The protester argues that, in making its
award decision, DOE relied exclusively on the technical ratings given
to the offerors and failed to consider price. The protester contends
that DOE merely "ranked each offeror in descending order of technical
strength of proposals," and based its evaluation and award
determination only on technical and past performance factors. Centech
contends that "DOE has provided absolutely no support for its broad
and blanket assertion that it evaluated price" and argues that the
agency's "blanket statement that it considered cost and cost had no
impact on the selection decision, without more, is not [a] sufficient
review of price."
The agency's position is that its cost/technical tradeoff was proper
and that "[t]he record of this procurement makes clear that cost was
considered." Specifically, the agency points out that appropriate
cost information, consisting primarily of the proposed ceiling prices
for each offeror, was given to the SSO and that the source selection
statement expressly states, as noted above, that cost was considered
and that the relative prices proposed by the offerors for CLIN 003 did
not alter the overall ranking of the awardees. In response to
Centech's argument that the agency merely ranked the firms according
to technical merit and selected the highest technically-ranked firms
for award, the agency notes that the Rating Plan called for each TEC
to list offerors in order of their technical scores and, given the
relative weights of the evaluation factors, argues that it was
"rational" for the SSO to select the highest technically-ranked
proposals in the circumstances presented here. DOE points out that
Centech's proposed ceiling price of $34.6 million was higher than all
but three of the awardees' ceiling prices and its technical score was
lower than all of them. Centech's technical score was 70 points lower
than the technical score received by Abacus--which was the lowest
technically-scored awardee that was higher priced than Centech.
DOE also argues that there is no technical/past performance/cost
relative weighting that is consistent with the solicitation evaluation
scheme in which cost was significantly less important than technical,
and also less important than past performance, which would call for
award to Centech. To demonstrate this, in response to the protest,
DOE normalized the scores for the technical and cost factors and
found, for example, that if technical were weighted 50 percent, past
performance were weighted 30 percent and cost were weighted 20
percent, Centech's technical score would be 33.43 and its cost score
would be 15.48, for a total of 48.91. In comparison, Abacus, the
lowest technically scored awardee, would score 37.36 for the technical
and 14.03 for cost, for a total of 51.39. Centech's total score would
be less than any of the awardees' scores.
Source selection officials in negotiated procurements have broad
discretion in determining the manner and extent to which they will
make use of technical and cost evaluation results. Grey Advertising,
Inc., 55 Comp. Gen. 1111, 1120, (1976), 76-1 CPD para. 325 at 12; Mevatec
Corp., B-260419, May 26, 1995, 95-2 CPD para. 33 at 3. In exercising that
discretion, they are subject only to the tests of rationality and
consistency with the established evaluation criteria. Mevatec Corp.,
supra, at 3. As a general rule, however, agencies are required by the
Competition in Contracting Act of 1984 (CICA) to include cost or price
as a significant factor in the evaluation of proposals. 41 U.S.C. sec.
253a(b)(1)(A) (1994); Federal Acquisition Regulation sec. 15.605(b)(1)(i)
(June 1997).
The record provide no basis for concluding that cost was not
considered in making the awards or that the cost/technical tradeoff
was unreasonable. The SSO expressly stated in his source selection
statement that DOE considered price in its cost/technical tradeoff.
Our Office conducted a telephonic hearing at which the SSO testified
concerning DOE's cost/technical tradeoff. The SSO stated that he
received extensive oral and written reports from the TEC presenting
and explaining the evaluation and the award recommendations, and that
he questioned the evaluation team members concerning the evaluations.
He focused on the technical ranking form, which ranked offerors by
technical scores and listed their size status, past performance
ratings, and proposed costs. The SSO stated that, while he did not
use statistics or perform precise calculations in comparing the
offerors' technical scores and costs, he did balance the major factors
in making his decision. Specifically, he first looked for "break
points" in technical scores and examined ceiling prices to ensure that
awards would be made to firms which provided a technical advantage at
a reasonable cost. While no written cost evaluation report was
prepared,[4] the SSO stated that he looked at the ceiling prices of
each offeror to see if a firm that was not an obvious candidate for
award had a particularly attractive price. He said that the proposals
from firms "on the margin," such as Centech, did not offer especially
low prices. He stated that Centech was not selected for award because
of the natural break in technical scores between it and the awardees
and because its price was not particularly attractive. Specifically,
the SSO noted that, while Centech proposed fairly average costs,
Centech was not attractive because the five firms ranked immediately
above it on technical merit proposed lower costs.
We also note that, using the same normalization technique as DOE, we
calculated technical and price scores for Centech and Abacus using
different weights for the technical and cost factors which were
consistent with the RFP criteria weighting provision. The agency is
correct that no reasonable combination of weights consistent with the
evaluation criteria alters the protester's ranking vis-�-vis Abacus
(or any other awardee).[5] While point scores are to be used merely
as guides in decision making, this analysis does support the propriety
of the selection decision. In our view, the source selection
determination reflects an appropriate comparison of the competing
proposals, balancing technical merit and costs. Under these
circumstances, and given that technical factors were more important
than price, we see no basis to object to the award selection.[6]
Accordingly, the protest is denied.
Comptroller General
of the United States
1. EIA is an independent statistical and analytical agency within DOE.
2. Three separate TECs, one for each CLIN or functional area,
evaluated the proposals.
3. For example, a score of 5 reflected a proposal which appeared
capable of meeting the RFP requirements and had few significant
strengths or significant weaknesses. A score of 8 reflected a
proposal evidencing very good responses showing a high probability of
meeting the RFP's requirements and had significant strengths and few
weaknesses.
4. Centech's argument that DOE's failure to prepare a cost evaluation
report is a fatal flaw in the cost/technical tradeoff is without merit
where, as here, the requirement for the report was not an RFP
requirement but rather is simply listed in DOE's Rating Plan. The
Rating Plan is the agency's own internal source selection document
which addresses source selection procedures. Source selection plans
are internal agency instructions and, as such, do not give outside
parties any rights. Eccles Assocs., Inc.; Deloitte Touche Tohmatsu
ILA Group Ltd., B-260486.6,
B-260486.7, Oct. 17, 1995, 95-2 CPD para. 179 at 7. It is the evaluation
scheme in the RFP, not internal documents, to which the agency is
required to adhere in evaluating proposals and in making the source
selection. Id.
5. For example, if technical merit were weighted 45 percent of the
evaluation and price were weighted 25 percent, Centech's total score
would be 49.44 and Abacus's total score would be 51.16.
6. Centech also argues that DOE failed to make an award to an 8(a)
small business "as required" by the solicitation. While the agency
argues that the protester has misinterpreted the RFP, which does not
require such an award, we need not resolve this disagreement because
the record shows that 3 of the 11 awards were to 8(a) small
businesses.