BNUMBER: B-279049; B-279049.2
DATE: April 30, 1998
TITLE: Chant Engineering Company, Inc., B-279049; B-279049.2, April
30, 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:Chant Engineering Company, Inc.
File: B-279049; B-279049.2
Date:April 30, 1998
Michael H. Payne, Esq., and Joseph A. Hackenbracht, Esq., Starfield &
Payne, for the protester.
Robert Martin, Esq., Simon, Turnbull & Martin, for Rexroth
Corporation, an intervenor.
Glenn Heisler, Esq., Panama Canal Commission, for the agency.
C. Douglas McArthur, Esq., and Christine S. Melody, Esq., Office of
the General Counsel, GAO, participated in the preparation of the
decision.
DIGEST
1. Evaluation of protester's proposal was reasonable and consistent
with solicitation providing for submission of preliminary design for
hydraulic power systems where agency reasonably found the information
submitted with the preliminary design insufficient to establish that
design could meet the agency's technical requirements.
2. Allegation that awardee received an unfair competitive advantage
under solicitation to design and manufacture hydraulic systems for
lock gate, because it performed an earlier contract to design a
prototype system, fails to state a valid basis of protest, in the
absence of evidence showing preferential or unfair action by the
government.
DECISION
Chant Engineering Company, Inc. protests the award of a contract to
Rexroth Corporation under request for proposals (RFP) No.
CNC-82163-LM-29, issued by the Panama Canal Commission for hydraulic
power systems to operate miter gates. Chant asserts that the
evaluation and rejection of its proposal were unreasonable.
We deny the protests.
On October 1, 1997, the Commission issued the RFP for a multiyear
(8-year) fixed-price contract to design, fabricate, deliver, and
supervise the installation of hydraulic power systems to replace the
existing machinery for operating miter gates at locks in the canal.
RFP sec. B, C.1.1. The RFP advised offerors that: the gates were
nearly 65 feet in length and 7 feet in thickness, with heights ranging
from 47 to 82 feet; the machinery had to open or close the gates
within 2 minutes; and the canal's three locks included 80 gates, all
requiring the new systems. RFP sec. C.1.3. The RFP advised potential
offerors that the moving machinery consisted of a large gear, or crank
gear, revolving in a horizontal plane, with a vertical pin at the
periphery connected to a strut attached to the lock gate. The crank
gear room, into which the hydraulic cylinder would be installed, is
subject to flooding and is separated from a compensating gear room by
a watertight bulkhead.
The solicitation provided for award to the responsible offeror whose
proposal the Commission determined "most advantageous (in other words
represents the best value)," based upon listed evaluation criteria.
RFP sec. M.1. These criteria included three "technical merits"
subfactors, as follows: technical design and ease of installation;
experience of the firm; and past performance. RFP sec. M.2.A The
combined value of these subfactors was to be significantly more
important than price. RFP sec. M.2.B.
For evaluation under the technical design and ease of installation
subfactor, section L of the RFP instructed offerors to furnish
detailed technical information presenting the offeror's preliminary
design for the hydraulic power system, in accordance with section C,
the statement of work. According to the RFP, sec. L.1, this information
was to include the following:
a. Preliminary design for the hydraulic cylinder and hydraulic
power unit.
b. Preliminary design calculations for the forces exerted by the
existing miter gate moving machine.
c. A hydraulic control schematic for the main hydraulic power
unit.
d. A written description of the hydraulic system explaining how
it will operate to meet the design parameters listed in the
specifications. Particular emphasis should be placed on the
pumps to be used and how they will be controlled.
e. A written description and/or drawing showing ability to shop
test the hydraulic cylinder under simulated field loading
conditions.
f. Electrical and control schematics with control operations
sequence description.
g. Electrical single-line, and elementary diagrams to indicate
functions of equipment components.
h. Step-by-step installation procedure.
i. Ease of Installation: Offerors shall submit information as
to how their proposed hydraulic powered system will be installed.
Particular emphasis shall be placed on providing an installation
scheme that will reduce the outage time required to perform the
installation. Ease of removal of the hydraulic cylinder and
other components and their maintainability shall also be
contemplated.
With respect to the second subfactor, experience, offerors were to
submit evidence that they could provide a mix of design, engineering,
and manufacturing capabilities adequate to complete the contract. In
particular, they had to provide evidence of having successfully
manufactured similar systems within the previous 10 years. Regarding
the third subfactor, past performance, the RFP provided for evaluation
of each offeror's organization, capacity, and capability, requiring
offerors to provide a description of facilities, an organizational
plan, and information on previous contracts of comparable size,
involving similar work.
The solicitation contained schematic drawings of a hydraulic system,
with details of the existing equipment. RFP sec. C.1.4a, J. It listed
certain design parameters, including the maximum hydraulic operating
pressure, the maximum motor size, and a maximum cycle time of 2
minutes. RFP sec. C.1.4b(1). The solicitation advised offerors that
currently the lock control boards presented a miniature representation
of the locks, showing the position of the miter gates; the contractor
would have to replace this system with a new system showing the actual
position of the gates while opening and closing. RFP sec. C.1.4e(4),
(6). In addition, the RFP provided for a site visit within 15 days of
notice of award, to allow the contractor "to thoroughly familiarize
himself with all details of the work and working conditions, to verify
dimensions and clearances in the field, and . . . [to] then advise the
Contracting Officer of any discrepancies . . . ." RFP sec. C.1.7.
Part 2 of the statement of work contained specific requirements for
materials and mechanical equipment ( sec. C.2.1), electrical equipment ( sec.
C.2.2), and other requirements such as testing and training ( sec. C.2.3).
Section C.2.3c provided for shop testing of the pumps for the
hydraulic power units to "verify flow and pressure ratings"; section
C.2.3d provided for field testing of the hydraulic systems at the
agency's expense "[a]fter the hydraulic system has been erected,
adjusted, and otherwise made ready for operation at the site . . . ."
Section C.2.2f contained requirements for electrical control devices
and wiring, including a programmable logic controller (PLC), which
would monitor data on the status of the lock opening or closing to
control the operation of the system.
The agency received two proposals on November 5, one from Chant and
one from Rexroth, and referred them to a technical evaluation board
(TEB) on November 6. Chant's initial offer was high in price
[deleted]. Further, the TEB considered Chant's electrical proposal
too vague, because [deleted]. The evaluators also found that the
proposal lacked specifics on the position measuring system; that Chant
had not provided sufficient detail on the hydraulic sequence of events
for them to determine the acceptability of the design; and that the
installation procedures were vague. In addition, the TEB was not
satisfied that Chant had sufficient experience with contracts similar
in size and dollar value. In the area of past performance, the
evaluators were concerned that Chant's facilities were [deleted]. TEB
Report, Nov. 10, 1997.
By letter dated November 13, the Commission advised Chant of the TEB's
concerns and stated that its price was "way too high." In its best
and final offer (BAFO), Chant cut its price [deleted]--to $20,092,112,
as compared to Rexroth's BAFO price of $21,990,812. While Chant's
BAFO satisfied some of the agency's concerns, many remained. The TEB
found that Chant's electrical proposal remained vague [deleted]. The
TEB also found that Chant had neither [deleted] nor provided
information on [deleted], information considered necessary to
determine whether the hydraulic operator would meet the RFP's 2-minute
opening and closing requirement. With respect to the position
measuring system, the evaluators concluded that both of the designs
proposed by Chant were unacceptable. TEB Report, Dec. 19, 1997, at
1-2.
With respect to Chant's experience, the Commission initially concluded
that Chant had performed one comparable contract of similar size, a
contract with the Corps of Engineers to install 16 miter gate machines
and power units at the London and Marmet locks. The Corps of
Engineers subsequently informed the Commission that, contrary to
Chant's assertion that it had designed the system at the Marmet and
London locks, the Corps itself had designed that system, providing
detailed drawings for Chant, whose only responsibility was fabrication
(for gates one-third the size of the miter gates here) and oversight
of installation. Pending clarification of Chant's responsibilities
for the Marmet and London locks contract, the TEB concluded that,
assuming the Corps's initial report was correct, the protester had
essentially no design experience with hydraulic systems for miter gate
operation.
In sum, the TEB concluded that Chant's proposal was incomplete, did
not meet minimum requirements, and, owing to its vagueness, presented
a high risk of failure.
On December 19, the Commission issued a second request for BAFOs, to
allow Chant to respond to the information from the Corps regarding its
contract at the London and Marmet locks. Chant's December 23
response, which essentially disagreed with the Corps's analysis, did
not alleviate the agency's concerns. Neither offeror revised its
proposal in response to the second BAFO request. On January 12, 1998,
in view of the TEB's recommendation that Chant's proposal be
considered technically unacceptable, the contracting officer selected
Rexroth for award. At Chant's request the agency provided a
debriefing by letter dated January 15, and this protest followed.
Chant protests the agency's evaluation of its offer and conclusion
that the proposal was technically unacceptable. Chant asserts that
the RFP required only a "preliminary design," and that it accordingly
submitted technical information at a level of detail commensurate with
a preliminary design. The protester notes that, in 1995, the agency
issued a solicitation (No. CNP-89207-LM-29) for a prototype design of
the hydraulic systems, under which Rexroth was selected for award.
Rexroth was therefore able, Chant argues, to submit a design that the
Commission had already approved, at a level of detail beyond the
"preliminary design" called for here and which prompted the Commission
to require an unreasonably detailed explanation from Chant. The
protester argues that the Commission (and the same group of
evaluators) found acceptable Chant's 1995 proposal responding to
essentially the same requirements and was therefore unreasonable in
finding the current proposal, which was essentially the same,
technically unacceptable. In a supplemental protest, filed after
receipt of the agency report, Chant asserted that Rexroth had an
unfair competitive advantage for the instant procurement because of
its experience with the prototype contract.
The Commission responds, generally, that the RFP used the term
"preliminary design" only in reference to the hydraulic cylinder and
hydraulic power unit and calculations for forces exerted by the miter
gate moving machine. See RFP, Data To Be Submitted With Proposal, sec.
L.1.a, b. Further, even to the extent that the RFP called for a
"preliminary" design, the agency notes that it required "detailed
technical information" regarding that design, id. at sec. L.1, and argues
that Chant did not submit the detail required to demonstrate that its
design would operate as required. Regarding the prior contract with
Rexroth, the agency states that, prior to design of the prototype, its
engineering personnel were unfamiliar with hydraulic miter gates and
that the earlier procurement was in part designed to give the
Commission some experience and familiarity with such equipment. It
did not, however, specify Rexroth's prototype design for use in the
instant procurement because of certain concerns that it had with that
design (cylinder size and installation problems, for example), was
searching for alternatives, and, in any event, wanted the selected
contractor to be responsible for making the design work.
It is not the function of our Office to evaluate proposals de novo.
Rather, we will examine an agency's evaluation to ensure that it was
reasonable and consistent with the stated evaluation criteria and
applicable statutes and regulations, since determining the relative
merit of competing proposals is primarily a matter within the
contracting agency's discretion. Robotic Sys. Tech., B-278195.2, Jan.
7, 1998, 98-1 CPD para. 20 at 7. 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 find the evaluation here reasonable and
consistent with the solicitation and the stated evaluation criteria.
As a preliminary matter, our review of the evaluation record
associated with award of the prior contract for a prototype design
indicates that, although the agency found Chant's proposal under that
solicitation technically acceptable, the protester's proposal shared
many of the problems encountered here--[deleted]. With regard to the
primary technical factor, Chant's scores were essentially the same in
the two procurements--[deleted].
What changed significantly from the prototype procurement to the one
at issue here was the agency's perception of Chant's experience.
Viewing Chant as experienced, under its Corps of Engineers contract,
with the design of similar systems, the evaluators under the prior
procurement were more willing to accept the protester's technical
representations; further, they awarded Chant [deleted], considerably
enhancing the protester's overall score. Technical Evaluating
Committee Report on Solicitation No. CNP-89207-LM-29 Hydraulic Powered
Miter Gates, Oct. 18, 1995, at 1. However, the information
subsequently received from the Corps in connection with the current
procurement cast substantial doubt on whether the protester had ever
performed a similar design effort. The statement of work in the
solicitation for the Marmet and London locks contract--an invitation
for bids (IFB)--indicates that Chant was to "fabricate," rather than
design, the operating machinery. Similarly, a statement from the
chief of the Corps's design branch indicates that the IFB specified 42
specific parts "or equal," with Chant providing [deleted]; apart from
shop drawings, the only drawing prepared by Chant was a dimensional
layout of components on top of the reservoir. We do not find it
unreasonable that the TEB was less willing to accept gaps in Chant's
data, once reasonable doubts were raised whether the protester had
experience in designing similar systems. Each procurement is a
separate transaction, and neither disparate evaluation scores nor
different conclusions about an offeror's record of past performance
between identical offers submitted under similar procurements
demonstrate that the evaluation was unreasonable. See Continental
Serv. Co., B-274531, Dec. 17, 1996, 97-1 CPD para. 9 at 7.
With regard to its technical submissions, the Commission states that
Chant's design of the electrical control system failed to provide
[deleted], and thus was unacceptable. The protester contends that its
electrical schematics were sufficient for a preliminary design, that
the RFP did not require programming the PLC,[1] and that such
programming is more appropriate for the contractual design effort.
The agency denies that it expected offerors to program the PLC for
their proposals, but states that it did expect them to describe the
components and sequence of operations, show circuits, and provide
enough information for the TEB to understand how the system would
work. Specifically, the Commission explains the required process as
follows: the PLC takes incoming information (or "inputs") and
processes it by applying a programmed logic that arranges the inputs
into a sequence, which is then issued as an "output." The output
controls the hydraulic movement of the system. According to the
Commission, Chant listed a vague series of inputs, but did not
describe the logic or sequence the PLC would use to achieve control of
the hydraulic movement. Further, the drawing Chant submitted with its
BAFO, in response to the Commission's questions in this area, showed a
system of relays (inputs and connected outputs), with no PLC at all.
While Chant asserts that the drawings provided with its BAFO were
intended to supplement rather than revise or substitute for its
initial design, there is nothing in the proposal to indicate this. An
agency's evaluation is dependent upon information furnished in a
proposal, and it is the offeror's burden to submit an adequately
written proposal for the agency to evaluate. DATEX, Inc., B-270268.2,
Apr. 15, 1996, 96-1 CPD para. 240 at 6. We cannot conclude that the TEB's
concerns about Chant's electrical design were either unreasonable or
inconsistent with the solicitation criteria.
With respect to Chant's position measuring system, the Commission
concluded that both of the designs proposed by Chant were
unacceptable. The Commission regarded the first proposed design,
[deleted], as prone to damage from logs and floating debris. Although
Chant argues that the solicitation did not warn offerors to avoid such
dangers, the Commission reasonably asserts that such conditions are
not design criteria but existing Panamanian field conditions, which
any offeror would be expected to take into account. The Commission
also concluded that the alternate design would require extensive
physical modification to the existing crank gear room; Chant does not
rebut the Commission's position.
With regard to the hydraulic sequence of events, the Commission states
that Chant's proposal failed to show the hydraulic oil flow and
pressure plotted over the cycle of the miter gate opening and closing;
this information would allow the agency to determine if the hydraulic
operator could meet the RFP's 2-minute opening and closing
requirement. Chant contends that the solicitation did not identify
the different hydraulic pressures and oil flow as parameters and
argues that such a detailed analysis would ordinarily be part of the
contractual design effort and not performed during development of a
proposal. The evaluators, however, considered such information
necessary to establish that the proposed design could meet the
critical 2-minute opening/closing cycle requirement; lacking any data
on oil flow and pressure, and with questions as to Chant's experience
in designing hydraulic systems, the TEB could not determine whether
the design would work even as a "preliminary" one. Although Chant
argues that agency engineers could have verified the feasibility of
the design from data provided with the proposal, it is the offeror's
responsibility to provide, within the four corners of its proposal,
the information for evaluation. See EOD Tech., Inc., B-266026, Dec.
18, 1995, 95-2 CPD para. 273 at 4.
We believe that the agency had a reasonable basis for finding that
Chant's proposal was altogether too "preliminary," in that there was a
significant risk that major components would not work as planned,
especially in view of the data submitted by Rexroth and in the absence
of any real analysis by the protester.[2] In our view, the
solicitation did not envision a contractor completely redesigning the
system during performance, particularly in view of sec. C.2.3d, which
provided for testing at the agency's expense after the system had been
installed at the site. Section C.1.7, providing for a site visit to
ascertain "details" of the work, does not imply that a contractor
could wait until the site visit to make basic decisions on the type of
system that he will supply. Based on the record here, the agency
reasonably concluded that Chant's proposal presented too high a risk,
particularly in view of the evidence that Chant was inexperienced with
design work of a similar nature.[3]
Chant's supplemental submissions, asserting that Rexroth had an unfair
competitive advantage in the procurement, fail to state a valid basis
of protest. Chant essentially argues that the knowledge gained by
Rexroth during its design of the prototype allowed the awardee to
submit nearly complete data on the system proposed for this
procurement. In support of its contentions, the protester offers only
the fact, conceded by Rexroth, that many of the drawings submitted
here are copies of those prepared for, or incorporate information
gained during, design of the prototype. Our Office has consistently
held that there is no obligation for an agency to take steps to
redress one offeror's competitive advantage, so long as the advantages
do not result from preferential or unfair action by the government;
specifically, knowledge gained through performance of a prior
contract, without more, does not constitute an "unfair" advantage.
See Bendix Field Eng'g Corp., B-241156, Jan. 16, 1991, 91-1 CPD para. 44
at 7.
In its final submission to our Office, Chant raised additional issues,
challenging the adequacy of the discussions held here and asserting
that its inclusion in the competitive range was improper, given the
initial disparity in the technical ratings assigned to the two
offerors. Both issues are untimely. Our Bid Protest Regulations
require that protests based on other than alleged improprieties in a
solicitation must be filed no later than 10 calendar days after the
protester knew, or should have known, of the basis for protest,
whichever is earlier. 4 C.F.R. sec. 21.2(a)(2) (1997). Chant's bases of
protest stem from the material in the agency report; since Chant
waited more than a month--from February, when it received that
report--to raise these issues, for the first time on March 23, its
objections are clearly untimely.[4]
The protests are denied.
Comptroller General
of the United States
1. As noted above, sec. C.2.2f of the RFP contained requirements for
electrical control devices, including a PLC, which would monitor data
on the status of the lock opening or closing.
2. For example, the power necessary to drive the rod was part of a
tradeoff against stress. In response to a discussion question,
Rexroth provided extensive data indicating that a broader (lower psi)
cylinder than it proposed could not achieve the 2-minute cycle time,
while a cylinder with a smaller cross-section would not meet
requirements for a safety factor of three against buckling. Rexroth
letter, Nov. 18, 1997 (response to BAFO request) at 2, with attachment
"Comparison Between Cylinders." Data submitted to support the latter
part of the analysis used a cylinder of the precise size proposed by
Chant; Chant's failure to submit any data of its own added to the
agency's concerns. In addition, sec. C.2.3c of the RFP provides for shop
testing to "verify" flow and pressure ratings for the hydraulic power
unit, at a minimum suggesting that the offerors were expected to
provide some data on flow and pressure as a basis for identifying the
ratings proposed in the design.
3. As noted above, the Commission also found Chant's installation
procedure vague and, under the past performance factor, had concerns
about the capacity of the protester's facility. Given our conclusion
that the Commission reasonably found Chant's proposal technically
unacceptable on the grounds discussed above, we need not address the
evaluation in these other areas. Keco Indus., Inc., B-261159, Aug.
25, 1995, 95-2 CPD para. 85 at 8.
4. Chant's allegations regarding retention of its proposal in the
competitive range imply bias on the agency's part--that the agency
wanted to make award to Rexroth and that the negotiations were only a
subterfuge to create an appearance of competition. We do not
attribute unfair or prejudicial motives to agency officials on the
basis of inference or supposition; a protester must provide credible
evidence clearly demonstrating such bias. Rockhill Indus., Inc.,
B-278797, Mar. 16, 1998, 98-1 CPD para. 79. The record shows that, while
Rexroth had unique expertise in producing hydraulic systems, the
competition was genuine; indeed, the agency had some concerns with
Rexroth's design, and nothing in the record indicates that its
selection was a foregone conclusion.