BNUMBER:  B-279723             
DATE:  July 14, 1998
TITLE: Riveer Company, B-279723, July 14, 1998
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Matter of:Riveer Company

File:B-279723            
        
Date:July 14, 1998

Matt Petter for the protester. 
Joshua A. Kranzberg, Esq., and Laurence M. Smail, Esq., Department of 
the Army, for the agency. 
Adam Vodraska, Esq., and James A. Spangenberg, Esq., Office of the 
General Counsel, GAO, participated in the preparation of the decision.

DIGEST

Contracting agency reasonably evaluated protester's proposal as 
technically unacceptable for failing to meet material solicitation 
requirements and properly excluded the proposal from the competitive 
range because the proposal would require major revisions to become 
acceptable.

DECISION

Riveer Company protests the rejection of its proposal and the award of 
a contract to The Centech Group, Inc. under request for proposals 
(RFP) No. DAAH10-98-R-0004, issued by the U.S. Army Aviation and 
Missile Command, Aviation Applied Technology Directorate, Fort Eustis, 
Virginia, for a prototype aircraft cleaning and deicing system (ACDS).  
The prototype ACDS will be used for operational evaluation by the 
contracting agency to establish the requirements for a production 
model ACDS.

We deny the protest.

The RFP, issued February 11, 1998, as a total small business set-aside 
under the commercial item procedures of FAR part 12, contemplated the 
award of a fixed- price contract to the responsible offeror whose 
offer conforming to the solicitation represents the best value to the 
government, price, technical and past performance factors considered.  
RFP at 1, 10, 19.  The technical factor was of paramount importance 
and price was more important than past performance.  RFP at 19.  
According to the RFP, proposals would be evaluated under the technical 
factor to assess whether the proposed ACDS will likely meet the 
minimum government requirements.  Id.

The RFP incorporated a modified version of the standard provision 
"Instructions To Offerors--Commercial Items," FAR  sec.  52.212-1, which 
informs offerors that the government intends to evaluate offers and 
award a contract without discussions (but reserves the right of the 
government to conduct discussions if necessary) and that initial 
offers should therefore contain an offeror's best terms from a price 
and technical standpoint.  FAR  sec.  52.212-1(g).   

The solicited ACDS is a portable stand-alone piece of equipment with a 
self-contained power source.  It will operate by spraying 
cleaners/solvents, deicing fluid or water through a nozzle and wand 
assembly at the temperature and pressure appropriate for the task.  
Because the runoff from washed aircraft and components (e.g., engines) 
typically contains soap, dirt, grease, and other contaminants, the 
ACDS is required to provide an environmentally safe method of washing 
aircraft in a field environment by utilizing a portable containment 
system that will catch runoff and return the runoff to the ACDS for 
processing so that the fluid is clean enough for use in washing more 
aircraft or for proper disposal.

The RFP's statement of work (SOW) required, among other features, that 
the ACDS:

     C-1.7.  Provide the capability to catch, collect, and recover 
     fluid runoff. . . .  When aircraft wash water is recovered the 
     ACDS must provide the capability to process the effluent to meet 
     U.S. Environmental Protection Agency (EPA) and foreign 
     environmental standards.  The following levels of contamination 
     are representative of the effluent following a typical aircraft 
     wash cycle:

                    .     .     .     .     .

     The ACDS will process this effluent so that after eight typical 
     aircraft wash cycles the effluent will have no greater than the 
     following levels of contamination:

                    .     .     .     .     .

     C-1.10. . . . The gross weight of the ACDS must not exceed 4200 
     lbs.

                    .     .     .     .     .

     C-1.13.  Have sufficient water capacity through the use of 
     effluent processing to operate not less than 2 hours. . . .  The 
     total water storage capacity shall not exceed 200 gallons.  The 
     clean fluid source and the processed fluids recovered from the 
     containment system shall be stored separately.  The clean fluid 
     will be used primarily for rinse operations whereas the processed 
     fluid will be used primarily for washing operations.

RFP at 12, 13.  

Riveer and Centech were among the offerors that submitted proposals by 
the
March 13 due date.  After evaluating Riveer's technical proposal, the 
agency evaluators concluded that Riveer's proposal was technically 
unacceptable because its proposed ACDS did not provide the capability 
to process effluent from the runoff as required by SOW paragraph 
C-1.7, and it did not provide the capability to store the processed 
fluids and the clean fluids separately as required by SOW paragraph 
C-1.13.  The evaluators recommended that Riveer's proposal not be 
included in the competitive range because significant revisions 
necessitating a reengineering of its offered system would be necessary 
to make its proposal acceptable.  According to the evaluators, Riveer 
would have to reconfigure its filtration systems to meet EPA 
requirements and significantly redesign its ACDS to prevent 
contamination of the clean water.  

On April 6, the contracting officer informed Riveer that its proposal 
was not included in the competitive range, with the following 
explanation:

     Your proposal indicates that your ACDS will provide 120 gallons 
     of beginning wash water.  The stated reason for doing so is to 
     meet the maximum 4200 lbs. [gross weight] required by C-1.10.  
     Your proposed system does not provide the capability to store 
     processed fluids and the clean fluids separately as required by 
     C-1.13.  There is reasonable doubt that this approach will enable 
     you to meet the requirements of C-1.7 and C-1.13.  The proposed 
     approach assumes that the effluent treatment system is both 
     effective in removing essentially 100% of the identified 
     contaminants and 100% of soap.  The filtration system vendor's 
     brochure enclosed with the proposal does not support this claim 
     with respect to removal of soap.  Even assuming that your ACDS is 
     capable of removing the soap, prior experience with effluent 
     treatment systems indicates that we can expect that the level of 
     contaminants will rise as the number of aircraft washed 
     increases.  The solicitation states that processed water will be 
     used for wash operations and clean water will be used for rinse 
     operations.  Your approach to using processed water for rinse 
     operations is considered to be a questionable procedure and is 
     high risk.

Based on the technical, price, and past performance evaluations, the 
contracting officer, who was the source selection authority for this 
procurement, concluded that Centech's proposal provided the best value 
to the government, and awarded the contract to Centech on April 6 for 
$69,540.13.  

Riveer protests that its offer was erroneously found to be technically 
unacceptable, and contends that its proposal clearly showed that it 
was in compliance with the SOW in all respects and that it should 
receive the award because its price was lower than Centech's.

The evaluation of proposals and the resulting determination of whether 
an offer is in the competitive range are matters within the discretion 
of the contracting agency, since that agency is responsible for 
defining its needs and the best method of accommodating them.  
Laboratory Sys. Servs., Inc., B-256323, June 10, 1994, 94-1 CPD  para.  359 
at 2.  In reviewing an agency's technical evaluation, we will not 
reevaluate the proposal, but instead will examine the agency's 
evaluation to ensure that it was not arbitrary or in violation of the 
procurement laws and regulations.  Id.  Where a proposal is 
technically unacceptable as submitted and would require major 
revisions to become acceptable, the agency is not required to include 
the proposal in the competitive range.  Id.

Based on the record, we think the agency reasonably concluded that 
Riveer's proposal was technically unacceptable for failing to meet the 
material solicitation requirements of SOW paragraph C-1.13, namely 
that the clean fluid source and the processed fluids recovered from 
the containment system be separately stored, and that the clean fluid 
be used primarily for rinse operations.  

The record shows that Riveer's proposal was premised on its ACDS 
continuously processing recovered runoff (effluent) to rinse-quality 
water, so as to meet the SOW's 2-hour operating requirement and the 
4,200-pound maximum weight limitation with a beginning water storage 
capacity of only 120 gallons.  (The 120-gallon water storage capacity 
of Riveer's ACDS consists of a 40-gallon chamber for wash water and a 
separate 80-gallon bladder for rinse water.)  Specifically, after wash 
operations are commenced and the effluent collected by the containment 
system and returned to Riveer's ACDS, the effluent is processed 
through several stages of filtration to meet the EPA guidelines 
incorporated in SOW paragraph C-1.7.  After the first stages of 
filtration, the processed effluent is clean enough for continued wash 
operations and some of this "filtrate" is stored in the 40-gallon 
chamber for continued use in washing aircraft.  The next stages 
involve the continued filtering of the filtrate not used for wash 
water so that it is suitable to be used as "clean" rinse water.  This 
rinse-quality "permeate" is stored in the 80-gallon bladder, which is 
where the clean unprocessed water may be stored under SOW paragraph 
C-1.13 prior to being employed in the operations of the ACDS, for use 
as rinse water.

Although Riveer's ACDS is configured to separately draw rinse water 
and wash water during operation, all the water used by the system is 
"processed" as either filtrate or permeate and reused continuously, 
and thus there is no separation of processed from unprocessed fluid as 
required by the RFP.  Indeed, any clean unprocessed water that may be 
added initially to the 80-gallon bladder as rinse water will not be 
separated from the processed water because the permeate is returned to 
the 80-gallon bladder during operation.[1]  Thus, Riveer's ACDS does 
not have the capability to store the processed fluids and the clean 
fluid source separately, as required.  Moreover, while Riveer's 
approach may very well have merit if its filtration systems work as 
well as it claims, Riveer's ACDS also does not comply with the RFP's 
minimum requirement that the clean (unprocessed) fluid be used 
primarily for rinse operations because the permeate used for rinsing 
is processed fluid.[2]

Riveer does not argue that the requirements of SOW paragraph C-1.13 
were not material, and the contracting officer states that "each and 
every specific performance requirement was required (not just 
desired)."  Further, the record evidences that the requirements of SOW 
paragraph C-1.13 reflect the agency's prior experience with effluent 
treatment systems (including an earlier demonstration version of 
Riveer's ACDS) which indicated that the level of contaminants could be 
expected to rise as the number of aircraft washed increases, thus 
necessitating the use and separate storage of clean unprocessed water 
for rinsing.  While Riveer argues that its approach ensures "clean" 
rinse water, thus making the SOW's distinction between clean fluid and 
processed fluid meaningless, Riveer should have protested any aspects 
of SOW paragraph C-1.13 it found objectionable prior to the due date 
for submission of proposals, as is required to timely protest an 
alleged solicitation impropriety.  4 C.F.R.  sec.  21.2(a)(1) (1998).

Because Riveer's proposal was premised on continuous processing of 
effluent into rinse-quality water, we agree with the agency that 
Riveer would have to make major revisions to its proposed ACDS to 
become acceptable, such as by increasing the size of its rinse water 
storage capacity to meet the 2-hour operational requirement without 
exceeding the maximum weight limitation and redesigning its filtration 
systems so that permeate is no longer processed into rinse water.  
Accordingly, the agency was not required to include Riveer's proposal 
in the competitive range.[3]

The protest is denied.

Comptroller General
of the United States

1. This is why the agency considered Riveer's rinse water 
"contaminated" by the processed effluent.  

2. We note that Riveer's proposal itself essentially recognized that 
its ACDS involved an alternate approach to satisfying the requirements 
of SOW paragraph C-1.13 that may not literally comply with the 
requirements as stated.  Riveer Technical Proposal at 14.

3. Since the agency could reasonably exclude Riveer's proposal from 
the competitive range for its noncompliance with SOW paragraph C-1.13, 
we need not consider whether the agency reasonably concluded that 
Riveer's ACDS did not have the capability to process effluent from the 
runoff as required by SOW paragraph C-1.7, the other reason given by 
the agency for finding Riveer's proposal technically unacceptable.