BNUMBER:  B-280013.2 
DATE:  August 6, 1998
TITLE: Information Systems Technology Corporation, B-280013.2,
August 6, 1998
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Matter of:Information Systems Technology Corporation

File:     B-280013.2

Date:August 6, 1998

Paul J. Chun, Ph.D., for the protester.
Kenneth E. Patton, Esq., and Jonathan A. Baker, Esq., Department of 
Health & Human Services, for the agency.
Linda S. Lebowitz, Esq., and Michael R. Golden, Esq., Office of the 
General Counsel, GAO, participated in the preparation of the decision.

DIGEST

Agency reasonably determined not to establish a blanket purchase 
agreement (BPA) with the protester where the firm failed to 
demonstrate in its technical proposal its understanding of the BPA 
statement of work requirements.

DECISION

Information Systems Technology Corporation (ISTC) protests the 
decision of the Health Care Financing Administration (HCFA), 
Department of Health & Human Services, not to establish a blanket 
purchase agreement (BPA) with the firm for independent verification 
and validation (IV&V) and system testing support services.  ISTC 
protests the agency's evaluation of its proposal for the BPA.

We deny the protest.

By invitation letter dated January 29, 1998, the agency notified eight 
vendors on Federal Supply Schedule 70 for automated data processing 
services that the agency intended to establish four to six BPAs for 
IV&V/system testing support services.  See Federal Acquisition 
Regulation (FAR)  sec.  8.404(b)(4).  The letter invited vendors to make an 
oral technical presentation tailored to the BPA statement of work 
(SOW) included with the invitation letter.  The invitation letter also 
announced that three task orders were available for immediate 
consideration.  The invitation letter included a SOW for task order 
No. 0001, and prior to the oral presentations, the agency issued SOWs 
for task order Nos. 0002 and 0003.

The invitation letter advised vendors that they could propose on "any, 
all, or none" of the task orders, and in this regard, stated that if a 
vendor was proposing on only the basic, i.e., BPA, SOW, that the 
presentation should not exceed 1 hour, and if the vendor was proposing 
on any or all of the task orders, that the presentation should not 
exceed 2 hours.

The invitation letter stated that technical merit (technical approach, 
project management plan, personnel, Medicare program comprehension, 
and past performance) was paramount, and that the selections would be 
based on technical merit and the overall best values to the 
government.  Cost/price would not be a factor in establishing the 
BPAs, but would be a consideration in issuing the task orders.

All eight firms, including ISTC, responded to the invitation letter by 
submitting limited technical proposals consisting of the firm's oral 
presentation viewgraphs and written textual supplementation, key 
personnel resumes, and past performance information.  ISTC submitted a 
proposal responding to the SOWs for the BPA and for each of the task 
orders, and made a 2-hour oral presentation.

The agency evaluated a vendor's proposal for the BPA without 
considering information in the vendor's task order proposals.  The 
agency evaluated a vendor's task order proposals independently from 
each other.  Thus, depending on the number of task orders, in addition 
to the BPA, for which a vendor submitted a proposal, the agency could 
perform from one to four individual technical evaluations per vendor 
with each individual proposal being scored on a 600-point scale.  In 
selecting vendors for the BPAs, the agency did not consider the 
evaluation results for the vendors' task order proposals.

As relevant to this protest, ISTC's proposal for the BPA received 
264.1 points; the scores for the proposals of the other seven vendors 
ranged from 336.7 to 549.9 points.  These scores were supported by 
narratives of the strengths and weaknesses in the vendors' proposals.  
With respect to ISTC, the agency basically determined that the firm 
failed to sufficiently demonstrate in its proposal for the BPA that it 
understood the technical requirements of the BPA SOW.  The agency 
established BPAs with the four vendors with the highest technical 
scores.  With respect to the agency's evaluation of the vendors' 
proposals for the task orders, ISTC's task order proposals received 
significantly lower scores compared to the scores for the task order 
proposals of the highest-rated vendors.  The basis for the low scores 
assigned to ISTC's task order proposals was the firm's failure to 
demonstrate its understanding of the task order SOW requirements.  
However, subsequent to the establishment of the BPAs, the agency 
canceled task order Nos. 0001 and 0002 because they were not directly 
related to supporting HCFA's millennium compliance efforts.

ISTC challenges the agency's evaluation of its proposal for the BPA, 
basically contending that in deciding not to establish a BPA with the 
firm, the agency misevaluated its proposal by not also considering the 
information in its proposals for task order Nos. 0001 and 0002.  In 
other words, ISTC maintains that there was information in its task 
order proposals which, when considered in conjunction with the 
information in its BPA proposal, would have demonstrated the firm's 
understanding of the technical requirements of the BPA SOW.[1]

Agencies are not required to request proposals or to conduct a 
competition before establishing BPAs.[2]  Because the agency did 
conduct a competition here, however, we will review the agency's 
actions to ensure that the evaluation was reasonable and consistent 
with the terms of the invitation letter.  See COMARK Fed. Sys., 
B-278343, B-278343.2, Jan. 20, 1998, 98-1 CPD  para.  34 at 4-5.  The fact 
that a protester does not agree with the agency's evaluation does not 
render the evaluation unreasonable.  Tracor, Inc., B-250716.2, Feb. 
23, 1993, 93-1 CPD  para.  165 at 7.

The record shows that the agency's primary concern with ISTC's 
proposal for the BPA was the firm's failure to specifically describe 
its technical approach beyond reiterating the requirements of the BPA 
SOW.  In its proposal for the BPA, ISTC listed the following 6-step 
technical approach:  (1) information gathering; (2) planning; (3) 
verification; (4) validation; (5) findings and recommendations; and 
(6) policies and procedures.  Proposal at 10.[3]  ISTC then furnished 
supporting information, in "bullet" format, for each of these steps.  
The record supports the agency's conclusion that this supporting 
information was cursory, lacked detail, and basically parroted the 
information contained in the BPA SOW.  As a result, the agency could 
reasonably conclude that ISTC's BPA proposal failed to sufficiently 
demonstrate the firm's technical approach and understanding of the BPA 
SOW requirements.

More specifically, the BPA SOW required, among other things, that the 
contractor "[v]erify the consolidated standard system's hardware and 
software inventories and configurations during the life cycle 
process," and "[e]valuate, verify and validate the approaches, plans, 
analyses, methods, processes and other deliverables throughout the 
life cycle of the system consolidation, millennium compliance and 
other efforts as determined by HCFA."  BPA SOW, encl. 1 to Jan. 29 
invitation letter,  sec.  C.1.b at 2, bullets 8 and 1.  For step 3 of its 
technical approach (verification), ISTC stated only that the firm 
would "[v]erify technical guidelines, procedures and standards with 
requirements and specifications"; would "[s]ubstantiate requirements 
and design specifications"; would "[c]onfirm contractor approaches, 
plans, analyses, methods and procedures"; and would "[s]ubstantiate 
[the adequacy and availability of] . . .  systems' hardware and 
software inventories."  Proposal at 13-14.  The BPA SOW also required 
that the contractor "[r]ecommend solutions to HCFA in the resolution 
of issues related to the approaches, plans, analyses, methods, 
processes and other deliverables and any potential problem areas."  
BPA SOW, bullet 2.  For step 5 of its technical approach (findings and 
recommendations), ISTC stated only that it would "[d]ocument and 
report all findings," and "[p]repare recommendations for alternatives 
to alleviate any problems or issues with approaches, plans, analyses, 
methods, processes and other deliverables."  Proposal at 16.  The BPA 
SOW further required that the contractor "[p]rovide recommendations to 
HCFA in the development of operational policies and procedures for 
HCFA consolidated standard systems."  BPA SOW, bullet 7.  For step 6 
of its technical proposal (policies and procedures), ISTC stated only 
that it would "[r]eview . . . HCFA strategies, policies and procedures 
for consolidation," and "[p]rovide recommendations to HCFA for the 
development of operational policies and procedures for consolidated 
systems."  Proposal at 17.  These examples illustrate that ISTC 
parroted in its technical proposal the SOW language for the BPA 
without explaining the methodologies by which the firm would 
accomplish the requirements of the BPA SOW.  We conclude the agency 
reasonably downgraded ISTC's BPA proposal because the firm failed to 
offer sufficient detail in its proposal to establish its technical 
approach and understanding of the BPA SOW requirements.

ISTC maintains that there was information in its proposals for task 
order Nos. 0001 and 0002 that elaborated upon the technical 
information contained in its BPA proposal.  To the contrary, the 
record, as supported by the contemporaneous evaluation narratives, 
shows that in its proposals for the task orders, ISTC again failed to 
detail its technical approach or to include information that would 
have demonstrated its understanding of the technical requirements of 
the BPA SOW.  The record reasonably supports the agency's position 
that even if ISTC's task order proposals had been factored into the 
evaluation of the firm's BPA proposal, ISTC's technical score and 
overall ranking would not have improved.

For example, the BPA SOW required the contractor to "[r]eview and 
evaluate all test plans, procedures, scenarios, test data, and results 
related to the designated work efforts."  BPA SOW, bullet 5.  In its 
proposal for the BPA, for step 2 of its technical approach (planning), 
ISTC stated only that it would develop a project work plan using 
critical path methods (CPM) and program evaluation and review 
techniques (PERT) and "What-If" simulations, and that it would 
"[r]eview and evaluate test plans, facilities, procedures, scenarios, 
test data and results related to the consolidation work efforts."  
Proposal at 12.  We conclude that while the agency gave ISTC credit 
for identifying the need for a project work plan and products to be 
reviewed, the agency also reasonably downgraded ISTC's proposal 
because, other than reiterating the BPA SOW language, ISTC provided no 
information on how these activities would be conducted nor the review 
standards the firm would apply.  In its proposal for task order No. 
0001, the record shows that ISTC provided little additional 
descriptive information for step 2 of its technical approach.  
Specifically, ISTC repeated the CPM and PERT acronyms; stated that it 
would "[plan] and [track] [a]ctivities of [m]ultiple [t]asks, 
[s]ubtasks, and [p]ersonnel"; and with respect to the "What-If" 
simulations, provided three bullets with the following cursory 
information:  "[t]imeframes for completing each [t]ask/[s]ubtask"; 
"[o]bjectives, [m]ilestones, and [d]eliverables relevant to each 
[t]ask [o]rder"; and "[r]esources needed to achieve each [t]ask and 
[s]ubtask."  Proposal at 27.  None of these bullets contained any 
information elaborating on ISTC's technical approach for the BPA SOW.

In its proposal for task order No. 0002, ISTC simply stated it "may 
use the same [t]echnical [a]pproach [as presumably outlined in its BPA 
proposal] with [i]mprovements"; "[d]evelop a [m]ethod and [p]rocedure 
for [u]tilization of [a particular cost report information system] in 
[i]nitial [r]eview"; and [d]evelop [d]eliverables and any [i]nterim 
[r]eports on [f]indings and [r]ecommendations."  Proposal at 45.  
Again, there was no information in ISTC's proposal for task order No. 
0002 that explained the firm's technical approach beyond the bullets 
contained in its BPA proposal.

ISTC has not shown that the agency unreasonably downgraded its 
proposal for failing to sufficiently demonstrate its technical 
approach and understanding of the requirements of the BPA SOW, either 
in its proposal for the BPA or in its proposals for the two task 
orders.  ISTC has not offered any meaningful challenge to the agency's 
articulated concerns in this regard.  On this record, we have no basis 
to object to the agency's decision not to establish a BPA with ISTC, 
the firm with the lowest technically rated proposal for the BPA.

Accordingly, the protest is denied.

Comptroller General
of the United States

1. ISTC believed, based on the invitation letter, that the evaluation 
of proposals for the BPA and for the task orders would be combined 
because nowhere in the invitation letter did the agency clearly 
announce that the evaluation of a vendor's BPA proposal would be 
performed without considering information in the vendor's task order 
proposals.  The agency believes its intent to segregate the 
information and to evaluate proposals for the BPAs and task orders 
individually was clear from the invitation letter.  However, we think 
the invitation letter failed to include a clear statement of the 
agency's intent to conduct separate evaluations of a vendor's BPA and 
task order proposals.  Nevertheless, as will be discussed, the lack of 
a clear statement of the basis for the agency's evaluation did not 
prejudice ISTC because the contemporaneous evaluation record 
reasonably supports the agency's position that ISTC's proposals for 
the two task orders did not contain information which could have 
materially improved the results of the agency's evaluation of ISTC's 
BPA proposal. 

2. After a BPA is established, however, otherwise applicable 
competition requirements still apply to all acquisitions under the 
BPA.  FAR  sec.  13.303-5(a) (BPA to be used only for purchases that are 
otherwise authorized by law or regulation).

3. Citations to the proposal refer to ISTC's oral presentation 
viewgraphs.