BNUMBER: B-280154.2
DATE: November 16, 1998
TITLE: Rohmann Services, Inc., B-280154.2, November 16, 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:Rohmann Services, Inc.
File: B-280154.2
Date:November 16, 1998
David F. Barton, Esq., The Gardner Law Firm, for the protester.
John E. Lariccia, Esq., and Daniel R. Petersen, Esq., Department of
Air Force, for the agency.
John Van Schaik, Esq., and Michael R. Golden, Esq., Office of the
General Counsel, GAO, participated in the preparation of the decision.
DIGEST
Protest of the evaluation of protester's past performance is denied
where the contracting agency reasonably assigned a moderate risk
rating to the protester's past performance as a result of customer
complaints about the protester's performance and staff and manager
turnover on the incumbent contract.
DECISION
Rohmann Services, Inc. protests the award of a contract to WP
Photographic Services, Inc. under request for proposals (RFP) No.
F41650-98-R-0002, issued by the Department of Air Force for visual
information services at Kelly Air Force Base. Rohmann argues that the
agency improperly evaluated its past performance and failed to
communicate to the firm the agency's concerns about its performance of
the incumbent contract.
We deny the protest.
BACKGROUND
The solicited services include advice and assistance on visual
information materials, methods, equipment and facilities, graphics
services, studio and location photography, film processing, visual
information library services, and equipment maintenance. RFP sec. C-5.
The RFP stated that the agency would evaluate offers on the basis of
past performance and price and contemplated award to the offeror whose
proposal met the terms of the solicitation and contained the best
overall value to the government. Id. at 21. According to the RFP,
the agency was to consider past performance significantly more
important than price and evaluate offerors' past performance for the
same or similar work assigning performance risk ratings of high,
moderate, low, or not applicable.[1] Id. The RFP advised that,
although the agency reserved the right to conduct discussions if
necessary, the agency planned to award on the basis of initial
proposals, without discussions. Federal Acquisition Regulation (FAR) sec.
52.212-1 (April 1998) (incorporated by reference). RFP at 1.
The agency received six proposals. Rohmann, the incumbent contractor,
submitted the lowest-priced proposal, at $1,291,649.40, and WP's
proposal was the third lowest priced, at $1,351,302.27. Agency
Report, Enclosure 5 at 1, 3. Based on information submitted by the
offerors and information provided by references contacted by the
agency, Rohmann was assigned a moderate past performance risk rating
and WP was assigned a low rating. Rohmann's moderate rating primarily
was due to concerns about Rohmann's performance on the incumbent
contract. Supplemental Agency Report at 2; Agency Report, Enclosure
11 at 21-55. Award was made to WP based on the conclusion that WP's
offer was the most advantageous to the government. Agency Report,
Enclosure 5 at 5.
PROTEST ALLEGATIONS
Rohmann primarily argues that the agency improperly evaluated its
performance on the incumbent contract. According to Rohmann, the
marginal rating which it received for its performance as the incumbent
is not supported by the record and is a result of the bias of the
agency's quality assurance evaluator (QAE) on that contract. Comments
at para. 9, 27 and 39-40. Rohmann argues that the QAE solicited
complaints against Rohmann and, as a member or the evaluation panel,
manipulated the past performance evaluation and influenced other
evaluators to harm Rohmann. Id. at para. 40. Rohmann also argues that
the agency's record of its performance is poorly organized, with
duplicate copies of some documents, partial documentation of some
events, and many documents that have no bearing on the determination
that Rohmann performed poorly at Kelly and, in some cases, show
acceptable performance. Id. at para. 36.
Rohmann also argues that the agency failed to communicate to the firm
the agency's concerns about its performance of the incumbent contract.
Comments at para. 23, 26, and 30; Supplemental Comments at para. 25-28.
According to Rohmann, during the evaluation, it was entitled to an
explanation of the agency's concerns about the firm's performance on
the incumbent contract and an opportunity to respond to those
concerns. Comments at para. 23, 26, and 30.
ANALYSIS
Evaluation of an offeror's past performance is a matter within the
discretion of the contracting agency, and we will not substitute our
judgment for a reasonably based past performance rating. PMT Servs.,
Inc., B-270538.2, Apr. 1, 1996, 96-2 CPD para. 98 at 6. An agency's
evaluation of past performance may be based upon the procuring
agency's reasonable perception of inadequate prior performance, even
where the contractor disputes the agency's interpretation of the
facts. Quality Fabricators, Inc., B-271431, B-271431.3, June 25,
1996, 96-2 CPD para. 22 at 7. However, we will question such a conclusion
where it is not reasonably based or is undocumented. Ashland Sales &
Serv., Inc., B-255159, Feb. 14, 1994, 94-1 CPD para. 108 at 4; SDA Inc.,
B-248528.2, Apr. 14, 1993, 93-1 CPD para. 320 at 10-12.
Here, a price negotiation memorandum that served as the source
selection document indicates that Rohmann's overall moderate risk
rating was based on its performance on the incumbent contract. Agency
Report, Exhibit 5 at 3. In that memorandum, the contracting officer
stated:
Incumbent[] shows documented adverse performance at Kelly [Air
Force Base] for the past year. The documentation, not following
[contracting officer] direction, non-compliance with contract
requirements, customer complaints and fraudulent work orders,
[is] attached to the past performance questionnaire. Has had
ample time to remedy the situation. The incumbent's contract
performance at Kelly Air Force [Base] has been rated as marginal
by the QAE and the Contract Administrator.
The record of Rohmann's performance as the incumbent includes four
separately tabbed sets of documents which correspond to the four
concerns raised in the above-quoted statement of the contracting
officer: not following the contracting officer's advice,
non-compliance with contract requirements, customer complaints and
fraudulent work orders. While each of those sets of documents raises
concerns about Rohmann's performance, each of those sets also includes
material that reflects positively upon Rohmann and other material the
significance of which is simply unclear and which is not otherwise
explained by the Air Force.
For example, under the "Not Following CO Advice" tab, the record
includes two letters from Rohmann to Air Force officials concerning a
plan by Rohmann to move part of its operation under the contract. In
those letters, Rohmann requests information concerning local
regulations that it may need to be aware of concerning the move and
requests a "safety impact be performed prior to the move." Agency
Report, Enclosure 12, Apr. 9, 1997. Each of those letters includes a
handwritten notation by the Air Force's contract administrator stating
that Rohmann is not to send letters directly to the addressee offices
and that all such letters should go through the contracting office.
While this may be a violation of some provision of Rohmann's contract
and Rohmann may have been advised of this problem previously, this is
not clear from the evaluation record and the Air Force has not
otherwise explained these notations. Thus, we have no basis to
conclude that these letters, or the notations on these letters,
establish that Rohmann violated a provision of the contract or failed
to follow contracting officer advice.[2]
Nonetheless, in spite of some anomalies in the record, based on our
review, we conclude that, the marginal rating assigned to Rohmann's
performance as the incumbent, and the overall moderate risk rating
assigned to Rohmann, were supported by the record. Among other
problems, the record includes customer complaints that support the
ratings assigned to Rohmann's performance. In a May 12, 1997
complaint, Rohmann's photo lab manager is described as
"discourteous/rude" during a call to inform a customer that no order
had been submitted for a requested photographer. Although, in his
contemporaneous response to the complaint, the manager denied being
rude, he conceded that he "may have been abrupt. I will attempt to be
less abrupt in the future." Agency Report, Enclosure 12, Customer
Complaint Record, May 12, 1997.
In another complaint, dated April 7, 1998, a customer stated that the
Rohmann audio-visual library failed to provide adequate customer
service because a Rohmann employee informed the customer that he would
have to return a projector early and that the customer may not be able
to use the projector on dates that previously had been approved.
Agency Report, Enclosure 12, Customer Complaint Record, April 7, 1998.
In a subsequent memorandum, the Air Force's QAE stated that Rohmann's
employee had been uncooperative and discourteous and that the customer
had been treated in an unprofessional manner. Id., Attachment 2.
A customer complaint dated April 22, 1998, states that a Rohmann
employee was "non-supportive and non-customer oriented but also very
rude." Id., Attachment 1. The Air Force's QAE concluded that the
complaint showed a "lack of concern for good customer relations at the
film library" and that "[c]ustomer service at the film library has
been a problem for some time." Id., Attachment 2. In addition, the
QAE concludes that "[t]his incident clearly shows a lack of adequate
interpersonal skills and an attitude of indifference which is very
detrimental to effective customer service." Id.
Finally, concerning a customer complaint dated May 11, 1998, the QAE
concludes:
This is the third customer complaint against the [Rohmann]
contract manager for verbal abuse in about a month. [Visual
information services] customers should not have to accept this
type of service from anyone. His unwillingness to provide
customer service in a courteous manner is incomprehensible,
especially after the two recent customers who complained about
his abusive behavior and his lack of concern for customer needs.
. . . .
.
There is a disturbing pattern of the [Rohmann] contract managers
negative behavior towards [visual information services]
customers, civilian and military, here at Kelly [Air Force Base].
Some customers who have encountered this type of abusive behavior
have complained orally but have been reluctant to submit a formal
complaint for fear of some type of retaliation. Unfortunately,
many customers have been conditioned to accept mediocre or even
poor service as the norm. Since 1995 three out of four [Rohmann]
contract managers have had complaints submitted against them for
verbal abuse or unsatisfactory customer services. Having four
contract managers in less than three years is an area of concern.
The employee turn-over is also of equal concern. In the last two
and a half years the [visual information services] contractor has
lost six employees and has replaced only two of the six who quit
or resigned.
Agency Report, Enclosure 12, Customer Complaint Record, May 11, 1998,
Attachment 1.
The documents under the heading "Not Complying With Contract
Requirements," include records of Rohmann opening the film library
late, failing to vacate the graphics shop on time, using equipment for
nongovernment work, and using an unauthorized entrance during a base
exercise. Agency Report, Enclosure 12, Memorandum, March 14, 1997 and
Memorandum, April 26, 1998. Also under the heading "Not Complying
With Contract Requirements," the record of Rohmann's performance
includes a May 2, 1997, memorandum prepared by the contract
administrator concerning Rohmann's failure to provide notice that it
was relocating the graphic shop to the visual information library.
Agency Report, Enclosure 12, Memorandum, May 2, 1997. That memorandum
notes that Rohmann had already relocated a large piece of equipment
without the permission of government representatives and that Rohmann
had failed to provide proof, in the form of a receipt, that certain
property it had moved belonged to the contractor. Id.
We conclude that these performance problems, combined with the
customer complaints described above and the staff and manager turnover
on the contract, provide support for the moderate risk rating assigned
to Rohmann. While Rohmann offers explanations and interpretations of
the record that provide a more favorable picture of its performance
history than drawn by the agency, the protester has not addressed many
of the agency's allegations concerning the firm's performance, and we
conclude that the evaluation was based on the Air Force's reasonable
perception of inadequate prior performance.[3]
Rohmann contends that the QAE was biased against the firm and
attempted to influence the other evaluators to think that Rohmann was
a poor performer. Comments at para. 11, 39-40. According to Rohmann,
the marginal rating which it received for its performance as the
incumbent at Kelly is not supported by the record and is a result of
the bias of the agency's QAE on that contract. Comments para. 8, 27. In
addition to conducting an unfair evaluation, Rohmann argues that the
QAE solicited complaints against Rohmann, and, as a member or the
evaluation panel, manipulated the past performance evaluation process
and influenced other evaluators to harm Rohmann. Comments at para. 40-1.
Because government officials are presumed to act in good faith, we do
not attribute unfair or prejudicial motives to them on the basis of
mere inference or supposition. Lancaster & Co., B-254418, Dec. 14,
1993, 93-2 CPD para. 319 at 7. Where, as here, a protester alleges bias
or bad faith on the part of a procurement official, our focus is on
whether the official exerted improper influence in the procurement on
behalf of the awardee or against the protester. Prose, Inc.,
B-259016, Feb. 28, 1995, 95-1 CPD para. 123 at 3. To show bad faith, a
protester must show that the contracting agency directed its actions
with the specific and malicious intent to injure the protester.
Robertson Leasing Corp., B-275152, Jan. 27, 1997, 97-1 CPD para. 49 at 4.
Here, the record does not support Rohmann's allegation of bias. While
the QAE's criticisms of Rohmann's performance on the incumbent
contract are stated in strong terms and the QAE indicated that he
would not do business with Rohmann again, see Agency Report,
Attachment 11, Request For Past Performance Evaluation Information
Questionnaire at 2, we do not assume, as Rohmann apparently does, that
the QAE's judgment was based on unfair or prejudicial motives.
Rather, we conclude that his opinion was based on his experience as an
agency official responsible for oversight of Rohmann's performance on
the incumbent contract. Moreover, although Rohmann focuses on the
QAE's involvement in the evaluation, the record shows that a number of
other agency officials, including customers and contracting officials,
expressed concerns about Rohmann's performance. In fact, contrary to
Rohmann's contention that the QAE negatively influenced the views of
other agency officials, in many cases, the QAE's negative view of
Rohmann was directly based on the input of these other officials.[4]
Rohmann also argues that it should have been given an opportunity,
either through discussions or clarifications, to respond to the Air
Force's concerns about its performance at Kelly Air Force Base.
Comments at para. 23, 26, 30, 33, and 59. According to Rohmann, since
it was not given such an opportunity, the records of these alleged
performance problems should not have been considered in the
evaluation. Comments at para. 33, 35, 38, 45, 54, and 61.
There generally is no obligation that a contracting agency conduct
discussions where, as here, the RFP specifically instructs offerors of
the agency's intent to award a contract on the basis of initial
proposals. Robotic Sys. Tech., B-278195.2, Jan. 7, 1998, 98-1 CPD para.
20 at 11. While the contracting officer's discretion in deciding not
to hold discussions is not unfettered, it is quite broad and has been
expanded in recent years. Id. Our Office will review the exercise of
such discretion to ensure that it was reasonably based on the
particular circumstances of the procurement. Id.
Here, the agency had received several other technically acceptable
proposals from firms with better past performance records than
Rohmann. Although Rohmann argues that it should have been given the
opportunity to respond to agency concerns about its performance
record, the concerns related to the predecessor contract, where
Rohmann was the incumbent, and agency officials were therefore
directly aware of the performance history. Under the circumstances,
the decision to award on the basis of initial proposals, without
discussions, was reasonable.
Rohmann also argues that the Air Force should have communicated with
the firm concerning its performance, even without conducting
discussions. Supplemental Comments at para. 25-27. In this regard,
Rohmann refers to FAR sec. 15.306(a), which was amended by the Federal
Acquisition Circular No. 97-02, which includes the Part 15 rewrite.
FAR sec. 15.306(a)(2) which concerns "Clarifications and award without
discussions," states:
If award will be made without conducting discussions, offerors
may be given the opportunity to clarify certain aspects of
proposals (e.g., the relevance of an offeror's past performance
information and adverse past performance information to which the
offeror has not previously had an opportunity to respond) or to
resolve minor or clerical errors.
Apparently, it is Rohmann's position that this provision requires a
contracting officer to conduct "clarifications" with any offeror where
the agency intends to rely on adverse past performance information on
which the offeror has not previously had an opportunity to respond.
Supplemental Comments at para. 27.
We read no such "requirement" into FAR sec. 15.306(a)(2), which states
that "offerors may be given the opportunity to clarify certain aspects
of proposals" including past performance information (emphasis added).
Similar to the decision whether or not to hold discussions, under the
above-quoted language, we think a contracting officer has broad
discretion to decide whether to communicate with a firm concerning its
performance history. We will review the exercise of such discretion
to ensure that it was reasonably based on the particular circumstances
of the procurement.
In this case, since the adverse past performance information concerned
Rohmann's incumbent contract, there is no question the information
was relevant. Although Rohmann argues that it has not had the
opportunity to respond to the adverse information concerning its
performance, the record indicates that Rohmann was aware of much of
that information, including customer complaints and some of the
allegations that it had failed to comply with contract requirements.
Under the circumstances, since past performance was significantly more
important than price under the RFP and Rohmann's price was not so low
as to be considered advantageous, the contracting officer's decision
not to communicate with Rohmann during the evaluation concerning the
firm's performance history was reasonable.
Rohmann also notes that the contracting officer acknowledged that
Rohmann "can satisfactorily perform the requirement," Agency Report,
Enclosure 13 at 1, and argues that, under the circumstances, it is
unreasonable to award to WP at a five percent premium over an award to
Rohmann. Comments at para. 10-11. In a negotiated procurement, the
government is not required to make award to the lowest cost,
technically acceptable offeror unless the RFP specifies that cost will
be the determinative factor for award. General Servs. Eng'g, Inc.,
B-245458, Jan. 9, 1992, 92-1 CPD para. 44 at 9. Award to offerors with
higher-rated proposals and higher prices are unobjectionable, so long
as the result is consistent with the evaluation criteria, and the
agency has determined that the technical difference is sufficiently
significant to outweigh the cost difference. Id. Consistent with
that standard, the agency concluded that WP, with its superior
performance history, represented the best value despite its higher
price. We see nothing unreasonable with that conclusion.
Finally, Rohmann challenges the agency's evaluation of its alternate
proposal under which Rohmann offered a lower price that would be
achieved by consolidating services under the contract into one
building, allowing the firm to streamline its operation and personnel,
while returning cost savings to the government. Agency Report,
Enclosure 9 at 1. Rohmann notes that its alternate proposal was
evaluated by the QAE and argues that the QAE did not consider the
merits of the proposal but instead merely repeated the charges of
adverse performance by Rohmann on the incumbent contract. Comments at para.
47-52.
In an April 22 memorandum, the QAE concluded that Rohmann's alternate
proposal was unacceptable and should not be considered. Agency
Report, Enclosure 10. That memorandum states that the alternate
proposal would involve electrical work in an historical building,
which may have to be performed by government personnel and at
government expense and that the move might not result in any cost
savings to the agency. Agency Report, Enclosure 10. The memorandum
also questions Rohmann's performance on the incumbent contract and,
noting that two complaints had recently been submitted concerning
Rohmann's performance, argues that the agency is already not receiving
the service that it needs from Rohmann. Id. We have reviewed the
record, including the agency's evaluation materials and the
protester's submissions in this regard. The record shows that the
agency was not convinced that Rohmann's alternate proposal would offer
any advantages to the government, even with its lower price. Based on
our review, we find no basis to question the agency's decision to
award to WP. Rohmann's mere disagreement with the agency does not
render the evaluation of its alternate proposal unreasonable. Cessna
Aircraft Co., B-261953.5, Feb. 5, 1996, 96-1 CPD para. 132 at 13, n.19.
The protest is denied.
Comptroller General
of the United States
1. The RFP defined these ratings as follows:
High: Significant doubt exists, based on the offeror's
performance record, that the offeror can satisfactorily
perform the work.
Moderate: Some doubt exists, based on the offeror's
performance record, that the offeror can satisfactorily
perform the work.
Low: Little doubt exists, based on the offeror's
performance record, that the offeror can satisfactorily
perform the work.
Not Applicable: The offeror has no record of relevant
past performance, or information on the offeror's past
performance is not available. The offeror will not be
evaluated favorably of unfavorably on past performance.
2. In another example, although the contracting officer's statement
refers to "fraudulent work orders" under the heading "Work Orders,"
the record does not demonstrate that "fraudulent" is a fair
characterization of the orders presented. Among the documents under
that heading are a number of orders which have handwritten notations
indicating that Rohmann produced more photographs or slides than were
ordered. Although the Air Force argues that these documents show that
Rohmann "overcharged" the agency, Agency Report, Memorandum of Law at
2, as Rohmann points out, this was a fixed-price contract under which
Rohmann was paid a fixed amount each month. Comments at para. 14.
Rohmann also notes that there are only 44 extra units in the
questioned work orders--an insignificant number in relation to the
total contract, Supplemental Comments at para. 35--and that many of the
additional photographs are explained by the fact that the camera used
for passport photographs takes four photographs simultaneously.
Comments at para. 19. We note that the agency may have had legitimate
concerns about these orders since the incumbent contract provided for
a price adjustment based on workload fluctuations and since
negotiation of future contracts was to be based on the agency's
experience under that contract. Supplemental Agency Report,
Attachment 1. The characterization of these orders as "fraudulent,"
however, is not supported by the record.
3. Rohmann argues that it cannot respond to the record of its
performance on the incumbent contract because, as Rohmann's counsel
states, the firm cannot see much of that record since it is subject to
the protective order issued in this protest. Comments at para. 8. Upon
the request of an attorney admitted to a protective order, we
frequently have permitted information subject to the order to be
released from the order so that such information can be reviewed by a
protesting firm. The information in question here, which concerned
Rohmann's performance of the incumbent contract, would have been
appropriate for release from the protective order. We received no
such request in this case.
4. Rohmann notes that the selection decision stated: "In addition, WP
was the low offeror (best price)." Agency Report, Enclosure 5 at 5.
Rohmann argues that, based on this statement, it is not clear what the
contracting officer understood the prices to be. We do not agree.
The document referenced by Rohmann included the prices of Rohmann, WP,
and all other offerors. Of the five offerors that received "Low" risk
ratings, WP's price was the lowest. Read in context, we have no basis
to conclude that the contracting officer's statement indicated that
she misunderstood the prices offered.