BNUMBER:  B-280270 
DATE:  August 10, 1998
TITLE: Randolph Engineering Sunglasses, B-280270, August 10, 1998
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Matter of:Randolph Engineering Sunglasses

File:     B-280270

Date:August 10, 1998

Ronald S. Perlman, Esq., Ralph L. Kissick, Esq., and Jeffrey L. 
Karlin, Esq., Zuckert, Scoutt & Rasenberger, for the protester.
John F. Kearney, Esq., AO Sunwear USA, Inc., an intervenor.
J. Albert Calluso, Esq., Defense Logistics Agency, for the agency.
Paul E. Jordan, Esq., and Paul Lieberman, Esq., Office of the General 
Counsel, GAO, participated in the preparation of the decision.

DIGEST

1.  In procurement set aside for small businesses, where protester 
fails to timely challenge proposed awardee's size status after 
receiving agency notice of intent to award and contracting officer 
otherwise had no information prior to award that impeached awardee's 
certification that it is a small business, contracting officer acted 
reasonably in not questioning that certification.

2.  Protest of price/technical tradeoff in best value procurement is 
denied where source selection authority reasonably determined that 
protester's "excellent" past performance rating did not justify paying 
a significantly higher price than that proposed by an offeror with a 
"good" past performance rating.  

DECISION

Randolph Engineering Sunglasses protests the award of a contract to AO 
Sunwear USA, Inc. under request for proposals (RFP) No. 
SPO200-97-R-5014 for aviation sunglasses issued by the Defense Supply 
Center Philadelphia (DSCP), Defense Logistics Agency.  Randolph 
questions the compliance of AO's proposed product with the RFP 
specifications and protests the award determination and the agency's 
acceptance of AO's certification that it is a small business.

We deny the protest.

The RFP was issued as a total small business set-aside for the supply 
of aviation sunglasses made in accordance with military specifications 
incorporated in the RFP.  The RFP contemplated award of a fixed-price, 
indefinite-quantity, indefinite-delivery contract for a base year with 
two 1-year options at an estimated quantity of 40,920 sunglasses for 
each year.

Technical proposals were to be evaluated under two factors:  past 
performance and electronic data interchange (EDI) capability.[1]  
Together these factors were considered significantly more important 
than price.  Award was to be made to the offeror whose proposal was 
evaluated as most advantageous to the government.  The RFP at section 
52.212-2, Addendum, also provided that the agency would develop a 
level of confidence assessment for each offeror which was to reflect 
the government's "degree of confidence in the offeror's ability to 
keep promises it has made in its proposal."  This rating was to be 
used in adjusting the evaluation of the offeror's proposal and "could 
be highly influential in determining which offeror represent[ed] the 
best overall expected value."  The RFP went on to state that the most 
important factor in the development of the assessment rating would be 
the offeror's record of past performance and experience.  

Randolph, AO, and two other offerors submitted proposals by the 
November 24, 1997 closing date.  After evaluating the proposals and 
conducting discussions, the agency obtained best and final offers from 
each offeror in the competitive range.[2]  The final ratings and 
prices for Randolph and AO are as follows:

    Offeror  Past Perform.EDI    Confidence
                                 Level      Total Est. Quantity Price

    Randolph ExcellentAcceptable High           $1,273,021

    AO       Good     Acceptable High           $  913,334

    Offeror CGood     Acceptable Moderate       $  979,215
In making his award determination, the contracting officer, as source 
selection authority, considered Randolph's higher past performance 
rating and the price differential between AO and Randolph.  Based on 
the fact that Randolph's price was approximately 40 percent higher 
than AO's price, the contracting officer reasoned that "the price 
differential is significant and does not warrant making award to 
Randolph Engineering based on a marginally superior rating for past 
performance."  Source Selection Decision Document.  He therefore 
determined that AO's proposal represented the best value to the 
government.

The contracting officer notified Randolph of his intent to award the 
contract to AO on May 22, 1998, in order to provide it an opportunity 
to challenge AO's size status.  In the absence of any challenges, the 
contracting officer awarded AO the contract on May 28.  This protest 
followed.  After initially staying performance of the contract, the 
agency determined to override the stay based on the best interest of 
the government.

Randolph first challenges AO's status as a small business based upon a 
1993 ruling by the Small Business Administration (SBA) that AO, then 
operating under a different name, was considered other than small due 
to its affiliation with a large business.  The Small Business Act, 15 
U.S.C.  sec.  637(b)(6) (1994), gives the SBA, not our Office, the 
conclusive authority to determine matters of small business size 
status for federal procurements.  Bid Protest Regulations, 4 C.F.R.  sec.  
21.5(b)(1) (1998); Survice Eng'g Co., B-235958, July 20, 1989, 89-2 
CPD  para.  71 at 2.  We therefore will not review a protester's challenge 
to another company's size status, nor will we review a decision by the 
SBA that a company is, or is not, a small business for purposes of 
federal procurements.  Survice Eng'g Co., supra; Antenna Prods. Corp., 
B-227116.2, Mar. 23, 1988, 88-1 CPD  para.  297 at 2.  Accordingly, this 
issue is not for our consideration.

Randolph also argues that AO, having been declared other than small in 
1993, was not allowed to self-certify itself as small unless it had 
obtained a recertification from the SBA, see 13 C.F.R.  sec.  
121.1009(g)(3), and that the contracting officer was on notice that 
AO's self-certification as a small business should be questioned.  
While our Office will review whether an offeror's self-certification 
as a small business should have been challenged by the contracting 
officer, Fiber-Lam, Inc., B-237716.2, Apr. 3, 1990, 90-1 CPD  para.  351 at 
4, we will not consider the issue here, because it was untimely 
raised.  Our Bid Protest Regulations require that a protest be filed 
within 10 days after the basis of the protest is known or should have 
been known.  4 C.F.R.  sec.  21.2(a)(2).  Randolph asserts that it learned 
this basis of protest after review of the agency report in which it 
found a letter AO submitted with its offer which allegedly called into 
question AO's self-certification.  Randolph received the agency 
report, including AO's submission, more than 10 days before it raised 
this issue in its comments on the agency report, and it is therefore 
untimely.

In any event, we note that a contracting officer generally may accept, 
at face value, an offeror's self-certification, unless he has 
information prior to award that reasonably impeaches the 
certification.  Fiber-Lam, Inc., supra.  Here, the contracting officer 
had before him only AO's submission stating that "[p]rior to June 1996 
AO, [under its former name] was considered a large business only 
because its Board of Directors were the same [as those] of American 
Optical Corporation, which prior to June 1996 was a large business."  
Letter from the President of AO Sunwear USA, Inc., to the Contracting 
Officer (Nov. 19, 1997).  The statement went on to state that both AO 
and American Optical each employed less than 50 people and would both 
be considered small businesses.  These statements do not constitute 
information that can be considered to "reasonably impeach" AO's 
self-certification so as to create an obligation on the part of the 
contracting officer to refer the matter to the SBA.  

Randolph next contends that the agency's award determination was 
flawed because it was based on an improper evaluation.  Where there is 
a challenge to the evaluation of proposals in a negotiated 
procurement, it is not the function of our Office to evaluate the 
proposals de novo.  Rather, we will examine an agency's evaluation 
only 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.  Advanced Tech. and 
Research Corp., B-257451.2, Dec. 9, 1994, 94-2 CPD  para.  230 at 3; 
Information Sys. & Networks Corp., B-237687, Feb. 22, 1990, 90-1 CPD  para.  
203 at 3. 

Past performance was to be evaluated under the following subfactors:  
offeror's reputation for conforming to specifications and standards of 
good workmanship; adherence to contract schedules; and reasonable and 
cooperative behavior, commitment to customer satisfaction, and having 
a business-like concern for the customer's interests.  RFP at  sec.  
52.212-2, Addendum.  The difference between an "excellent" rating and 
a "good" rating under the past performance factor is based upon 
relatively slight degrees of divergence.  Thus, to achieve an 
"excellent" rating, the "majority" of past performance contacts must 
indicate that the offeror has a record of "complete conformance" with 
specifications and an "outstanding" reputation for good workmanship 
and manufacturing practices.  To achieve a "good" rating, "most" of 
the contacts must indicate a "better than average" record of 
performance, specification compliance and good workmanship reputation.  
With regard to timely performance, an "excellent" record is necessary 
for an "excellent" rating, while a "good" rating is based on a "better 
than average" delivery record.  With regard to complaints, an 
"excellent" rating is based on complaints being "negligible or 
unfounded" and on an "excellent" record of responding to customer 
complaints."  A "good" rating is based on "perhaps valid" complaints 
being "few and relatively minor."  Technical Evaluation, Rating Scale.

Randolph argues that in making its award determination, the agency 
failed to properly consider the "huge" differences between the bases 
for Randolph's "excellent" past performance rating and AO's "good" 
rating.  Given those differences, Randolph asserts that AO's "high" 
confidence assessment was unwarranted.  Based on our review of the 
record, the agency's evaluation and the award determination were both 
reasonable.

In this regard, the agency found that both offerors had successful 
technical experiences in building metal frames and electroplating.  
The evaluators also noted that AO was the originator of the frame 
style to be supplied.  While Randolph was given credit for its "many 
sizeable contracts [mainly metal wire frames and gas mask inserts] 
with DSCP in the past 15 years," AO was credited for its "many" 
contracts (mainly metal frames) with DSCP during the same period.  The 
end-users liked both offerors' workmanship.  While Randolph's delivery 
was "always" on time, AO's was "mostly" on time.  There was no history 
of complaints against Randolph, and while there was a history of some 
complaints against AO, AO was "willing to correct the deficiencies 
quickly."  The evaluators noted that in the many purchases over the 
last year, there had been no complaints about AO's workmanship. 
Randolph "always" adhered to the contract delivery schedules and was 
recognized for its "extra efforts" in meeting a surge requirement for 
gas mask inserts during Operation Desert Storm, while AO "mostly" 
adhered to the delivery schedules.  Randolph was evaluated as being 
"very cooperative" with the government's interest including 
development of competitive products with lower cost and development of 
prototypes for evaluation at no cost to the government.  AO was 
evaluated as "reasonably cooperative" with the government's interest 
and although the company had changed hands "many times" during the 
past 20 years, AO continued to work toward furthering the "mutual 
interest" of the company and the government.

While the agency recognized differences in Randolph's and AO's past 
performance, we do not agree with Randolph that these differences 
should be viewed as "huge."  Rather, as recognized by the evaluators, 
Randolph's past performance was better than AO's, and warranted an 
"excellent" rating, while AO's performance was not as outstanding, but 
warranted a "good" rating.  The fact that the differences were 
significant enough to warrant the respective ratings does not mean 
that they were significant enough to warrant a less than "high" 
confidence assessment for AO.  In this regard, the confidence 
assessment is a subjective judgment about how much confidence, trust, 
or reliance the agency has in an offeror's promises to perform.  In 
view of AO's complaint-free performance in the preceding year while 
filling multiple small orders for sunglasses, its willingness to 
quickly correct any deficiencies, and its overall "good" past 
performance rating, the agency reasonably assessed its confidence in 
AO's ability to perform its promises as "high."  Randolph's mere 
disagreement with the evaluators' judgment does not render the 
evaluation unreasonable.  See Litton Sys., Inc., B-237596.3, Aug. 8, 
1990, 90-2 CPD  para.  115 at 8.

Likewise, Randolph's disagreement with the contracting officer's 
tradeoff determination does not make it unreasonable.  Agency 
officials have broad discretion in determining the manner and extent 
to which they will make use of technical and price evaluation results.  
Price/technical tradeoffs may be made; the extent to which one may be 
sacrificed for the other is governed by the test of rationality and 
consistency with the established evaluation factors.  General Servs. 
Eng'g, Inc., B-245458, Jan. 9, 1992, 92-1 CPD  para.  44 at 9.  Here, the 
contracting officer considered the difference in the offerors' past 
performance ratings.  He specifically noted that multiple small orders 
had been issued to both offerors and both had an excellent record of 
filling the orders.  While recognizing Randolph's higher past 
performance rating, the contracting officer determined that it was not 
high enough to justify paying the substantial price premium 
represented by Randolph's proposal.  In this regard, he specifically 
noted that paying a price premium of less than 6 percent could have 
been justified by Randolph's superior past performance.  Price 
Negotiation Memorandum at 2.  In view of the relatively close 
technical merit of the two proposals and the significant price 
differential, the contracting officer's tradeoff cannot be considered 
unreasonable.

Finally, Randolph challenges AO's compliance with the applicable 
military specification.  According to Randolph, the temples on AO's 
sunglasses do not meet the size and "swedging" process requirements.  
The agency has submitted statements from an agency engineer that AO's 
sunglasses in fact meet the temple thickness specifications and that 
AO employs the "swedging" process to meet the temple thickness 
requirements.  In the absence of any evidence from Randolph to rebut 
the engineer's statements, there is no basis to conclude that AO's 
sunglasses do not meet all specifications.

The protest is denied.

Comptroller General
of the United States

1. The RFP advised that DSCP intended to use EDI to send delivery 
orders to, and receive invoices from, the contractor.

2. The fourth offeror's proposal was eliminated from the competition 
because it did not meet the small business size standard.