TITLE:   D.F. Zee's Fire Fighter Catering, B-280767.4, September 10, 1999
BNUMBER:  B-280767.4
DATE:  September 10, 1999
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D.F. Zee's Fire Fighter Catering, B-280767.4, September 10, 1999

Decision

Matter of: D.F. Zee's Fire Fighter Catering

File: B-280767.4

Date: September 10, 1999

John Lukjanowicz, Esq., Oles Morrison Rinker & Baker, for the protester.

Alan D. Groesbeck, Esq., Department of Agriculture, for the agency.

John L. Formica, Esq., and James Spangenberg, Esq., Office of the General
Counsel, GAO, participated in the preparation of the decision.

DIGEST

1. Protest that the agency unreasonably evaluated the protester's final
revised offer (FRO) under certain technical evaluation factors is denied
where the record shows that the evaluation was reasonable; the fact that the
protester's FRO received a slightly lower technical rating than the
protester's previous offer, even though the protester's FRO and previous
offer were substantially the same, does not establish that the FRO
evaluation was unreasonable.

2. Agency complied with Federal Acquisition Regulation sect. 42.1503(e), which
provides that "past performance information shall not be retained to provide
source selection information for longer than 3 years after completion of
contract performance," even though it considered all of the protester's
5-year past performance history under the predecessor contract, because the
past performance evaluation took place within 3 years of completion of that
contract's performance.

DECISION

D.F. Zee's Fire Fighter Catering (DFZ) protests the awards of contracts to
Z-Best Company and Port-A-Pit Catering under request for proposals (RFP) No.
49-98-10, issued by the Forest Service, Department of Agriculture, for
mobile food services. The protester argues that the agency's evaluation of
proposals and selection of the awardees' higher-priced proposals for the
awards were unreasonable.

We deny the protest.

The RFP, issued on March 11, 1998, provided for award of fixed-price,
indefinite-delivery, indefinite-quantity, requirements contracts for a
1-year base period with four 1-year options. RFP sect.sect. B, at 2, L.5, at 138.
The successful contractors under the RFP are required to provide hot and
cold meals and supplemental items during wildland fires and other activities
at the locations and periods specified in each contract line item (CLIN).
RFP sect. C-1.1, at 12. For example, CLINs 16 and 17 (the CLINs that are the
subjects of this protest) required that the contractor have the necessary
equipment based within 20 miles of Bend, Oregon, from June 15 through
September 30, and July 1 through September 30, respectively, and be
available to provide the required services during these periods should the
need arise. RFP sect. B, at 4. Each offeror could offer to perform the services
at any location or multiple locations, so long as the contractor remained
available at the required times at the locations offered (i.e., the
availability dates at two locations did not overlap).

The RFP stated that awards would be made to the offerors submitting the
proposals determined to be most advantageous to the government, and listed
the following evaluation factors in descending order of importance: (a) Past
Performance, (b) Equipment, (c) Ability to Understand and Perform the Work,
and (d) Experience. [1] RFP sect. M.4, at 151. The RFP added that these
"non-price factors" as a whole would be considered more significant than
price in determining which proposals represented the best overall value. Id.

The RFP included detailed instructions for the preparation of proposals, and
requested that the offerors' technical proposals consist of two parts. Part
A was to address the equipment and ability to understand and perform the
work evaluation factors, and part B was to address the past performance and
experience factors. RFP sect. L.9, at 139-41. The RFP specified that the
equipment offered would first be evaluated against the minimum requirements
set forth in the RFP to determine technical acceptability, and if the
equipment were determined acceptable, it would then "be evaluated based upon
the Mobile Food Service Unit's flexibility for efficient feeding." Id. at
140. In this regard, the RFP required that offerors submit drawings of the
Mobile Food Service Unit offered "indicating equipment location, traffic
flow, layout, size of unit, etc." Id.

The agency received proposals from 21 offerors by the RFP's April 24, 1998,
closing date. Agency Report, Tab R8, Prenegotiation Memorandum, at 2. The
proposals were forwarded to a technical evaluation team (TET) for review.
Sixteen proposals were included in the initial competitive range. The agency
scheduled and conducted inspections of each offeror's proposed equipment,
during which discussions were also held. Id. at 3. The agency found the
equipment proposed by one offeror to be technically unacceptable. The
remaining 15 proposals were further evaluated by the agency. One offeror
subsequently withdrew from the competition, and the agency excluded three
more proposals from the competitive range. Id. at 6; Agency Memorandum of
Law at 3.

The agency requested and received best and final offers (BAFO) from the
offerors whose proposals remained in the competitive range, and the TET made
tentative award recommendations for some of the CLINs. Agency Memorandum of
Law at 3. Two of the three offerors whose proposals were excluded from the
competitive range filed protests with our Office. One of the protests was
withdrawn based upon the agency's inclusion of that offeror's proposal in
the competitive range, and the other protest was denied. See Wilderness
Mountain Catering, B-280767.2, Dec. 28, 1998, 99-1 CPD para. 4.

The agency subsequently provided each of the competitive range offerors with
updated, complete adverse past performance information, and requested
responses to this information as well as final revised offers (FRO). Agency
Report, Tab L, Protester's Combination Invitation/Opportunity to Comment on
Past Performance and Invitation to Submit a Final Revised Offer; Agency
Memorandum of Law at 4. The TET evaluated the FROs and made award
recommendations for each CLIN. Agency Report, Tab R22, Mobile Food Services
Contract Award Recommendations. The contracting officer concurred with the
TET's recommendations, and forwarded the award recommendations, report of
the TET, and associated materials to the agency's Office of General Counsel
and Head of Contracting Activity for review and approval. Agency Memorandum
of Law at 31; Agency Report, Tab R23, Memorandum from the Contracting
Officer to the Director, Acquisition Management (May 19, 1999). After
receiving the necessary approvals, the agency made awards under the RFP,
with Z-Best and Port-A-Pit receiving the contracts for CLINs 16 and 17,
respectively. These CLINs are the subjects of DFZ's protest.

DFZ's proposal was rated as "acceptable -" (i.e., acceptable minus) overall,
with a rating of "acceptable -" under the past performance evaluation
factor, and ratings of "acceptable" under the equipment, ability to
understand and perform the work, and experience factors, at a price for
three meals per day per person of [DELETED]. Agency Memorandum of Law at 5.
Z-Best's proposal was rated as "acceptable +" overall, with ratings of
"acceptable" under the past performance and ability to understand and
perform the work evaluation factors, and "acceptable +" under the equipment
and experience evaluation factors, at a price for three meals per day per
person of $38.78. Id. Port-A-Pit's proposal was also rated as "acceptable +"
overall, with ratings of "acceptable +" under the past performance and
equipment factors, "exceptional -" under the experience factor, and
"exceptional" under the ability to understand and perform the work factor,
at a price for three meals per day per person of $40.50. Id. at 6.

In determining which proposal offered the best value to the government under
CLIN 16, the agency noted that "[a]lthough [DFZ's] price is [DELETED] less
than Z-Best's price, Z-Best's equipment has a higher cooking capacity and
serving flexibility providing greater capacity and efficiency." Agency
Report, Tab R22, Mobile Food Services Contract Award Recommendation, at 19.
The agency also discussed DFZ's history of performance deficiencies and
acceptable equipment, noted Z-Best's superior performance history, and
concluded that Z-Best's "better past performance history, larger sized
equipment with higher cooking capacity and serving flexibility . . .
justifies paying [DELETED] more per day per person." Id. at 18-19.
Similarly, with regard to CLIN 17, the agency, while noting DFZ's [DELETED]
per person per day price advantage, found that Port-A-Pit's "better past
performance history, larger sized equipment with higher cooking capacity and
serving flexibility . . . justifies paying [DELETED] more per day per
person." Id. at 20.

DFZ protests that the evaluation of its proposal was unreasonable primarily
because its FRO received a lower rating than its BAFO, even though its FRO
and BAFO were essentially the same. Protester Comments at 6-9. In this
regard, the protester notes that its BAFO received a rating of "acceptable"
under the past performance factor and "acceptable" overall, whereas its FRO
was rated as "acceptable -" under the past performance factor and
"acceptable -" overall. [2]

The evaluation of proposals is primarily a matter within the agency's
discretion, since it is responsible for defining its needs and deciding on
the best method for accommodating them. Thus, we question the evaluation
only if the record demonstrates that it was unreasonable or inconsistent
with the RFP's evaluation criteria. Andrulis Corp., B-281002.2, June 2,
1999, 99-1 CPD para. 105 at 4. The fact that DFZ's BAFO received a higher rating
than DFZ's FRO does not establish in and of itself that the agency's FRO
evaluation was unreasonable. Rather, we look to the complete record to
determine the reasonableness of the agency's evaluation. Id.

In our view, the primary difference between the agency's evaluation of DFZ's
BAFO and FRO is not that DFZ's FRO received the lower score of "acceptable
-," as opposed to "acceptable," but rather the detail and clarity of the
agency's FRO evaluation as reflected by the relevant documentation. For
example, while the evaluation documentation of the TET's consensus rating of
the protester's BAFO consists of one hand-written sheet (which was unclear
as to what rating DFZ's proposal actually received under the past
performance factor), the documentation of the consensus rating of the
protester's FRO consists of approximately three typewritten pages setting
forth in considerable detail the reasoning behind the agency's conclusions.
Agency Report, Tab R11, Protester's BAFO Consensus Rating Sheet; Tab R19,
Protester's FRO Consensus Rating Sheet. Based on our review, we find the
agency's well-documented evaluation of DFZ's FRO to be reasonable.

For example, in evaluating DFZ's FRO as "acceptable -" under the past
performance evaluation factor, the agency noted that DFZ had "encountered
difficulty" during the first 3 years of the predecessor contract. Agency
Report, Tab R19, Protester's FRO Consensus Rating Sheet, at 1. The TET found
that DFZ had discussed these difficulties in its proposal "openly and
effectively," and that the performance information provided by DFZ in its
BAFO for the 1998 fire season, as well as agency records, "show positive
performance." Id. The TET added, however, that, while DFZ's performance had
improved, deficiencies nevertheless occurred "in nearly every year of the
previous 5-year contract." Id. The TET explained that, while the
"deficiencies were rectified after each specific occurrence . . . some
continued to occur sporadically throughout the entire contract performance
period." Id. The TET added that "[e]ven though the management showed
willingness to change there was insufficient evidence of resolution or
corrective actions established to give additional credit," and that while
DFZ "readily admitted problems . . . few solutions were observed in
performance from 1996 forward." Id. In light of the fact that the protester
does not dispute the accuracy of the agency's characterization of its past
performance, and the apparent reasonableness of the agency's views, we have
no basis to object to the agency's evaluation of DFZ's past performance as
"acceptable -."

With regard to the protester's equipment, the protester complains that,
while the kitchen unit proposed in its BAFO and FRO was the same and even
though its "acceptable" rating remained the same, its equipment "suddenly
became old and tired" in the agency's narrative after the FRO evaluation.
Protester's Comments at 9. Here, too, the primary difference between the
agency's evaluation of DFZ's BAFO and FRO is the detail and clarity of the
agency's FRO evaluation as reflected by the relevant documentation. Included
in the FRO evaluation is a more precise description of the protester's
equipment, including its kitchen unit. The protester does not argue that the
agency's description of its equipment as "older" is inaccurate, nor does the
protester argue that its equipment should have received a rating other than
"acceptable." Moreover, it is not apparent from the TET's award
recommendation that describes the relative merits of the offerors' equipment
that the fact that DFZ's kitchen unit is "older" was given any weight in the
agency's award decision.

The protester argues that the agency "added two evaluation subfactors to the
equipment [factor] which are not fairly included in the RFP--the age of the
equipment and two serving lines." Protester's Comments at 10. The protester
points out here that the agency documents recommending that the award of
CLINs 16 and 17 be made to Z-Best and Port-A-Pit, respectively, both noted
in a positive manner that the kitchen units proposed by these offerors had
"the flexibility of two serving lines." Protester's Comments at 10; Agency
Report, Tab R22, Mobile Food Services Contract Award Recommendations, at 18,
19.

Solicitations must inform offerors of the basis for proposal evaluation, and
the evaluation must be based on the factors set forth in the solicitation.
Federal Acquisition Regulation (FAR) sect.sect. 15.203(a)(4), 15.305(a). Although
agencies are required to identify all major evaluation factors, they are not
required to identify all areas of each factor which may be taken into
account, provided that the unidentified areas are reasonably related to or
encompassed by the stated criteria. JoaQuin Mfg. Corp., B-275185, Jan. 29,
1997, 97-1 CPD para. 48 at 2.

As mentioned previously, the RFP specifically stated that the equipment
offered would "be evaluated based upon the Mobile Food Service Unit's
flexibility for efficient feeding," and in order to facilitate this, it
required the submission of drawings of each Mobile Food Service Unit offered
"indicating equipment location, traffic flow, layout, size of unit, etc."
RFP sect. L.9, at 140. Given this language, it was consistent with the RFP's
evaluation factors for the agency to consider in a positive manner the
"flexibility for efficient feeding" resulting from the awardees'
demonstrated abilities to provide two serving lines. [3]

The protester also argues that Port-A-Pit's proposal was improperly
evaluated. Specifically, the protester points out that the sinks in
Port-A-Pit's proposed kitchen unit did not meet the minimum dimensions
required by the agency. Protester's Comments at 9; Agency Report, Tab R7,
Technical Proposal Evaluation Summary Sheet Site Visit for Port-A-Pit. The
protester adds that after the agency raised this deficiency with Port-A-Pit
during discussions, Agency Report, Tab R9, Port-A-Pit's BAFO Invitation, and
after receiving Port-A-Pit's BAFO which proposed new sinks that were
compliant with the agency's requirements, Agency Report, Tab R10,
Port-A-Pit's BAFO, at 2, the agency evaluated Port-A-Pit's equipment as
"acceptable +." The protester argues that informing Port-A-Pit during
discussions of the deficiency regarding its sinks and affording the awardee
an opportunity to correct this deficiency in its BAFO "render[ed] the site
inspection and the equipment rating meaningless." Protester's Comments at 9.

Contracting agencies have wide discretion in determining the nature and
scope of discussions, and our Office will not question that discretion
unless it is shown to lack a rational basis. Delany, Siegel, Zorn & Assocs.,
Inc., B-258221.2, B-258221.3, July 10, 1995, 95-2 CPD para. 7 at 5 n.5. There is
certainly nothing improper in an agency advising an offeror during
discussions of weaknesses and deficiencies in its proposal, as the Forest
Service did with Port-A-Pit here. Nor was it in any way improper for the
agency to give Port-A-Pit the opportunity to revise its proposal after the
close of discussions. See FAR sect. 15.307(b).

The protester argues that the agency failed to comply with FAR sect.sect. 42.1503(b)
and (e) in its evaluation of DFZ's past performance. Specifically, the
protester complains that the agency did not review certain disagreements
regarding DFZ's past performance at a level above the contracting officer,
as required by FAR sect. 42.1503(b), and was precluded by FAR sect. 42.1503(e) from
considering adverse past performance information from the 1994 fire season
because that information was more than 3 years old.

FAR subpart 42.15 "provides policies and establishes responsibilities for
recording and maintaining contractor performance information." FAR
sect. 42.1500. FAR sect. 42.1503 sets forth the procedures to be followed by
agencies in recording and maintaining past performance information, with FAR
sect. 42.1503(b) requiring that contractors be provided with and given an
opportunity to comment on the agency's evaluations of their performance. FAR
sect. 42.1503(b) states in pertinent part that "[a]gencies shall provide for
review at a level above the contracting officer to consider disagreements
between the parties regarding the evaluation," and notes that "[t]he
ultimate conclusion on the performance evaluation is a decision of the
contracting agency."

Here, contrary to the protester's assertions, the record reflects that DFZ's
past performance information, which included both DFZ's and the contracting
officer's views regarding DFZ's past performance, was reviewed by the
agency's Head of Contracting Activity and Office of General Counsel. Agency
Memorandum of Law at 31; Agency Report, Tab R23. In any case, as noted
above, DFZ has not refuted the negative information except to argue that it
relates to incidents that occurred more than 3 years ago.

FAR sect. 42.1503(e) provides that "past performance information shall not be
retained to provide source selection information for longer than three years
after completion of contract performance." The agency points out that DFZ's
performance under the predecessor contract was completed on December 31,
1998 (the date the predecessor contract expired), and the agency contends
that DFZ's performance under the predecessor contract may properly be
considered for 3 years from that date, that is, through December 31, 2001.
Agency Memorandum of Law at 32. The protester responds that "[t]he contract
performance [under the predecessor contract] that is in question occurred in
1994 and 1995," and that because those particular incidents of contract
performance took place more than 3 years ago, the agency's consideration of
them was inconsistent with FAR sect. 42.1503(e). Protester's Comments at 13.

The agency's reading of FAR sect. 42.1503(e) is, in our view, the more
reasonable reading of the provision and is consistent with the provision's
regulatory history. Specifically, the regulatory history of FAR sect. 42.1503(e)
reflects that the amount of time that past performance information could be
retained and considered was lengthened from 3 years to, ultimately, "three
years after completion of contract performance" in light of the belief that
"the retention period should exceed the length of the contract." 58 Fed.
Reg. 3575 (1993). Accordingly, we agree with the agency that a contractor's
past performance information may be considered for up to 3 years after the
completion of contract performance as a whole, rather than for only 3 years
after each incident of performance under the contract, as argued by the
protester.

Finally, DFZ challenges the agency's price/technical tradeoff determination
based upon its contentions regarding the agency's evaluation of proposals.
As explained above, we find that the agency's evaluation of proposals was
reasonable. Since the award selection document reasonably explained why
Port-A-Pit's and Z-Best's higher-rated proposals were worth their evaluated
price premiums, DFZ's contentions here provide no basis for overturning the
award determination. Matrix Int'l Logistics, Inc., B-277208, B-277208.2,
Sept. 15, 1997, 97-2 CPD para. 94 at 14.

The protest is denied.

Comptroller General
of the United States

Notes

1. The ability to understand and perform the work evaluation factor included
the following subfactors: organization, personnel, and capacity.

2. DFZ is correct that according to the record its BAFO received an overall
rating of "acceptable" whereas its FRO received an overall rating of
"acceptable -." However, it is difficult to determine from the record
whether DFZ's BAFO received a rating under the past performance evaluation
factor of "acceptable," as DFZ claims, or "acceptable -." For example,
although, as DFZ points out, the relevant consensus rating sheet includes a
statement that based upon favorable evaluations "from 1998" DFZ's past
performance rating "was upgraded to acceptable from acceptable -," the
rating on the sheet itself remained "acceptable -." Agency Report, Tab R11,
Protester's BAFO Consensus Rating Sheet. Unfortunately, the TET's
recommendation for award fails to clear up this discrepancy. Specifically,
while the TET's narrative provides that DFZ's proposal was rated
"acceptable" because, among other things, "they have acceptable performance
on the present contract," the accompanying technical consensus summary lists
a rating of "acceptable -" for DFZ under the past performance evaluation
factor. Agency Report, Tab R13, TET Contract Award Recommendations After
Receipt and Rating of BAFOs, at 7, 9.

3. In light of our prior finding that there is no evidence that DFZ's
"older" kitchen unit was considered in a negative manner in the agency's
award decision, we need not consider the protester's argument that the
consideration of the proposed equipment's age was not encompassed by the
RFP's evaluation criteria.