BNUMBER:  B-280834; B-280834.2 
DATE:  November 25, 1998
TITLE: Lear Siegler Services, Inc., B-280834; B-280834.2, November
25, 1998
**********************************************************************

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:Lear Siegler Services, Inc.

File:     B-280834; B-280834.2

Date:November 25, 1998

Harvey G. Sherzer, Esq., Lee P. Curtis, Esq., Allen Cannon, III, Esq., 
and Douglas S. Manya, Esq., Howrey & Simon, for the protester.
Cyrus E. Phillips, IV, Esq., William H. Butterfield, Esq., and 
Christopher H. Jensen, Esq., Kilcullen, Wilson and Kilcullen, for 
Sikorsky Support Services, Inc., an intervenor.
Ellen Washington, Esq., and J. Cole Cartledge, Esq., Naval Air Systems 
Command, Department of the Navy, for the agency.
Ralph O. White, Esq., and Christine S. Melody, Esq., Office of the 
General Counsel, GAO, participated in the preparation of the decision.

DIGEST

1.  Protester's contention that inconsistencies in the ratings 
definitions found in the source selection plan resulted in an 
unreasonable evaluation is denied where the record shows that the 
evaluators performed a reasonable assessment of proposals in 
accordance with the solicitation's evaluation plan.

2.  Allegation that agency held inadequate discussions because it did 
not advise the protester that its price was considered high is denied 
where the record shows that the protester's initial price was, in 
fact, within the middle range of prices, and even as revised, was not 
so much higher than the prices of other offerors to require advising 
the protester of this fact. 

3.  Protest that agency's evaluation of past performance failed to 
consider the relevance of an offeror's experience is denied where the 
record shows that the agency evaluators considered the awardee's lack 
of relevant experience and reflected it in the assigned rating.  
Although the record is less clear about whether the agency considered 
the relevance of the protester's experience (protester was the 
incumbent for these services for the previous 10 years), the agency 
reasonably rated the protester's experience as satisfactory, given the 
protester's problems in performing these services during the 
predecessor contract.

4.  Contention that agency performed a flawed price analysis by 
failing to consider whether the awardee planned to provide the fringe 
benefits required under the applicable collective bargaining 
agreements and wage determinations, thus permitting the awardee a 
competitive advantage, is denied where the record does not indicate 
that the awardee will not comply with the required compensation 
levels, and where the agency's price analysis was otherwise 
reasonable.  

5.  Protester's contention that agency failed to perform an 
appropriate price/technical tradeoff between its proposal and the 
proposal of the awardee is denied where the record shows that the 
protester was not prejudiced by any failure in this regard because the 
protester was not next in line for award.  Instead, a tradeoff was 
made between the awardee's lower-rated, lower-priced proposal, and 
another offeror's proposal that was rated higher, but priced lower, 
than the protester's proposal.   

DECISION

Lear Siegler Services, Inc. (LSI) protests the award of a contract to 
Sikorsky Support Services, Inc., by the Department of the Navy 
pursuant to request for proposals (RFP) No. N00019-97-R-0030, issued 
for maintenance of fixed- and rotary-wing aircraft at Naval Air 
Stations in Meridian, Mississippi; Pensacola, Florida; and Corpus 
Christi, Texas.  LSI argues that the Navy's method of evaluating 
proposals was irrational; that the agency failed to hold meaningful 
discussions; that the agency's assessment of past performance and its 
price analysis were unreasonable; and that the selection decision was 
flawed for the reasons above, and improper on its face.

We deny the protest.

BACKGROUND

The RFP, issued December 24, 1997, sought maintenance services for 
approximately 139 T-2C and TA-4J aircraft (together with approximately 
5 HH-1N and UH-3H helicopters) used by the Chief of Naval Air Training 
to train undergraduate student pilots in intermediate and advanced 
"Strike" fighter skills.  Hearing Transcript (Tr.) at 83-84.  The RFP 
anticipated award of a fixed-price requirements contract for a 1-year 
base period, followed by four 1-year options, to the offeror whose 
proposal represented the best value to government.

As amended, the RFP identified three evaluation factors, in descending 
order of importance:  technical, management, and price.  Under the 
technical and management evaluation factors were the following 
subfactors (technical subfactors listed in descending order of 
importance; management subfactors equal in weight): 

     Technical 
        -- Maintenance and logistics support approach
        -- Engineering support and services
        -- Quality assurance program
        -- Safety and environmental

     Management 
        -- Management approach
        -- Experience/past performance/systemic improvement

RFP, amend. 0005,  sec.  M-2, para. 1.  Under the price evaluation factor, 
the RFP advised offerors that the agency would perform a price 
analysis, including calculating an evaluated price using a weighted 
average method, as well as a best estimated quantity (BEQ) price.  Id. 
at para. 2.  The RFP further advised that the agency would assess risk 
under each evaluation factor and subfactor.  Id. at para. 1.

The Navy received four initial proposals, including those submitted by 
LSI and Sikorsky.  To evaluate the technical and management portions 
of the proposals, the Navy convened a technical evaluation team (TET); 
to review price proposals, the Navy convened a price evaluation team 
(PET).  At the conclusion of the TET and PET reviews, the teams 
presented their findings to a competitive award panel (CAP).  The TET 
findings, in particular, consisted of a list of evaluated strengths 
and weaknesses under each factor and subfactor, for each of the four 
proposals.  The PET review identified each offeror's evaluated price 
and BEQ price, along with any comments regarding the price proposal 
and any subjects for discussion or clarification with the offeror.

After presentations by the TET and PET, the CAP recommended to the 
source selection authority (SSA) that all four proposals be included 
in the competitive range for award, and that the Navy hold discussions 
with the offerors.  The SSA concurred, and after discussions, offerors 
were asked to submit written responses, and any revised prices by June 
18, 1998.  After review of these submissions, offerors were asked to 
submit final revised proposals (FRP) by July 1.  Although the call for 
FRPs permitted changes, offerors were advised that any changes 
required documentation.

Upon receipt of FRPs, the TET and PET revised their evaluations, and, 
on July 7, presented the results of their final review to the CAP.  
The minutes of this CAP meeting were memorialized in a memorandum 
dated July 8, which contains a summary of the overall technical and 
management ratings and risk assessments, as well as the proposed 
evaluated and BEQ prices.  The final overall ratings and prices, as 
set forth in the CAP memorandum[1], are shown below:

            Technical
           rating/risk   Mgmt.
                      rating/risk Overall
                                rating/risk Evaluated
                                              Price
                                           (millions)    BEQ
                                                        Price
                                                     (millions)

Offeror A      S/M       HS/L      S+/M      $172.0    $177.4

LSI           S+/L        S/L       S/L      $181.1    $173.3

Offeror B     S+/L       S+/M      S+/L      $169.7    $165.1

Sikorsky       S/M        S/L       S/M      $149.6    $147.7     
CAP Memorandum, July 8, 1998, at 2-4.  In reviewing these results, the 
CAP "decided there was no competitive advantage for awarding to either 
[LSI] or [Offeror A] since both were considerably higher in price than 
either [Offeror B] or Sikorsky."  Id. at 3.  

The CAP memorandum also considered whether to raise the overall risk 
rating for Sikorsky from medium to high, but concluded that the medium 
risk factor need not be changed, and that the risk of awarding to 
Sikorsky versus Offeror B was offset by the $17.4 million in savings 
achieved from awarding to Sikorsky.[2]  Id.  In addition, the CAP 
memorandum stated:

     Although Sikorsky's proposed price is low and they provide no 
     risk mitigation plan to cover the potential loss of qualified 
     personnel, the CAP believed that these concerns could be 
     rectified with close Government monitoring and by adding a CDRL 
     [Contract Data Requirements List] for a Government-approved 
     training program at the time of award.

Id. at 4.

One week later, on July 14, 1998, the SSA concurred in the 
recommendations found in the CAP memorandum by marking an "X" on a 
cover sheet appended to the memorandum.  Although the SSA testified 
that some of the members of the CAP discussed the evaluation results 
with him, there is no separate memorandum of that discussion, and the 
minutes of the CAP meeting were used as the source selection document.  
See Tr. at 41-42.  The Navy awarded the contract to Sikorsky on August 
10, notified LSI of the award the next day, and provided a debriefing 
to LSI on August 14.  On August 19, LSI filed this protest.

In response to LSI's protest, our Office requested a report from the 
Navy by not later than September 18.  On September 9, the CAP 
reconvened to prepare a new selection decision, which was again 
reflected in a memorandum, and again adopted by the SSA.  The SSA's 
concurrence and the second CAP memorandum are dated September 16.  
During the course of the hearing held by our Office, the SSA explained 
that the CAP was reconvened in response to the protest and was tasked 
to perform a tradeoff between the proposals submitted by LSI and 
Sikorsky, because the earlier CAP memorandum had not focused on a 
tradeoff with LSI, but with another offeror--i.e., offeror B in the 
table above.  Tr. at 39-40.  In this document, the CAP lists each of 
the identified strengths of the LSI proposal, and concludes that none 
of these strengths are sufficient to justify selection of LSI's 
higher-priced, higher-rated proposal over the lower-priced, 
lower-rated proposal submitted by Sikorsky.  

ANALYSIS

As stated above, LSI's protest raises three distinct types of 
challenges to the Navy's conduct of this procurement:  (1) process 
challenges, including the evaluation method and the adequacy of 
discussions; (2) substantive challenges, including the evaluation 
assessments in the areas of past performance and price realism; and 
(3) a challenge to the source selection decision.  Based on our review 
of the record, and a hearing convened in this protest, we disagree 
with LSI's challenges to the method of the evaluation, the adequacy of 
discussions, and the substantive evaluation assessments, as discussed 
in greater detail below.  On the other hand, while we agree that the 
source selection statement was flawed, we conclude that LSI was not 
prejudiced by the agency's actions in this area.  

The Challenge to the Evaluation Method

LSI argues that the ratings definitions used by the evaluators to rate 
proposals under all of the factors and subfactors, as well as the 
method of preparing consensus summaries of the evaluation results, 
improperly culminated in all of the proposals receiving the same 
satisfactory rating under almost every factor and subfactor.  With 
respect to the issue of ratings definitions, LSI explains that the 
definitions in the source selection plan require reliance on 
information about the offeror's past performance that was generally 
not available to the technical evaluators.  While LSI is correct about 
the problem with the ratings definitions, we do not agree that this 
problem resulted in an unreasonable evaluation of proposals.

The Navy's source selection plan contained the following standard for 
a rating of outstanding:

     Proposal significantly meets or exceeds the requirements of the 
     solicitation and contains at least one exceptional enhancing 
     feature which benefits the Government.  Offeror demonstrates past 
     performance that consistently exceeds expectations.  Any weakness 
     is minor.

Source Selection Plan, Jan. 13, 1998, at 8 (emphasis added).  
Similarly, each of the other definitions required a conclusion about 
the offeror's past performance:  the rating of "satisfactory" required 
a conclusion that past performance "generally meets expectations."  
Id. at 8-9.  LSI contends that since the technical evaluators 
generally did not review the past performance portion of the proposal, 
they lacked information upon which to base the conclusions requested 
by the ratings definition.

Preliminarily, we note that to the extent LSI argues that the Navy 
failed to follow the source selection plan, its argument ignores the 
distinction between an evaluation scheme included in the RFP, and a 
source selection plan provided to evaluators as a guideline.  As 
between these two documents, it is the RFP--and the evaluation scheme 
set forth therein--that forms the compact between the agency and the 
offerors about how proposals will be evaluated.  Loral Aeronutronic, 
B-259857.2, B-259858.2, July 5, 1995, 95-2 CPD  para.  213 at 9.  Source 
selection plans are internal agency instructions and do not give 
rights to outside parties.  Id. at 9-10.  

Even though our Office will not sustain a protest based on deviations 
from the source selection plan, we were concerned about how this 
anomaly in the ratings plan affected the evaluation.  During the 
hearing in this protest, one of the technical evaluators testified 
about the evaluation process and confirmed that he did not review the 
past performance volume, or any other unrelated proposal volume, 
unless specifically referenced there by the portion of the technical 
proposal he was reviewing.  Tr. at 255, 260-61.  Nonetheless, he 
explained that while he recognized the "three-legged" nature of the 
ratings definitions--i.e., each rating sought an assessment of 
requirements, enhancing features, and past performance--he was able to 
evaluate proposals using the selection plan's definitions, and did not 
feel unable to award ratings of outstanding or highly satisfactory 
because of a lack of information.  Tr. at 252-54, 270-71.  In 
addition, he noted that despite the ratings definition, there were 
still ratings of highly satisfactory or outstanding awarded to 
portions of some proposals.  Tr. at 271.  The evaluator explained he 
was comfortable making the assessment called for by the ratings 
definition because there was other past performance information 
mentioned within each portion of the proposal.  Tr. at 255. 

While the testimony here confirms LSI's contention that the technical 
evaluators generally did not review the past performance volumes in 
the proposals, the record establishes that the evaluators nonetheless 
made assessments across the range of definitions (including awarding 
ratings of highly satisfactory and outstanding (Tr. at 271)), despite 
the apparent problem with the ratings definitions.  In addition, LSI 
has not shown--nor has it argued--that any of its ratings under the 
technical evaluation criteria were unreasonable.  Thus, we conclude 
that this problem with the ratings definition did not translate to an 
unreasonable evaluation of the proposals vis-ï¿½-vis the evaluation 
criteria.

Secondly, LSI argues that in preparing summary materials for 
higher-level review, the evaluators leveled the differences between 
proposals by awarding ratings of satisfactory regardless of the 
numbers of strengths and weaknesses identified.  LSI contends that it 
was unreasonable for its proposal to receive an overall rating of 
satisfactory/low risk, while Sikorsky's proposal received a rating of 
satisfactory/moderate risk, given the fact that the evaluators 
identified 18 strengths and only 2 weaknesses in LSI's proposal, while 
identifying 8 strengths and 10 weaknesses in Sikorsky's proposal.  In 
addition, LSI points out that 4 of Sikorsky's 8 strengths were related 
to helicopter maintenance, while only 5 of the 144 aircraft covered by 
this procurement are helicopters.  Tr. at 83-84.  

An agency's method for evaluating the relative merits of competing 
proposals is a matter within the agency's discretion, since the agency 
is responsible for defining its needs, and the best method for 
accommodating them.  Advanced Tech. and Research Corp., B-257451.2, 
Dec. 9, 1994, 94-2 CPD  para.  230 at 3.  Where an evaluation is challenged 
we will examine the record to determine whether the agency's judgment 
was reasonable and consistent with stated evaluation criteria and 
applicable statutes and regulations.  ESCO, Inc., B-225565, Apr. 29, 
1987, 87-1 CPD  para.  450 at 7.  Our chief concern is not the numbers of 
strengths or weaknesses, point scores, or specific ratings, but 
whether the evaluation communicates the principal strengths and 
weaknesses to the SSA and whether the record supports the evaluators' 
conclusions.  Innovative Logistics Techniques, Inc., B-275786.2, Apr. 
2, 1997, 97-1 CPD  para.  144 at 9.  

Here, the Navy agrees, and the record confirms, that the agency's 
evaluators identified more strengths and fewer weaknesses for LSI than 
Sikorsky.  The Navy explains, however, that LSI's proposal's 
strengths, either alone or collectively, did not raise the proposal to 
the level of highly satisfactory or outstanding in the eyes of its 
evaluators.  Thus, the Navy argues that its evaluation was reasonable, 
and that there was no methodology of leveling, as LSI urges.

Our review of the record shows nothing unreasonable in the Navy's 
approach to assigning overall adjectival ratings to each proposal 
based on the proposal's assessed strengths and weaknesses.  See id.  
Nor do we see anything unreasonable about the adjectival ratings 
assigned to LSI's proposal.  In this regard, we find persuasive the 
testimony of the evaluator who explained that the large number of 
satisfactory ratings was, in fact, the consensus view of the 
evaluators about the merits of the proposals reviewed.  Tr. at 271.  
As stated above, we note that LSI does not claim that its individual 
ratings were unreasonable, only that the relative strengths and 
weaknesses of its proposal were lost in the process.  Accordingly, we 
deny LSI's challenge to the underlying process of assigning ratings.  

Adequacy of Discussions

LSI also argues that discussions were inadequate because the Navy did 
not advise the company that its price was significantly higher than 
Sikorsky's, or that its price proposal contained two identified 
weaknesses.  

Our Office reviews the adequacy of agency discussions to ensure that 
agencies point out weaknesses that, unless corrected, would prevent an 
offeror from having a reasonable chance for award.  Department of the 
Navy--Recon., B-250158.4, May 28, 1993, 93-1 CPD  para.  422 at 3.  For the 
reasons set forth below, we conclude that, under the circumstances 
here, the Navy was not required to advise LSI that its price was 
higher than Sikorsky's, or about the two weaknesses identified in 
LSI's price proposal.

The record shows that at the conclusion of initial evaluations, one 
offeror's price was significantly above, and one's significantly 
below, the spread of prices.  (A table summarizing the pricing[3] at 
the time of initial, revised, and final revised proposals is set forth 
below.)

                       PROPOSAL PRICES
                    (in millions of dollars)

             Initial
            Evaluated
              Price     Revised
                       Evaluated
                         Price     Final
                                 Evaluated
                                   Price      Final
                                            BEQ Price

Offeror A    $200.8     $178.2    $172.0     $177.4

LSI          $170.0     $184.4    $181.1     $173.3

Offeror B    $163.3     $169.7    $169.7     $165.1

Sikorsky     $137.9     $150.3    $149.6     $147.7     
PET Briefing for CAP, July 7, 1998, at second and nineteenth 
unnumbered pages.  As a result, the Navy opted to advise Sikorsky that 
its initial price was considered low, and Offeror A that its initial 
price was considered high.  CAP Minutes, May 18, 1998, at 5-6.  

Offerors were asked to respond to the discussion questions and revise 
their proposals as needed, by June 18.  In this revised submission, 
LSI's evaluated price increased significantly and, at $184.4 million, 
was the highest-priced revised proposal.  One week later, without 
further discussion questions for any offeror, the Navy advised that 
discussions were concluded and called for FRPs by July 1.  In 
addition, the Navy counseled that further changes to proposals were 
not expected, and that any changes must be documented.    
 
While LSI contends it was unreasonable for the Navy not to advise it 
that its price was considered high--given the Navy's willingness to 
advise Offeror A and Sikorsky that their prices were considered high 
and low, respectively--there is nothing about LSI's pricing posture at 
the time the Navy evaluated initial proposals that triggered a 
requirement for the Navy to advise the company that its price was 
considered high.  As shown above, LSI's price was more than $30 
million lower than Offeror A's price, and was in line with the price 
submitted by Offeror B.  

In addition, we are not convinced by this record that even if the Navy 
had held a second round of discussions after receiving responses to 
its first round--and it did not--that there was a requirement to 
advise LSI that its revised price was too high.  At the time of 
revised proposals, each offeror other than Offeror A (whose initial 
price had significantly exceeded the others) increased its price 
significantly.  While LSI's price became highest, the table above 
shows that LSI's revised price was not dramatically above either 
Offeror A or Offeror B's price.  Under these circumstances, we will 
not conclude that the Navy was required to advise LSI that its price 
was considered high.[4]   

The second prong of LSI's complaint about the adequacy of discussions 
regarding its price involves two weaknesses identified by the Navy in 
the price proposal.  First, LSI argues that it should have been 
advised that the Navy identified high pricing in the low quantity 
areas of the proposal as a weakness, causing the evaluated price to be 
high.  PET Briefing to CAP, July 7, 1998, at twelfth unnumbered page.  

Our review of the evaluation materials prepared in response to LSI's 
initial proposal leads us to reject this argument completely.  The 
PET's assessment of LSI's initial proposal notes that "[b]and pricing 
and [m]anning are balanced compared to [the] BEQ."  This assessment is 
supported by the fact that LSI's initial evaluated and BEQ prices are 
relatively close, $169.96 million and $163.21 million, respectively.  
Initial PET Briefing, May 18, 1998 at ninth unnumbered page.  Thus, 
this problem was first present in LSI's FRP, and LSI, not the Navy, 
bears the risk for negative changes made in its final proposal 
submission.  Mine Safety Appliances Co., B-242379.5, Aug. 6, 1992, 
92-2 CPD  para.  76 at 7.  In addition, we note that the selection decision 
in this procurement was based on BEQ prices, not evaluated prices, 
suggesting that this weakness may have had no impact on the selection 
decision.

Also, LSI argues that the Navy was required to advise the company that 
it considered the price proposal weak because the "[p]roportion of 
flight hour pricing with relation to fixed maintenance is lower than 
that experienced on past and present maintenance contracts."  PET 
Briefing to CAP, July 7, 1998, at twelfth unnumbered page.   

The record here shows that the Navy identified this issue in LSI's 
initial proposal, but did not label it a weakness and did not raise 
the matter during discussions.  Initial PET Briefing, May 18, 1998 at 
ninth and tenth unnumbered pages.  In the final evaluation, the Navy 
noted that the ratio remained unchanged and labeled this a weakness, 
as quoted above.  PET Briefing to CAP, July 7, 1998, at eleventh and 
twelfth unnumbered pages.  LSI claims that if it had been directed to 
this imbalance in its pricing structure, it would have reviewed the 
Navy's concerns and lowered its price.  Protester's Comments, Sept. 
28, 1998, at 41. 

In our view, the comments of the evaluators regarding the ratio of 
flight hour pricing to fixed maintenance costs do not translate to the 
kind of weakness about which LSI had to be advised during discussions, 
despite the decision of the pricing team to highlight this issue for 
the CAP.  As stated above, at the conclusion of the initial 
evaluation, LSI's price was not out of line with the competition, and, 
in fact, was in the middle of the offered prices.  Given the moderate 
nature of the total price, the fact that the evaluators observed a 
difference in the proposed versus experienced relationship between 
these two elements of the price does not mean that LSI should have 
been advised to consider changing the balance it had struck in 
building its price proposal.  In short, even if we assume that LSI 
would have lowered its price had it been advised of the Navy's views, 
we do not find in these facts that the Navy was required to advise LSI 
of this issue during discussions.[5]

Past Performance

LSI argues that the Navy's past performance review was unreasonable 
because the agency made no judgment about whether an offeror's past 
performance was relevant to the effort here, and as a result, assigned 
the same past performance score to Sikorsky's proposal as it did to 
LSI's.  Since Sikorsky's experience is largely with rotary-wing 
aircraft--a very small portion of the total aircraft to be maintained 
under this contract--while LSI has performed these services for the 
previous 10 years, LSI argues that there is no basis for a finding 
that the offerors were equal in this area.  For the reasons set forth 
below, we conclude that the evaluation in this area is reasonable.

As stated above, the experience/past performance/systemic improvement 
evaluation subfactor was one of two equally-weighted subfactors under 
the management factor in the RFP.  The RFP requested offerors to 
provide information directly applicable to the tasks here, including 
information on previous similar programs in the same plant, division 
or cost center where the offeror intends to provide these services.  
RFP, amend. 0005,  sec.  L-13(b)3.2.2.  In addition, offerors were 
specifically advised that the relevancy of their recent experience 
would be evaluated.  RFP, amend. 0005,  sec.  M.2, para. 2.  At the 
conclusion of the Navy's review of FRPs, both LSI and Sikorsky 
received ratings of satisfactory/low risk under this subfactor.

As with any evaluation factor, when a protester challenges an 
evaluation of its past performance and experience, we will examine the 
record to determine whether the agency's judgment was reasonable and 
consistent with the stated evaluation criteria and with applicable 
statutes and regulations.  IGIT, Inc., B-275299.2, June 23, 1997, 97-2 
CPD  para.  7 at 5; ESCO, Inc., B-225565, Apr. 29, 1987, 87-1 CPD  para.  450 at 
7.  In addition, as LSI contends, a proposal reflecting more relevant 
successful past experience should generally be rated higher than a 
proposal reflecting clearly less relevant past performance.  Israel 
Aircraft Indus., Ltd; MATA Helicopters Div., B-274389 et al., Dec. 6, 
1996, 97-1 CPD  para.  41 at 9; Ogden Support Servs., Inc., B-270012.4, Oct. 
3, 1996, 96-2 CPD  para.  137 at 3.  

Here, there can be little doubt that LSI's experience in performing 
the same effort for the previous 10 years is more relevant than the 
past performance offered for review by Sikorsky.  There is no dispute 
in the record that each of the three Sikorsky contracts evaluated by 
the Navy involves maintenance of helicopters or helicopter components, 
while the maintenance effort here is comprised of 139 fixed-wing 
aircraft and only 5 helicopters.    

On the other hand, LSI's contention that the Navy failed to consider 
the relevance of its and Sikorsky's past performance and experience is 
not supported by the record.  While LSI is correct that no mention of 
the relevance of an offeror's experience is made in the summary 
evaluation documents, our review of the individual evaluation sheets 
shows otherwise.  With respect to Sikorsky, the evaluation sheets show 
at least three instances--and possibly four[6]--where evaluators 
assessing the experience/past performance subfactor specifically note 
that Sikorsky's experience is largely with helicopters and not with 
fixed-wing aircraft.  Having clearly considered that Sikorsky's 
experience is different from the effort covered by this procurement, 
the evaluators then rated Sikorsky's experience as satisfactory under 
this subfactor.[7]  This is a judgment well within the discretion of 
the evaluators, and one that our Office will not second-guess.  See 
generally U.S. Tech. Corp., B-278584, Feb. 17, 1998, 98-1 CPD  para.  78 at 
7-8. 

With respect to LSI's rating of satisfactory, the Navy's assessment 
also withstands scrutiny.  Although there is no doubt that LSI's 
experience is more relevant than Sikorsky's, its performance of these 
services over the previous 10 years cannot be termed successful, 
without qualification.  As explained by the Navy in its initial and 
supplemental agency reports, and as reflected extensively throughout 
the evaluation materials, LSI's previous maintenance of the T-2C 
aircraft was considered so problematic that in 1997 the entire fleet 
was grounded, and the Navy threatened not to exercise the final option 
year of the contract.  Agency Report, Sept. 18, 1998, at 14; 
Supplemental Agency Report, Oct. 12, 1998, at 7.  The record also 
shows that this issue was raised with LSI during discussions, and 
while its response was considered adequate to address the concerns, 
the Navy concluded that a rating of satisfactory/low risk was the 
highest rating warranted under the circumstances.  Id.  At no point 
during the course of this protest, despite the filing of comments, 
supplemental comments, and a post-hearing brief, did LSI challenge the 
facts about its past performance offered by the Navy as justification 
for LSI's satisfactory rating.

In summary, while we see no place in the record that makes a finding 
about the greater relevance of LSI's experience vis-ï¿½-vis the other 
offerors, we see nothing unreasonable about an evaluation assessment 
of LSI's past performance that turns on the problems LSI experienced 
in performing this very contract.  Simply put, it is hard to imagine 
information more relevant than LSI's problems performing these same 
services for the same Navy installation.  IGIT, Inc., supra, at 6.  

Price Analysis

LSI argues that the Navy failed to perform an adequate price realism 
analysis to permit the agency to fully understand the risks associated 
with Sikorsky's significantly lower price.  We disagree.

As LSI correctly argues, the RFP requested that offerors confirm in 
their proposals that their prices are in accordance with the 
applicable wage determination or collective bargaining agreement.  
RFP, amend. 0005,  sec.  L-13(b)4.0.  In addition, offerors were advised 
that the agency would perform a price realism evaluation that would 
include a review of personnel compensation rates.  RFP, amend. 0005,  sec.  
M-2, para. 2.C.  In LSI's view, this analysis should have addressed 
not only whether the direct labor rates were in accordance with the 
applicable wage determination or collective bargaining agreement, but 
whether the fringe rates applied to the direct rates would provide the 
requisite total compensation package.

As a general rule, price realism is not considered in the evaluation 
of proposals for the award of a fixed-price contract, because these 
contracts place the risk of loss upon the contractor.  The Arora 
Group, Inc., B-277674, Nov. 10, 1997, 98-1 CPD  para.  64 at 4.  However, 
agencies may elect to provide for the use of a price realism analysis 
in a solicitation for the award of a fixed-price contract for the 
purpose of measuring an offeror's understanding of the solicitation's 
requirements or to assess the risk inherent in an offeror's proposal.  
PHP Healthcare Corp., B-251933, May 13, 1993, 93-1 CPD  para.  381 at 5.  In 
addition, while our Office generally will not consider questions of an 
offeror's compliance with wage determinations or collective bargaining 
agreements, we will review an allegation that an agency's use or 
evaluation of such determinations or agreements has prevented the 
protester from competing on an equal basis with the awardee.  
Education Serv. District of Washington County, B-198726, B-198792, 
Nov. 19, 1980, 80-2 CPD  para.  379 at 2.

As stated earlier, the record here shows a large difference in the 
final BEQ prices proposed by LSI and Sikorsky--i.e., $173.3 million 
and $147.7 million, respectively.  The CAP focused on Sikorsky's low 
price during the cost/technical tradeoff stating: 

     the low burden rates and .5% profit proposed by Sikorsky are 
     unusually low and considered a risk since the first step a 
     contractor usually takes when in a loss situation is to remove 
     employees.  It was further discussed that although the offeror 
     had the right to reduce his profit margin to make himself more 
     competitive in this fixed price environment, this could increase 
     the performance risk.  

CAP Report, July 8, 1998, at 3.  LSI argues that the considerations 
reflected in the CAP report show that the Navy considered Sikorsky's 
low price to be caused by low burden rates and profit, and failed to 
understand that Sikorsky was not, in LSI's view, offering the mandated 
wage rates.

As a preliminary matter, our review of the pleadings in this area do 
not lead us to conclude that LSI has established the factual predicate 
of its argument--i.e., that the Sikorsky proposal denies its employees 
wages mandated by the solicitation and by law, and that the Navy acted 
unreasonably by not addressing the issue in its evaluation.  Sikorsky 
takes no exception to the RFP's compensation requirements, and 
represents in its proposal that it has used the collective bargaining 
agreements and wage determinations provided by the agency.  Sikorsky 
Proposal, Vol. 4 at 46.  Thus, we conclude that Sikorsky is legally 
bound to pay the wages and fringe benefits required here, and has 
obtained no unfair advantage since it will be required to absorb any 
costs for which it has failed to account.  JVAN, Inc., B-202357, Aug. 
28, 1981, 81-2 CPD  para.  184 at 4-5.  

As Sikorsky convincingly shows, the LSI argument appears to be based 
on an "apples versus oranges" comparison of the fringe rates used by 
the two offerors.  Specifically, Sikorsky provides detailed evidence 
showing that when its rates are normalized to cover the same costs 
included in LSI's rates there is almost no difference between the two 
proposals.  Sikorsky's Supplemental Comments, Oct. 5, 1998, at 2.  
Despite a detailed filing on this issue subsequent to Sikorsky's 
filing, LSI does not rebut this contention.  In addition, Sikorsky, 
through the use of its expert witness, sets forth a detailed 
explanation--again unrebutted--of each of the bases for the difference 
between the two prices, none of which are related to compliance with 
the applicable wage rates.  Sikorsky's Comments, Sept. 28, 1998, at 
16-17.  

Even assuming LSI is correct in its contentions about the reasons for 
the price differential between these two offerors--and it does not 
appear that it is--LSI's arguments have more to do with the detailed 
kind of analyses seen in a cost realism review, than with a review of 
prices in a fixed-price environment. The Navy explains that it 
reviewed the distribution of costs across contract line items to 
ensure that overall prices were materially balanced when compared to 
the BEQ; compared the offered prices to the prices of similar 
maintenance contracts; compared the prices to the prices of other 
offerors in the competition; and compared the wage rates with those 
mandated.  In addition, the Navy made a finding of proposal risk 
associated with Sikorsky's low price, which is, in fact, one of the 
purposes of a price realism review.[8]  PHP Healthcare Corp., supra.

Under all of the circumstances here, and given that the nature and 
extent of an agency's price realism analysis is a matter within its 
discretion, we conclude that the Navy performed a reasonable review of 
price realism in this procurement.  The Centech Group, Inc., B-278715, 
B-278715.2, Mar. 5, 1998, 98-1 CPD  para.  108 at 6-7.

Source Selection Decision

LSI argues that the source selection decision, as set forth in the CAP 
Memorandum of July 8, failed to perform a proper price/technical 
tradeoff between its proposal, and the proposal of Sikorsky.  LSI also 
argues that the Navy's second price/technical tradeoff prepared in 
response to the protest should be given little weight. 

As explained above, the Navy's first source selection decision 
contains almost no mention of LSI, whose proposal is higher-rated and 
higher-priced than the awardee's proposal.  Instead, after including 
LSI in one table showing its factor-level ratings and risk, and 
another table showing its evaluated price, the CAP "decided there was 
no competitive advantage for awarding to either [LSI] or [Offeror A] 
since both were considerably higher in price than either [Offeror B] 
or Sikorsky."  CAP Memorandum, July 8, 1998 at 3.  In addition, as 
shown in the table at page 4 of this decision, LSI's overall technical 
rating was lower than Offeror B's--LSI received a rating of S/L, while 
Offeror B received a rating of S+/L.  Thus, the remainder of the 
selection decision does not address the relative merits of Offeror B 
and Sikorsky, but instead focuses on whether Sikorsky will be able to 
perform the services here for its significantly lower price.  

Given that we have reviewed each of LSI's challenges to its evaluation 
and have concluded that the overall evaluation was reasonable, and 
given that there was a higher-rated, lower-priced proposal between the 
awardee and LSI, the Navy was not required to perform a 
price/technical tradeoff between LSI and Sikorsky.[9]  Accordingly, we 
do not reach LSI's challenges to the supplemental price/technical 
tradeoff decision. 

The protest is denied.

Comptroller General
of the United States

1. The CAP report adopts the summary assessments used by the TET to 
report its findings.  The TET used adjectival ratings of outstanding 
(O), highly satisfactory (HS), satisfactory (S), marginal (M), or 
unsatisfactory (U).  These adjectival ratings were supplemented by a 
plus (+) or minus (-) sign as appropriate.  Risk was assessed as 
either high (H), medium (M), or low (L).  

2. The price savings used for the cost/technical tradeoff in the CAP 
memorandum, and by the Navy throughout this procurement, is based upon 
a comparison of the BEQ prices.

3. The Selection Decision in this procurement was ultimately based on 
the BEQ prices submitted by each offeror, rather than the evaluated 
prices shown in three of the four columns of this table.  This table 
shows evaluated prices because the record contains no calculation of a 
revised BEQ price for the offerors.  Thus, for consistency of 
comparison, this discussion is based on the evaluated prices.  

4. LSI also argues that during the week between the time it submitted 
its revised price and the time the Navy advised offerors that 
discussions were concluded, the Navy should have advised LSI that its 
price was considered high.  We need not reach this issue, since we 
conclude that the Navy would not have been required to advise LSI 
about this issue, even if the Navy had conducted further discussions.

5. We also cannot fail to observe that among the offerors here, 
LSI--the incumbent for the previous 10 years--was uniquely positioned 
to make an informed judgment about the appropriate ratio between 
flight time and maintenance costs for these services, and was less in 
need of coaching during discussions about costs experienced in the 
past than any other offeror at the table.  

6. Because the individual evaluator's scoresheets are not particularly 
well-organized, we cannot rule out the possibility--based on a 
similarity in the handwriting--that one of the four worksheets 
identified in our review may, in fact, be a summary sheet prepared by 
one of the same evaluators who prepared the other three scoresheets.  
These scoresheets are found in the Agency Report, Tab 17, at the 
twenty-eighth, thirty-first, thirty-seventh, and sixty-fourth 
unnumbered pages.

7. With respect to Sikorsky's rating, we disagree with the protester's 
assertion that the situation here is like the situation we reviewed in 
Ogden Support Servs., Inc., supra.  In that case, as here, the RFP 
sought evidence of similar experience for evaluation under the past 
performance factor.  However, our Office sustained Ogden's protest 
when the evaluators awarded a rating of excellent in the area of past 
performance to both Ogden and the awardee despite the awardee's 
significantly dissimilar experience.  Id. at 3.  Here, the Navy's 
rating of satisfactory for Sikorsky appears to reflect a consideration 
of the fact that Sikorsky's past performance, while quite good, 
involves experience somewhat different (helicopters versus fixed-wing 
aircraft) from the solicited effort.

8. LSI also misstates the CAP's concerns.  The CAP consideration, 
quoted above, does not state that the Navy considers Sikorsky's low 
burden and profit rates to be the only reason for its low price.  
Rather, it acknowledges that the rates are low and makes a finding of 
risk associated with them.  

9. Similarly, we deny LSI's contention that the source selection 
decision wrongly added a requirement for the government to monitor 
Sikorsky's training program, on the basis that LSI was not prejudiced 
by this further element of the price/technical tradeoff between 
Offeror B and Sikorsky.  Our Office will not sustain a protest unless 
the protester demonstrates a reasonable possibility of prejudice, 
McDonald-Bradley, B-270126, Feb. 8, 1996, 96-1 CPD  para.  54 at 3; see 
Statistica, Inc. v. Christopher, 102 F.3d 1577, 1581 (Fed. Cir. 1996).  
In any event, this issue appears to be one appropriately reserved for 
the agency's administration of the contract.  See Vitro Corp., 
B-247734.3, Sept. 24, 1992, 92-2 CPD  para.  202 at 9.