BNUMBER: B-281384; B-281384.2
DATE: February 3, 1999
TITLE: Bulova Technologies LLC, B-281384; B-281384.2, February 3,
1999
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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:Bulova Technologies LLC
File:B-281384; B-281384.2
Date:February 3, 1999
Glenn A. Rowley, Esq., John E. McCarthy, Jr., Esq., and Donald E.
Sovie, Esq., Crowell & Moring, for the protester.
Larisa A. Trainor, Esq., Anne B. Perry, Esq., and Louis D. Victorino,
Esq., Fried, Frank, Harris, Shriver & Jacobson, an intervenor.
Larry Brady, Esq., Gerald T. Williams, Esq., and Maj. Cynthia M.
Mabry, U.S. Army Materiel Command, for the agency.
Marie Penny Ahearn, Esq., and John M. Melody, Esq., Office of the
General Counsel, GAO, participated in the preparation of the decision.
DIGEST
1. Allegation that protester would have been able to eliminate
certain deficiencies in the portion of its proposal related to a
certain item, had the agency made predecessor contract information
available, is untimely where first raised after closing time for
receipt of proposals and protester knew that the item had been used
under prior contract (and actually requested that the item be provided
as government-furnished equipment), but neither requested information
about the item, nor protested its omission from the solicitation prior
to the closing time.
2. Protest that agency improperly considered offerors' experience in
manufacturing specific item being acquired is denied where evaluation
factors encompassed consideration of such experience.
3. Protest that evaluation improperly was based on unstated
criteria--methodology to mitigate component obsolescence of a specific
component--is denied where, contrary to protester's position, record
indicates that evaluation was conducted on basis of general
methodology to mitigate component obsolescence, as provided for in
solicitation, and protester failed to present a plan in this area.
4. Protest that agency improperly evaluated protester's price
assumption--that component parts will function properly when
manufactured to technical data package and assembled--as inconsistent
with solicitation is denied, where solicitation specifically provided
that contractor was not to assume that all possible combinations of
tolerances and fits permitted by specifications/drawings would
consistently satisfy test requirements.
5. Where solicitation advised offerors that government intended to
make award on basis of intitial proposals, contracting agency was not
obligated to conduct discussions concerning protester's proposal,
which was rated marginal with significant weaknesses based on
omissions/informational deficiencies.
DECISION
Bulova Technologies LLC protests the award of a contract to KDI
Precision Products, Inc. under request for proposals (RFP) No.
DAAE30-98-R-0310, issued by the Department of the Army for production,
testing, load, assembly, pack, and delivery of M734A1 fuzes used in
120mm mortar systems.[1] The protester challenges the evaluation and
award on several grounds.
We deny the protest.
The RFP, which limited competition to small businesses, provided for
award of a fixed-price contract on a best value basis, applying the
following four evaluation factors, in descending order of importance:
(1) quality, (2) cost, (3) management, and (4) past performance. In
the actual evaluation, quality was weighted at 50 percent, cost at 25
percent, management at 15 percent, and past performance at 10 percent.
The quality factor included three subfactors--manufacturing process,
technical capabilities and facilities/capital equipment. The
management factor included two subfactors--program management and
configuration management. The RFP provided that quality and
management were to be assigned color ratings of blue, green, yellow,
or red and assessed for proposal risk using the ratings of low,
moderate, and high.[2] Past performance was to be evaluated using the
same adjectival risk ratings. RFP sec. M.1, M.3-M.6, at 84-92. Cost
was to be evaluated by adding the price for the basic year (first
article and production quantity) to the total of all evaluated prices
for all option years. The solicitation provided that the "Government
intends to award without discussions" and, therefore, "[e]ach initial
offer should contain the offeror's best terms." RFP sec. M.2, at 85.
The statement of work consisted of a CD-ROM technical data package
(TDP) with requirements and drawings which were described as
"defin[ing] the effort required" and were to be used "as the approved
Product Baseline documentation . . . within the overall context of the
configuration management control authority" provided for in the
solicitation." RFP sec. C.1, C.2, at 5.
The agency received two proposals, from Bulova and KDI, who is the
incumbent. For the subfactors under the quality and management
factors, Bulova received primarily yellow ratings, defined as
"Marginal" - "Fails to meet evaluation standards; however any
significant deficiencies are correctable." RFP sec. M.4, at 87. KDI
received primarily green ratings, defined as "Acceptable" - "Meets
evaluation standards and any weaknesses are readily correctable." Id.
KDI's proposal risk was evaluated as low, with low risk ratings in all
quality and management subfactors, while Bulova's proposal risk was
evaluated as high, with high risk ratings in three of the five
subfactors (along with one moderate and one low rating in the other
two).[3] Id. Both offerors received a low risk rating for past
performance.
KDI's total evaluated price was $225,670,895, approximately [deleted]
percent higher than Bulova's at $[deleted]. The contracting officer
determined that discussions were not necessary, because they would not
eliminate concerns about Bulova's high proposal risk in the quality
and management areas. The contracting officer performed a
price/technical tradeoff analysis and determined that KDI's proposal
represented the best value to the government. Award was made to KDI
on September 25, 1998.
Bulova challenges the evaluation on several grounds. In reviewing a
protest against an agency's evaluation of proposals, we will examine
the record to determine whether the agency's judgment was reasonable
and consistent with the stated evaluation criteria. ESCO, Inc.,
B-225565, Apr. 29, 1987, 87-1 CPD para. 450 at 7. The protester must
demonstrate that the evaluation was unreasonable, a burden that is not
met by mere expressions of disagreement with that evaluation. CH2M
Hill, Ltd., B-259511 et al., Apr. 6, 1995, 95-1 CPD para. 203 at 4. We
have examined the evaluation here and conclude that it was both
reasonable and consistent with the evaluation criteria. We discuss
some of Bulova's key arguments below.
QUALITY
Testing and RF Tester
The RFP specified the required tests (for conformance to the
performance specification), test parameters, and requirements for
special test equipment, such as the RF tester, to be designed by the
offeror. Detail Specification M734A1 DTL12973560 sec. 4.1, 4.4.3.1, at
8, 68.
Bulova argues that the agency improperly failed to release predecessor
contract documentation relating to the RF tester and necessary to
respond to the solicitation, and that this resulted in an unequal
competition because KDI, as the incumbent, had access to this
documentation. According to Bulova, if it had received a complete RF
tester technical package, "it would have been able to propose a[n] RF
Tester which met the Government's requirements." Supplemental
Protest, Dec. 4, 1998, at 7. The protester complains that, without
the existing RF tester data, it had to design an RF tester, including
drawings, from "scratch," which "divert[ed] resources" and "affected
many of the alleged deficiencies" as evaluated in its proposal.
Comments, Dec. 24, 1998, at 33; Supplemental Comments, Jan. 13, 1999,
at 15-16.
Under our Bid Protest Regulations, 4 C.F.R. sec. 21.2(a)(1) (1998),
protests based on alleged solicitation improprieties must be filed
prior to the closing time for receipt of initial proposals. East Penn
Mfg. Co., Inc., B-261046, Aug. 1, 1995, 95-2 CPD para. 50 at 3. This
requirement is intended to enable the procuring agency to decide an
issue while it is most practicable to take effective corrective action
where the circumstances warrant. Mead Data Central, B-242598, Mar.
26, 1991, 91-1 CPD para. 330 at 3. Although the record shows that Bulova
was aware that there was an RF tester that had been used under the
predecessor contract (see n.5 below), and that the agency would
"assess the offeror's knowledge and capability to fabricate the M734A1
RF tester," RFP sec. M.6.1 at 89, it never asked the agency to provide
this information. Instead, Bulova opted to prepare a proposal that,
it now asserts, contained deficiencies/weaknesses in the RF tester
area that could only have been eliminated with reference to the
predecessor contract information. While Bulova perhaps was unaware of
the precise documents available until after award, Bulova does not
assert that it had reason to believe that no information relative to
the RF tester existed prior to the closing time, and there is nothing
in the record to support such an assumption.[4] (We note that Bulova
did request other specific engineering change proposals, requests for
waivers, and drawings which were not included in the TDP. See Agency
Report, Dec. 1, 1998, Tab. 28--Correspondence between Bulova and the
Army.) Under these circumstances, Bulova should have sought RF tester
information from the Army prior to the closing time, or protested its
absence from the RFP package some time prior to the closing time.
Because it failed to do so, this aspect of the protest is untimely and
will not be considered.[5]
In any event, it is not apparent how the predecessor contract
information in question would have improved Bulova's evaluation.
According to the Army, "Bulova was not criticized directly for their
proposed RF Tester design," but rather because the firm "provided a
general description of a proposed RF tester with no narrative on how
it will interface with the fuze or discussion relating to fuze test
requirements" and "fail[ed] to demonstrate [how] their RF Tester could
support the required production rates." COSF, Dec. 1, 1998, Attach.
1, at 17, and Attached Memorandum, Nov. 25, 1998, at 2.[6] The agency
concludes that the "[a]vailability of RF Tester documentation and/or
an RF Tester would not have rescued Bulova from these criticisms."
Supplemental Contracting Officer's Statement of Facts (SCOSF), Dec.
16, 1998, Attached Response, Dec. 15, 1998, at 3. Moreover, while the
protester focuses on the RF tester, the record indicates that most of
the evaluated deficiencies in the quality area related to Bulova's
broad failure to address the test requirements, which are unrelated to
the RF tester.[7] In this regard, despite RFP instructions stating
that offerors were to provide a "[d]etailed narrative" which
"[d]emonstrate[s] a detailed understanding" of the processes and
testing required under the RFP ( sec. L.13.1, at 77-78), Bulova's low
ratings were based on a finding that the firm failed to "provide a
complete detailed process flow for the assembly and test of the M734A1
fuze, particularly sub-assembly test requirements in the fuze
specification." Business Clearance Memorandum, Sept. 15, 1998, at 13;
Risk Analysis, Aug. 19, 1998, at 2. Essentially, the technical
evaluation team (TET) determined that Bulova failed to address or even
list all the required tests of the fuze. SCOSF Dec. 16, 1998,
Attached Response, Dec. 15, 1998, at 3.[8] For example, the agency
found that "Bulova's proposal does not address the required air
pressure tests for the electronic head assembly," a test with no
apparent relation to the RF tester; Bulova does not rebut this agency
finding. Business Clearance Memorandum, Sept. 15, 1998, at 14; Risk
Analysis, Aug. 19, 1998, at 3. We conclude that Bulova has not
established that its lack of predecessor contract documentation
related to the RF tester caused its evaluated weaknesses.
Bulova also argues in this area that the Army improperly evaluated its
proposal under two allegedly unstated RF testing criteria---the
"[r]equirement to demonstrate knowledge of the unique residual delay
cancellation feature necessitating special test capability in the
Proximity Fuze RF Tester," and the requirement "to address the
necessity for unique features for the RF Tester." Protest, Oct. 26,
1998, at 7 and Attach. 3.
The agency states that "Bulova was not penalized directly for [the]
absence of discussion of residual delay" (a factor "below which the
time delay [of the fuze] cannot be reduced"). COSF, Dec. 1, 1998,
Attach. 1, at 17. Rather, according to the agency, Bulova's "[l]ack
of addressing residual delay line cancellation [in the proposed RF
tester design] was discussed during the debriefing as one example of
where Bulova's proposal contained omissions that when combined with
other omissions and errors led the government to question Bulova's
ability to manufacture the M734A1 fuze within the program timeliness
of the solicitation," and "demonstrate[d Bulova's] lack of knowledge
in FM-CW ranging systems." COSF, Dec. 1, 1998, Attached Memorandum,
Nov. 25. 1998, at 2; Attach. 1, at 17. According to the agency,
"residual delay line cancellation for such a tester is routinely
identified and any offeror with knowledge in this area would have
known to address it." COSF, Dec. 1, 1998, Attached Memorandum, Nov.
25, 1998, at 2.[9] Bulova has not rebutted the agency's explanation
in this regard, and also has not timely specified any unstated
'unique' RF tester features against which its proposal was evaluated.
There thus is no basis to question the evaluation in this area.
Experience
Under the second quality subfactor, technical capabilities, the RFP
provided that, among other things, the government would "assess the
offeror's knowledge and experience in fuze design and manufacture,"
and instructed offerors to "[d]iscuss previous experience with
manufacturing of similar items." RFP sec. M.6.1, at 89; sec. L.13.1, at 78.
Bulova proposed two electrical engineers and two consultants. The
TET determined that no "RF or Proximity Fuze experience" was indicated
for the electrical engineers, and that the consultants' experience did
not adequately extend to M734A1 fuzes. Id. at 4.
Bulova argues that the Army essentially improperly downgraded its
proposal based on an unstated evaluation criterion--specific prior
experience in M734A1 proximity fuze manufacture. According to the
protester, this was contrary to the RFP's requirement for generic RF
fuze experience, which its proposed electrical engineers and
consultants satisfied.
This argument is without merit. Agencies properly may take into
consideration specific, albeit not expressly identified, experience in
making qualitative distinctions between competing proposals, so long
as the specific experience is logically encompassed by or related to a
solicitation's requirements and stated basis for evaluation;
accordingly, it is not objectionable for an agency to rate a firm that
has previously supplied the same type of item called for under a
solicitation higher than a firm with more general experience.
Fidelity Tech. Corp., B-258944, Feb. 22, 1995, 95-1 CPD para. 112 at 2-3.
Here, while the RFP did not specifically require a firm to have
manufacturing experience with the M734A1 proximity fuzes, the
solicitation is for the manufacture of those fuzes and did provide
that experience with manufacture of similar fuzes would be considered.
Under these circumstances, offerors' specific experience with M734A1
proximity fuzes clearly was encompassed by the terms of the
solicitation, and the agency properly considered this experience. See
id. (agency properly scored firm with prior experience in performing
exact work called for under RFP higher than protester).[10]
MANAGEMENT
Component Obsolescence
Under the management subfactor, program management, "the offeror's
proposed approach to mitigate component obsolescence" was one of five
areas to be evaluated. RFP sec. L.13.3, M.6.3, at 80, 91. In this
regard, the RFP specifically instructed offerors that "[a]s a minimum
the following points," including "efforts to mitigate component
obsolescence," "shall be addressed." RFP sec. L.13.3, at 80. In this
area, Bulova's proposal consisted of one paragraph, and in pertinent
part stated the following:
From its experience with the M762 program, Bulova believes
the M734A1 active electronic devices have the greatest threat
of component obsolescence. These threats have been mitigated
by the technologies selected for each of the active devices. For
example, the signal processor has been implemented in an
analog-switched capacitor technology. Analog components
typically do not suffer from fabrication process obsolescence
problems that digital components experience. Consequently,
custom analog components are typically available long after
custom digital components of the same vintage become
completely unavailable. . . . As a result, no functional
differences
will be apparent as the manufacturing processes and the
device geometries change.
Bulova Management Proposal sec. 3.1.4, at 3.
Under this subfactor, Bulova's proposal received a yellow rating and a
"significant weakness" based on the lack of "a methodology to mitigate
component obsolescence," and the firm's "reliance on the current
M734A1 Fuze electronic design to be the solution to component
obsolescence [was determined] unacceptable." Risk Analysis, Aug. 19,
1998, at 4; see also Technical Evaluation, Aug. 11, 1998, Caucus
Rating and Rationale Summary, at 1, and Approved Strengths and
Weaknesses, at 1. Bulova's proposal also received a high risk rating
based on the "failure to address a management methodology for the
continued prevention of component obsolescence . . . which adds
significant risk to the option year schedules and potentially leaves
the government with an obsolete fuze design at the end of the
multi-option contract." Caucus Rating and Rationale Summary, at
1.[11] The agency characterized the impact of the high risk rating
as follows:
The M734A1 design contains several complex electronic components
that are only available from one source, namely the Signal
Processor and the MMIC Integrated Circuits [IC]. Integrated
circuit suppliers utilize Foundries (sub-vendors) to fabricate
the necessary wafers and these foundries often change their
processes to stay competitive with the commercial marketplace and
advancing technology. In any event, changes to the Foundry's
processes typically dictate a requalification of the part and may
lead to availability problems with the components. A recent
design translation required by the MMIC vendor to stay compatible
with their Foundry required a 18-24 month lead time and a
$500,000 cost. Proper planning with the Fuze Manufacturer and
the IC vendors resulted in an execution plan that prevented any
program slippage. Issues like this can cause a significant,
unexpected program delay if not properly monitored. The
predecessor to this program, the M734 Basic fuze, experienced
schedule delays and plant shutdowns due to component obsolescence
issues. In addition, the government requires that the contractor
monitor these issues and suggest product improvements to keep the
overall fuze design from becoming obsolete over the course of the
five years (Basic + 4 Options) of contract performance.
Risk Analysis, Aug. 19, 1998, at 4-5; see also Business Clearance
Memorandum, Sept. 15, 1998, at 15.
Essentially, the protester argues that the agency improperly evaluated
the firm's proposal based on an unstated requirement to mitigate the
obsolescence risk of the MMIC, one of the fuze components, based on
problems encountered under the incumbent contract. According to the
protester, "[i]f [it] had known MMIC obsolescence was a key concern of
the Government's, [it] would have most certainly addressed this issue
in its proposal." Supplemental Protest, Dec. 4, 1998, at 5.
This argument is without merit. The Army explains that the evaluation
of Bulova's approach to mitigating component obsolescence was based,
not on any particular component, such as the MMIC, and that the
evaluation discussion quoted above, and relied on by the protester,
was intended to be merely illustrative. Rather, Bulova's proposal
rating in this area was based on the firm's reliance solely on its
expressed view that it was unlikely the technologies set forth in the
solicitation would lead to an obsolescence problem, in lieu of a plan
of its own to mitigate component obsolescence. According to the
agency, this was inadequate given the RFP's specific request for
offerors to address mitigation of component obsolescence. In this
regard, the agency asserts that it "was looking for the offeror to
acknowledge that potential component obsolescence issues exist and
provide a management technique for alerting the Government of these
issues prior to them becoming problems with schedule and cost impact."
SCOSF, Dec. 16, 1998, at 3.[12]
The evaluation of component obsolescence was reasonable. There is no
indication that Bulova's proposal was downgraded for failure to
discuss the mitigation of MMIC obsolescence. Rather, it is clear from
the record, as the agency explains, that Bulova's proposal was
evaluated as deficient for failing to discuss mitigation of any
component obsolescence and that the discussion of MMIC component
obsolescence in the evaluation record was merely illustrative. More
specifically, given the agency's disagreement with Bulova's view
regarding component obsolescence and the protester's failure to
establish that the agency's position is incorrect, we think the agency
reasonably downgraded Bulova's proposal for failing to specifically
address the matter of mitigating component obsolescence.[13]
PRICE ASSUMPTION REGARDING COMPONENT PARTS
Bulova's price proposal stated as follows:
The costs for the proposal were prepared with the assumption that
the technical data package and its related documents will produce
a unit that will properly function when Bulova assembles the
components utilizing proper manufacturing techniques.
Bulova Cost Proposal at 1. However, a drawing in the RFP's TDP
package stated as follows:
The contractor will not assume, nor does the government guarantee
that all possible combinations permitted by the tolerance limits
of the specifications and drawings will consistently satisfy the
test requirements. Therefore the manufacturer is obligated to
choose those combinations of tolerance and fits within the limits
of the specification and drawings that best suit his process
needs and still satisfy the requirements.
Risk Analysis, Aug. 19, 1998, at 3, quoting RFP TDP, Drawing No.
12973560, n.11. The TET determined that Bulova's assumption
represented a "significant discrepancy" from the TDP drawing for the
top assembly of the M734A1; this was one of five factors which led to
Bulova's proposal being rated high risk. Risk Analysis, Aug. 19,
1998, at 1-3; Business Clearance Memorandum, Sept. 15, 1998, at 14.
The Army's rationale in this regard was set forth as follows:
Test requirements of proximity fuzes are very complex in nature
and require engineering throughout a production program. The
functionality of a random mix of signal processors, MMIC
transceivers, Turbine Alternators etc. can not be assumed to
always produce fuzes that meet the test requirements,
particularly in high volume production when electronic part
variability increases. Bulova's assumption combined with their
lack of proposed RF engineering support demonstrates significant
cost and schedule risk to the government and in Bulova's ability
to perform within their proposed pricing.
Risk Analysis, Aug. 19, 1998, at 1-3; Business Clearance Memorandum,
Sept. 15, 1998, at 14.
Bulova argues that its "innocent pricing assumption" "does no more
than state [its] belief and reasonable expectation that the
fundamental design of the M734A1 will work," and "does not in any way
contradict the notice found in the technical data package," or "in any
way deny Bulova responsibility for production of the fuze in
accordance with the technical data package." Comments, Dec. 24, 1998,
at 47 and 22. In any case, the protester characterizes this area of
evaluated deficiency as a "part variability [problem] between the
signal processors and the MMIC chips," which has been resolved by
"deviations, waivers and drawing changes [that] had been promulgated
to address and resolve this issue" and that, thus, in actuality, the
agency criticized Bulova's proposal for failing to address a
corrected, nonexistent problem. Supplemental Protest, Dec. 4, 1998,
at 8.
The evaluation in this area was reasonable. First, we think the Army
reasonably interpreted the language in Bulova's proposal as
conflicting with the admonition in the TDP drawing. Specifically,
while the drawing expressly provided that the contractor was not to
assume the correctness of the tolerances in the specifications in
making its manufacturing decisions, Bulova's price proposal purported
to be based on the assumption that a properly functioning item will
result from complying with the TDP. Whether or not Bulova intended to
take exception to the TDP drawing language, the quoted language is
reasonably susceptible of such a reading.
According to the agency, moreover, the evaluation in this area really
focused on a broader concern; the "criticism of Bulova in this area
stemmed from the fact that they did not address generic production
problems associated with Proximity fuzing," i.e., part
inconsistencies/variability among vendors, which "is common with
components required for proximity fuze programs" and is "not unique to
the M734A1 Proximity Fuze." SCOSF, Dec. 16, 1998, at 4, 7. In this
regard, the agency asserts, while the TET "did not require offerors to
submit a detailed plan to control part variation, [they] required
discussion on component parameter variations in order to demonstrate
an understanding of the fuze operation," and Bulova's proposal failed
to provide "a qualitative discussion on system parameters," which,
"combined with the technical omissions and errors, demonstrates that
Bulova does not have the knowledge or experience needed to
independently produce M734A1 fuzes that will meet the end item
performance requirements." COSF, Dec. 1, 1998, at 16. The agency
maintains that Bulova's "interpretation [expressed in its protest
argument] that all part variability problems between the signal
processor and the MMIC chips have been resolved and no longer
represent a problem is incorrect." SCOSF, Dec. 16, 1998, at 7.
Rather, according to the agency, "[t]he government continues to try to
refine the product baseline documentation to reduce the potential of
these types of issues from impacting the performance of the fuze" and
Bulova's interpretation is "grounds for further criticism of Bulova's
knowledge and capability in Proximity fuzing since these issues will
remain throughout the production life cycle of the item." Id. Bulova
has not shown that the agency's position regarding continued part
variability is incorrect. We conclude that the agency reasonably
determined that this area of Bulova's proposal evidenced performance
risk.[14]
AWARD WITHOUT DISCUSSIONS
Bulova argues that its proposal was downgraded under the quality
subfactors and assigned a high risk rating based on informational
deficiencies which could have been corrected through discussions.
Generally, agencies are not obligated to 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. Under such
circumstances, offerors are required to provide in their initial
proposals all of the information necessary to permit the agency to
conclude that the proposal meets the solicitation's requirements.
Norden Sys., Inc., B-255343.3, Apr. 14, 1994, 94-1 CPD para.
257 at 7-8. While the contracting officer's discretion in deciding
not to hold discussions is not unfettered, it is quite broad. Id.;
Robotic Sys. Tech., supra.
There is no basis for questioning the agency's decision not to conduct
discussions. The RFP specifically advised offerors that the
government intended to award a contract without discussions, and that
each initial proposal should contain the offeror's best terms. RFP sec.
M.2, at 85. Based on the initial proposals received, the Army
determined that KDI's represented the best value to the government
based on its technical superiority, low risk, and reasonable price.
Bulova does not argue that its proposal was technically equal to KDI's
and does not contest the agency's determination that KDI's proposal
was clearly superior. Under these circumstances, the mere possibility
that Bulova's technical proposal, which was evaluated as substantially
inferior with significant weaknesses, could theoretically become the
best value proposal through discussions did not preclude the agency
from awarding the contract based on initial proposals. See Harry A.
Stroh Assocs., Inc., B-274335, Dec. 4, 1996, 97-1 CPD para. 18 at 3.[15]
PRICE/TECHNICAL TRADEOFF
Bulova also alleges that the price/technical tradeoff was inadequate
primarily due to the alleged failure to consider the price
differential between the proposals. This argument is without merit.
The record indicates that the TET conducted a detailed "Cost Tradeoff
Analysis" which "identified[d] the areas that support the difference
in Risk Assessment of the two offerors." Risk Analysis, Aug. 19,
1998, at 1. The tradeoff focused on Bulova's high risk versus KDI's
low risk, and the fact that this high risk could lead to unacceptable
performance delays. Id. at 1. Conversely, the TET concluded that
KDI's low performance risk would enable the firm "to meet the schedule
within the RFP," because "their proposal addressed all areas of the
RFP," "they are successfully producing the M734A1 in quantities of 10K
per month under the [predecessor contract]," and "KDI also presented a
methodology for monitoring component obsolescence issues with the
electronic components." Id. at 1, 5. In the final analysis, the TET
recommended that the best value award be made to KDI without
discussions based on their (1) "distinctly superior . . . overall
proposal, particularly the technical portion," (2) significantly lower
risk with no past performance problems on similar contract, and (3)
the fact that "Technical (Quality/Management) is far more significant
than Cost (as identified in the RFP) (+10%)." Id. at 5. The
contracting officer considered this recommendation, characterizing it
as a determination that "the low risk asociated with the somewhat
higher priced KDI proposal . . . more than compensate[d] for the risk
of awarding to Bulova which has limited or no experience in producing
proxmity fuzes and has not set forth a proposal that conclusively
demonstrates how they can successfully meet all contract
requirements." Business Clearance Memorandum, Sept. 15, 1998, at 16.
Further, the contracting officer determined that "[a]lthough lower
priced, award to Bulova would likely result in major program delays
and related expenses due to impact of late deliveries." Id. at 16.
Based on these considerations, the contracting officer determined that
"KDI has presented a distinctly superior proposal . . . significantly
lower in risk than Bulova and recommended that a best value award be
made to KDI for the basic production year in the amount of
$11,665,850.64." Id.
Contrary to the protester's position, the documentation of the
tradeoff was clearly adequate. The fact that the documentation did
not specifically mention the [deleted]-percent differential does not
undermine the fact that the agency weighed the proposals' advantages,
including schedule risk, against prices. Further, contrary to the
protester's allegation that schedule risk was improperly considered in
the tradeoff, consideration of risk is inherent in the evaluation of
proposals, Hi-Shear Tech. Corp., B-261206, Aug. 31, 1995, 95-2 CPD para.
97 at 4, and thus the agency was not precluded from considering it.
Finally, to the extent that the protester contends that the agency was
required to quantify the dollar value of the superior features of
KDI's proposal, there is no requirement that an agency quantify the
value of technical superiority in relation to low cost to determine
the best value to the government. KRA Corp., B-278904, B-278904.5,
Apr. 2, 1998, 98-1 CPD para. 147 at 14; Picker Int'l, Inc., B-249699.3,
Mar. 30, 1993, 93-1 CPD para. 275 at 12. Thus, the price/technical
tradeoff here is unobjectionable.
The protest is denied.
Comptroller General
of the United States
1. The fuze is the "brains" of the overall cartridge, providing both
safety and arming functions. Contracting Officer's Statement of Facts
(COSF), Dec. 1, 1998, at 1. It is primarily a "proximity fuze,"
which allows it to function in the air at some predetermined height
above the ground. In order to accomplish this, it utilizes frequency
modulated continuous wave (FM-CW) radar technology with Directional
Doppler Ratio (DDR) ranging signal processing techniques and contains
custom radar transceiver and signal processing integrated circuits.
Id.
2. Low risk was defined as: "Little potential to cause disruption to
schedule, increased cost, or performance[; n]ormal contractor effort
and normal government monitoring will probably be able to overcome
difficulties." RFP sec. M.5, at 88. High risk was defined as: "Likely
to cause serious disruption of schedule, increased cost, or
degradation of performance, even with special contractor emphasis and
close Government monitoring."
3. The specific ratings under the quality and management factors were
as follows:
Factors KDI: Rating Risk Bulova: Rating Risk
Quality:
Manufacturing Process green low yellow
mode
ate
Technical Capabilities blue low yellow high
Facilities and Capital Equip.blue low yellow high
Management:
Program green low yellow high
Configuration green low green low
4. Even if we agreed with Bulova that it could not protest the
agency's failure to provide the predecessor contract documents until
it learned of the specific documents in the agency's report, this
aspect of the protest would still be untimely. Specifically, while
Bulova generally asserted in its protest that the documents were
necessary to prepare an adequate proposal, Bulova did not actually
attempt to draw a nexus between specific documents and evaluation
deficiencies until it filed its comments on the report which, due to
an extension granted by our Office, were not filed until December 24,
which was 23 days after the report was received. Comments, Dec. 24,
1998, at 35-37, 38. The nature of this protest argument is such that,
without specifics establishing that the documents would have made a
difference, there would be no basis for sustaining the protest. Under
these circumstances, the specifics provided in Bulova's December 24
comments constituted independent grounds of protest that failed to
independently satisfy our timeliness requirements. Brisk
Waterproofing Co., Inc., B-276247, May 27, 1997, 97-1 CDP para. 195 at 6.
5. Bulova also argues that the Army improperly failed to make a
government-owned RF tester (in KDI's possesion) available to the
protester. This argument is untimely for the same reason as discussed
above. Bulova knew the RF tester existed, and even allegedly asked
the agency "whether the RF Tester previously used in the production of
the M734A1 product was government-owned and if so, whether it would be
made available to the awardee for use." Protest Clarification on
Timeliness, Nov. 24, 1998, at 1. If Bulova believed the RF tester
should have been made available to it for purposes of equalizing the
competition, or otherwise, it should have protested the RFP's failure
to make such provision prior to the closing date.
6. In this regard, the agency explains that "[s]ince testing of
proximity fuzes is complex and time consuming the offeror needed to
address the M734A1 unique features such as the interconnection process
of the M734A1 to the RF tester to demonstrate how the RF tester would
be able to support the required production rate." Id.
7. In this regard, we note that Bulova's blanket proposal statement
that "[a]ll . . . testing will be performed in full compliance to
DTL12973560" reasonably was deemed inadequate given the RFP's specific
testing requirements and provision for evaluation of offerors'
"in-depth understanding" of test requirements. Bulova Quality
Proposal, at F1-11; RFP sec. L.13.1, at 78.
8. In this regard, the agency noted that "any experienced offeror
should compare their final proposal to the system requirements and
confirm that all requirements are properly addressed. . . . Bulova
failed to complete this simple task." Id.
9. In this regard, the agency asserts that the TET "was looking for
some mention of the need to cancel this delay to meet the RF tester
requirements specified in the product baseline documentation." COSF,
Dec. 1, 1998, Attach. 1, at 17.
10. Bulova complains that, because KDI is the only firm with
production experience on the M734A1 fuze, only KDI could achieve a low
risk rating. However, the agency responds that Bulova could have
demonstrated directly relevant experience by either proposing
individuals with such experience or proposing experience with
proximity fuzes of similar technology, such as the "XM450 Medium
Altitude Prox Fuze, XM773 MOFA, M732A2 Prox[imity] fuze for artillery
and the DSU-33 general purpose bomb proximity fuze." COSF, Dec. 1,
1998, at 14. Bulova does not rebut the Army's position. In any case,
the agency was not required to compromise its experience requirements
based on the fact that only one offeror may be able to achieve the
maximum score.
11."Lack of a plan to address component obsolescence in Bulova's
proposal leaves the government at great risk for schedule
interruptions in the option years" since "[i]t is easily conceivable
that two interruptions of 4-6 months each over a 5-year period would
result if this is not monitored adequately." Business Clearance
Memorandum, Sept. 15, 1998, at 15.
12. Further, the agency asserts that "the M734A1 product baseline
documentation includes several critical components such as the Signal
Process, MMIC and Turbine Alternator having single sources of supply,
which further emphasize the necessity of addressing component
obsolescence issues." SCOSF, Dec. 16, 1998, at 3.
13. The protester also argues that the agency "placed inordinate
emphasis on [component obsolescence] in the evaluation," when it "was
but one of five subfactors within the Program Management Subfactor
which at best was worth 1.5% in the overall evaluation score."
However, since this argument was raised for the first time in the
protester's comments, Comments, Dec. 24, 1998, at 37-38, filed more
than 10 days after receipt of the agency report which contained the
information upon which this argument is based, it is untimely and will
not be considered. 4 C.F.R. sec. 21.2(a)(2).
14. As later recast in its comments, the protester acknowledges that
it did not address part variability in its proposal, but contends that
part variability was an unstated criterion, since the "the agency
failed to inform [the firm] that "the design was still in flux and not
yet stable, and . . . [that] certain additional processes are required
to deal with the exigencies of the shifting design." Comments, Dec.
24, 1998, at 22 and 47; see also Supplemental Comments, Jan. 13, 1999,
at 16. Further, the protester raised a specific example of where part
variability had been allegedly resolved under the prior contract by
"ma[king] a minor adjustment of the resistor values for resistors R1
and R3 on the Flex assembly." Comments, Dec. 24, 1998, at 35 and 47.
The specifics of this argument were untimely filed more than 10 days
after receipt of the agency report. We nevertheless note that, even
if Bulova were correct that the issue of part variability of one
component part has been resolved, that certainly would not negate the
agency's concern with Bulova's price assumption and the on-going issue
of part variability with all components. Further, we think the TDP
drawing did put Bulova on notice that, essentially, the design was not
stable.
15. In its comments, Bulova for the first time raises specific
objection to certain evaluated deficiencies in its proposal. These
allegations, based on the evaluation information contained in the
agency report received by Bulova on December 1, are untimely because
they were not raised until December 24, more than 10 days later. See
Global Eng'g & Constr. Joint Venture, B-275999.4, B-275999.5, Oct. 6,
1997, 97-2 CPD para. 125 at 4 n.2.