TITLE:   J&D Maintenance and Service, B-282249, June 18, 1999
BNUMBER:  B-282249
DATE:  June 18, 1999
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J&D Maintenance and Service, B-282249, June 18, 1999

Matter of: J&D Maintenance and Service

File: B-282249

Date: June 18, 1999

John C. McManus, Esq., and Mahlon F. McLean, Esq., McManus & McLean, for the
protester.

Michael A. Gordon, Esq., and Fran Baskin, Esq., Holmes, Schwartz & Gordon,
for S.D. Ashe Landscaping & Services, Inc., an intervenor.

Thomas Kathe, Esq., and Vicki O'Keefe, Esq., Naval Facilities Engineering
Command, for the agency.

Jennifer D. Westfall-McGrail, Esq., and Christine S. Melody, Esq., Office of
the General Counsel, GAO, participated in the preparation of the decision.

DIGEST

1. Protest that awardee failed to adequately address various subfactors
under a particular evaluation factor is denied where record demonstrates
reasonable basis for agency ratings of highly satisfactory or acceptable
under each subfactor.

2. Even if proposal is unbalanced, it need not be rejected where agency
determined that lack of balance did not pose unacceptable risk to the
government and any unbalancing was immaterial since there was no basis for
concern that the offer might not ultimately be low.

DECISION

J&D Maintenance and Service protests the award of a contract to S.D. Ashe
Landscaping & Services, Inc. under request for proposals (RFP) No.
N68931-98-R-0059, issued by the Naval Facilities Engineering Command for
grounds maintenance services at three Navy bases in Florida. The protester
contends that the Navy unreasonably found Ashe's proposal to be acceptable.

We deny the protest.

BACKGROUND

The RFP sought proposals to furnish all supervision, engineering services,
labor, transportation, supplies, equipment, and materials to provide grounds
maintenance services at the Naval Air Station (NAS), Jacksonville; NAS,
Cecil Field; and Naval Station, Mayport. The solicitation contemplated the
award of a contract combining definite-quantity line items and indefinite
quantity line items for a base year and up to four 1-year option periods.
(The definite-quantity line items are referred to in the record as firm
fixed-price (FFP) items and so, for the sake of consistency with the record,
we use that acronym here, although the indefinite-quantity line items also
had fixed unit prices.) The FFP line items, for which prices were requested
on a monthly basis, covered scheduled services, while the
indefinite-quantity items, for which estimated quantities were furnished,
covered unscheduled services.

The RFP provided for award to the offeror whose proposal represented the
best value to the government, with the cumulative weight of technical
factors equal to that of price. RFP sect.sect. M.3, M.4. Proposals were to be
evaluated on the basis of four technical factors: methods and procedures,
experience, past performance, and corporate resources and management. Under
the methods and procedures factor, offerors were to address the following
eight subfactors: full-time equivalency rationale; employee qualifications;
tools, supplies and equipment; rationale--overhead personnel; indefinite
quantity and FFP work plans; recurring work schedule; purchasing system; and
quality control plan. To facilitate the agency's evaluation of the FFP
portion of the proposals, offerors were required to complete a supplemental
pricing form breaking down their direct and indirect costs and specifying
their proposed full-time equivalents (FTE).

Ten firms submitted proposals prior to the August 24, 1998 closing date.
After initial evaluation, the technical evaluation board (TEB) rated the
proposals of both J&D (the incumbent contractor) and Ashe highly
satisfactory, and included them in the competitive range along with two
other proposals that had received ratings of acceptable. After conducting
discussions with the four offerors and receiving revised proposals, the TEB
lowered its rating of Ashe's proposal from highly satisfactory to
acceptable, [1] [DELETED]. Memorandum from Chairman, TEB to Chairman, SEB,
Nov. 16, 1998, at 1 and encl. 1, at 6. A second round of discussions was
conducted, at the conclusion of which the technical ratings were not
revised. Memorandum from Dec. 16, 1998, at 1. The TEB's final ranking of
proposals, together with their prices, was as follows:

Ranking Offeror Rating Price

1 J&D Highly Satisfactory $19,469,042.80

2 Offeror C Highly Satisfactory [DELETED]

3 Ashe Acceptable $18,282,268.32
4 Offeror D Acceptable [DELETED]

Contracting Officer's Memorandum, Mar. 22, 1999, at 7. After reviewing the
TEB's ratings, the source selection authority (SSA) determined, with the
source selection board's (SSB) concurrence, that the downgrading of Ashe's
overall technical rating from highly satisfactory to acceptable based on the
TEB's understanding that Ashe [DELETED]unwarranted. Id. at 7-8. The SSA
revised Ashe's overall rating to highly satisfactory and determined that the
proposal was technically equivalent to J&D's. Id. at 8. The SSA further
determined that Ashe's proposal, which was lower in price than J&D's,
represented the best value to the government. On March 1, the contracting
officer awarded a contract to Ashe.

ANALYSIS

J&D argues that Ashe's proposal should have been rejected as unacceptable
because it failed to demonstrate Ashe's understanding of, and ability to
perform, the work effort required. [2] In this regard, the protester
maintains that the proposal failed to address adequately six of the eight
subfactors identified under the methods and procedures factor. [3]

The evaluation of technical proposals is primarily the responsibility of the
contracting agency. Our Office will not make an independent determination of
the merits of technical proposals; rather, we will examine the record only
to ensure that the agency's evaluation was reasonable and consistent with
the stated evaluation criteria. Am-Pro Protective Agency, Inc.; MVM, Inc.,
B-271385.4 et al., Sept. 23, 1996, 96-2 CPD para. 192 at 3. Here, as set forth
below, we see no basis to object to the agency's evaluation of Ashe's
proposal under the evaluation subfactors in question.

First, the protester alleges that Ashe failed to furnish an adequate
rationale for its FTE numbers by failing to explain how it had derived the
numbers. In this regard, J&D maintains that the solicitation required
offerors to support their FTE numbers with the information they used to
arrive at those numbers. Protester's Comments, Apr. 24, 1999, at 4.

The RFP instructed offerors to "provide information to support the work
effort of the proposed Full Time Equivalent (FTEs) . . . ." RFP sect. M.4(a)(1).
We do not think that this language required offerors to explain how they had
derived their FTE numbers; it simply required them to support (i.e.,
justify) their numbers. The agency evaluators found that Ashe's FTE total,
although "slightly high," was justified because it [DELETED]; accordingly,
they rated Ashe's proposal as acceptable under this subfactor. TEB Report,
Oct. 22, 1998, encl 1 at 4 and encl. 2; Declaration of SSB Chairperson, Mar.
23, 1999, at 2. Since Ashe provided a reasonable explanation for why its FTE
total exceeded the government estimate, the protester's argument that Ashe
failed to furnish an adequate rationale for its FTE numbers is unpersuasive.

Second, J&D argues that Ashe failed to address adequately the employee
qualifications subfactor by failing to identify the personnel that it was
proposing to fill several significant positions. Specifically, the protester
objects to Ashe's failure to identify in its proposal its quality control
personnel, pest control personnel, arborist, and horticulturist.

The RFP required offerors to "describe the qualifications" of the employees
or subcontractors who would be performing the work requirements. RFP sect.
M.4(a)(2). Ashe responded by naming and describing the qualifications of its
senior management personnel (i.e., its president, vice president, general
manager, senior quality control manager, and two site managers). Ashe also
stated that it would be hiring personnel to fill other positions, including
those of horticulturist, arborist, quality control managers, and pest
control applicators. Ashe described in detail the qualifications that it
would require of such individuals. For example, it stated its intention to
hire a horticulturist from the Florida area who was "specifically familiar
with and educated in the growing conditions and the plants native to
Florida's growing environment"; an arborist "from the area who is intimately
familiar with the trees of the region"; quality control managers with 5
years of broad-based experience in grounds management; and pest control
applicators certified by the state of Florida. Ashe's Proposal, Methods and
Qualifications tab; Ashe's Response to Discussion Questions, Nov. 9, 1998,
at 1-3. While Ashe did not identify specific individuals by name to fill
these positions, there was no requirement in the RFP that it do so. Since
Ashe described the qualifications it would require of the individuals hired
to fill these positions and named the personnel currently in its employ who
would be managing the contract, as well as describing their qualifications,
we see no basis to find unreasonable the agency's evaluation of Ashe's
proposal under this subfactor.

J&D argues next that Ashe failed to submit an adequately detailed workplan
for the indefinite-quantity work. The RFP did not require offerors to submit
detailed indefinite-quantity workplans; it required them to "describe" their
plans for handling the indefinite-quantity orders. RFP sect. M.4(a)(5). Ashe
responded by explaining that [DELETED]. Given that the solicitation
requested only a description of the offeror's plan, we think that the
evaluators could reasonably regard this overview as acceptable.

J&D further argues that the evaluators could not reasonably have found
Ashe's sample schedule for the recurring work highly satisfactory since it
did not cover all categories of recurring work to be performed. The RFP
required offerors to "[d]evelop a single sample schedule of recurring work.
. . ." RFP sect. M.4(a)(6). Ashe responded by furnishing a sample schedule for
one category of work at one location (Maintenance Level I, NAS
Jacksonville), together with an explanation of the process that it would
follow to develop the remainder of the schedule if, and when, it were
awarded the contract. Ashe's Proposal, Operations and Scheduling Tab. Given
that the solicitation requested only a single sample schedule, we see no
reason that the evaluators could not reasonably have viewed Ashe's
submission of a sample schedule for one category of work as sufficient.

J&D also argues that Ashe's description of its purchasing system was
inadequate. The solicitation required offerors to describe the purchasing
system that they would use to deliver materials. RFP sect. M.4(a)(7). Ashe
responded with a description of its purchase order tracking system and an
explanation of its approach to acquiring supplies and materials, which
emphasized bulk purchases. Ashe's Proposal, Operations and Scheduling Tab.
In response to the agency's query as to where bulk items purchased in
advance would be stored, Ashe noted that it had begun a search for suitable
storage facilities by contacting two local commercial real estate brokers.
Ashe's Response to Discussion Questions, Nov. 9, 1998, at 2nd unnumbered
page.

The protester argues that this response should have been deemed inadequate
because it failed to demonstrate that Ashe had inquired as to the
availability or cost of suitable storage facilities. We see no reason that
the evaluators could not have accepted Ashe's explanation that it was in the
process of looking for suitable facilities as sufficient, however,
particularly given the absence of any indication that the RFP required more.

Finally, in terms of its challenges to the technical evaluation, the
protester contends that although the RFP required Ashe to submit a quality
control plan for the proposed work, Ashe submitted only a quality control
plan summary.

Contrary to the protester's assertion, the RFP did not require offerors to
submit their quality control plans; it required them to "discuss" their
quality control plans and "the methods used to inspect the services rendered
including specific regard to authority and chain of command." RFP sect.
M.4(a)(8). Ashe's summary of its quality control plan, furnished under the
Operations and Scheduling tab of its proposal, states that the quality
control manager will be a full-time employee and explains how Ashe's quality
control guidelines will be applied. Ashe's summary also states, with regard
to the issue of inspections, that inspections will be done on foot where
practical; that they will be accomplished while the work is in progress;
that follow-up inspections will be conducted in the event of a detected
deficiency or where the work cannot be completely evaluated at the time of
completion; that equipment will be inspected daily to assure quality and
safety; and that personnel will be inspected daily to ensure that they are
using proper safety equipment. Given the information in its proposal, we
think the evaluators reasonably viewed Ashe's proposal as providing
sufficient discussion of its quality control plan and inspection procedures.

Next, J&D argues that Ashe deviated from the terms of the solicitation by
submitting an unbalanced offer, thereby gaining a competitive advantage over
other offerors; as a consequence, the protester asserts, Ashe's proposal
should have been rejected. The protester maintains, in this regard, that
Ashe included a portion of the cost of performance of its
indefinite-quantity work in its FFP line item prices.

As an initial matter, [DELETED]. [4]

Even if this pricing is viewed as unbalanced, however, the agency was not
required to reject the offer on that basis. The RFP did not state that a
proposal containing unbalanced prices between line items or subline items
could be considered unacceptable, as the protester alleges; instead, it
provided that a proposal containing materially unbalanced prices or prices
whose lack of balance posed an unacceptable risk to the government could be
considered unacceptable. RFP sect. L.3(f)(8). Cf. Federal Acquisition Regulation
sect. 15.404-1(g)(3) (similar provision). Here, where the agency did not find
that any lack of balance in Ashe's offer was material or created an
unacceptable risk to the government, we will review that conclusion for
reasonableness.

We see no basis to question the reasonableness of the agency's analysis
here. We recognize that legitimate concern about the risk to the government
may arise where an offer includes relatively high prices for FFP line items
(where there can be a firm expectation that the items will be ordered) and
relatively low prices for indefinite-quantity line items (where there may be
doubt about the accuracy of the quantity estimates). One kind of risk that
acceptance of such an offer may create--which could render the unbalancing
material--is the risk that, if the solicitation's quantity estimates prove
not to be accurate, the offer may ultimately not represent the low cost to
the government. Here, however, the protester does not challenge the accuracy
of the quantity estimates, and there is no basis otherwise to doubt their
accuracy, so any risk to the government should be limited and any
unbalancing thus appears immaterial. See International Terminal Operating
Co., Inc., B-229591, B-229591.2, Mar. 18, 1988, 88-1 CPD para. 287 at 4.

Moreover, Ashe provided the government concrete explanations for its pricing
[DELETED], so that the agency could reasonably determine that the pricing
proposed was a business judgment on the part of the offeror that was not
objectionable and did not pose an unacceptable risk to the government.
Specifically, regarding the issue of whether Ashe's [DELETED], the SSB found
that Ashe's [DELETED] did not present a risk that [DELETED] would not be
performed, Agency Report at 10, a conclusion which the protester has not
disputed and which we have no reason to question. [5] On this record, we
have no basis to question the reasonableness of the agency's view that the
pricing structure in Ashe's proposal did not present an unacceptable risk to
the government. [6]

Finally, J&D complains that the price for the base year FFP work on Ashe's
Supplemental Pricing Form differs from the price for the base year FFP work
in its final price proposal. The protester asserts that due to the
discrepancy, it is impossible to determine the actual cost to the government
of the base year FFP work. The discrepancy in pricing to which the protester
refers is attributable to the fact that Ashe revised the pricing in its
proposal after discussions, but was not requested to, and did not, submit a
revised Supplemental Pricing Form. We do not see that the discrepancy
results in any confusion as to Ashe's price; in any event, it is clearly the
price in its revised price proposal that controls.

The protest is denied.

Comptroller General
of the United States

Notes

1. The TEB also raised the rating of another offeror, not relevant here,
from acceptable to highly satisfactory.

2. The protester also argued in its initial protest that the agency had
deviated from the evaluation scheme set forth in the RFP by selecting for
award the lowest-priced, technically acceptable offer, rather than the offer
representing the best value to the government; that the solicitation, by
requesting supplemental pricing information for the fixed-price portion of
the schedule only, had implied that these were the only prices that would be
considered in the evaluation of price; and that the agency had not
considered the value of the enhancements that it had offered in performing
its best value analysis. The agency responded to these arguments in its
report, pointing out that it had not selected for award the lowest-priced,
technically acceptable offer (which had been submitted by offeror D, not
Ashe). The agency further noted that both sections L and M of the
solicitation had advised offerors that indefinite-quantity prices would be
part of the evaluation, and that the evaluators had considered the value of
the enhancements included in J&D's proposal, but had decided that they were
not worth its higher price.

In commenting on the agency report, the protester has not attempted to rebut
any of the agency's responses. Accordingly, we consider it to have abandoned
these bases of protest. Arjay Elecs. Corp., B-243080, July 1, 1991, 91-2 CPD
para. 3 at 1 n. 1.

3. Ashe received ratings of acceptable under the FTE rationale,
indefinite-quantity/FFP work plans, and quality control plan subfactors, and
ratings of highly satisfactory under the other five subfactors.

4. During discussions with Ashe, the agency pointed out that its pricing for
the FFP items and the indefinite-quantity items appeared to be unbalanced;
Ashe responded by explaining that "[DELETED]." Ashe's Response to Discussion
Questions, Nov. 9, 1998, at 4th unnumbered page. Also, in response to the
agency's second round of discussions, Ashe noted that [DELETED]. Letter from
Ashe to the Contracting Officer (Dec. 1, 1998).

5. It is apparent from the foregoing that the protester's argument that the
SSB failed to consider the impact on performance of Ashe's unbalanced
pricing is without basis. It is also apparent that any failure by the price
evaluation board to analyze Ashe's price for imbalance did not have a
material impact on the source selection decision because the SSB clearly was
aware of, and took into consideration, the apparent unbalancing in Ashe's
prices in making their award recommendation.

6. J&D cites our decision, Tri-State Gov't Servs., Inc., B-277315.2, Oct.
15, 1997, 97-2 CPD para. 143, as a basis for objecting to the pricing structure
in Ashe's proposal. In Tri-State, we found improper a contract award to an
offeror that had materially altered an RFP pricing schedule to its
competitive advantage. Instead of submitting single unit prices for each
line item as requested by the RFP, it split the estimated quantities listed
on the price schedule for a number of items and submitted one price for a
number that it designated the "first" quantities ordered and a different
price for what it designated the "next" quantities ordered. Thus, it in
effect created an extra line item for each of the affected line items. We
found that the substitution of this modified price schedule for the one set
forth in the RFP constituted a material deviation from the terms of the RFP.
Tri-State is not controlling here, since there is no basis to conclude that
Ashe's pricing constituted a material deviation from the terms of the RFP.