TITLE:   ATA Defense Industries, Inc., B-282511; B-282511.2, July 21, 1999
BNUMBER:  B-282511; B-282511.2
DATE:  July 21, 1999
**********************************************************************
ATA Defense Industries, Inc., B-282511; B-282511.2, July 21, 1999

Matter of: ATA Defense Industries, Inc.

File: B-282511; B-282511.2

Date: July 21, 1999

Claude P. Goddard, Jr., Esq., Hal J. Perloff, Esq., and Vivian H. Gembara,
Wickwire Gavin, for the protester.

Rodney A. Grandon, Esq., Patton Boggs, for Caswell International
Corporation, an intervenor.

Jeffrey I. Kessler, Esq., and Caridad Ramos, Esq., Department of the Army,
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 the awardee's proposal for a targetry system
was improperly evaluated is sustained where the record shows that the agency
could not reasonably conclude that the awardee's proposal merited a rating
of excellent under the technical evaluation scheme, which reserved an
excellent rating for those systems which locate hits for armor targets to
within 60 millimeters of where a round actually penetrates the plane of the
target, and the awardee's proposal shows that it does not meet this margin
of error.

2. General Accounting Office (GAO) will not review an agency's determination
to waive Buy American Act preference requirements as being in the public
interest, nor will GAO invalidate an agency's source selection decision
merely because the waiver is approved after the award decision.

DECISION

ATA Defense Industries, Inc. protests the award of a contract to Caswell
International Corporation under request for proposals (RFP) No.
DAAE20-98-R-0215, issued by the Department of the Army, Tank-Automotive and
Armaments Command (TACOM), for the Intermediate New Generation Army Targetry
System (INGATS). ATA argues that the Army's evaluation was unreasonable in
several technical areas, that the source selection decision improperly
discounted ATA's strengths and overlooked Caswell's weaknesses, and that the
Army improperly failed to apply the Buy American Act price evaluation factor
to Caswell's proposal.

We sustain the protest.

BACKGROUND

The INGATS procurement calls for the installation of complete live-fire
training ranges, including training in range operations, at various Army
facilities throughout the world. RFP at 3. The training ranges purchased
under the INGATS contract will be composed of commercially-available
targetry equipment, thus the procurement was conducted under the commercial
item procedures set forth in the Federal Acquisition Regulation (FAR) Part
12. Question and Answers (posted on the Internet with the solicitation),
Jan. 7, 1999, at 1. The major subsystems that are assembled into training
ranges include, among other things: stationary infantry targets (SIT),
moving infantry targets (MIT), stationary armor targets (SAT), moving armor
targets (MAT), moving armor targets-vertical (MAT-V) (used to simulate
helicopters, etc.), hit detector devices (HDD), sound effects simulators
(SES), battle effects simulators (BES), hand-held controllers (HHC), and
central control systems (CCS). Performance Description (PD), Oct. 30, 1998,
sect. 3.1.

The RFP, issued October 8, 1998, anticipated award of a fixed-price
indefinite-delivery, indefinite-quantity contract, covering approximately 5
years, to the offeror whose proposal presents the best value to the
government. RFP at 3-4, 36.

The RFP set forth eight contract line items (CLIN) with each identifying a
separate target range. [1] RFP amend. 0001, at 3-9. These eight ranges
include one acceptance test installation at Fort A.P. Hill, in Virginia,
followed by the installation of seven other ranges in the Republic of Korea.
Id. at 2. Listed within each CLIN, but not indicated as separate sub-CLINs,
are the components which will make up the range, and the quantity of each
component needed. For example, CLIN 0001 requires installation of a sniper
range at Camp Casey, composed of 2 HHCs, 70 RFSITs, 12 SESs, and 12 RFMITs.
[2]

The RFP identifies four evaluation elements: technical, performance risk,
small business utilization, and price. RFP at 36. Of these four elements,
technical is significantly more important than performance risk and small
business utilization combined, while performance risk is slightly more
important than small business utilization. The RFP also states that price is
"less important than all other elements combined within the non-price area."
Id. In addition, the RFP identifies five technical sub-elements, set forth
below, in descending order of importance:

(1) Hit detection

(2) Overall design and stability of the design

(3) Battle effects simulator

(4) Radio frequency bandwidth

(5) Training/manual

Of these technical sub-elements, the first two--hit detection, and overall
design and stability of design--are significantly more important than all
the others combined.

For each of the non-price evaluation elements, including all five technical
sub-elements, the RFP anticipated the use of adjectival ratings. For the
technical sub-elements, the RFP anticipated ratings of excellent, good,
adequate, or marginal. Id. at 37-38. In addition, each of the technical
sub-elements was assigned a technical risk rating of very low, low, medium,
or high risk.

The performance risk and small business utilization elements followed the
same adjectival scheme as the technical sub-elements with the following
modifications: the performance risk scheme included an additional rating of
unknown, where no past performance information was available; and, the small
business utilization scheme included an additional rating of poor. In
addition, the RFP set forth separate definitions for each adjectival rating
under each technical sub-element, and under the performance risk and small
business utilization elements. RFP at 37-40, as modified by amend. 0004, at
4-6. These separate definitions will be set forth below, as needed, to
resolve the protester's contentions.

To calculate the total evaluated contract price, the Army totaled the prices
for the eight CLINs identified in the RFP, which formed the minimum
guaranteed quantity. To this sum, the Army added a weighted unit price for
each of the separate components to be used in future ranges multiplied by
the estimated quantities of each component. These weighted component prices
were calculated for the base period, and for each of the four option
periods. CO's Initial Statement, supra, at 4.

The RFP also incorporated by reference Defense Federal Acquisition
Regulation Supplement (DFARS) sect. 252.225-7001, which implements the Buy
American Act, 41 U.S.C.A. sect.sect. 10a-10d (West Supp. 1999), and provides for the
addition of an evaluation differential to offerors proposing to furnish
foreign end products when they are in competition with offers of domestic
end products. RFP at 20. The differential to be applied to a nonqualifying
country end product is 50 percent of the offered price inclusive of duty.
DFARS sect. 252.225-7001(d).

Five proposals, including those of ATA and Caswell, were received in
response to the RFP. Upon receiving proposals, the Army performed an initial
evaluation, held discussions with all offerors, requested and received
revised proposals--followed by further discussions and submission of final
revised proposals. Upon completing its evaluation of final revised
proposals, the Army excluded the proposals submitted by the two
highest-priced offerors from further consideration given their lower
technical ratings and higher technical risk than two of the three
lower-priced proposals. Source Selection Decision, Mar. 31, 1999, at 7. The
final proposal ratings for the three remaining offerors are set forth below:

 EVALUATION         ATA                CASWELL            OFFEROR A
 ELEMENT
                    (adjective/risk)   (adjective/risk)   (adjective/risk)

 TECHNICAL

 --Hit Detection    Excellent/very     Excellent/low      [deleted]
                    low

 --Overall Design   Good/low           Good/low           [deleted]

 --Battle Effects   Good/very low      Good/very low      [deleted]

 Simulator

 --Radio Frequency  Good/low           Good/low           [deleted]

 Bandwidth

 --Training/Manual  Good/medium        Excellent/very     [deleted]
                                       low

 PERFORMANCE RISK   Good               Good               [deleted]

 SMALL BUSINESS     Good               Excellent          [deleted]
 UTILIZATION

 PRICE              [deleted]          $114.2 million     [deleted]

Id. at 6.

Given the evaluation results shown above, the Source Selection Authority
(SSA) first performed a price/technical tradeoff between ATA's and Caswell's
proposals, and the lower-priced, lower-rated proposal submitted by Offeror
A, and concluded that the higher-priced, higher-rated proposals submitted by
ATA and Caswell represented greater value for the Army. Id. at 26-29. As
between ATA and Caswell, the SSA weighed in detail the evaluated merits of
these closely-rated proposals, and made the following three types of
judgments and observations:

(1) the SSA acknowledged and accepted the evaluated superiority of Caswell
in the areas of the training and manuals sub-element, and the small business
utilization element (id. at 30-31);

(2) the SSA differentiated between the identical technical ratings given ATA
and Caswell under the overall design and battle effects simulator
sub-elements, and under the performance risk element, concluding in each
case that Caswell's proposal was superior to ATA's despite the identical
rating (id. at 29-32); and

(3) the SSA discounted Caswell's slightly higher technical risk under the
hit detection sub-element rating (low versus ATA's rating of very low)
because the Army did not expect that Caswell would have difficulty
integrating its subcontracted hit detection device with the Caswell system
(id. at 29).

Based on these judgments, the SSA concluded that Caswell's higher-priced
proposal offered a better value to the agency than ATA's proposal. This
protest followed.

ANALYSIS

Evaluation of hit detection

ATA's challenge to the Army's evaluation of Caswell's proposal under the
most heavily-weighted technical subfactor, hit detection, falls into two
categories. First, ATA argues that Caswell's proposed hit detection device
(HDD) will not meet the 60 millimeter (mm) accuracy requirement established
in the RFP as necessary for a rating of excellent. Second, ATA argues that
the Caswell's device is not as mature as ATA's device, has not been
demonstrated to the Army, and thus cannot be reasonably considered equal to
ATA's device. According to ATA, if the Army had properly evaluated Caswell's
device, it would have awarded the proposal a rating of good or adequate.

In reviewing protests of allegedly improper evaluations and source selection
decision, our Office examines the record to determine whether the agency's
judgment was reasonable and in accord with the stated evaluation criteria.
Abt Assocs. Inc., B-237060.2, Feb. 26, 1990, 90-1 CPD para. 223 at 4. A
protester's mere disagreement with an agency's judgment does not render it
unreasonable. Brunswick Defense, B-255764, Mar. 30, 1994, 94-1 CPD para. 225 at
9.

As a preliminary matter, certain background information regarding hit
detection is necessary here. First, two types of hit detection devices are
discussed in this decision: one detects the presence of a hit by the
vibrations caused when a projectile actually strikes the target, and is
called a contact hit detection device; the other is a significantly more
sophisticated device that extrapolates the virtual position of a projectile
by measuring the acoustic waves (or other types of footprints) the
projectile makes as it passes through the plane of the target. This is
called a non-contact hit detection device. (For the remainder of this
decision we will refer to the device as an HDD, modified by the terms
contact, or non-contact, as appropriate.) Greatly simplified, a contact HDD
provides information about whether there was a hit; a non-contact HDD
provides information about whether and where the hit occurred.

The technical requirements for hit detection are set forth in the PD
document attached to the RFP. The PD requires that some form of HDD be
attached to each of the targets, and that the HDD report information about
hits or misses to the computerized control equipment that monitors the
operation of the range. PD sect. 3.2.3. The PD also requires that all HDDs be
able to identify the time of a hit, the target identifier, and the number of
hits required to kill the target. PD sect. 3.2.3.3. Contact HDDs are used to
meet these requirements. For armor-type targets, as opposed to infantry-type
targets, the PD imposes more stringent requirements that trigger the use of
non-contact HDDs. For these targets--the SAT, MAT, and MAT-V--the HDD must
be able to detect and identify several different projectile types (PD
sect. 3.2.3.2), and must meet the following requirements for accuracy:

The data collected from the SAT, MAT, and MAT-V shall additionally include
the location of all supersonic rounds penetrating the target plane, for both
hits and near misses. Near misses are defined as within a minimum of 2 feet
of the target. The calculated location of the hits for the SAT, MAT, and
MAT-V shall be accurate 97% of the time, to within a minimum acceptable
parameter of 120 mm of where the round actually penetrated the plane of the
target, or to within a preferred acceptable parameter of 60 mm of where the
round actually penetrated the plane of the target. This error tolerance
shall remain consistent for rounds penetrating the target at angles up to 15
degrees to the left and right of the target centerline and up to three (3)
degrees above and below the plane of the target. [3]

PD sect. 3.2.3.3, as modified by amend. 0007.

As mentioned above, the RFP established separate definitions for the
adjectival ratings for each technical sub-element (as well as for the other
non-price elements). The following are the ratings definitions applicable to
the hit detection sub-element (for ease of reference, the places where the
ratings of good and excellent are different are shown in bold):

Excellent: Item has been produced, or a prototype sample is available, and
capabilities have been demonstrated that exceed the requirement listed in
Paragraph 3.2.3 of the performance description, including the preferred
acceptable parameter of accurately calculating the location of the hits for
the SAT, MAT, and MAT-V to within 60 mm of where the round actually
penetrated the plane of the target, 97% of the time.

Good: Item has been produced, or a prototype sample is available, and
capabilities have been demonstrated that exceed the requirement listed in
Paragraph 3.2.3 of the performance description, including the minimum
acceptable parameter of accurately calculating the location of the hits for
the SAT, MAT, and MAT-V to within 120 mm of where the round actually
penetrated the plane of the target, 97% of the time.

Adequate: Meets the minimum acceptable requirements listed in Paragraph
3.2.3. of the performance description, and has produced or a prototype is
available that meets, but some redesign is necessary to achieve the
specifications listed in the performance description.

Marginal: Meets the minimum acceptable requirements listed in paragraph
3.2.3 of the performance description but considerable redesign is necessary.

RFP amend. 0007, at 3-4.

ATA's argument that the Army has misevaluated the capabilities of Caswell's
non-contact HDD focuses on the distinction between the definition of
excellent and good in the RFP's rating scheme. As shown above, the RFP
reserved the technical rating of excellent for proposals offering an HDD
that meets the preferred parameter of calculating the location of hits to
within 60 mm of where the round actually penetrated the target plane. The
technical rating of good was reserved for proposals offering an HDD that
calculates the location of hits between 60 and 120 mm of where the round
penetrates the target plane. ATA contends that the non-contact HDD proposed
by Caswell will, in some cases, register hit information that calculates the
location of hits at greater than 60 mm from where the round penetrated the
target plane. Thus, ATA argues that the Army violated the RFP's stated
evaluation scheme by awarding a rating of excellent to the Caswell proposal
in this area.

Our analysis of ATA's contention starts with the PD document, quoted above,
which identifies the requirement that offerors propose a hit detection
system to calculate the location of all supersonic rounds penetrating the
target plane. The PD limits the location requirement to the area of the
target itself, plus at least 2 feet from the edge of the target. A
non-contact HDD calculates the virtual location where a round penetrates the
target plane, and since the device calculates locations indirectly--as
opposed to actually measuring them--the device operates with a margin of
error (described in the PD and RFP as its accuracy tolerance). It is this
margin of error that drives the distinction between a rating of excellent
(60 mm) and a rating of good (120 mm).

Because of the way the technology functions, the task of calculating the
location of a projectile's penetration of the target plane is easiest near
the center of the target, and grows progressively more difficult for
penetrations approaching the edges of the target and beyond. Thus, the risk
of error in calculating projectile penetrations increases as the actual
penetration moves from the target center outward. See Tr. at 256-57.

This increasing risk of error in locating hits as the actual penetration
moves from the target center outward is reflected in Caswell's proposal,
which set forth with specificity the tolerances of its proposed device in
its final revised proposal (FRP). [4] Of relevance here, the proposal states
that: (1) the accuracy tolerance for the target area itself is "[deleted
[5]] radius at projectile impact center," (2) the accuracy tolerance from
the edge of the target to 60 mm beyond the edge is "[deleted] radius or
better at projectile miss impact center," and (3) the accuracy tolerance
from 60 mm beyond the edge of the target to 2 feet beyond the edge of the
target is "[deleted] radius or better at projectile miss impact center."
Caswell Proposal, Revised Tab 4, app. A, at 14 of 30.

Focusing on the second of the three tolerances identified above, ATA points
out that Caswell's device may score projectiles that miss the target by up
to 60 mm as hits, because the [deleted] margin of error of Caswell's device
in this range easily reaches back into the target area. When this happens,
the device generates a false positive hit report. In addition, because of
the [deleted] margin of error for the device in this area, the false
positive hit reported by the system could be more than 60 mm away from the
actual point where the projectile penetrated the target plane. Thus, ATA
argues that Caswell's proposed device is not eligible for the rating of
excellent, which according to the RFP was reserved for devices that located
hits no more than 60 mm from where the round actually penetrated the target
plane. [6]

ATA's logic regarding the operation of the accuracy tolerances associated
with false positive hit reports appeared correct, and was consistent with
positions taken by the Army during the course of this procurement. For
example, the Army's answers to offeror questions about the solicitation
(which were posted on the Internet together with the solicitation) expressly
acknowledged that false positive and false negative hit information would be
generated for hits near the target edges in accordance with the accuracy of
the offeror's non-contact HDD. Questions and Answers, Jan. 7, 1999
(specifically, question 10 at 14, question 37 at 18, question 43 at 19, and
question 158b at 45-46). In addition, the Army's evaluation of Caswell's
initally-proposed non-contact HDD, which included accuracy tolerances of
[deleted] at the target edges, raised the issue of whether such tolerances
would violate the acceptable minimum tolerance set forth in the PD. [7]

To more fully consider ATA's contention, and to permit the Army and Caswell
to explain their disagreement with ATA, our Office convened a hearing, and a
subsequent conference call. As discussed in detail below, we find that
neither the Army nor Caswell offered a cogent explanation for how Caswell's
device's stated accuracy tolerance satisfies the 60 mm tolerance limitation
reserved for the technical rating of excellent.

First, Caswell answers ATA's claim by pointing to the narrative portion of
its proposal (immediately preceding the accuracy tolerances identified
above) to show that its device meets the tolerance required for an excellent
rating. In relevant part, the proposal states:

"The calculated location of any round that passes between the target edge
and [60 mm] inside the physical target (Area B) will be accurate to within
[deleted] of where the round actually penetrates the target plane and scored
100 [percent] of the time as a hit.

The calculated location of any round passing from the edge of target Area
"B" to [60 mm] outside the edge of the target is Area "C" and will be
counted and scored as a miss 100 [percent] of the time.

Caswell proposal, supra. (Areas A, B, and C, refer to a diagram included in
Caswell's proposal to highlight the operation of its device in the target
area, and in the areas near and beyond the edge of the target.) However, the
quoted narrative in the proposal is internally inconsistent, since it admits
to a margin of error of [deleted], while simultaneously claiming a 100
percent success rate (i.e., zero margin of error) in identifying hits and
misses. During the course of the proceedings before our Office, Caswell was
unable to provide an explanation for this discrepancy.

On this issue, the Army's evaluators also noted the discrepancy between the
Caswell proposal's narrative claim that its device would always score actual
hits as hits (and actual misses as misses), and the accuracy tolerances in
its proposal that would appear to allow a certain number of false positive
and false negative hit readings. However, the contracting officer explains
that the evaluators concluded that the discrepancy was immaterial because
the RFP contains no accuracy requirements for scoring misses, only for
scoring hits. Supp. CO's Statement, June 16, 1999, at 62-63.

While the CO's Statement is correct--there is no accuracy requirement for
scoring misses--the logic is flawed. Since the non-contact HDD functions by
calculating the virtual location of penetrations, and since the possible
margin of error for calculating the location of a penetration that misses
the target can generate a false positive hit reading, the device necessarily
will report that some missed shots were hits. Given the [deleted] margin of
error for the Caswell device in this area, the distance between the actual
penetration of the target plane and the calculated location of the hit, can,
in some cases, exceed the "excellent" accuracy tolerance of 60 mm. Thus, the
device has violated that tolerance for a hit, not for a miss, as the CO
reasons.

Alternatively, both the Army and Caswell explain that Caswell also offered
to [deleted]. (This response to ATA's challenge appears for the first time
in the post-hearing comments filed by both the Army and Caswell.)
Specifically, Caswell claims [deleted].

While our review of Caswell's proposal confirms that the company did, in
fact, offer to [deleted], the offer was related to an earlier technical
requirement (to detect subsonic hits as well as supersonic hits) that was
ultimately deleted from the solicitation. Nowhere in Caswell's proposal does
the company offer to [deleted], and nowhere in the Army's contemporaneous
evaluation materials does it consider whether [deleted] might be an
appropriate solution for locating hits and misses. [8] See Army Post-Hearing
Comments, June 30, 1999, at 7.

In conclusion, we find that the tolerances identified in the Caswell
proposal for its non-contact HDD will result in virtual hit reports at the
target edges that will be located more than 60 mm from the point where a
round penetrated the target plane. We note that this finding is consistent
with positions taken by the Army throughout this procurement, and we note
that Caswell has not repudiated the tolerances identified in its proposal.
Under these circumstances, we conclude that the Army violated the evaluation
scheme by awarding the Caswell proposal a rating of excellent, which was
reserved for devices which locate hits for armor targets to within 60 mm of
where the round actually penetrated the plane of the target.

With respect to the Army and Caswell's alternative position that Caswell is
offering to [deleted], we see no evidence of any such offer in Caswell's
proposal. In any event, even if the proposal could be read to support a
conclusion that Caswell can meet these requirements, we find that the Army
could not reasonably conclude that Caswell's proposal demonstrates its
ability to do so--as also required for a rating of excellent or good under
the evaluation scheme here. Accordingly, we sustain ATA's challenge to the
evaluation of Caswell's hit detection system. [9]

Challenge to the Price/Technical Tradeoff Decision

In addition to challenging the underlying evaluation, as discussed above,
ATA's protest also mounts at least 18 separate challenges to the SSA's
decision that the Caswell proposal offered the best value to the government.
In essence, ATA contends that in looking at the comparatively equal ratings
given the proposals submitted by it and Caswell, the SSA improperly found no
relative benefit in ATA's offer, and no relative weakness in Caswell's. ATA
Post-Hearing Comments, June 30, 1999, at 17. Since we have already concluded
that the evaluation upon which this tradeoff was based was unreasonable, we
also sustain ATA's overall challenge to the price/technical tradeoff. With
respect to the remaining challenges, we will not review in detail each of
the arguments raised by ATA, but will instead set forth here a
representative sample of two of the areas where ATA challenges the best
value decision--i.e., its contentions that the SSA wrongly praised Caswell's
BES, and improperly found risk in ATA's remaining effort to develop software
for the armor targets. In both cases--and in those not discussed here--we
deny ATA's remaining challenges to the tradeoff decision.

The SSA's best value analysis, discussed above, undertook a detailed
comparison of the similarly-rated ATA and Caswell proposals. Source
Selection Decision, supra, at 29-32. In selecting Caswell for award, the
SSA: (1) acknowledged and accepted Caswell's evaluated superiority in the
training and manuals sub-element, and the small business utilization
element; (2) differentiated between the identical technical ratings given
ATA and Caswell under the overall design and BES sub-elements, and under the
performance risk element; and (3) discounted Caswell's slightly higher risk
rating under the hit detection sub-element.

As a preliminary matter, we note that there is nothing improper about an
SSA's decision to look behind the adjectival ratings given proposals by
evaluators in an attempt to ascertain the true relative strengths and
weaknesses of proposals. In fact, the propriety of a tradeoff decision turns
not on the difference in technical scores and ratings per se, but on whether
the source selection official's judgment regarding the differences in the
competing proposals was reasonable and adequately justified in light of the
RFP's evaluation scheme. Veda Inc., B-278516.2, Mar. 19, 1998, 98-1 CPD
para. 112 at 13.

With respect to the BES, evaluated under the third technical sub-element,
ATA challenges the SSA's decision that Caswell's device is superior to
ATA's--even though both received a rating of good, with very low technical
risk. (The arguments raised in this challenge were also raised in a
challenge to the Army's technical and risk assessment of Caswell's BES.)
According to ATA, the SSA's decision unreasonably overlooked problems
arising from the lack of an Army-issued safety certification for Caswell's
BES. As a result, ATA argues, only its BES will be available for immediate
use, and the Army will be required to spend money on the remaining testing
necessary for Caswell's BES to receive the safety certifications needed.

The BES is a device that produces flashes, smoke, and sound effects to
simulate the "killing" of a target. Tr. at 19. ATA's arguments in this area
spring from a provision in the PD that states the Army's preference is for a
BES that does not use pyrotechnics in order "to avoid the lengthy
certification procedure and eliminate some of the transporting and handling
risk involved with the current pyrotechnics." PD, as amended by amend. 0007,
at 2. This preference was incorporated into the separate adjectival
definitions for evaluating each offeror's BES. The evaluation scheme
reserved the rating of excellent for solutions that did not use
pyrotechnics; while the rating of good was reserved for solutions that used
pyrotechnics, but for which the offeror had received, or was in the process
of receiving "a safety certification through an authorized U.S. Government
safety testing agency." RFP at 37-38. Since both ATA and Caswell proposed
the less favored pyrotechnic BES, and since both were evaluated to have an
authorized safety certification, both received ratings of good.

Despite these equal ratings, the SSA concluded that Caswell's BES was
superior to ATA's because it "offers [deleted]." Source Selection Decision,
supra, at 30. The SSA also noted that while the ATA device already had
certain safety certifications from the Army, the Caswell device's approval
by the U.S. Department of Transportaion (DOT) meant there was no signficant
difference between the two proposals in the certification area. Id.

ATA contends, however, that Caswell's DOT safety certification will not
permit the device to be used on Army installations without further delay and
testing expense. Thus, while ATA must concede that the Caswell BES meets the
evaluation requirement for a rating of good, it argues that the distinctions
made by the SSA in favor of Caswell's device were unreasonable. We disagree.

In response to ATA's assertions, the Army explained that neither ATA's nor
Caswell's proposed device (both devices are being purchased from
subcontractors) has received sufficeint testing to receive the final
approval necessary for the use of such pyrotechnic devices on Army
installations. Army Post-Hearing Comments, June 30, 1999, at 6-7. Thus, in
the Army's view, both devices will require further testing, and the testing
for both devices will be at the Army's expense. ATA has provided no evidence
that the Army's characterization of the need for further testing is
incorrect. Given the relative equality of the two offerors in this respect,
and the fact that the Caswell device offers extra features not available on
the ATA device, we see nothing unreasonable in the Army's conclusion that
the Caswell device offers the better value, despite the identical ratings
given the two offerors in this area.

A second example is ATA's contention that the SSA improperly overemphasized
the risk involved in ATA's remaining effort to develop software for its
armor targets. In this regard, ATA describes its remaining effort as the
conversion of "established, fielded software from DOS to Windows." ATA
Comments, May 28, 1999, at 32. In the Army's view, ATA's contention
oversimplifies the SSA's concerns, and understates the nature of the
remaining software effort.

The SSA decision noted problems with the development of ATA's software for
its armor targets under the overall design and stability of design technical
sub-element, the second most heavily-weighted sub-element. Specifically, the
SSA stated:

Both offerors received Technical ratings of Good and Technical Risk ratings
of Low; however, the reason for the Technical Risk rating is an important
trade-off discriminator for this effort. Caswell received the slightly
higher risk rating because they lack a mature MIT. ATA received the same
risk rating because they lack developed armor software. This is actually a
major difference between the two offerors from the view point of concerns in
meeting the critical INGATS delivery schedule.

Although Caswell lacks a mature MIT, they do have a good SIT and MAT;
therefore, the MIT hardware, which combines elements of the SIT and MAT,
should be reasonably simple to bring to completion in suficient time for
initial deliveries. On the other hand, ATA's lack of developed software is
considered to be a much more significant risk in meeting the critical INGATS
delivery schedule. Caswell's armor software is fully developed, and has been
successfully fielded with high marks for realiability, ease of use, and
customer satisfaction.

. . . . .

Finally, a significant discriminator in technical risk is the fact that
Caswell's software is fully developed, successfully fielded, and has high
marks for quality, reliability and customer satisfaction. Compared to the
uncertainty of ATA's undeveloped software and the serious negative impact
this could have on the critical INGATS delivery schedule, this more than
justifies the premium required for an award to Caswell over ATA . . . .

Source Selection Decision, supra, at 29-30, 32.

In challenging the SSA's finding that ATA's undeveloped software could have
a negative impact on the INGATS delivery schedule, ATA argues that the
underlying evaluation materials rated ATA's remaining software development a
low risk, and described its system as mature and competitive. Thus, ATA
argues that the SSA's concerns were unwarranted and unsupported.

Our review of the record here--guided by a substantive response from the
Army, which ATA has not rebutted despite several opportunities to do
so--leads us to conclude that ATA has focused on a summary paragraph
concerning its overall hardware and software capabilities, and not on an
assessment of its armor software capabilities. Supp. CO's Statement, June
16, 1999, at 81-2. In addition, the Army explains that this issue is not
simply a matter of converting DOS software to Windows, but that ATA has not
yet demonstrated its armor software at all. Id. at 82. Further, the Army
explains that even if the development issues with ATA's software were
limited to converting DOS to Windows, the software conversion is estimated
to require several months. Id. In our view, the Army's answer fully
addresses the issues raised by ATA in its challenge, and reasonably
buttresses the SSA's rationale for relying upon concerns about ATA's
unfinished software to support the selection of the Caswell proposal as
offering the best value to the government.

Buy American Act

ATA protests that the non-contact HDD proposed by Caswell is a foreign end
item, and as such, the Army is required to apply the 50-percent price
evaluation factor to this portion of Caswell's offer. The Army denies that
Caswell's device is a foreign end item for purposes of applying the Buy
American Act price evaluation factor. Nonetheless, during the course of this
protest, the agency requested and received a secretarial-level exemption
from the application of the Act, and, as a result, the Army asks that we
deny this basis of ATA's protest.

The record shows that Caswell's HDD is manufactured in Switzerland.
Acquisitions for products from Switzerland, may, on a purchase-by-purchase
basis, be exempted from the application of the Buy American Act as
inconsistent with the public interest. DFARS sect. 225.872-1(b). The record also
shows that on July 16, 1999, the Assistant Secretary of the Army
(Acquisition, Logistics and Technology) made such a determination.

Our Office will not review a decision by the appropriate agency officials to
waive the Buy American Act provisions in a particular procurement, as such a
decision "involves balancing competing Buy American and foreign policies to
determine what is in the public interest." Canadian Commercial
Corp./Liftking Indus., Inc., B-282334 et al., June 30, 1999, 99-__ CPD para. ___
at 14 (citing and quoting SeaBeam Instruments, Inc., B-247853.2, July 20,
1992, 92-2 CPD para. 30 at 5). We also have no basis to disturb the agency's
procurement merely because the waiver of the Act's requirements took place
after award. Canadian Commercial Corp./Liftking Indus., Inc., supra.
Accordingly, ATA's assertion that the Caswell non-contact HDD should be
considered a foreign end item has been rendered academic, and we will not
consider the question further.

RECOMMENDATION

We recommend that the Army reopen the procurement and reevaluate proposals
in accordance with the stated evaluation scheme. If, after reevaluation,
Caswell's proposal does not represent the best value to the government, we
recommend that the agency terminate the award to Caswell, and award to the
offeror whose proposal presents the best value under the evaluation scheme.

We also recommend that the protester be reimbursed the reasonable costs of
filing and pursuing its protest, including attorneys' fees. 4 C.F.R.
sect. 21.8(d)(1) (1999). In accordance with 4 C.F.R. sect. 21.8(f)(1), ATA's
certified claim for such costs, detailing the time expended and the costs
incurred, must be submitted directly to the agency within 60 days after
receipt of this decision.

The protest is sustained.

Comptroller General
of the United States

Notes

1. The RFP also requests prices for separate "components, parts, systems
hardware and software" to allow for installation of future ranges with
configurations not yet known. RFP at 3. These prices were to be entered onto
separate pricing evaluation sheets appended to the solicitation. RFP at 4.
The 15 pricing evaluation sheets requested unit prices by component, over
varying quantity ranges, over each of five separate pricing periods.

2. Since INGATS anticipates the purchase of both hardwired and
radio-operated targetry ranges, PD, supra, sect. 1.2., most of the targetry
subsystems can be purchased using either configuration. When, as in CLIN
0001, the RFP anticipates the purchase of radio-operated equipment, the
agency adds an RF prefix to the subsystem's acronym--thus, RFSITs and
RFMITs.

3. This requirement that HDDs capture information from rounds penetrating
the target plane at other than a perpendicular angle is referred to as
"off-axis capability" and is considered one of the most technically
challenging aspects of this procurement. See Hearing Transcript (Tr.) at
121, 171-2.

4. For reasons not relevant to this protest, Caswell elected to abandon the
non-contact HDD identified in its initial proposal, and to substitute
another manufacturer's non-contact HDD in its FRP. While we need not review
in detail the specifics of the initial device, it will be appropriate later
in the decision to contrast the evaluation of the final Caswell device with
the evaluation of its initial one.

5. The Caswell proposal sets out its accuracy tolerances in centimeters,
while the RFP identifies tolerances in the PD document and the evaluation
scheme in millimeters. For ease of reference, we have converted all
centimeter tolerances to millimeters.

6. ATA argues that this situation is even worse when the projectile passes
more than 60 mm beyond the edge of the target plane. Under this scenario,
the Caswell device has a possible margin of error of [deleted], which could
lead to a false positive hit reading where the reported hit is even further
from where the round actually penetrated the plane of the target.

7. See Letter from CO to Caswell opening discussions, at 3 (Feb. 18, 1999)
("[Y]ou . . . state that ‘[t]he accuracy at the target edges is
nominally [deleted] and is not expected to get better.' Please explain how
you intend to meet the stated minimum requirements of the referenced
paragraph [PD, sect. 3.2.3.3].")

8. In fact, in the same discussion letter quoted in note 7, supra, the
questions asked of Caswell reveal that the Army understood Caswell to be
offering [deleted]. The Army asked:

[deleted]

Letter from CO to Caswell, supra, at 2. In response, Caswell answered,

[deleted]

Caswell Technical Response to Discussion Questions, Mar. 5, 1999, at 3.

9. Since we find that the Army could not reasonably conclude that Caswell
has demonstrated its ability to meet these requirements, we need not reach
ATA's contention that the Caswell device must be rated lower than ATA's
device because Caswell did not provide a product demonstration. We note for
the record, however, that the RFP's product demonstration clause, on its
face, is limited to the evaluation of the overall design and stability of
the design technical sub-element.