TITLE: Engineered Air Systems, Inc.; Hunter Manufacturing Company, B-283011; B-283011.2; B-283011.3, September 21, 1999
BNUMBER: B-283011; B-283011.2; B-283011.3
DATE: September 21, 1999
**********************************************************************
Engineered Air Systems, Inc.; Hunter Manufacturing Company, B-283011;
B-283011.2; B-283011.3, September 21, 1999
ecision
Matter of: Engineered Air Systems, Inc.; Hunter Manufacturing Company
File: B-283011; B-283011.2; B-283011.3
Date: September 21, 1999
Timothy F. Noelker, Esq., Steven E. Kellogg, Esq., and Linda L. Shapiro,
Esq., Thompson Coburn, for Engineered Air Systems, Inc., and Kenneth A.
Martin, Esq., and Jennifer C. Adams, Esq., Martin & Rylander, for Hunter
Manufacturing Company, the protesters.
David Vogel, Esq., and Matthew S. Perlman, Esq., Arent Fox Kintner Plotkin &
Kahn, for Polartherm Oy, an intervenor.
John E. Lariccia, Esq., and Bradley S. Adams, Esq., Department of the Air
Force, for the agency.
Linda C. Glass, Esq., and Paul I. Lieberman, Esq., Office of the General
Counsel, GAO, participated in the preparation of the decision.
DIGEST
1. Protest that the contracting agency treated protester and awardee
unequally in assigning risk assessment ratings is denied where record
provides a reasonable basis for the agency's conclusions that protester's
proposal presented a moderate risk under performance requirements and that
the awardee's proposal presented a low risk.
2. Protest challenging the agency's evaluation of the protester's and
awardee's past performance is denied where the record establishes the
reasonableness of the agency's evaluation and the protester merely disagrees
with the agency's determination.
3. Allegation that agency improperly evaluated proposals is denied where the
record shows that the agency evaluated in accordance with the criteria
announced in the solicitation, and the record reasonably supports the
evaluators' conclusions.
4. Where record supports agency's conclusion that awardee's technical
proposal was superior to that of the protesters, agency reasonably concluded
that award should be made on to the technically superior proposal
notwithstanding the associated price premium.
5. Agency conducted meaningful discussions concerning past performance where
protester was placed on notice concerning negative past performance
information.
DECISION
Engineering Air Systems, Inc. (EASI) and Hunter Manufacturing Company
protest the award of a contract to Polartherm Oy under request for proposals
(RFP) No. F09603-98-R-71047, issued by the Department of the Air Force for
the development, first article test and production of new generation heaters
(NGH) to be used as aerospace ground support equipment.
We deny the protests.
BACKGROUND
The RFP, issued February 10, 1999, contemplated the award of a fixed-price
contract for eight first article units with five 1-year production options.
The acquisition is to provide complete replacement of all existing H-1
heaters currently in use by the Air Force, other services, and foreign
customers. Contracting Officer's Statement sect.1. The requirement is for a
deployable, wheeled, trailer-mounted, duct-type heater which operates on
multiple fuels, primarily JP-8 jet fuel, depending on environment and
available supply. Id. The heater will provide warmth to personnel performing
aircraft maintenance and heat aircraft cockpits, engines, cargo areas and
temporary structures in various environments. Id. The acquisition was
conducted using streamlined source selection procedures in accordance with
the Air Force Federal Acquisition Regulation Supplement (AFFARS). RFP sect.
L-900.
The RFP provided for award to be made to the responsible offeror whose
proposal conforming to the RFP requirements was judged to represent the best
value to the government. RFP sect. M-900.1.0. The RFP defined best value as the
expected outcome of an acquisition that, in the government's estimation,
provides the greatest overall benefit in response to the requirement. Id.
The RFP listed the following evaluation factors in descending order of
importance:
Factor I. Technical
1. Performance Requirements
2. Engineering
3. Production Planning
4. Management
Factor II. Cost/Price
General Considerations
Within Factor I, the subfactors were also listed in descending order of
importance. RFP sect. M.900.2.3. Each subfactor was to receive a
color/adjectival rating and a proposal risk rating. [1] RFP sect. M.900.2.2. A
performance risk rating, based upon the offeror's relevant past and present
performance as it relates to the RFP requirements, was also to be assigned
at the factor level. Id. The three ratings were to receive equal
consideration by the source selection authority (SSA) during the evaluation.
The RFP listed performance thresholds, which are required to satisfy the
user's need, and objectives, which reflect desirable capability above the
threshold; for example, for weight conformance, the threshold was 900
pounds, while the objective was 800 pounds.
The government reserved the right to give evaluation credit for proposed
features that exceeded the objectives and also reserved the right to
evaluate and give evaluation credit for proposed features, other than those
described above, that had merit and exceeded specified performance or
capability requirements in a way beneficial to the Air Force. RFP sect.
M.900.2.2.a.2. The RFP specifically explained how price would be computed
and provided that the government would also assess the realism,
completeness, and reasonableness of the proposed cost/price. RFP
sect.sect. M.900.2.2.b, 6.0. With respect to past performance, the RFP provided that
offerors would be given an opportunity to address negative past performance
information if the offeror had not had a previous opportunity to review the
rating. RFP sect. M.900.5.3.(ii). The RFP stated that the performance risk
assessment at the factor level would be based upon the offeror's relevant
present and past performance and would consider the number and severity of
the problems, the appropriateness and/or effectiveness of any corrective
actions taken, and the offeror's overall work record; the RFP warned
offerors that even prompt corrective action in isolated instances might not
outweigh overall negative trends. Id.
Seven initial proposals were received by the March 12, 1999, closing date.
After evaluation of the initial proposals, three proposals were eliminated
from the competitive range. Evaluation notices (ENs) were issued to the
remaining four offerors. After evaluating responses to the ENs, the Air
Force issued a request for final proposal revisions on May 11 and final
proposals were received May 17. The Polartherm, EASI, and Hunter proposals
were rated as follows:
Polartherm EASI Hunter
TECHNICAL /L /M /L
Performance Requirements B/L B/M B/M
Engineering G/L G/L G/L
Production Planning G/L G/L G/L
Management G/L G/L G/L
COST/PRICE $66,276,423 $54,528,820 $65,546,822
Under the technical factors, Polartherm received a Blue/Low risk rating in
performance requirements, the most critical subfactor, while Hunter and EASI
received a Blue/Moderate rating. Agency Report Tab 22; Proposal Analysis
Report. The evaluators determined that Polartherm's proposal warranted a low
proposal risk rating for this factor because Polartherm's proposed
reliability figures, unlike Hunter's and EASI's, were based on actual
historical data from fielded units rather than theoretical data derived from
engineering analysis and limited testing of developmental units. The
evaluators also found that Polartherm's proposal offered other benefits
consisting of an additional combustion component and an extended engine
warranty resulting in significant cost avoidance. All other ratings of
Polartherm and Hunter were identical. The same result was obtained with
respect to EASI, except that Polartherm received a low performance risk
rating while EASI received a moderate rating. Based on information received
concerning the past performance on Polartherm and its subcontractor, Heat
Wagon, Inc., the agency concluded that Polartherm posed little risk to
timely and successful performance of the requirement. The agency concluded
from EASI's past performance information that EASI had problems [deleted].
Based on the results of the evaluations, the SSA concluded that Polartherm's
proposal offered the best value to the government. Agency Report, Tab 23,
Source Selection Decision Memo. Award was made to Polartherm on May 28. The
agency debriefed EASI and Hunter on June 11, and these protests followed.
[2]
EASI'S PROTEST
EASI contends that the agency failed to apply the same evaluation criteria
to EASI's and Polartherm's proposal and unreasonably evaluated EASI's and
Polartherm's past performance. EASI also protests that the agency's award to
Polartherm did not constitute the best value to the government, and that the
award was tainted by bias or undue influence. In a supplemental protest
filed on July 27, EASI contends that the agency failed to conduct meaningful
discussions with EASI with respect to past performance issues, failed to
conduct a cost avoidance benefit analysis regarding verifiable life cycle
costs, improperly failed to deem Polartherm's cost proposal as
non-responsive and/or assign Polartherm an increased risk, and failed to
consider Polartherm's lack of knowledge regarding maintenance at the agency.
DISCUSSION
Evaluation of Proposals
EASI contends that the agency's evaluation of EASI's and Polartherm's
proposals was inconsistent and unequal in several respects. EASI maintains
that it received a moderate proposal risk rating under the performance
requirement subfactor because it had never manufactured the precise heat
exchanger being offered, while Polartherm received a low proposal risk
rating even though it, like EASI, had never before manufactured the precise
heat exchanger being offered. EASI also maintains that it received a
moderate performance risk rating in part because of performance problems
under prior contracts, despite the fact that EASI had resolved the problems,
while Polartherm received a low risk rating for having resolved performance
problems. Finally, EASI contends that Polartherm received a low performance
risk rating even though the model of heater that its proposal was based on
had suffered from quality and reliability problems.
In reviewing a protest challenging an agency's technical evaluation, we
examine the record only to ensure that the agency's evaluation was
reasonable and consistent with the stated evaluation criteria. Abt Assocs.,
Inc., B-237060.2, Feb. 26, 1990, 90-1 CPD para. 223 at 3-4. A protester's mere
disagreement with the agency's evaluation determination does not demonstrate
that the evaluation was unreasonable. Brunswick Defense, B-255764, Mar. 30,
1994, 94-1 CPD para. 225 at 9. Here, the record provides no basis to question
the reasonableness of the agency's evaluation of proposals.
EASI's proposal was evaluated as less advantageous than Polartherm's
proposal in two respects: it was assigned a moderate proposal risk rating
under the performance requirements subfactor, and was assigned a moderate
performance risk rating under the technical factor. Polartherm's proposal
was assigned a low risk under both. EASI asserts that, according to the
agency, it received a moderate risk rating under the performance
requirements subfactor because it was offering a newly designed heat
exchanger, was integrating components for the first time in this heater and
had conducted only limited testing on a prototype. However, EASI maintains
that Polartherm was also proposing a heater that it had never produced
before but was not downgraded.
The record shows that the basis for EASI's moderate performance requirements
risk assessment was that the heat exchanger/combustion chamber proposed was
of a new design, as specifically stated by EASI in its technical proposal
and, although information was provided to demonstrate system reliability on
defined critical components from other heater designs, the agency concluded
that there was a risk associated with integrating all of the components into
a new system for the first time. While EASI had provided evidence that it
had performed limited testing on the new design heat exchanger, the agency
concluded that an element of risk was present because the system had not
been operated within flight line or similar operating environments and would
utilize a heater controller not yet available. Contracting Officer's
Statement at 7. EASI's reliability figures were not fully supported by
actual experience and, as such, the agency concluded that this presented an
increased risk to the government. Polartherm, on the other hand, proposed a
heater system configuration that was essentially identical to a unit that it
is currently producing. Polartherm's proposal discussed its existing heat
exchanger and the minor changes required in order to meet the solicitation
requirements and provided information regarding the reliability performance
that was substantiated through its customer.
In its comments submitted in response to the agency's report, EASI contends
that its proposed heat exchanger, like Polartherm's, is a derivative of an
existing EASI heat exchanger which has reliability data that could be relied
upon to support the proposed reliability figures. However, in its proposal,
EASI referred to its proposed heat exchanger as a "new design" and never
claimed that its proposed heat exchanger was a derivative of an existing
EASI device. Moreover, in response to the agency's concerns about its
reliability data, EASI responded that its proposed heater was a new design,
but that its engineers had the technical knowledge and expertise to produce
a heater that could achieve high reliability figures because some of its
components were individually reliable. Agency Report, Tab 12, EN No.
EAS-T-02.
While EASI goes into great details to demonstrate that the agency should
have been aware that its proposed heater was a derivative of its current
design, EASI simply did not indicate this in its proposal. Since EASI
repeatedly represented that its proposed heater was a new design, we do not
think the agency was unreasonable in evaluating it as such.
In its protest, EASI made a general allegation of unequal treatment in the
evaluation, but did not provide any specific instances where it believed
Polartherm's proposed heater failed to comply with solicitation
requirements. [3] EASI does, however, question the agency's assessing
Polartherm a low proposal risk because EASI contends it meets or exceeds
more of the stated objectives than did Polartherm. The record shows that
Polartherm received a low proposal risk rating not because of the number of
objectives that it met or exceeded, but rather because, as previously
explained, Polartherm (unlike EASI) discussed in detail the modifications of
its current heater that were necessary to conform to the solicitation
requirements, and it provided operating information to support its proposed
reliability figures. The evaluators concluded that the modifications
proposed by Polartherm were minor, would not affect the system architecture,
and would have a minimal impact on the system's reliability, making the
proposed heater a low risk.
Overall, the record here, which includes EASI's and Polartherm's proposals,
the evaluation documentation, EASI's protest, the agency's report, EASI's
and Polartherm's comments on the report, and additional supplemental
submissions by all parties, demonstrates that the agency's evaluation was
reasonable. EASI's objection to the agency's evaluation constitutes no more
than its disagreement with the evaluation results, which does not
demonstrate that the agency's technical evaluation was unreasonable. DBA
Sys., Inc., B-241048, Jan. 15, 1991, 91-1 CPD para. 36 at 4.
Past Performance Evaluation
EASI protests that the agency applied inconsistent evaluation criteria with
respect to the past performance evaluation of EASI and Polartherm. EASI
contends that Polartherm was given credit for resolving certain technical
problems, while EASI was downgraded for having to resolve problems. EASI
also contends that Polartherm was not assessed an increased risk when its
proposed system experienced a 40-percent failure rate. Lastly, EASI
maintains that the agency was intent on portraying EASI in as negative light
as possible by carefully selecting a few negative comments, ignoring the
vast majority of positive responses and manufacturing a past performance
history that is not reflective of how government agencies view EASI.
We have thoroughly reviewed the record and find no basis to question the
agency's evaluation of past performance. As noted above, the RFP advised
offerors that the performance risk assessment would consider the number and
severity of the problems, the appropriateness and/or effectiveness of any
corrective actions take, and the offerors' overall work record. The RFP
further provided that even prompt corrective action in isolated instances
might not outweigh overall negative trends.
Here, the record shows that the agency received positive responses
concerning Polartherm's and its subcontractor, Heat Wagon's, past
performance. In contrast, EASI's references noted several significant
problems with [deleted]. In this regard, the protester contends that the
agency improperly relied upon negative comments given by a trainee at Kelly
Air Force Base, even though those comments conflict with those of the
engineer responsible for the programs, and reflect the views of a
disgruntled government employee who criticized his agency as much as he did
EASI; in EASI's view, the negative comments do not reflect how the procuring
agency perceived the quality of EASI's products. The agency states that this
employee is the point of contact regarding problems with the air conditioner
programs and his review of EASI's past performance was part of his job in
which he relied on supporting information from a database with comments from
actual users. [Deleted.]
Furthermore, the Air Force notes that, when informed of its poor past
performance record, EASI failed to provide information indicating a positive
trend. EASI, in fact, admitted its problems and acknowledged the negative
trend in its past and present contracts by advising of several actions taken
to resolve many of the concerns, such as corrective actions taken to address
[deleted], but EASI failed to furnish evidence of any positive changes or
trends as a result of the corrective action. Agency Report, Tab 19, EN No.
EAS-P-2-8.
After receipt of the agency report, the protester discovered that the agency
had relied on a computer-generated contractor performance assessment report
(CPAR) that contained a typographical error, which indicated the author
"definitely would not award" to EASI again, while the hard-copy version of
the form that the protester had seen correctly reflected the writer's view
that he "definitely would award" to EASI again. The protester, noting that
the erroneous CPAR was repeatedly cited in the evaluation record, contends
that the Air Force relied heavily upon this obvious typographical error. The
agency concedes the error, but states that it did not rely solely upon the
inaccurate CPAR to assess EASI a moderate risk rating and maintains that the
record without this CPAR supports a moderate risk rating for EASI. While
there is no dispute that the CPAR contained an error, we find that it did
not prejudice the protester, since the record contains otherwise ample
support for the agency's moderate performance risk rating for EASI.
With respect to Polartherm's past performance evaluation, the Air Force
states that it specifically investigated the two "failures" alleged in the
firm's performance and found that they did not warrant an adjustment of the
risk rating as the problems were minor and were quickly corrected by the
contractor. EASI contends that the Air Force's evaluation of Polartherm's
past performance with two airlines was unreasonable and factually
unsupportable because of differences in the type and quantity of the items
at issue and because of a high failure rate. The agency reports that a
relevance assessment, as required by the RFP, was performed on performance
data ranging from very relevant, semi-relevant, to not relevant and that
applying these standards to Polartherm's performance on the contract with
one airline was very relevant and properly resulted in a past performance
rating of low risk. (The Air Force states that it did not consider
Polartherm's performance with the other airline.)
It is clear that past performance information on EASI contained numerous
negative responses, primarily focused on EASI's problems with [deleted].
While EASI was responsive to the concerns and resolved the matters on
individual contracts, it is apparent that EASI did not demonstrate to the
evaluators that its corrective actions justified a low risk rating. In
contrast, the evaluators had a reasonable basis to find Polartherm's past
performance justified a low risk rating. On this record, we find without
merit EASI's assertion that the agency's evaluation was improper.
Price/Technical Tradeoff
EASI objects to the reasonableness of the cost/technical tradeoff analysis
asserting, that the agency failed to justify or explain why the Polartherm
heater is worth an additional $11.7 million. EASI contends that cost was
never a serious consideration in the award decision.
In choosing between a higher-cost, higher-rated proposal and a lower-cost,
lower-rated one, agency officials have broad discretion, and our review is
limited to a determination of whether the cost/technical tradeoff is
reasonable and consistent with the solicitation's evaluation criteria.
Management Sys. Designers, Inc., B-244383.3, Sept. 30, 1991, 91-2 CPD para. 310
at 3.
Here, the SSA, in a detailed, five-page source selection memorandum, noted
that all competitive range offerors were rated exceptional or "blue" in
performance requirements, the most critical technical subfactor, with a
moderate proposal risk except for Polartherm which was rated "blue" and low
proposal risk. He further noted that the technical factor was significantly
more important than the cost/price factor. The SSA specifically concluded
that Polartherm's technical superiority (as evidenced by its low risk in the
performance requirements subfactor) and its low performance risk rating was
worth the higher cost associated with this proposal and that Polartherm
offered the best overall value to the government. In this regard, the SSA
found that Polartherm's technical superiority in the performance requirement
subfactor was based on the high level of confidence in its reliability
commitments. Polartherm, by offering a modified version of its commercially
available heater, provided the agency existing reliability data rather than
the theoretical data provided by the other offerors. Polartherm's proposal
also offered benefits of a warranty above what was required by the RFP and
offered by the other competitive range offerors. In selecting Polartherm's
proposal for award, the SSA provided ample, documented support for his
decision.
Undue Influence and Bias
The protester argues that the agency was improperly influenced by the
memorandum of understanding between Finland and the United States and the
offset agreement between the Boeing Corporation and Finland, which allegedly
played a role because Polartherm is a Finnish company. When a protester
contends that contracting officials are motivated by bias or bad faith, it
must provide convincing proof, since contracting officials are presumed to
act in good faith. ACS Sys. & Eng'g, Inc., B 275439.3, Mar. 31, 1997, 97-1
CPD para.126 at 5. EASI has provided no evidence to support its speculation in
this regard.
EASI's Supplemental Protest
In its supplemental protest, EASI argues, first, that the Air Force failed
to conduct meaningful discussions with EASI with respect to past performance
issues. [4] The agency responds that EASI had the opportunity to respond to
the adverse past performance information at the time it was being compiled
and in fact did respond. The record shows that during discussions EASI was
given the opportunity to respond to numerous instances where negative
information was received by the agency through customer feedback. While EASI
provided responses that indicated that appropriate corrective action was
taken, we do not find it unreasonable for the agency to conclude that EASI
had not demonstrated that certain systemic problems had been corrected.
Accordingly, we find no basis to question the adequacy of the agency's
discussions with EASI.
Next, EASI argues that the Air Force went out of its way to manufacture a
cost avoidance evaluation criterion and assess Polartherm a benefit for its
additional warranty by relying on unsubstantiated data, yet failed to
conduct the same analysis with respect to verifiable life cycle cost data.
While the solicitation did not provide for the evaluation of life cycle
costs, it did state that the Air Force reserved the right to evaluate and
give evaluation credit for proposed features that met or exceeded the stated
objectives. In this regard, all offerors except EASI offered warranties
beyond that which was required by the RFP. The agency found that
Polartherm's extended warranty was a feature that exceeded a specific
objective found in the solicitation, and the Air Force performed a cost
avoidance benefit analysis to estimate the value of the additional warranty.
The Air Force did not find any feature in the EASI's proposal that exceeded
the solicitation's objectives and that deserved to be quantified. We have no
basis to object the reasonableness of the Air Force's conclusions in this
regard. Moreover, as stated above, the decision to award to Polartherm was
primarily based on its technical superiority, rather than on cost avoidance.
EASI also argues that, although Polartherm failed to include all required
cost information in its cost proposal and admitted in its proposal that it
was not familiar with the cost structure of ground support equipment use and
maintenance, the agency unreasonably determined Polartherm's cost proposal
to be realistic, reasonable and complete.
Here, the record shows that with respect to Polartherm, the agency
specifically found all elements of the price proposal, except for the ones
relating to the warranty costs, to be consistent with the scope of the
proposed effort, reasonable and complete. All concerns the agency had with
Polartherm's price proposal, including warranty costs, were resolved during
discussions. Agency Report, Tab 18, Price Competition Memorandum. Further,
there was no requirement in the RFP that offerors demonstrate a familiarity
with the agency's cost structure for ground support equipment. On this
record, the Air Force's price realism analysis of
Polartherm's proposal was reasonable.
HUNTER'S PROTEST
Hunter, like EASI, challenges the agency's evaluation and argues that the
agency conducted unequal evaluation of its and Polartherm's proposals.
Hunter contends that Polartherm's proposal was technically unacceptable
because it failed to meet the agency's threshold weight requirements. The
protester states that the Air Force specified a maximum weight requirement
of not more than 900 pounds for the heaters and that Polartherm's proposed
unit had a weight of 1,036 pounds.
The agency reports that it did not waive any requirements for any offeror.
The RFP required the gross dry weight of the heater without ducts and
adapter not to exceed 900 pounds as a threshold with an objective of 800
pounds. RFP sect. 3.1.1. The RFP further provided that this standard is met when
the offeror provides in its proposal "an acceptable approach, through the
required draft parts list/bill of materials and associated estimated
weight," to demonstrate compliance to the standard. RFP sect. M-900.8, at 23.
The record shows that Polartherm in its initial proposal committed to the
weight threshold but failed to provide information demonstrating its ability
to meet the weight requirement. During discussions, Polartherm was requested
to provide additional information to demonstrate its ability to meet the
weight requirement. In its final proposal, in accordance with the RFP
requirements and the relevant EN, Polartherm provided a bill of materials
which listed all the components and their corresponding weights and showed a
total weight of all the components equal to 406.5 kilograms or 896 pounds.
The protester contends that, although Polartherm committed to the weight
requirement, the agency should have taken into consideration the fact that
in order to correct technical failures in the past, Polartherm had to add
weight to its heater design.
We find nothing unreasonable in the agency's evaluation here. As previously
stated, the RFP specifically provided that the weight requirement would be
met by the submission of a parts list/bill of materials and associated
weights. Polartherm, like the other offerors, including Hunter, provided
such a list, which clearly demonstrated that it would meet the weight
requirement. While we recognize that, since all offerors were either
proposing a new design or modifying an existing one, there is some
uncertainty about whether any offeror will actually meet its weight
commitment, there is simply no evidence that the agency relaxed the weight
requirement for Polartherm or any other offeror.
Next, the protester attempts to challenge the agency's evaluation as
unreasonable, by listing several instances where Polartherm's initial
proposal failed to meet certain technical requirements. The protester
recognizes that these deficiencies were corrected by Polartherm in its final
proposal. The record shows that the alleged deficiencies were brought to
Polartherm's attention during discussions and that none of the alleged
deficiencies appeared in Polartherm's final proposal. The technical
acceptability of Polartherm's proposal was properly based on the final
proposal including all revisions that were the result of its responses to
the agency's concerns during discussions, and the fact that there were
deficiencies in the initial proposal is irrelevant to the final source
selection.
Hunter also argues that the agency erred in assessing Polartherm a low
performance risk rating in the face of Polartherm's use of an inexperienced
small business to assemble the mass production housing for the heater that
Polartherm ships from overseas.
As previously discussed, the agency reviewed Polartherm's and Heat Wagon's
prior contracts, determined their relevance and, based on the positive
responses, assessed Polartherm as having a low performance risk. The record
shows that the agency did have some concerns with Heat Wagon assembling the
heater and expressed them to Polartherm during discussions. Polartherm, in
response, discussed in detail its relationship with Heat Wagon and
specifically outlined its schedule for incorporating Heat Wagon's
participation in the assembly of the heater. Based on the details of
Polartherm's production plans and the positive responses from Polartherm's
and Heat Wagon's references, we believe the agency reasonably assessed
Polartherm as having a low performance risk. Hunter's arguments to the
contrary merely express its disagreement with the agency's evaluation.
Next Hunter, as did EASI, challenges the agency's assessment of a low risk
rating for the performance requirement subfactor for Polartherm and a
moderate rating for the protester. Hunter primarily argues that it was
downgraded under this factor for its failure to provide documentation to
support its reliability commitments, while Polartherm's reliability was
based on the redesign of a heater that experienced substantial failures due
to vibration problems.
As discussed above, the record shows that Polartherm was assessed a low risk
rating under the performance requirement subfactor because its reliability
commitments were based on actual historical data from fielded units rather
than theoretical data based on engineering analysis and limited testing of
breadboard units as was the case with Hunter's. The Air Force thus did not
treat Polartherm and Hunter unequally, but had a reasonable basis for its
low risk assessment of Polartherm's proposed heater design. Polartherm's
proposal demonstrated that it proposed modifications to an existing product,
and the agency determined that those modifications were minor in nature. The
protester, on the other hand, admits that its proposal was presented more as
offering a completely new design that was significantly different from any
heater it had previously produced. While the protester presents numerous
arguments concerning unequal treatment, the record shows that Polartherm
clearly demonstrated in its proposal how, with only minor modification to
its existing heater already in production, it would meet the agency's
requirements.
As explained in our response to EASI's protest, we find no basis to conclude
that the award to Polartherm was tainted by bias or undue influence or
unfair advantages. Likewise, we find the cost/technical tradeoff analysis
was reasonable. We also find without merit to Hunter's contention that
Polartherm was not required to comply with Equal Employment Opportunity
(EEO) standards and audits. The EEO compliance standards were properly
applied to American firms, including Polartherm's subcontractor, Heat Wagon.
Polartherm, a foreign company, does not have to comply with the same
socio-economic requirements as domestic firms. There is no legal requirement
that procuring activities equalize whatever competitive advantages foreign
firms might have because they are not subject to such requirements. [5] The
Hygenic Corp., B-215110, May 24, 1984, 84-1 CPD para. 571 at 2.
The protests are denied.
Comptroller General
of the United States
Notes
1. Proposal risk assesses the risks associated with the offeror's proposed
approach as it relates to accomplishing the requirements at the subfactor
level. The possible evaluation ratings for proposal risk and performance
risk were high, moderate and low. The color/adjectival ratings were
blue/exceptional, green/acceptable, yellow/marginal, and red/unacceptable.
2. After the protests were filed, the agency discovered that an error had
occurred in the calculation of transportation costs for EASI; correction of
the error resulted in a $976,648.30 downward adjustment of EASI's total
evaluated price. As a result of this error, the SSA reviewed the information
and concluded that since the basis of award to Polartherm was its technical
superiority and low risk, notwithstanding the decrease in EASI's total
evaluated price, the award to Polartherm represented the best value.
Throughout our decision, we use the corrected figures.
3. In a submission filed more than 10 days after EASI received the agency
report, the protester included a report from a consultant, who provides
detailed arguments alleging that Polartherm's proposed heater does not meet
the agency's requirements and that Polartherm's heater is inferior to
EASI's. In its initial protest, EASI raised a general allegation of unequal
treatment but, other than arguing that it met or exceeded more of the stated
objectives than did Polartherm, did not claim that Polartherm was unable to
meet certain technical requirements. We consider the allegations raised with
consultant's report to be untimely, for the consultant's specific
allegations go far beyond the grounds asserted in the initial proposal, and
our Regulations do not permit such a piecemeal development of protest
issues. See Dial Page, Inc., B-256210, May 16, 1994, 94-1 CPD para. 311 at 4. In
any event, we view the consultant's report as expressing mere disagreement
with the Air Force's determination with respect to the quality of
Polartherm's heater design.
4. EASI focuses in this regard on its lack of opportunity to respond to the
statement in one computer-generated CPAR (discussed above) that erroneous
indicated that one respondent had said that he "definitely would not award"
to EASI again, when, in fact, he had actually indicated that he definitely
would award to EASI again. As noted above, we find that the past performance
assessment and the resulting risk rating were unaffected by this error, so
that any lack of discussions did not prejudice the protester.
5. The protesters have raised various other collateral issues, such as
Polartherm's alleged lack of knowledge regarding maintenance at the agency.
We have considered those issues and find them to be without merit.