TITLE:  Department of Commerce--Request for Modification of, B-283137.7, February 14, 2000
BNUMBER:  B-283137.7
DATE:  February 14, 2000
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Department of Commerce--Request for Modification of, B-283137.7, February
14, 2000

Decision

Matter of: Department of Commerce--Request for Modification of
Recommendation

File: B-283137.7

Date: February 14, 2000

Robert M. Nutt, Esq., for Kathpal Technologies, Inc., and Edward J. Tolchin,
Esq., Fettman, Tolchin & Majors, for Computer & Hi-Tech Management, Inc.,
the protesters.

Terry Hart Lee, Esq., Department of Commerce, for the agency.

Guy R. Pietrovito, Esq., and James A. Spangenberg, Esq., Office of the
General Counsel, GAO, participated in the preparation of the decision.

DIGEST

Solicitation's evaluation scheme may not be materially changed after receipt
of proposals without providing offerors an opportunity to submit revised
proposals based on the revised scheme.

DECISION

The Department of Commerce requests that we modify the recommendation in
Kathpal Techs., Inc.; Computer & Hi-Tech Management, Inc., B-283137.3 et
al.,
Dec. 30, 1999, 2000 CPD para. __. In that decision, we concluded that Commerce
improperly rejected the protesters' proposals under request for proposals
(RFP) No. 52-SAAA-9-00010, issued by the Department of Commerce for the
award of government-wide acquisition contracts, referred to as the Commerce
Information Technology Solutions (COMMITS) program.

In our decision, we found that Commerce improperly excluded the protesters'
proposals from consideration for award based upon the ratings of a single
technical subfactor without consideration of the offerors' proposed prices
or the other technical factors and subfactors. This, we found, violated
statutory requirements for meaningful consideration of price in all
negotiated procurements and for evaluation of proposals under the factors
stated in the solicitation. 41 U.S.C. sect.sect. 253a(c)(1)(B), 253b(a) (1994). We
also agreed with the protesters that, contrary to the express language of
the RFP, the agency improperly deprived the protesters of the opportunity to
make oral presentations as a part of their technical proposals.

We recommended that Commerce either afford all technically acceptable
offerors, including the protesters, an opportunity to make oral
presentations or amend the solicitation to properly inform offerors that
oral presentations would not be considered as part of offerors' proposals
and obtain revised proposals. We further stated that in either event
Commerce should reevaluate proposals against the solicitation criteria,
adequately document the relative strengths and weaknesses of the proposals,
and select awardees through written source selection decisions that
meaningfully consider all of the evaluation criteria, including price.

Commerce does not assert that our decision contains errors of law or fact,
or information not previously considered, that warrants reversal or
modification. Commerce does not challenge the merits of our decision, but
requests that we modify our protest recommendation in favor of an "approach
[that] is more practical and workable for the agency and in no way
prejudices the protesters or other offerors." Agency Request at 2.

Specifically, Commerce proposes to amend the RFP to inform offerors that the
previously submitted proposals will be evaluated against all technical
factors and price to determine which offerors will be allowed to make oral
presentations, and that only those offerors that make oral presentations
will be considered for award. The agency's source selection decisions would
then be based upon a documented evaluation of proposals under all the
evaluation criteria, including price. As before, the agency intends to make
award without conducting discussions. [1] Agency Request at 1-2.

Despite its plan to revise the RFP to inform offerors that it will
reevaluate written proposals in accordance with the evaluation criteria to
determine which offerors will be permitted to make oral presentations,
Commerce states that it will not obtain revised proposals from offerors but
will, instead, evaluate proposals as originally submitted. Agency Request at
3. Commerce argues that it would be "prejudicial to the government's
interests and those of the awardees" to obtain revised proposals because
unsuccessful offerors, such as Kathpal and CHM, which learned in debriefings
the areas of their proposals that were deemed weak or deficient, would have
a competitive advantage. Id. "Moreover, [Commerce argues] to allow revised
proposals has the potential for a major reshuffling of awardees in all
functional areas, some of whom have already begun task order performance."
Id. On the other hand, Commerce anticipates that merely re-evaluating the
proposals as submitted to determine which offerors will receive the
opportunity for oral presentations would not result in a "significant
difference in source selections." Id.

We recognized in our prior decision the difficulties faced by Commerce in
needing to evaluate more than 200 proposals, particularly given the
solicitation's requirement for oral presentations. Accordingly, we fashioned
our protest recommendations, cognizant of the discretion retained by the
contracting agency in implementing corrective action. See BNF Techs., Inc.,
B-254953.4, Dec. 22, 1994, 94-2 CPD para. 258 at 3. Thus, we suggested several
different actions the agency could take to remedy the statutory and
regulatory violations in its conduct of the procurement. We stated that the
agency could evaluate the proposals as submitted in accordance with the
solicitation requirements; this would require the conduct of oral
presentations by all offerors whose proposals were found to be technically
acceptable after the evaluation of all evaluation factors. We also stated
that Commerce could instead amend the solicitation to inform offerors of a
change in the evaluation criteria or the requirement for oral presentations
by all offerors. [2] If the agency chose to amend the solicitation, we
stated that the agency would need to obtain revised proposals.

We find Commerce's proposed corrective action to be consistent with the
recommendations contained in our decision in all but one aspect; that one
difference is fundamental, however. That is, Commerce may amend the
solicitation to limit the opportunity for oral presentations to those
offerors that are found, after evaluation of proposals under all the
solicitation criteria, including price, to be the most competitive. However,
the agency may not change the basis upon which offerors' proposals are
considered without obtaining and considering offerors' revised proposals
under the new evaluation scheme.

It is fundamental that offerors in a negotiated procurement must be informed
of the criteria against which their proposals will be judged. 41 U.S.C. sect.
253b(a); The Faxon Co., B-227835.3, B-227835.5, Nov. 2, 1987, 87-2 CPD para. 425
at 4. It is equally fundamental that, where an agency revises the criteria
against which offers are to be evaluated or otherwise materially changes the
solicitation's evaluation scheme, offerors must be given a reasonable
opportunity to respond to the revised criteria or evaluation scheme;
otherwise, the statutory requirement to notify offerors of the criteria upon
which their offers will be evaluated is meaningless. See Labat-Anderson
Inc., B-246071, B-246071.2, Feb. 18, 1992, 92-1 CPD para. 193 at 6-7 (agency
evaluation which emphasized oral presentations beyond what the solicitation
contemplated was improper because offerors were not provided an opportunity
to revise their proposals to address the agency's evaluation emphasis on
oral presentations).

Commerce's plan to limit oral presentations to highly-rated offerors (based
upon the agency's re-evaluation of previously submitted proposals) without
providing offerors an opportunity to revise their proposals consistent with
this new evaluation scheme ignores a principal and undisputed finding in our
prior decision. That is, offerors, including the protesters, prepared
proposals in the expectation that all acceptable offerors would be given an
opportunity to make an oral presentation, which was an important part of the
technical proposal. In fact, the RFP limited the past performance
information that could be provided in the written proposals and informed
offerors that this information could be provided in the oral presentation.
Offerors, such as the protesters, who relied upon the RFP evaluation scheme
that promised oral presentations, will be prejudiced if they are not allowed
an opportunity to revise their written proposals, given that Commerce
proposes that only offerors whose written proposals meet a certain threshold
will be provided with the opportunity to orally supplement those proposals.
See id.

Commerce also contends that it would be unfair to allow the submission of
revised proposals after revision of the solicitation here because
unsuccessful offerors, such as Kathpal and CHM, would allegedly have a
competitive advantage over the awardees, given the debriefings the
unsuccessful offerors have received. We disagree. Generally, no unfair
competitive advantage results where an agency carries out the FAR
requirements for notices of award and post-award debriefings and later
events require the reopening of proceedings under the procurement. NavCom
Defense Elecs., Inc., B-276163.3, Oct. 31, 1997, 97-2 CPD para. 126 at 4. In
this regard, Commerce has not shown that unsuccessful offerors, such as
Kathpal and CHM, would actually have a competitive advantage. Nevertheless,
if Commerce has concerns in this regard, it has the discretion to offer a
debriefing to any offeror, whether previously successful or not, see FAR
sect. 15.506, or to conduct discussions with the offerors, including the
awardees, if the agency believes this is necessary to ensure a fair and
equal competition.

Finally, Commerce states that the performance of task orders by various
awardees will be unduly disrupted if there is a major reshuffling of the
awardees. Agency Request at 3. However, our recommendation does not require
the termination of task orders that were already awarded under the RFP.

The request for modification of our protest recommendations is denied.

Comptroller General
of the United States

Notes

1. Commerce has labeled this process of determining which offerors will make
oral presentations as establishing a "competitive range." Labeling this
process as the establishment of a competitive range is not appropriate,
given Commerce's decision not to conduct discussions. The Federal
Acquisition Regulation (FAR) provides that "if discussions are to be
conducted, [agencies shall] establish the competitive range." FAR sect.
15.306(c)(1).

2. We also indicated that the agency could choose to conduct discussions
and, in this event, establish a competitive range of those offerors with
which the agency would conduct discussions.