TITLE:  Global Readiness Enterprises, B-284714, May 30, 2000
BNUMBER:  B-284714
DATE:  May 30, 2000
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Global Readiness Enterprises, B-284714, May 30, 2000

Decision

Matter of: Global Readiness Enterprises

File: B-284714

Date: May 30, 2000

William H. Butterfield, Esq., Kilcullen, Wilson and Kilcullen, for the
protester.

Devon E. Hewitt, Esq., and Dennis E. Pryba II, Esq., Shaw Pittman, for
ManTech Telecommunications and Information Systems Corporation and for
Engineering and Professional Services, Inc., the intervenors.

Joshua A. Kranzberg, Esq., and Robert A. Russo, Esq., Department of the
Army, for the agency.

C. Douglas McArthur, Esq., Linda S. Lebowitz, Esq., and Michael R. Golden,
Esq., Office of the General Counsel, GAO, participated in the preparation of
the decision.

DIGEST

Protest is denied where agency's evaluation of proposals was consistent with
solicitation terms, which provided that technical evaluation factors were
more important than price, and where agency reasonably selected for award
proposals of higher technically rated offerors (one slightly higher priced
and one lower priced) as compared to protester's lower technically rated
proposal.

DECISION

Global Readiness Enterprises (GRE) protests the award of contracts to
Engineering and Professional Services, Inc. (EPS) and ManTech
Telecommunications and Information Systems Corporation under request for
proposals (RFP) No. DAAB07-99-R-G752, issued by the U. S. Army
Communications-Electronics Command (CECOM), for field support services. GRE
challenges the agency's evaluation of proposals and the agency's selection
decisions.

We deny the protest. [1]

The RFP, issued on May 4, 1999, contemplated the award of
indefinite-delivery/ indefinite-quantity, time and materials contracts to
perform Omnibus Logistics and Readiness Field Support Services, for a 1-year
base period and four 1-year option periods. RFP at 3, 59. The RFP's
executive summary advised offerors as follows:

The government plans to make up to three (3) awards from this solicitation.
Each award will cover all Statement of Work (SOW) technical requirements.
Two (2) awards will be Small Business Set-Asides, with at least one of these
planned awards being made to an 8A Small Disadvantaged Business. The third
award is planned to be made on an unrestricted basis.

Id. at 2-3.

The RFP advised small business prime offerors that they were required to
perform 51 percent or more of the assigned work within their corporate
entity or joint venture agreement; the balance of assigned work could be
performed by team members/subcontractors. Id. at 3.

The RFP provided that the awards would be made to the offerors whose
proposals offered the best values, considering technical evaluation factors,
performance risks, prices, and small business participation plans. These
evaluation factors were listed in descending order of importance. RFP
amend. 1, at 11. The technical evaluation factor included two
subfactors--sample tasks and management. As relevant here, the sample task
subfactor was composed of six equally weighted sample tasks, which were
designed to test the offeror's expertise and capabilities in responding to
the types of situations that could be encountered during contract
performance. Id. The RFP required offerors to prepare a 45-minute videotape
oral presentation in responding to each sample task. Id. at 8-9. Responses
to the sample tasks would be evaluated in terms of the offeror's
understanding of the task, the feasibility of the offeror's approach, and
completeness. Id. at 11.

In order to evaluate an offeror's performance risk, the RFP required
offerors to describe recent (within the past 3 years) and relevant (in terms
of scope) contracts. Id. Concerning price, attachment 2 to the RFP contained
a list of 52 labor categories, with an estimated annual level of effort
(total off-site and on-site hours) for each category. For each labor
category, the RFP directed offerors to provide fully loaded labor rates,
which would be multiplied by the corresponding level of effort. The RFP
provided that the offeror's estimated other direct costs, plus G&A/material
handling costs, would be added for each contract year. The sum of the basic
and option years would equal an offeror's total evaluated price. Id. at 12.
The RFP provided that the agency would use the labor categories and hours
provided in each sample task, along with the rates provided in the price
factor, to evaluate the price reasonableness of the sample tasks. Id. The
RFP advised that awards would not necessarily be made to the lowest priced
offerors.

The agency received seven proposals by the closing time on June 11. Only one
small disadvantaged business--Offeror D--submitted a proposal. Contracting
Officer's (CO) Statement at 2. Three small businesses, including GRE and
EPS, and three large businesses, including ManTech, submitted proposals.
More specifically, EPS submitted a proposal as a small business prime
offeror, with ManTech and two other entities as contributing/supporting team
members. Id. at 6. ManTech submitted a proposal as a large business prime
offeror for the unrestricted competition, with EPS and another entity as
contributing/supporting team members. Id. As relevant to this protest, the
final ratings were as follows:

                      GRE          EPS          ManTech      Offeror D

 Technical            Acceptable   Good         Good         Acceptable

 Sample Tasks         Acceptable   Good         Good         Acceptable

 Management           Outstanding  Good         Outstanding  Acceptable

 Performance Risk     Low          Low          Low          Low

 Evaluated Price      $398.4M      $400.4M      $355.9M      $444.9M

 Small Business       Outstanding  Acceptable   Acceptable   Outstanding
 Plan

Agency Report (AR), Tab 5, Source Selection Decision Document, at 1.

The agency awarded a contract to Offeror D, the only small disadvantaged
business which participated in this procurement. [2] The agency also awarded
a contract to EPS, which submitted the best overall proposal by a small
business offeror. Id. With respect to this award, the agency determined that
the proposal of EPS was "of such significantly superior technical quality
that it [was] worth paying approximately 0.5% ($2.0M) more than the proposal
submitted by [GRE]." Id. The agency concluded that EPS "demonstrated
efficiencies which [would] result in a total cost savings over the five (5)
year life of this time and materials service contract that will more than
totally offset the minimal difference in the total evaluated price." Id. at
2. Finally, the agency awarded a contract to ManTech, a large business which
submitted a technically superior, significantly lower priced proposal. Id.

Relying primarily on the similarity of the sample task presentations by EPS
and ManTech and the agency's evaluations thereof, GRE complains that the
agency, in essence, awarded two of the three contracts to the same
entity--the team of EPS and ManTech, which simply "flip-flopped" roles as
between the small business set-aside and unrestricted portions of the
procurement. Protest at 11. GRE maintains that these awards to EPS and
ManTech will effectively preclude competition for future task orders because
these firms will be "competing against themselves," thus defeating the
purpose of multiple awards. [3] Protester's Comments at 2.

Despite the similarity of their sample task presentations and the
evaluations thereof, the record does not support GRE's position that EPS and
ManTech were the same entity. In this regard, EPS and ManTech each submitted
a separate proposal for evaluation, with evaluated prices based on different
labor rates and different proportions of team member participation. For
example, while EPS, the small business prime contractor, teamed with ManTech
and two other entities, EPS was required to perform 51 percent or more of
the work with its own employees under the terms of the RFP. In contrast,
ManTech, the large business prime contractor, teamed with EPS and one other
entity, yet there was no corresponding RFP restriction on which of ManTech's
own employees could perform the work. In addition, EPS and ManTech submitted
different management and small business participation plans and different
past performance information. Since nothing in the RFP prohibited teaming
arrangements, we have no basis to object to the agency's decision to award
separate contracts to two prime contractors which also had roles as team
members under each of the other's prime contracts.

In any event, even if we assume, arguendo, that EPS and ManTech are the same
entity and that (after two awards are made, one to that EPS/ManTech entity
and the other to Offeror D) GRE would be in line for an additional (third)
award, GRE cannot establish the prejudice necessary for our Office to
sustain the protest, because no third award was required. In this regard,
our Office will not sustain a protest unless the protester demonstrates a
reasonable possibility that it was prejudiced by the agency's actions, that
is, unless the protester demonstrates that, but for the agency's actions, it
would have had a substantial chance of receiving the award.
McDonald-Bradley, B-270126, Feb. 8, 1996, 96-1 CPD para. 54 at 3; see
Statistica, Inc. v. Christopher, 102 F.3d 1577, 1581 (Fed. Cir. 1996). In
this case, the RFP's executive summary advised that the agency "plans to
make up to three (3) awards." Although the RFP expressed the agency's plan
or intention to award up to three contracts, this expression of plan or
intention cannot reasonably be read as stating a legal requirement for three
multiple awards. Rather, the agency's expression of a plan or intention
merely signified the agency's expectations and did not create a legal
obligation to award three contracts. See Canadian Commercial Corp./Liftking
Indus., Inc., B-282334 et al., June 30, 1999, 99-2 CPD para. 11 at 3, 9 (similar
language that "[t]he government intends to award up to two contracts" did
not obligate the agency to make two awards). In other words, there was no
requirement in the RFP that a third award be made. [4]

GRE next complains that its technical proposal, based on its responses to
the sample tasks, was unreasonably downgraded because the agency did not
follow the rating scheme set forth in the source selection evaluation plan,
which provided definitions for the ratings of "acceptable," "good," and
"outstanding" in terms of the degree to which proposal disadvantages offset
proposal advantages. An "acceptable" proposal was defined as offering "major
or minor advantages that are offset by disadvantages"; a "good" proposal was
defined as offering "some major or numerous minor advantages that are not
offset by disadvantages"; and finally, an "outstanding" proposal was defined
as offering "numerous major advantages that are not offset by
disadvantages." AR, Tab 18, Source Selection Evaluation Plan, at 29. GRE
states that in total, its proposal received 7 major and 17 minor advantages
and 1 major and 8 minor disadvantages. On this numerical record, GRE
contends that it should have received a rating of good, not merely
acceptable, because its proposal disadvantages could not possibly offset its
proposal advantages. Protest at 8; Protester's Comments at 7.

We conclude that GRE has failed to articulate any basis to question the
agency's evaluation of its technical proposal. We point out that the RFP did
not describe any type of adjectival rating scheme for the evaluation of
technical proposals. Rather, the scheme described above appeared solely in
the agency's source selection evaluation plan which was furnished to the
protester at its debriefing. An agency's source selection evaluation plan
constitutes an internal agency guideline, and failure to adhere to it does
not provide a basis for protest. Mid Pacific Envtl., B-283309.2, Jan. 10,
2000, 2000 CPD para. 40 at 6.

Moreover, GRE does not meaningfully challenge any aspect of the agency's
evaluation of technical proposals. For example, in its initial protest, GRE
specifically contended that the agency improperly evaluated its response to
sample task 3, which involved new equipment training and field support at
three separate sites. In its administrative report, the agency explained
that it downgraded GRE's proposal because the firm failed to provide
adequate labor hours or personnel for two of the sites and that this
omission constituted a major proposal disadvantage. [5] CO Statement at 4;
AR, Tab 6, Source Selection Authority Decision Briefing, at 17. In its
comments on the agency's administrative report, GRE did not elaborate upon
this contention, apparently conceding that the agency reasonably evaluated
and downgraded its proposal based on its limited response to sample task 3.
See Protester's Comments at 7 ("[f]ive of the six sample tasks are clearly
[good] (at the least) with only Task 3 possibly remaining at the
[acceptable] level"). GRE also does not provide any basis to question the
higher ratings (more advantages and fewer disadvantages) assigned to the
proposals submitted by EPS and ManTech. On this record, we have no basis to
disturb the agency's evaluation of technical proposals.

In addition, GRE challenges the evaluation of price proposals, contending
that because the agency failed to calculate a "composite rate" for each
offeror's overall bid and sample tasks, the agency failed to recognize that
GRE's composite rate was less than that of EPS and ManTech. Protester's
Comments at 5. As noted above, for each labor category listed in the RFP,
offerors were required to apply their fully loaded labor rates to the
estimated levels of effort. The RFP provided that the offeror's estimated
other direct costs, plus G&A/material handling costs, would be added for
each contract year, and that the sum of the basic and option years would
equal an offeror's total evaluated price. The RFP further stated that the
agency would use the labor categories and hours provided in each sample
task, along with the rates provided in the price factor, to evaluate the
price reasonableness of the sample tasks. The calculation of a "composite
rate" was not contemplated by the terms of the RFP and, therefore, such a
rate reasonably was not calculated or considered during the evaluation.

Finally, GRE complains that the agency failed to perform a meaningful price
reasonableness analysis of the sample tasks. The record shows, however, that
each sample task for each offeror was examined to determine whether an
offeror's proposed approach and technical assumptions were reasonable and
whether an offeror's labor categories were consistent with the proposed
approach and technical assumptions. See AR, Tabs 7-9, Evaluation
Documentation for GRE, EPS, and ManTech. For example, with respect to GRE,
for sample task 3, the agency commented that a major disadvantage was that
"[h]ours given do not add up for a full three site fielding and training
mission." The agency believed that GRE did not provide enough hours in the
labor categories cited to complete this task at all three sites. In
particular, "[GRE] listed hours and personnel but did not include schedules
for their planned training. The hours and personnel they did show were not
adequate for the fielding and training requirements." AR, Tab 7, Evaluation
Documentation for GRE, Sample Task 3. As a result of GRE's "misconception,"
the agency "adjusted for evaluation purposes only" GRE's manhours "to
project the reasonableness of [GRE's] proposal if all three sites had been
furnished." Id. In contrast, the agency took no exception to the hours and
personnel reflected in the sample task responses of EPS and ManTech. The
agency concluded that these responses were within the government's manhour
estimates for the offerors' proposed approaches and technical assumptions,
and the labor categories were consistent with the offerors' proposed
approaches and technical assumptions. See AR, Tabs 8-9, Evaluation
Documentation for EPS and ManTech.

In sum, the record shows that the price reasonableness of each offeror's
sample task responses was determined based upon the specific approaches and
assumptions made by the particular offeror. See Agency Statement, Apr. 19,
2000, at 1-2. Contrary to GRE's assertion, the results of the sample task
price reasonableness evaluations were reasonably documented and, in the case
of GRE, we think the agency was reasonably concerned with the labor hours
and personnel proposed by the firm for accomplishing some of the sample
tasks.

Accordingly, consistent with the terms of the RFP, we conclude that the
agency reasonably awarded contracts to EPS and ManTech, both of which
submitted technically superior proposals. GRE, which submitted a lower
technically rated, lower priced proposal, has failed to demonstrate the
unreasonableness of the agency's decision to pay a slight premium to EPS,
and GRE has provided no basis to object to the award to ManTech, which
submitted a lower priced proposal.

The protest is denied.

Comptroller General
of the United States

Notes

1. GRE requested the admission of an accounting expert under the protective
order issued for this protest to assist in reviewing the record. Although
the agency and the intervenor objected, contending that the protester failed
to show how the expert would provide any additional and necessary assistance
in pursuing the merits of its protest, we found these objections to be
insufficient. Absent any special concern over the sensitivity of the
material or any reason to believe that the admission of an expert would pose
an unacceptable risk of inadvertent disclosure, there is a strong policy in
favor of permitting protesters to choose the assistance they deem necessary
to pursue their protests. Bendix Field Eng'g Corp., B-246236, Feb. 25, 1992,
92-1 CPD para. 227 at 6-7. We therefore admitted the protester's expert over the
objections of the agency and the intervenor.

2. GRE does not protest the award to Offeror D.

3. GRE also argues that the teaming arrangements between EPS and ManTech
create organizational conflicts of interest. However, there is no basis to
find such conflicts here. The fact that two members of a team submit
separate prime contractor proposals, each relying on the other member of the
team as a subcontractor, neither constitutes nor creates an organizational
conflict of interest. GRE points to nothing in Subpart 9.5 of the Federal
Acquisition Regulation that would support its position in this regard.
Further, neither EPS nor ManTech wrote the solicitation or the statement of
work and neither firm will be evaluating the other's work. Under these
circumstances, there simply is no basis to find an organizational conflict
of interest.

Moreover, the specific conflict of interest alleged by GRE--manipulation by
EPS and ManTech of the competitions for individual task orders--is a matter
to be addressed during performance. Specifically, the RFP's organizational
conflict of interest clause requires the contractor to fully disclose to the
contracting officer any actual or potential conflict which arises after
award with regard to any task order or modification. RFP at 34. Compliance
with the RFP's organizational conflict of interest clause involves a matter
of contract administration, which is within the discretion of the
contracting agency and for review by a cognizant board of contract appeals
or the Court of Federal Claims, not our Office. Bid Protest Regulations,
4 C.F.R. sect. 21.5(a) (2000).

4. GRE argues that an award to EPS cannot be considered a small business
award because of that firm's cooperation with ManTech and that under the
terms of the RFP, an award still needs to be made to a small business, i.e.,
GRE. We disagree. As explained above, the award to EPS is subject to the
rules governing awards to small businesses and that firm's cooperation with
ManTech does not render the two firms' relationship a violation of the terms
of the RFP or otherwise change the size status of EPS.

5. Contrary to GRE's assertion, the record contains reasonable
contemporaneous documentation of the agency's evaluation and selection
decisions. For example, the record contains narrative descriptions of the
advantages and disadvantages in each offeror's proposal corresponding to the
RFP's evaluation scheme. AR, Tabs 7-9, Evaluation Documentation for GRE,
EPS, and ManTech. The record also contains detailed evaluation briefing
slides used by the source selection authority and this individual's
narrative explanation of the tradeoff decision between GRE and EPS, which
resulted in a determination that it was worth paying a slight premium to EPS
for its higher technically rated proposal.