TITLE:  National Systems Management Corporation, B-286112.2, November 16, 2000
BNUMBER:  B-286112.2
DATE:  November 16, 2000
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National Systems Management Corporation, B-286112.2, November 16, 2000

Decision

Matter of: National Systems Management Corporation

File: B-286112.2

Date: November 16, 2000

Andrew N. Cook, Esq., and Joel S. Rubinstein, Esq., Bell, Boyd & Lloyd, for
the protester.

Joseph Boggs, Esq., Department of the Navy, for the agency.

Jacqueline Maeder, Esq., and Michael R. Golden, Esq., Office of the General
Counsel, GAO, participated in the preparation of the decision.

DIGEST

1. Agency's evaluation of protester's proposal is unobjectionable where the
record establishes that the evaluation was reasonable and consistent with
the stated evaluation factors; protester's mere disagreement with the
agency's conclusions does not render the evaluation unreasonable.

2. Under best value solicitation in which technical factors were more
important than price, selection on the basis that protester's technical
advantage on most important technical factor did not warrant the associated
price premium is unobjectionable and consistent with the evaluation scheme.

DECISION

National Systems Management Corporation protests the award of a contract to
Sierra Management and Technologies, Inc., under request for proposals (RFP)
No. N00421-00-R-0116, issued by the Department of the Navy, Naval Air
Warfare Center, as a small business set-aside for technical support services
in the acquisition and life-cycle management of aircraft weapons systems and
government-furnished equipment. National contends that the agency's
technical, management and past performance evaluations were flawed and that
the agency improperly altered the relative importance of the stated
evaluation factors.

We deny the protest.

The solicitation, issued November 22, 1999, contemplated the award of a
time-and-materials indefinite-delivery/indefinite-quantity 12-month contract
with four 1-year options for technical assistance support, including program
management support, information management support, configuration and
acquisition production support, and administrative support at Lexington
Park, Maryland and the Naval Air Station, Patuxant River, Maryland. The RFP
provided for award to the offeror whose conforming proposal was determined
to be the best value to the government and set forth four technical
evaluation factors, including personnel, technical (which entailed responses
to sample tasks), past performance, and management. Personnel was more
important than technical, past performance, and management, which were
stated to be of equal importance, and cost was least important. The RFP
advised that the agency reserved the right to make an award to other than
the lowest priced offeror or the offeror with the highest technical score if
the agency determined that to do so would result in the best value to the
government.

Five proposals, including National's and Sierra's, were received by the
January 20, 2000 closing date. The proposals were evaluated by five
evaluation teams, including one for each technical evaluation factor and a
cost evaluation team. Members of the technical evaluation teams individually
evaluated each proposal and, in internal discussions, reached a consensus on
the strengths and weaknesses of each proposal. Proposals were assessed under
each evaluation factor using five adjectival ratings: "outstanding," "highly
satisfactory," "satisfactory," "marginal," or "unsatisfactory." The
evaluation teams also assigned a risk rating of "high," "medium," or "low"
under the personnel, technical and management factors. The risk ratings for
past performance were "very low," "low," "moderate," "high," "very high,"
and "unknown."

Based on the initial evaluation, four proposals, including National's and
Sierra's, were included in the competitive range. On June 9, discussions in
the form of written items for negotiations were issued along with the
request for final proposal revisions (FPRs). FPRs were received by June 19.
The final ratings and evaluated costs for the awardee's and the protester's
proposals were as follows:

                   National             Sierra

                   Rating/Risk          Rating/Risk

 Personnel         outstanding/low      highly
                                        satisfactory/low

 Technical         satisfactory/low     satisfactory/low

 Management        satisfactory/low     satisfactory/low

 Past Performance  low risk             low risk

 Evaluated Cost    $12,295,635.20       $10,807,603.20

The evaluation teams forwarded their evaluation results to a five-member
competitive award panel (CAP), which reviewed the evaluations and
recommended to the source selection authority (SSA) that award be made to
Sierra. The SSA approved the award recommendation and award was made to
Sierra on August 17. After an August 28 debriefing, National protested to
our Office.

EVALUATION

Technical

National protests that the agency's evaluation of its proposal under the
technical and management factors was improper. Under the technical factor,
National contends that the agency failed to identify strengths, weaknesses
and deficiencies in the protester's responses to the four sample tasks and
to acknowledge strengths in National's proposal. The protester claims that
the evaluators "merely inserted comments" in the evaluation documents rather
than identify strengths and weaknesses. Protester's Response to Dismissal
Request at 3. To support this claim, National notes that out of 108
categories of input in the evaluation of offerors, National received only 2
strength notations, and no weakness or deficiency notations. Id. at 2.
National argues that the agency's failure to identify strengths and
weaknesses under this factor resulted in a flawed evaluation.

The evaluation of technical proposals is a matter within the contracting
agency's discretion since the agency is responsible for defining its needs
and the best method of accommodating them. KRA Corp., B-278904, B-278904.5,
Apr. 2, 1998, 98-1 CPD para. 147 at 7. In reviewing an agency's technical
evaluation, we will not reevaluate the proposal, but will examine the record
of the evaluation to ensure that it was reasonable and in accordance with
stated evaluation criteria, and not in violation of procurement laws and
regulations. Id. A protester's disagreement with the agency's judgment,
standing alone, is not sufficient to establish that the agency acted
unreasonably. Oceaneering Int'l, Inc., B-278126, B-278126.2, Dec. 31, 1997,
98-1 CPD para. 133 at 6-7.

Here, we find no merit in National's contention that the evaluation of its
proposal under the technical factor was improper. Nine areas were evaluated
under each sample task (including, for example, the overall feasibility and
completeness of the offeror's proposed technical approach, the offeror's
knowledge of the content of the work, the offeror's recognition of the
appropriate sequence and realistic duration of work activities, the
offeror's knowledge of the personnel and subcontractor qualifications
necessary to complete the work, and the offeror's ability to identify a
suitable labor mix to accomplish the task). While it is true that, in their
evaluation of National's proposal, the evaluators noted few strengths and no
weaknesses or deficiencies, the evaluators did include comments under each
of the nine evaluation subfactors under each sample task. For example, under
sample task 1, the evaluators noted that National provided a detailed,
comprehensive technical approach, demonstrated knowledge of the types of
activities required to perform the tasks, and provided full details on
resource allocation by type and task. Agency Report, Tab 8, at 1-5. Under
sample task 3, the evaluators noted that National provided a detailed work
plan with a labor mix to explain how the work would be performed, provided a
listing of the types of resources required and a work plan which detailed
the work activities in an appropriate sequence. Id. at 11-14. Evaluator
comments on sample tasks 2 and 4 were similar.

Thus, the record shows that the agency noted positive attributes of
National's proposal under every category of every sample task. We see no
reason that the agency was required to conclude that these attributes rose
to the level of "strengths." To the extent that National argues that these
positive attributes were required to be classified as "strengths," the
protester is merely disagreeing with the agency's assessment. In any event,
while National argues that the Navy failed to acknowledge its strengths, the
protester does not point to anything specific in its responses to the sample
tasks that it believes should have been rated as a "strength." Indeed,
National has not shown that the agency unreasonably determined that its
responses to the sample tasks generally demonstrated neither strengths nor
weaknesses. Under these circumstances, we see nothing unreasonable in the
agency's evaluation of National's proposal.

Management

National next argues that the evaluation under the management factor was
improperly skewed in favor of offerors using subcontractors, contingency
hires and part-time personnel. National proposed to use its own personnel
with no contingency hires or subcontractors. Since its use of its own
employees was not noted as a "strength," the protester argues that its
proposal was somehow downgraded on this factor and its evaluation is
therefore too low.

We see no basis to question the agency's evaluation of National's proposal
with regard to management. Specifically, the agency evaluated 15 areas under
the management factor, including, for example, the offeror's approach
regarding proposed subcontractors, its integration plan for subcontractors,
its proportion of contingency hires and the specific employees who are
contingency hires. For these areas, the Navy noted no strengths, weaknesses
or deficiencies in National's proposal but commented, for example, that "No
subcontractors were proposed,"
"No subcontractors being utilized," and "There are no contingency hires."
Agency Report, Tab 8, at 19, 20, 22. Thus, the record clearly shows that the
agency was aware that National proposed only in-house employees to perform
the work required under the solicitation. Since the agency judged that these
employees met its needs, its proposal was evaluated as satisfactory on this
factor. Thus, National was given credit for its in-house personnel and its
proposal was not downgraded. Moreover, the agency's written summary of its
evaluation on this factor shows that it also considered National's use of
in-house personnel in its risk assessment. Here, the Navy specifically
states that National had no proposed contingency hires or subcontractors and
therefore could be productive the first day because of its current and prior
experience. The agency also noted that award to National would result in
little or no potential to cause disruption of schedule, increase in cost or
degradation of performance. Under these circumstances, we see no basis to
question the Navy's evaluation.

National argues, again, that the agency failed to adequately identify its
proposal's strengths under this factor. The protester points to one instance
concerning its staffing plan where the agency in its comments stated that
its "current and prior experience is a definite strength" because it was
"currently doing similar tasks" and there were "no forecasted contingency
hires." Agency Report, Tab 8, at 20. Noting that the agency's overall
evaluation did not identify National's experience/staffing as a "strength,"
the protester argues that its proposal "was not given credit for strengths
even the Navy admits are strengths." Protester's Comments at 3.

National's "current and prior experience" was listed as a "definite
strength" in the "Comments" section regarding the offeror's staffing plan
and phase-in of employees upon contract award. It is unclear why this
assessment was not carried over and specifically listed as a "strength."
However, as noted above, the offeror's staffing plan was only one of 15
areas evaluated under the management factor, and therefore would not affect
the award decision. In any event, this "strength" was reflected in the
overall evaluation record because the Navy noted in its overall management
risk rating that National has no proposed contingency hires and no proposed
subcontractor and that National could "be productive the first day because
of [its] current and prior experience with the proposed tasking." Agency
Report, Tab 8, at 24. Additionally, the strength of National's proposed
staffing was part of the business clearance memorandum, which was prepared
by CAP members and submitted to the SSA for review. Agency Report, Tab 5, at
9-11. The CAP recognized that National's proposal was low risk and "would
have little to no potential to cause disruption of schedule, increase cost,
or degrade performance." Id. at 10. In making its best value determination,
the CAP looked at the overall assessments of both National and Sierra and
determined that, viewed as a whole, National's and Sierra's management
proposals were essentially equal with no significant qualitative or risk
differences between the two proposals, and the SSA accepted this assessment.
Id. at 9-10. Moreover, we have reviewed each comment concerning the Navy's
evaluation of National's management proposal and find no other instance
where the Navy identified a "strength" in its comments but failed to
specifically list it as a "strength" in its evaluation, and the protester
does not point to any other areas of its management proposal that it
believes were "strengths" that the Navy failed to acknowledge. Under these
circumstances, we cannot find that the agency's evaluation of National's
management proposal was unreasonable.

Past Performance

National also challenges its "low" risk assessment based on its past
performance. National argues that its past performance record should be
assessed as "very low" risk, pointing to its performance and outstanding
rating as the incumbent contractor in successfully performing the same type,
size and complexity of work. Protest at 3.

The record shows that the agency obtained responses concerning National's
past performance from four references. Agency Report, Tab 10, at 2-17. Each
reference noted whether it "strongly disagreed," "disagreed," "somewhat
agreed," "agreed," or "strongly agreed" with 21 statements relating to
National's quality of service, cost control, schedule, business
relationships, customer satisfaction and key personnel. Id. at 2-3. For
example, under customer satisfaction, references were to indicate, among
other things, their agreement or disagreement with the statements, "The
products/services provided adequately met the needs of the program," and "I
am satisfied with the performance of the Contractor under this effort."
Under quality, the references were to indicate agreement or disagreement
with, for example, the statement that "The Contractor provided a product or
service that conformed to contract requirements, specifications, and
standards of good workmanship." Under schedule, the references were to
indicate agreement or disagreement with two statements, including National's
responsiveness to technical and/or contractual direction and whether
National performed in a timely manner and in accordance with the contract.
References also submitted narrative comments on National's past performance.

Our review of the four past performance surveys submitted on National's
behalf show that two respondents strongly agreed with each of the 21
statements on the survey forms. Id. at 2-3, 10-11. Both respondents in their
narratives reported that National provided outstanding service, which
exceeded contract requirements. Id. at 4-5, 12-13. The other two surveys
generally noted agreement with the 21 statements. One reference "strongly
agreed" with several statements, including all cost control items, while the
other "strongly agreed" with the two schedule items. Id. at 6, 15. These
references "somewhat agreed" to six statements regarding quality of service,
personnel, cost control, and customer satisfaction, including, for example,
the statement that the contractor demonstrated cost efficiencies, utilized
personnel appropriate to the effort, and provided a product or service that
conformed to contract requirements, specifications, and good workmanship.
Id. at 6, 15-16. These lower ratings caused the agency evaluators to
conclude that a low risk assessment was appropriate. Agency Report, Tab 9,
Declaration of Past Performance Evaluation Team Member, at 2. While National
may disagree with this assessment, mere disagreement does not render the
assessment unreasonable. Accordingly, we see nothing unreasonable in the
agency's risk assessment.

Best Value Determination

Finally, National complains that the agency improperly modified the relative
weights of the evaluation criteria outlined in the solicitation without
informing offerors. Specifically, National claims that the Navy improperly
elevated the importance of cost/price, which was stated to be the least
important evaluation factor, and lowered the importance of personnel, which
was stated to be the most important criterion. National essentially argues
that because its proposal was rated higher than Sierra's on personnel, which
was the most important technical factor, the protester should have been
awarded the contract.

Source selection officials in negotiated procurements have broad discretion
in determining the manner and extent to which they will make use of
technical and cost evaluation results. Roy F. Weston, Inc., B-274945 et al.,
Jan. 15, 1997, 97-1 CPD para. 92 at 17. Since the RFP here stated that award
would be made to the offeror whose proposal was determined to be the best
value to the government, considering price and other factors, the agency had
the discretion to determine whether the technical advantages associated with
National's personnel proposal warranted payment of its higher price.
Contrary to the protester's apparent belief, the agency was not required to
make award to the firm offering the highest-ranked technical proposal.

Here, the record shows that the agency did not modify the relative
importance of the evaluation factors. Rather, as permitted under the best
value evaluation scheme, the evaluators evaluated each proposal on each of
the stated evaluation criteria and compared National and Sierra on each of
the technical evaluation factors. The Navy specifically noted National's
higher rating under personnel, but determined that this technical advantage
did not warrant payment of the price premium associated with National's
proposal. Agency Report, Tab 5, Business Clearance Memorandum, at 9-11. The
Navy's comparison and balancing of the cost/technical benefits reflects the
proper use of the agency's discretion in making the best value
determination. Under these circumstances, we see nothing improper in this
selection decision as it reflects an appropriate comparison of competing
proposals and a reasoned determination to select the lower-cost proposal.

The protest is denied.

Anthony H. Gamboa

Acting General Counsel