TITLE:  SWR Inc., B-286161.2, January 24, 2001
BNUMBER:  B-286161.2
DATE:  January 24, 2001
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SWR Inc., B-286161.2, January 24, 2001

Decision

Matter of: SWR Inc.

File: B-286161.2

Date: January 24, 2001

Benjamin M. Bowden, Esq., Albrittons, Clifton, Alverson & Moody, for the
protester.

Robert A. Lincoln, Esq., Library of Congress, 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

Rejection of protester's proposal as unacceptable because it allegedly did
not show specific required experience was unreasonable, where the proposal
specifically represented that it had the required experience, the basis for
the rejection was the omission of information concerning this experience in
documents that were provided by the protester to the agency at a site visit
for another purpose and which did not reasonably establish that the
protester did not have the experience required, and the alleged deficiency
was not identified to the protester during discussions.

DECISION

SWR, Inc. protests the rejection of its proposal and the award of a contract
to Telex Communications, Inc. under request for proposals (RFP) No.
S-LC00018, issued by the Library of Congress for the repair of talking book
machines. SWR contends that the Library's evaluation of its proposal was
unreasonable.

We sustain the protest.

The RFP provided for the award of a fixed-unit-price,
indefinite-delivery/indefinite-quantity contract for the repair of talking
book machines owned by the National Library Service for the Blind and
Physically Handicapped for a base year with four 1-year options. The talking
book machines, which were manufactured by Telex, are four-track,
microprocessor-controlled, audio-cassette tape players that provide fully
automatic playback of cassettes recorded using the Library's special track
format. RFP sect. J.3, Service Manual. Offerors were informed that the Library
estimated that 3,000 machines would be repaired and tested each year. RFP sect.
C.3.1. Performance, design, and test requirements for the machines were also
provided. RFP sect. J.1, Specification #102.

Offerors were also informed that an initial lot of machines would be
delivered to the contractor within 30 days of contract award and that the
contractor was required to deliver to the agency two "preproduction samples"
of repaired machines along with quality assurance test procedures within 60
calendar days of receipt of the initial lot. After the agency's approval of
the preproduction samples, machines needing repairs would be delivered to
the contractor, which was expected to repair and ship machines "at a rate of
approximately 300-400 [machines] per thirty (30) calendar days after
receipt." RFP sect.sect. F.3, F.4.

The RFP provided for award on the basis of a cost/technical tradeoff and
informed offerors that the technical factors were more important than
cost/price. The following technical evaluation factors were listed in
descending order of importance:

 Factor    Demonstrated ability to perform timely repairs
 1         in accordance with specifications as evidenced
           by successful past performance in component
           level repair of complex
           microprocessor-controlled electromechanical
           systems, including established quality control
           practices and procedures.

 Factor    Adequacy of plant facilities, parts acquisition
 2         and control, storage capacity, and equipment,
           including test equipment and ESD control
           facilities. [1]

 Factor    Managerial and/or corporate experience and
 3         qualifications of production personnel.

RFP sect. M. Instructions for the preparation of proposals were provided. Among
other things, offerors were directed to describe their previous experience
with component-level repair of complex microprocessor-controlled
electromechanical systems, their quality control practices and procedures,
their proposed repair facilities, and their complete list of equipment. RFP
sect. L.7.

The Library received four offers, including SWR's offer of $[DELETED]
million and Telex's offer of $2.21 million. SWR proposed to perform the
contract at a dedicated facility it would set up at its company's
headquarters with the proposed primary technical staff and equipment being
totally dedicated to contract performance. SWR's Technical Proposal
at 66-68. SWR's proposal specifically discussed its corporate and staff
component-level repair experience. Id. at 11, 15-17, 19-22, 31-42. Telex,
the incumbent contractor, proposed to perform the contract using the
production line and technical staff that originally built the machines.
Telex's Proposal at 1.

SWR's initial technical proposal received [DELETED] of 240 possible points
and was determined to be unacceptable but capable of being made acceptable
through discussions. Specific evaluation concerns with SWR's proposal
included the lack of detail in its quality assurance practices; an
inadequate description of its proposed production facility; and insufficient
details in its resumes concerning the employment history of proposed staff,
including how long the staff had been with SWR. Technical Evaluation
Memorandum (Sept. 7, 2000) at 2-3.

Telex's proposal received [DELETED] of 240 points and was determined to be
acceptable. The evaluators noted Telex's successful past performance of the
contract services and that Telex was proposing to continue contract
performance at the same facility with the same personnel who had experience
in the manufacture and repair of the machines. Id. at 1-2.

Discussions were conducted and revised proposals received. The Library then
conducted on-site visits of the offerors' facilities. SWR was informed that
the agenda for its site visit would include examining its proposed
repair/test facility and "a current copy of your Quality Control
Documentation (records of labor, parts used, test data certification) of
equipment for servicing from incoming inspection to
delivery/packaging/shipping. Equipment repair tracking log." Hearing exh.
No. 6, Site Visit Topics; Hearing Video Transcript (VT) at 11:36. The
contracting officer and the chair of the Library's evaluation board
conducted the site visit at SWR's facility. At the site visit, SWR provided
to the agency documents evidencing its current quality control system, as
well as letters of intent for the staff it intended to employ and agreements
for the purchase of equipment. Hearing exh. No. 7, SWR Documents.

After the site visit, the evaluators met to evaluate the proposal revisions.
The evaluators concluded that SWR's revised proposal was not technically
acceptable, primarily because the evaluators found that the documentation
provided by SWR at the site visit (and in response to the agency's agenda)
did not specifically show past performance of component-level repair of
complex, microprocessor-controlled, electromechanical systems. VT at
16:17-18. The agency concluded that the "extent of the repair services
provided [by SWR] were limited to board level and module swap repairs e.g.
replacing computer mother boards, installing disk drives, and performing
electromechanical adjustments such as mechanical switches and replacing
belts." Technical Evaluation Memorandum (Sept. 25, 2000) at 1. The
evaluators also expressed concern with SWR's quality control practices and
procedures, noting that SWR does not have, nor does it plan to have, an
[DELETED], and that SWR did not yet have in place a "production line repair
facility" for the machines, noting that the absence of a "production
infrastructure" created a risk of service disruption. Id. at 1-2. SWR's
proposal was thus found technically unacceptable, and award was made to
Telex based upon that firm's technically acceptable offer. Id. at 2. This
protest followed. [2]

SWR complains that the Library's evaluation and rejection of its technical
proposal are unreasonable. Specifically regarding component-level repair
experience, SWR argues that the Library misread the information provided by
SWR at the site visit and ignored specific proposal language to improperly
find that SWR did not have component-level repair experience. In this
regard, SWR complains that the Library never identified its concerns with
SWR's component-level repair at the site visit or during discussions. VT at
17:10-11. SWR contends that, if the Library had asked, it would have
provided additional information showing its component-level repair
experience. See VT at 17:04-10, 17:36-37 (testimony of SWR's vice
president).

The Library disagrees that it ignored SWR's proposal representations
regarding component-level repair experience, but states that based upon the
documentation provided by SWR at the site visit the agency found SWR's
proposal representations to be not credible. Specifically, the agency stated
that SWR provided the Library with copies of work orders it had performed
and that these work orders were for module replacement and not
component-level repair work. Agency's Post-Hearing Comments at 3.

In reviewing protests challenging the evaluation of proposals, we do not
conduct a new evaluation or substitute our judgment for that of the agency
but examine the record to determine whether the agency's judgment was
reasonable and in accord with the RFP evaluation criteria. Abt Assocs.,
Inc., B-237060.2, Feb. 26, 1990, 90-1 CPD para. 223 at 4. In performing this
review, we do not limit our review to contemporaneous evidence, but consider
all the information provided, including the parties' arguments,
explanations, and hearing testimony. Southwest Marine, Inc.; American Sys.
Eng'g Corp., B-265865.3, B-265865.4, Jan. 23, 1996, 96-1 CPD para. 56 at 10.
However, although we consider the entire record, including the parties'
later explanations and arguments, we accord greater weight to
contemporaneous evaluation and source selection material than to arguments
and documentation prepared in response to protest contentions. Boeing
Sikorsky Aircraft Support, B-277263.2, B-277263.3, Sept. 29, 1997, 97-2 CPD
para. 91 at 15.

Here, we do not find the Library's determination that SWR's proposal was
unacceptable to be supported by the record or reasonable. As noted above,
the primary basis for the agency's unacceptability determination was the
Library's conclusion that SWR did not show experience in component-level
repair of complex microprocessor-controlled electromechanical systems. See
VT at 14:57, 16:17-18; Technical Evaluation Memorandum (Sept. 25, 2000) at
1-2. However, as argued by the protester, SWR's initial proposal represented
that the firm and its proposed staff had significant component-level repair
experience. For example, SWR identified a contract it had performed for the
Department of the Army at Fort Jackson, South Carolina, under which it had
performed component-level repair of automated data processing equipment. SWR
Technical Proposal at 31. SWR also identified proposed staff with
component-level repair experience. Id. at 18-22, 40-42. The record shows
that the agency's evaluation committee accepted these representations,
finding in its initial evaluation that SWR had sufficient component-level
repair experience. [3] VT at 11:14-16, 11:54, 15:10-11, 15:28, 15:45, 16:07.
In fact, the evaluation committee chair testified that he had no doubt that
SWR's proposed staff could do the component-level repair work but that the
site visit documents did not show component-level repair work. [4] VT at
12:15-17, 12:20.

The record establishes that the sole basis for the agency's decision not to
accept SWR's proposal representations regarding its component-level repair
experience of microprocessor-controlled electromechanical systems is that
the documents provided by SWR at the site visit allegedly did not show this
experience. [5] VT at 11:06-09, 12:10, 13:13-14, 15:45. SWR disagrees that
these documents indicate a lack of component-level repair experience and
points to several records it asserts involved component-level repair. See
Hearing exh. 7, Tab 7, at 4, 7, 21; VT at 12:03-07. In this regard, the
chair of the evaluation committee admitted that the documents were subject
to some interpretation. VT at 12:03-04, 12:06. Apart from the parties'
disagreement, we view as significant that these documents were not intended
to show SWR's component-level repair experience, but were provided in
response to the agency's request that SWR provide at the site visit "a
current copy of [its] Quality Control Documentation." Hearing exh. No. 6,
Site Visit Topics. The documents provided were copies of quality control
inspection forms, service call logs, and customer questionnaires for past
work SWR had performed at other places. The agency did not ask to see
documents showing component-level repair, and there was no discussion at the
on-site visit concerning SWR's component-level repair experience. [6] VT at
11:43, 11:57, 11:59-12:00.

Reading the record most favorably to the agency, we do not think that the
documents provided at the site visit could alone form the basis for the
rejection of SWR's proposal. Even assuming, arguendo, that the documents do
not clearly show component-level repair experience, this does not
demonstrate that SWR does not have the experience explicitly asserted in its
proposal, given the purpose for which the documents were requested. While we
think that the omission of this experience in the documents could properly
raise concerns that the agency was entitled to consider, the agency should
have raised this concern in discussions with SWR to ascertain whether the
firm had the experience represented in its proposal. [7] See AAA Eng'g &
Drafting, Inc., B-250323, Jan. 26, 1993, 93-1 CPD para. 287 at 6-7.

We also find unreasonable a number of the other reasons (which, in any
event, the evaluators did not cite as primary reasons) asserted by the
Library in support of its determination that SWR's proposal was technically
unacceptable. Specifically, the evaluators expressed concern with SWR's
quality control plan, noting that SWR had not proposed a [DELETED]. [8] See
Technical Evaluation Memorandum (Sept. 25, 2000) at 2; VT at 14:58. At the
hearing, however, the chair of the evaluation committee and the other
evaluator who testified stated that the RFP did not require a [DELETED], and
that SWR's quality control plan was acceptable. See VT at 10:31, 12:45,
12:50-51, 15:00-03, 15:24, 16:09. In fact, the evaluator (who was identified
by the committee chair as the quality control expert on the evaluation
committee) stated that the lack of an [DELETED] was not a deficiency, but a
weakness that would not disqualify SWR, and that this was "not a big deal."
VT at 14:41-42, 15:03, 15:24, 15:43.

The evaluators also noted that SWR did not have an existing production line
for the repair of the machines, which would prevent the firm from meeting
the contract delivery requirements. [9] See Technical Evaluation Memorandum
(Sept. 25, 2000) at 2. As admitted by the evaluation committee chair and the
other evaluator who testified, the RFP does not require an existing
production line or that an offeror already have the equipment necessary to
perform the contract. See VT at 12:35, 12:43, 13:12, 15:33. Rather, the RFP
provided for the evaluation of offerors' proposals to provide production
facilities. Here, SWR proposed existing dedicated space for the production
facility and provided agreements it had with vendors to obtain required
equipment. Although the agency suggests that SWR cannot establish its
production line in sufficient time to satisfy the solicitation's delivery
requirements, the record does not show that the agency reasonably analyzed
during its evaluation whether SWR could establish its proposed production
line facility in time to meet the required delivery schedule. Moreover, it
was evident from the testimony provided by the evaluation committee chair
that he did not know what schedule was required to meet the contract
delivery requirements. [10] VT at 13.29.

In sum, we do not find that the agency has supported its determination that
SWR's lower-priced proposal was technically unacceptable. Given [DELETED],
we cannot say that SWR's proposal, if acceptable, would not be selected for
award as a result of a reasonable cost/technical tradeoff. Accordingly, we
sustain the protest.

We recommend that the agency reopen negotiations with the offerors, obtain
revised proposals, and reevaluate proposals. If as a result of this new
evaluation a firm other than Telex is selected for award, the contract
awarded to Telex should be terminated and award made to that other firm. We
also recommend that the protester be reimbursed the reasonable costs of
filing and pursuing the protest, including attorney's fees. 4 C.F.R. sect.
21.8(d)(1) (2000). The protester should submit its certified claim for such
costs, detailing the time expended and the costs incurred, directly to the
contracting agency within 60 days after receipt of this decision.

Anthony H. Gamboa

Acting General Counsel

Notes

1. "ESD control facilities" was not defined or discussed in the RFP, so the
agency did not evaluate ESD compliance. Technical Evaluation Memorandum
(Sept. 7, 2000) at 2.

2. Performance of Telex's contract was not stayed based upon the agency's
written determination that urgent and compelling circumstances and the best
interests of the government would not permit the agency to await our
decision.

3. The chair of the evaluation committee suggested at one point in his
hearing testimony that the evaluators were always "concerned" with SWR's
asserted component-level repair experience. VT at 11:11, 11:18. However,
this concern was not documented in the evaluators' individual scoring sheets
or the consensus initial proposal evaluation report, and another evaluator
testified that he did not recall this concern arising at the time of the
evaluation of initial proposals. VT at 15:09. The chair also admitted that
SWR was not asked about its component-level repair experience during
discussions. VT at 11:53-54. At another point in the chair's testimony, he
stated that he and the other evaluators accepted SWR's representations and
that this alleged deficiency was perceived as a result of the site visit. VT
at 11:14-16, 11:49.

4. Some of SWR's proposed technical staff with component-level repair
experience were employed elsewhere and were proposed under letters of intent
to accept employment with SWR, if SWR was awarded the contract. SWR states
that if the Library had asked, it could have provided documentation from
these proposed persons establishing their component-level repair experience.

5. In response to the protest, the agency also provided a memorandum from
its evaluators, asserting that the representations in SWR's initial proposal
of component-level repair experience were implausible for a variety of
reasons. See Memorandum of Technical Evaluation Committee (Oct. 30, 2000).
This document, which was prepared in response to the protest, is not
consistent with the contemporaneous evaluation record, which indicated no
such reservations. All of the reasons given for the evaluators' conclusions
would have existed prior to the site visit, but the contemporaneous record
and hearing testimony establish that the evaluators were not concerned with
SWR's component-level repair experience until after the site visit. Thus, we
give little weight to this post-protest evaluation, which was prepared in
the heat of the adversarial process and may not reflect the fair and
considered judgment of the agency. See Boeing Sikorsky Aircraft Support,
supra, at 15.

6. Present at the site visit were three proposed SWR staff members,
including the project manager for this contract, whose resumes in the
technical proposal indicated they had component-level repair experience; the
agency admitted that it did not ask any of these individuals about their
experience. VT at 12:00, 12:07, 12:27-28. The evaluation committee chair
testified that he did not do so because he had "already seen their resumes."
VT at 12:00-01.

7. In defending the protest, the Library argues that a very general question
asked during written discussion regarding SWR's past performance should have
led SWR to provide the agency with more information concerning the firm's
component-level repair experience. As noted above, however, SWR's
component-level repair experience only became a concern to the evaluators
after the site visit. Thus, this question could not have been intended to
elicit information from SWR concerning its component-level repair
experience. Moreover, the question is so general that it could not
reasonably apprise SWR that it needed to provide further information
regarding this aspect of its claimed experience. In this regard, discussions
should be as specific as practical considerations will permit. See
Biospherics, Inc., B-278278,
Jan. 14, 1998, 98-1 CPD para. 161 at 6.

8. The evaluation committee chair also expressed concern that, although SWR
prepared an acceptable quality control plan custom-tailored to the repair of
the machines, it was not a previously existing plan for an existing
production line facility. VT at 10:23-24, 10:30, 13:02. The RFP, however,
did not require offerors to have previously existing quality control plans
to be considered acceptable, although the reasonable risks associated with a
new quality control plan could properly be considered in the evaluation.

9. There are other weaknesses listed in the agency's final consensus
evaluation of SWR's proposal, for example, that the equipment proposed by
SWR was sufficient to operate [DELETED]. The record does not establish that
these other weaknesses would result in SWR's proposal being determined to be
unacceptable. In this regard, the hearing testimony showed that the number
of test stations necessary to perform the contract was dependent upon a
particular offeror's approach, and the record does not contain a reasoned
analysis as to whether SWR could perform with [DELETED]; in any event, this
was stated to be a weakness in SWR's proposal and not a deficiency. VT at
15:31-33, 15:56.

10. Evidence provided at the hearing belied other conclusions made by the
agency concerning SWR's proposed facility. For example, the evaluators
concluded from the site visit that SWR proposed to house the production line
in a facility without climate control. See Technical Evaluation Memorandum
(Sept. 25, 2000) at 2. SWR was not asked about the climate control at the
firm's proposed facility, and, in any event, its proposed facility has a
central heating and air conditioning system that has existed since the
original construction of the building. VT at 17:15-16, 17:23-24; Hearing
exh. 12, Pictures of SWR's Proposed Facility.