TITLE:  NMS Management, Inc., B-286335, November 24, 2000
BNUMBER:  B-286335
DATE:  November 24, 2000
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NMS Management, Inc., B-286335, November 24, 2000

Decision

Matter of: NMS Management, Inc.

File: B-286335

Date: November 24, 2000

Nancy O. Dix, Esq., and Matthew C. Bernstein, Esq., Gray Cary Ware &
Freidenrich, for the protester.

James F. Nagle, Esq., Oles Morrison Rinker & Baker, for Acepex Management
Corporation, an intervenor.

Wilson J. Campbell, Esq., and V. Paul Clay, Esq., Department of the Navy,
for the agency.

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

DIGEST

Where the solicitation provided for award on the basis of initial proposals
without conducting discussions, the agency reasonably determined not to
communicate with the protester or its team member regarding adverse past
performance information reported by one of the team member's contract
references since there was no inconsistency between the reference's
narratives and the overall rating assigned for the team member's performance
of the particular contract.

DECISION

NMS Management, Inc. protests the award of a fixed-price contract to Acepex
Management Corporation under request for proposals (RFP) No.
N68711-00-R-7604, issued by the Department of the Navy for custodial and
janitorial services at various facilities in San Diego County, California.

We deny the protest.

The RFP provided that in determining the proposal most advantageous to the
government, the technical evaluation factors (experience/past performance
and management/administration plan), when combined, would be approximately
equal in importance to price. In addition, the RFP provided that if
technical differences between proposals were insignificant, but price
differences were significant, then price would be the most important factor.
The RFP also advised offerors that award could be made on the basis of
initial proposals without conducting discussions. RFP at 156-58.

In its proposal, NMS stated that "[d]ue to the size of this contract, [it]
ha[d] decided to team with another local . . . firm--MC Contracting." NMS
Proposal at 1. NMS listed in its proposal three full service custodial
contracts performed by it and three janitorial service contracts performed
by MC. Id. at 1-3. The record shows that in evaluating the experience/past
performance of NMS, the agency received and considered completed past
performance questionnaires for five of the contracts listed in the NMS
proposal. More specifically, the contract references provided the following
ratings for NMS: "highly acceptable" on two contracts valued at
approximately $[deleted] and $[deleted] per year, and "acceptable" on a
contract valued at approximately $[deleted] per year. The contract
references provided the following ratings for MC: "highly acceptable" on a
contract valued at approximately $[deleted] per year, and "marginal" on a
contract valued at approximately $[deleted] per year. Contracting Officer's
(CO) Statement at 5. (In contrast, Acepex received three "highly acceptable"
ratings for contracts valued at approximately $[deleted], $[deleted], and
$[deleted] per year, and one "acceptable" rating on a contract valued at
approximately $[deleted] per year. Id.)

As relevant here, with respect to the above-referenced "marginal" rating
assigned to MC, the MC reference from the [deleted], supported her overall
adjectival assessment with detailed narratives. For example, she reported
that MC's performance of custodial services was "marginal" in terms of
quality ("[MC] has not met requirements under services for class
‘A'"); timely performance of work ("paperwork not timely");
understanding of the contract terms and scope of work ("owner understands,
but fails to train and monitor employees"); and responsiveness to technical
direction and contract changes ("slow to contract changes"). The MC
reference also reported that the firm's performance of custodial services
was "unacceptable" in terms of responsiveness in meeting schedules and time
constraints ("lags in paperwork and new work assigned"); effort to provide
high quality services versus just meeting minimum requirements ("effort only
meets minimum . . . preparing cure notice [for schedule of work]");
stability and quality of contractor's workforce ("[MC] let go on-site
supervisor two months ago. Since then, services have been lousy. No control.
[MC] depended too much on this person. Now [MC] can't handle contract
services"). MC's reference reported that she would not award another
contract to MC because the firm "[d]oes not manage employees well." Agency
Report (AR), Tab 6, MC Past Performance Questionnaire from [deleted].

The record shows that Acepex's proposal received an overall "exceptional"
technical rating, while the proposal of NMS received an overall "very good"
technical rating. [1] The NMS price was approximately 11 percent (i.e.,
almost $2 million) higher than Acepex's price. Acepex's proposal was ranked
first, and the NMS proposal was ranked second. The agency determined to
award a contract without conducting discussions to Acepex, the firm
submitting the highest technically rated, lowest priced proposal. CO
Statement at 6-7.

NMS complains that the procurement was flawed because the agency failed to
provide it and its team member, MC, an opportunity to comment on the adverse
past performance information reported by the MC reference, as detailed
above. We disagree.

Federal Acquisition Regulation (FAR) sect. 15.306(a)(2), which addresses
clarifications and award without discussions, states in relevant part that
where, as here, an award will be made without conducting discussions,
"offerors may be given the opportunity to clarify certain aspects of
proposals (e.g., the relevance of an offeror's past performance information
and adverse past performance information to which the offeror has not
previously had an opportunity to respond) or to resolve minor or clerical
errors." Pursuant to this provision, an agency has broad discretion to
decide whether to communicate with a firm concerning its performance
history. A.G. Cullen Constr., Inc., B-284049.2, Feb. 22, 2000, 2000 CPD para. 45
at 5. We will review the exercise of such discretion to ensure that it was
reasonably based on the particular circumstances of the procurement. Id.

With regard specifically to clarifications concerning adverse past
performance information to which the offeror has not previously had an
opportunity to respond, we think that for the exercise of discretion to be
reasonable, the agency must give the offeror an opportunity to respond where
there clearly is a reason to question the validity of the past performance
information, for example, where there are obvious inconsistencies between a
reference's narrative comments and the actual ratings the reference gives
the offeror. In the absence of such a clear basis to question the past
performance information, we think that, short of acting in bad faith, the
agency reasonably may decide not to ask for clarifications. Id.

Applying this standard here, we think the agency reasonably exercised its
discretion in deciding not to communicate with NMS and MC regarding the
adverse past performance information reported by one of MC's contract
references. As evident from the narratives quoted above, there is no
inconsistency between the reference's narratives and the overall "marginal"
rating assigned for MC's performance of the particular contract. While NMS
claims that MC "was not even aware of certain questionable performance
evaluations in the record," Protester's Comments, Nov. 6, 2000, at 2,
neither NMS nor MC disputes the substantive comments made by the reference.
[2] Given the permissive language of FAR sect. 15.306(a)(2), the fact that NMS
and its team member, MC, may wish to respond to the comments made by the MC
reference does not give rise to a requirement that the agency give these
firms an opportunity to do so. A.G. Cullen Constr., Inc., supra, at 5-6.

In any event, 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). Here,
even if we were to agree that the one "marginal" rating for MC should be
disregarded because NMS and MC were not afforded an opportunity to address
the adverse past performance information reported by the MC reference, NMS
would have the same past performance ratings as Acepex, that is, one
"acceptable" and three "highly acceptable" ratings. Moreover, even if we
were to assume that the proposals of Acepex and NMS were essentially
technically equal, that is, both proposals were "exceptional," NMS is not
prejudiced by any possible error in the conduct of this procurement. In this
respect, it is undisputed that NMS submitted a price that was significantly
higher than that submitted by Acepex. [3] Consistent with the terms of the
RFP, where proposals are essentially technically equal and price becomes the
most important factor, Acepex, which submitted a

significantly lower price than NMS, still would reasonably and properly
receive the award based on its significantly lower price. Watkins Sec.
Agency, Inc., B-248309, Aug. 14, 1992, 92-2 CPD para. 108 at 3-4.

The protest is denied.

Anthony H. Gamboa

Acting General Counsel

Notes

1. Technical proposals could receive one of the following adjectival
ratings: exceptional, very good, acceptable, marginal, or unacceptable.

2. In assigning an overall "very good" technical rating to the NMS proposal,
in which NMS listed only one high dollar value contract performed by it
(approximately $[deleted]), the record shows that the agency favorably
credited NMS with MC's "highly acceptable" performance rating on a contract
valued at approximately $[deleted]. CO Statement at 5.

3. In its initial protest, NMS raised a number of other issues, for example,
that Acepex's lower price was based on significantly understated staffing
levels and that the agency did not evaluate Acepex's experience/past
performance in accordance with the terms of the RFP. In its administrative
report, the agency addressed these, as well as all of the other, issues
raised by NMS in its initial protest. In its comments on the agency report,
NMS did not rebut the agency's position on any of these issues. Protester's
Comments, Nov. 6, 2000. Accordingly, we deem these matters to be abandoned.
See Heimann Sys. Co., B-238882, June 1, 1990, 90-1 CPD para. 520 at 4 n.2.
Moreover, to the extent NMS attempts in its supplemental comments on the
agency's supplemental report to resurrect its previously abandoned argument
that the agency did not evaluate the awardee's experience/past performance
consistent with the terms of the RFP, this attempt to resurrect and reargue
a previously abandoned issue is untimely. Bid Protest Regulations, 4 C.F.R.
sect. 21.2(a)(2) (2000).