TITLE:  Lynwood Machine & Engineering, Inc., B-287652, August 2, 2001
BNUMBER:  B-287652
DATE:  August 2, 2001
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Lynwood Machine & Engineering, Inc., B-287652, August 2, 2001

Decision

Matter of: Lynwood Machine & Engineering, Inc.

File: B-287652

Date: August 2, 2001

Howard N. Carpenter and Nick Berkem for the protester.

Mary E. Clarke, Esq., Defense Logistics Agency, for the agency.

Paul E. Jordan, Esq., David A. Ashen, Esq., and John M. Melody, Esq., Office
of the General Counsel, GAO, participated in the preparation of the
decision.

DIGEST

It was reasonable for agency to consider poor performance record of
protester's proposed special projects manager in evaluating protester's past
performance, where protester itself lacked a performance record with respect
to the required services, and the information available to the agency
indicated that the special projects manager would play an important role in
performing the contemplated contract.

DECISION

Lynwood Machine & Engineering, Inc. protests the award of a contract to SAF
Engineering Associates, Inc. under request for quotations (RFQ) No. SP0833-
00-Q-0171, issued by the Defense National Stockpile Center (DNSC), Defense
Logistics Agency (DLA), for material handling services. Lynwood challenges
the determination that its quotation was unacceptable.

We deny the protest.

The RFQ, issued for commercial items and utilizing simplified acquisition
procedures, requested quotations for the stacking, banding, and weighing of
approximately 3,972 metric tons (MT) of zinc, and approximately 78,564 MT of
lead, at the DNSC facility in Mechanicsburg, Pennsylvania. The work is
preparatory to sale of these materials by DLA. The contractor will be
required to handle a minimum of 200 MT per day. Because of the presence of
fine particles of lead and lead components on the ingots and in the soil in
and around the storage areas, the RFQ warned of potential health hazards and
included requirements for testing and the use of protective clothing and
respirators.

Award was to be made to the vendor whose quotation offered the best value to
the government based on three factors: experience, past performance, and
price. Experience and past performance combined were considered
significantly more important than price. In connection with the evaluation
of past performance, vendors were required to submit three references
concerning projects within the last 2 years covering work the same as or
similar to that required under the RFQ.

Five vendors, including Lynwood and SAF, submitted quotations. Lynwood's
price of $998,685.60 was low, and SAF's price of $1,065,606.36 was the next
low. For experience, Lynwood received a score of 3 out of 5 possible
evaluation points, while SAF received a score of 5 points. For past
performance, Lynwood received 3 of the 10 possible points, while SAF
received 8.3 points. The agency also conducted a preaward survey of Lynwood
which, because of unsatisfactory performance by Lynwood's proposed special
projects manager and a lack of relevant performance/experience on the part
of Lynwood itself, led to a recommendation that no award be made to Lynwood.
As noted in the Recommendation for Award, the agency concluded that Lynwood
lacked a record of acceptable past performance; Lynwood's quotation
therefore was determined to be technically unacceptable. Contracting
Officer's Statement at 5; Recommendation for Award at 4. DLA determined that
SAF's proposal represented the best value, and made award to that firm.
After receiving a debriefing, Lynwood filed this protest.

EXPERIENCE

Lynwood argues that its score under the experience factor was unreasonably
low, noting that SAF received a higher score despite the fact that Lynwood
was established in 1978, while SAF was not established until 1991, and that
Lynwood's experience was evaluated as equal to SAF's in a previous
procurement.

When using simplified acquisition procedures, an agency must conduct the
procurement consistent with a concern for fair and equitable competition.
Environmental Tectonics Corp., B-280573.2, Dec. 1, 1998, 98-2 CPD para. 140 at
4. When reviewing protests against an allegedly improper evaluation, we will
examine the record to determine whether the agency met this standard and
reasonably exercised its discretion. Lynwood Machine & Eng'g, Inc.,
B-285696, Sept. 18, 2000, 2001 CPD para. __ at 4. The evaluation of experience
was reasonable.

The agency explains that the evaluation focused on each vendor's
demonstrated ability to provide managers and personnel familiar with
handling metals like lead and zinc, rather than on the length of time a
company had been in existence. We find nothing unreasonable in this focus.
Regarding the actual scoring, the record indicates that, while SAF had
performed materials handling contracts for DNSC in the prior 2 years,
including contracts involving the handling of lead and zinc, and employed an
experienced workforce, Lynwood did not have any experience with high volume,
uniform stacking and banding of ingots, the work contemplated under the RFQ.
Rather, Lynwood's quotation and the preaward survey indicated that Lynwood
specializes in machining, welding, fabrication, repair and material handling
of large scale castings, forgings, steel pipe, and machinery. There thus was
a reasonable basis for the agency to score SAF higher under this factor.

As for the prior procurement where Lynwood received the same score as SAF,
the agency explains that the evaluation of Lynwood's experience there was
based on Lynwood's representation that it had acquired a materials handling
operation from another firm whose experience was similar to SAF's. The
protester did not make the same representation in its quotation here and
thus did not receive a similar score. While Lynwood did propose to hire
experienced former SAF personnel, including a former SAF employee to serve
as the project manager, the agency simply concluded that this employee
experience was not equivalent to SAF's demonstrated relevant corporate
experience. In any case, it did not provide any evidence (such as letters of
intent or commitment) showing that these employees would accept employment
with Lynwood. Under these circumstances, the agency was not required to
credit Lynwood with the employees' experience. See Urban-Meridian Joint
Venture, B-287168, B-287168.2, May 7, 2001, 2001 CPD para. 91 at 3; SWR Inc.,
B-286044.2, B-286044.3, Nov. 1, 2000, 2000 CPD para. 174 at 2-3. The agency
ultimately concluded that Lynwood's experience was not equivalent to SAF's,
and we find nothing unreasonable in this aspect of the evaluation.

PAST PERFORMANCE

Lynwood asserts that its past performance score (3 of 10 possible points)
was inconsistent with the reference ratings it provided the agency. Lynwood
further asserts that it should have received evaluation credit for SAF's
past performance based on its proposed hiring of former SAF employees. In
addition, Lynwood asserts that it was improper for the agency to downgrade
its proposal based on the past performance record of its proposed special
projects manager; according to Lynwood, that manager's proposed role was
limited and his record did not support a finding of poor past performance.

The evaluation in this area was reasonable. The evaluators reduced Lynwood's
reference rating score from 4.7 to 3 because the references were based on
work (machinery and steel fabrication, maintenance of material handling
devices, welding, blasting, painting and repairing tanks) that was not
similar to the RFQ work (stacking, banding, and handling of ingots, with
significant health hazards). [1] Since the RFQ requested past performance
information concerning the same or similar work, vendors were on notice that
similarity would be considered; the agency thus reasonably reduced Lynwood's
score. See J. A. Jones Grupo de Servicios, SA, B-283234, Oct. 25, 1999, 99-2
CPD para. 80 at 7.

The agency's evaluation of Lynwood's past performance with regard to SAF and
the proposed SAF employees also was unobjectionable. As noted, the RFQ
required vendors to furnish references from which the agency could establish
the quality of the firm's performance. While Lynwood's quotation proposed to
employ former employees of SAF as the project manager, material handlers,
banders, and forklift operators, and described the experience of the
proposed project manager, the quotation did not include specific references
which the agency could contact to establish the quality of the past
performance of the proposed project manager. The agency reports that the
contracting officials performing the evaluation and source selection also
had no personal knowledge of the proposed project manager's record of
performance. In any case, even if there were employee past performance
information that might have benefited Lynwood, the fact remains that
Lynwood's quotation did not include any evidence establishing the proposed
project manager's and the other employees' willingness to work for Lynwood
on this contract. In our view, it was reasonable for the agency to focus on
Lynwood's own performance record, rather than that of SAF and its employees.

The agency also reasonably considered Lynwood's proposed special projects
manager in evaluating the firm's past performance. While the protester
asserts that this manager's involvement in the contract would be "solely
administrative," Protest at 4, Lynwood's quotation indicated that he would
have a more significant role. The quotation stated that the project manager
would have "as his assistant" the proposed special projects manager, "who
also has experience completing lead handling contracts for DLA." Lynwood
also furnished DNSC with an organizational chart that showed the special
projects manager organizationally between the company president and the
project manager; that is, the line of responsibility for performing the
contract was shown as running from the company president to the contract
project manager, through the special projects manager, who also was shown as
interfacing with the employee responsible for quality assurance. In
addition, the special projects manager represented Lynwood during the
preaward survey. The agency therefore reasonably determined that the special
projects manager's involvement in the contract warranted giving significant
consideration to his past performance record in the evaluation.

The information available to DLA indicated a record of poor past performance
by the proposed special projects manager while working for other companies
as a point of contact and supervisor for various material handling projects
at DNSC depots. This information revealed that the special projects manager
had required constant government supervision; did not maintain the proper
number of units per bundle; did not maintain tight banding of units;
overused government-supplied banding material; was absent for large portions
of the workday, allowing workers to perform without supervision; and failed
to report some injuries suffered by employees. Recommendation for Award at
3. DLA reasonably downgraded Lynwood under the past performance factor based
on this information.

Lynwood asserts that the above criticisms are inconsistent with the overall
performance ratings--3 out of a possible 5 points--the company received on
those projects, reflected in two past performance questionnaires furnished
in the course of a 2000 procurement for material handling services at a
different facility. However, the specific detailed criticisms of the special
projects manager's performance summarized above were provided by the same
depot managers who responded to the 2000 questionnaires, and whose
evaluation Lynwood cites in support of its argument. Further,
notwithstanding an overall performance rating of three, one of the
2000 questionnaires includes observations that the contractor could not meet
daily requirements and needed constant oversight to ensure that the
statement of work was being followed. This criticism is consistent with the
criticism reported in the agency's preaward survey, and thus further
supports the conclusion that there is no basic inconsistency between the
reports received during the preaward survey and the 2000 questionnaires.
Moreover, to the extent that there are differences between the reports, we
note that the focus of the reports was different: the 2000 questionnaires
presumably were evaluations of the performance of the contractor as a whole,
while the reports received during the preaward survey apparently focused on
the proposed project manager's personal performance. [2]

Given Lynwood's limited corporate performance of similar work, coupled with
the special projects manager's more extensive, but poor performance record,
the agency reasonably determined that Lynwood's past performance was
unacceptable.

COMMERCIAL ITEMS

Lynwood asserts that the award to SAF was improper because the services
provided by SAF would not qualify as "commercial items." Lynwood's argument
is based on paragraph (5) under the definition of "commercial item" set
forth at Federal Acquisition Regulation (FAR) sect. 2.101, which states in part
that services are commercial when they are obtained from sources that offer
them to the general public and the federal government contemporaneously and
under similar terms and conditions. Lynwood asserts that SAF "is completely
dependent on government contracts for its revenue" (unlike Lynwood) and
therefore does not meet this requirement. Protest at 7.

As we held in denying a prior protest by Lynwood on this same basis, the
lead handling services here do not fall within the scope of the language of
paragraph (5) in the FAR sect. 2.101 definition of commercial items. By its
terms, the paragraph (5) language applies only to procurements of services
provided in support of commercial items, such as installation, maintenance,
repair, and training. Lynwood Machine & Eng'g, Inc., supra, at 8. The
services here fall outside of these specified categories. Although, as
Lynwood notes, the definition includes a reference to "other services,"
stacking, banding, weighing, and moving lead and zinc ingots are not
support-type services in the same sense as the specified categories. We thus
do not consider the services here to be covered by paragraph (5) of the FAR
sect. 2.101 definition of commercial items. [3]

The protest is denied.

Anthony H. Gamboa

General Counsel

Notes

1. Fifty percent of the past performance score was based on ratings
furnished by the vendor's references (Lynwood received 3 points) and 50
percent on the report of the agency's safety and health officer (0 points).

2. We note that, since the contracting officer had no reason to question the
information concerning the special projects manager, he reasonably could
rely on the information without seeking to verify it or permitting the
protester an opportunity to rebut it. Lynwood Machine & Eng'g, Inc., supra,
at 7; see A.G. Cullen Constr., Inc., B-284049.2, Feb. 22, 2000, 2000 CPD para.
45 at 5.

3. Lynwood also asserts that these material handling services do not meet
the standard set out in paragraph (6) of the commercial item definition in
FAR sect. 2.101, which DLA states was the basis for its determination that this
was a commercial item procurement. That paragraph defines commercial
services as: "Services of a type offered and sold competitively in
substantial quantities in the commercial marketplace based on established
catalog or market prices . . . ." Asserting that the services do not fit
under paragraph (6) is tantamount to arguing that this was not a proper
commercial item procurement, an argument that Lynwood does not specifically
raise. In any case, such an argument, concerning an apparent solicitation
impropriety, would be untimely under our Bid Protest Regulations. 4 C.F.R.
sect. 21.2(a)(1) (2001).