TITLE:  Sundt Construction, Inc., B-288136, September 25, 2001
BNUMBER:  B-288136
DATE:  September 25, 2001
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Sundt Construction, Inc., B-288136, September 25, 2001

Decision

Matter of: Sundt Construction, Inc.

File: B-288136

Date: September 25, 2001

Scott R. Schoenfeld, Esq., Jenkens & Gilchrist, for the protester.

Daniel J. Dykstra, Jr., Esq., Department of the Army, for the agency.

Charles W. Morrow, Esq., and James A. Spangenberg, Esq., Office of the
General Counsel, GAO, participated in the preparation of the decision.

DIGEST

Protest that agency did not sufficiently credit protester's offer of single
detached housing units under solicitation for family housing in selecting a
proposal for award that offered mostly duplex housing units is denied where
the protester's proposal was given appropriate credit under the only
evaluation subfactor that addressed housing unit type and the awardee's
lower-priced proposal had strengths under the other evaluation factors and
subfactors that offset the protester's advantage under the housing unit type
subfactor.

DECISION

Sundt Construction, Inc. protests the award of a contract to Lend Lease
Actus,
LLC under request for proposals (RFP) No. DACA05-01-R-0001, issued by the
United States Army Corps of Engineers, Sacramento, California, for
construction work. Sundt complains that the evaluation was not in accord
with the stated evaluation scheme of the RFP.

We deny the protest.

The RFP, issued November 13, 2000, was to reconstruct an entire neighborhood
at Fort Huachuca, Arizona under a fixed-price contract. The project required
replacing 110 Capehart family quarters on a design/build basis with various
factory built/manufactured and/or conventionally on-site constructed
dwellings. The replacement dwellings were to consist of variously configured
single and/or multi-unit, one- and two-story buildings to be constructed at
three sites in the neighborhood. [1]

The RFP provided for award on a best-value basis. The RFP stated that the
price/cost factor was approximately equal in value to the combined value of
the other factors. RFP amend. 1 at 00120-6. The RFP, as amended, listed the
following evaluation factors and their relative weights:

Factor 1, HOUSING UNIT DESIGN, is the most important and is slightly more
than the combined weight of Factors 2, 3, and 4.

Factor 2, SITE DESIGN, is worth slightly more than one-third the weight of
Factor 1. [2]

Factor 3, HOUSING UNIT ENGINEERING, is worth approximately one-fourth the
weight of Factor 1.

Factor 4, SITE ENGINEERING, is worth approximately one-fourth the weight of
Factor 1.

Factor 5, EXPERIENCE, PAST PERFORMANCE AND CAPABILITY, is worth
approximately one-half the weight of Factor 1.

Factor 6, SMALL BUSINESS UTILIZATION, is the least important Factor and is
weighted one-eighth the weight of Factor 1.

RFP amend. 1 at 00120-8. The RFP also listed subfactors, and their relative
weights, for each factor. Factor 1, Housing Unit Design, listed 15
subfactors: 1a. Housing Unit Type; 1b. Net Floor Area; 1c. Exterior
Appearance; 1d. Outdoor/Indoor Integration; 1e. Storage; 1f. Vehicle
Storage; 1g. Functional Arrangement; 1h. Living, Dining, and Family Areas;
1i. Sleeping; 1j. Bathing; 1k. Food Handling; 1l. Utility and Work Areas;
1m. Exterior Finishes, 1n. Historic Features; and 1o. Interior Finishes.
Subfactor 1g was the most important subfactor with 1a and 1c approximately
equal in importance and each weighted less than half of subfactor 1g, and
the remaining subfactors were of various lesser values. RFP amends. 1 & 2 at
00120-9-13. Regarding subfactor 1a, Housing Unit Type, the RFP stated:

The mix of housing unit types will be evaluated on the basis of a formula
which assigns each type of housing unit a point value. The relative weight
of housing unit types are in descending order of importance: (1) single
detached units in single story at the Mills Circle/Dove site, single
detached units in single story at the Bonnie Blink site, and no preference
at the Mason/Crandel site; (2) single detached units in single story at the
Mills Circle/Dove site, duplex units in one story at the Bonnie Blink site,
and no preference at the Mason/Crandel site; (3) single detached units in
single story at the Mills Circle/Dove site, two story duplex units at the
Bonnie Blink site, and no preference at the Mason/Crandel site. Mixes at the
Bonnie Blink site will be given partial extra points based on the ratios of
the preferences. Number 1 will receive the most points and number three the
least. The number of each type of housing unit is then multiplied by the
point value for the housing unit type. The sum of three values is then
divided by the total number of housing units to arrive at an average score
for the housing unit type.

RFP amend 2 at 00120-9. The RFP further advised that "proposals which exceed
the minimum criteria or include desirable optional features will . . . be
rated higher than proposals which only meet the minimum criteria in
accordance with the perceived value of these features to the Government."
RFP amend. 1 at 00120-8.

Five proposals, including Sundt's and Actus's, were received by the February
7, 2001 closing date. Sundt's proposal was based upon constructing single
detached units in single story for all 110 units: 27 units at the Mills
Circle/Dove site, 63 units at the Bonnie Blink site, and 20 units at the
Mason/Crandel site. See Agency Report, Sundt Proposal at ASP-1, ASP-2,
ASP-3. In contrast, Actus's proposal was based on furnishing 28 single
detached units in single story and 82 duplex, two-story units with 8 of the
single detached units at the Mills Circle/Dove site and 20 of the single
detached units at the Mason/Crandel site, and the 82 duplex units at the
Bonnie Blink site. See Agency Report, Actus Proposal, Site Plan, at C1, C2.

The Corps established a national evaluation team (NET), composed of
architects and engineers, to evaluate the proposals. The NET rated and
assigned points to the proposals under each factor and subfactor as keyed to
an adjectival rating scale. [3] The NET independently reviewed and rated the
advantages and disadvantages of each technical proposal, and then as a group
reached a consensus rating for each proposal. After the initial evaluation,
the proposals of Sundt, Actus and a third firm were included in the
competitive range. Contracting Officer's Statement at 5. The proposals of
Sundt and the third firm were determined acceptable, whereas Actus's
proposal was considered unacceptable but capable of being made acceptable.
Agency Report, Tab 6, Pre-Negotiation Business Clearance Memorandum, at 4.

The Corps then conducted discussions with the offerors. In discussions, the
Corps advised Sundt only that its price was considered high compared to the
funding authorized for the project. On the other hand, the Corps advised
Actus of the various deficiencies identified in its proposal, for example,
under Factor 1k, housing unit design, where no windows were provided in the
kitchen, and under Factor 3b, housing unit engineering, where its proposed
carbon monoxide detector was not hard-wired.

Final proposal revisions were received from offerors on May 11. The final
evaluation results for the two proposals relevant here were as follows:

 Offeror    Final Score     Price

 Actus      941             $15,038,152

 Sundt      904             $15,093,314

Agency Report at 7. Under Factor 1, housing unit design, of the 496 possible
points for this factor, Sundt's proposal (400 points) and Actus's proposal
(399 points) received nearly the same score. Sundt's proposal received the
maximum possible 52 points for subfactor 1a, housing unit type, while
Actus's proposal received 42 points. [4] On the other hand, Actus's proposal
received 90 of the 112 possible points for subfactor 1g, functional
arrangement, while Sundt's proposal received only 75 points. Under all other
factors, Actus's proposal received an equivalent or slightly higher
numerical score than Sundt's. For example, under site design, Actus's
proposal received 142 out of 175 points, while Sundt's proposal received
only 128 points. Contracting Officer's Statement, app. A. The proposals of
the three competitive range offerors received identical adjectival ratings
under each of the six evaluation factors of very good, very good,
satisfactory, very good, very good, and satisfactory, respectively, and
overall ratings of very good with a low performance risk rating. Agency
Report, Tab 16, Post-Business Clearance Memorandum, at 4.

Following the NET's final evaluation, the source selection evaluation board
(SSEB), independently reviewed the technical proposals, including final
proposal revisions, and the NET report, and determined that Actus's proposal
constituted the best value and recommended that award be made based on
Actus's highest-rated, lowest-priced proposal. Agency Report, Tab 15, Best
Value Analysis Report. The source selection authority (SSA) concurred with
the SSEB's recommendation and made award to Actus. [5] After a debriefing,
this protest followed.

Sundt protests that the Corps failed to adhere to the stated evaluation
scheme in evaluating the proposals for award. Sundt argues that the RFP's
evaluation scheme required the Corps to give greater weight to proposals
that offered all single detached housing units in single story, such as
proposed by Sundt, over proposals offering a mixture of housing unit types,
such as Actus's. Sundt notes in this regard that housing design was the most
important evaluation factor and under that factor the RFP provided that more
points would be awarded proposals offering single detached housing units in
a single story than those offering any other housing type. Thus, Sundt
argues that the Corps's relative evaluation of the proposals was improper.

We find that Sundt has misconstrued the RFP's evaluation scheme. The
preference for single detached units in single story is contained only in
the housing unit type subfactor, which is only 1 of the 15 subfactors of the
housing unit design factor. This subfactor is not even the most heavily
weighted subfactor of those comprising the housing unit design factor.
Moreover, no other housing unit design subfactor or other RFP factor
provides for any preference to be given offers of single detached units in
single story. While Sundt asserts that it was misled by the preference for
single detached units in single story expressed under the housing unit type
subfactor, a reasonable reading of this subfactor indicates that offerors
could offer a variety of housing types and a reasonable reading of the RFP
indicates that housing unit type was only one of the numerous subfactors to
be considered in evaluating proposals. It was thus within the technical and
business judgment of each offeror to prepare a proposal that it believed
would constitute the best value to the government, considering price and the
listed evaluation factors and subfactors, and there is simply no basis for
Sundt's expressed belief that the preference for single detached units in
single story should be applied under all of the evaluation factors and
subfactors.

Here, the record shows that Sundt received credit for its proposal based on
single detached units in single story under the applicable subfactor, but
that the particular strengths of Actus's proposal, which offered 82 duplex
housing units, under the other subfactors and factors offset Sundt's
evaluated advantage. [6] For example, Actus's proposal was rated higher
under the primary subfactor, 1g, functional arrangement, of the housing unit
design factor than Sundt's--a rating that Sundt has not specifically
challenged--and higher under the site design factor. While Sundt complains
that Actus's advantage under the site design factor was a result of its
offer of duplex housing units, which allowed for more open space and a
higher site design rating, that certain advantages and disadvantages might
accrue under the various subfactors and factors from choosing a particular
ratio of housing unit types was clearly inherent in the evaluation scheme
and Sundt's strengths under the site design factor were clearly related to
that factor. [7]

The protest is denied.

Anthony H. Gamboa

General Counsel

Notes

1. The three sites are Mills Circle/Dove, Bonnie Blink, and Mason/Crandel.

2. "SITE DESIGN includes overall planning, layout, design and development of
the housing site(s), exclusive of utility systems. It embraces
considerations of community appearance, compatibility of grounds and
buildings, functionality, dignity and livability." RFP amend. 1 at 00120-13.

3. The maximum possible point score was 1,246 and the possible adjectival
ratings under each factor and subfactor were unsatisfactory, marginal,
satisfactory, very good, and excellent.

4. The protester points out the evaluators' worksheets for this subfactor
did not reflect the evaluation scheme as updated by the most recently issued
amendments. However, the score under the subfactor was derived from a
formula and there is no evidence that the outdated language on the
worksheets affected the point scores awarded the proposals under this
subfactor.

5. In the agency report, the SSA advised that she considered the technical
proposals essentially equal in view of their identical technical ratings.
Agency Report, Tab 14, Declaration of SSA, at 2. While Sundt complains that
no cost/technical tradeoff was conducted, none was required here where the
award was made based on the lowest-priced proposal that was rated
technically equal or superior to the other proposals. See Winstar Fed.
Servs., B-284617 et al., May 17, 2000, 2000 CPD para. 92 at 11, 13.

6. While it could be argued that Sundt should have enjoyed more than a
10-point advantage under the housing unit type subfactor since it proposed
all of the preferred housing unit type and Actus proposed only approximately
25 percent of the preferred housing unit type, no possible error in this
area could have prejudiced the protester, given Actus's overall 37-point
advantage and lower price.

7. Sundt also protests that the discussions were not meaningful because the
agency did not advise Sundt that it would not be sufficiently credited for
its single detached unit in single story approach. This protest ground is
based upon the false premise that the RFP's preference for such units
extended beyond the subfactor where it was expressed. Sundt also complains
that the discussions were unequal because the deficiencies in Actus's
proposal were pointed out to that firm. However, since Sundt's technical
proposal contained no deficiencies (except with regard to its high price,
which was pointed out), this does not evidence unequal discussions. See
Federal Data Corp., B-236265.4, May 29, 1990, 90-1 CPD para. 504 at 5 (agency
may conduct extensive technical discussions with offerors that contain
technical deficiencies without providing such discussions to offerors whose
proposals do not contain such deficiencies).