TITLE:  Eagle-Picher Technologies, LLC, B-289093; B-289093.2, December 27, 2001
BNUMBER:  B-289093; B-289093.2
DATE:  December 27, 2001
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Decision

Matter of: Eagle-Picher Technologies, LLC

File: B-289093; B-289093.2

Date: December 27, 2001

Joseph P. Hornyak, Esq., Sonnenschein Nath & Rosenthal, for the protester.

D. Susan Spiegelman-Boyd, Esq., Department of the Navy, for the agency.

Mary G. Curcio, Esq., and John M. Melody, Esq., Office of the General
Counsel, GAO, participated in the preparation of the decision.

DIGEST

1. Protester was not entitled to higher rating than awardee for experience
simply because protester previously had furnished the battery requested by
the solicitation and awardee has not, where protester's experience was not
recent and procuring agency reasonably found that both protester and awardee
had recent experience producing similar batteries.

2. Past performance evaluation was not inequitable based on fact that agency
was able to obtain information from government sources concerning awardee's
delinquencies under prior contracts, but had to ask protester itself to
explain its delinquencies because agency personnel did not have the contract
numbers necessary to obtain the information from government sources;
although result was additional burden on protester, key consideration is
that protester had a meaningful opportunity to respond to agency's concerns.

3. Awardee did not improperly qualify its proposed price by reserving the
right to separately cost certain work, where that work was not within the
scope of the solicitation.

DECISION

Eagle-Picher Technologies, LLC protests the award of a contract to Yardney
Technical Products, Inc. under request for proposals (RFP) No.
N00164-01-R-0068, issued by the Department of the Navy, Naval Surface
Warfare Center, for replacement silver/zinc batteries for the Minuteman
Missile. Eagle principally argues that the Navy misevaluated its past
performance, and failed to hold meaningful discussions with it.

We deny the protest.

The solicitation requested 20 first article silver/zinc batteries, with two
options of 40 each production batteries, and associated documentation. The
batteries must meet Navy specifications and drawings for the SE-13G battery,
which currently is used in the Minuteman to power the stage 1 flight control
hydraulics. Agency Report (AR) at 3. The solicitation provided for a "best
value" award based on an evaluation of past performance and price, which
were of equal weight. [1] The RFP contained two past performance subfactors:
1(a) experience in manufacturing primary, remotely activated silver/zinc
batteries, and 1(b) the contractor's record of meeting delivery schedules.

Three proposals were received, two of which, Eagle's and Yardney's, were
included in the competitive range. Following discussions with Eagle and
Yardney and receipt and evaluation of final proposal revisions (FPR),
Yardney's proposal was rated overall highly favorable for past performance,
while Eagle's was rated favorable. Eagle's offered price was [DELETED] lower
than Yardney's. AR at 19. In its best value analysis, the agency determined
that Yardney's more favorable past performance rating was worth its
additional cost, and therefore made award to Yardney. This protest followed.

EXPERIENCE

Under past performance subfactor 1(a), the Navy was to consider the
offerors':

experience in the manufacturing of primary, remotely activated silver
oxide/zinc batteries. The more recent the experience and the more
similarities to the battery defined in this solicitation, the more weight
will be given.

RFP at 39. In its evaluation, the Navy concluded that both Yardney and Eagle
had manufactured remotely activated silver/zinc batteries, and thus rated
both firms highly favorable for the subfactor. [2] AR at 8, 12. Eagle
disagrees with these ratings. Noting that the solicitation provided that
more weight would be given to more similar experience, Eagle asserts that
its rating should be higher than Yardney's, since it is the previous
supplier of the SE-13G battery, while Yardney has never produced this
battery.

The evaluation of past performance is a matter within the discretion of the
contracting agency. NV Servs., B-284119.2, Feb. 25, 2000, 2000 CPD para. 64 at
13. In reviewing an agency's evaluation of past performance, we will not
reevaluate proposals, but instead, will consider whether the evaluation was
reasonable and consistent with the solicitation. Id.

The evaluation here was reasonable. While the agency found that Eagle had
experience with a similar battery, it also found that the experience was not
recent, since Eagle has not produced the battery since 1990. While the
agency further found that Eagle has recent experience producing other
silver/zinc batteries, the agency reports, and Eagle does not dispute, that
in most cases these batteries have been based on a [DELETED] design for
electrolyte delivery, which is different from the design for the SE-13G.
Supplemental Agency Report (SAR) at 7. In contrast, while Yardney has not
produced the SE-13G battery, the agency found that Yardney has substantial
recent experience producing silver/zinc batteries based on a [DELETED] for
electrolyte delivery, the same design as the SE-13G. [3] Id. Given that
Eagle's experience was more similar to the current requirement than
Yardney's, but not recent, and that Yardney's was less similar but more
recent, the agency's conclusion that the offerors merited the same rating
for the subfactor was reasonable.

ON-TIME DELIVERY

Under past performance subfactor 1(b), the solicitation provided that
"[p]ast performance will consider the contractor's record of meeting
delivery schedules." RFP at 40. The solicitation further provided, at 41,
with respect to past performance that

each offeror is required to submit a list of up to five of its most recent
contracts within the past three years, either completed or on-going, for the
same or similar products. . . . The Source Selection Authority
(SSA)/Contracting Officer will evaluate the offeror's past performance based
upon the information furnished by the offeror and/or other information
obtained by the Contracting Officer. The Contracting Officer is not
responsible for locating or securing any information not furnished with the
offer.

In evaluating offerors' proposals under subfactor (1)(b), the agency looked
at three types of information--the references provided by the offerors in
their proposals, the offerors' performance on contracts that were
administered locally by the contracting agency (NSWC-Crane), and contracts
administered by the Defense Contract Management Agency (DCMA). AR at 9.

The protester takes issue with the agency's actions in connection with its
consideration of contracts administered by DCMA. For Yardney, the agency
contacted the DCMA-Hartford Office that has oversight responsibility for
Yardney. AR at 9. DCMA-Hartford retrieved data from the Mechanization of
Contract Administration System (MOCAS) database; this database is used by
all DCMA offices to provide information about DCMA-administered contracts
and any delinquencies under those contracts. Id. at 9-10. DCMA reported to
the agency that performance was delinquent on [DELETED] of the 19 contracts
Yardney performed. The agency investigated the reasons for these delays by
contacting the cognizant DCMA industrial specialist and DCMA contract
administrator, and learned that most of the delays resulted from some
government action, and that none of the delays was completely contractor
caused. Id. at 10-11. Based on this information, Yardney was rated overall
highly satisfactory for past performance.

Regarding the protester, the Navy contacted the DCMA-Wichita Office that
administers Eagle's contracts. AR at 13. As DCMA-Hartford had done,
DCMA-Wichita accessed the MOCAS database. However, the information was
received in a format different from that provided for Yardney, in that it
was reported as a percentage of timely deliveries per month rather than the
number of delinquent contracts, and did not include contract numbers. [4]
Id. The data showed that for a 12-month period Eagle's deliveries were
on-time between [DELETED] and [DELETED] percent of the time, and that they
were [DELETED] percent timely for only [DELETED] month. Id. at 13, 14. The
Navy asked Eagle to rebut the negative past performance information for both
the DCMA and locally administered contracts. Eagle initially requested that
the Navy provide the contract numbers for the DCMA delinquencies, but both
the Navy and DCMA advised Eagle that this information was not available.
Subsequently, Eagle provided information on four DCMA-administered battery
contracts, explaining that the delinquency in one case was the fault of the
government and, in the others, resulted from either a technical difficulty
or a test anomaly. AR at 17-18. After reviewing this information, the agency
concluded that Eagle had problems meeting delivery schedules, and rated
Eagle favorable for past performance. AR at 18.

Eagle protests that the Navy treated it and Yardney differently in assessing
on-time deliveries. Specifically, Eagle complains that the Navy went beyond
the number of delinquencies for Yardney to qualitatively assess the reasons
for the delinquencies. In contrast, Eagle complains, the Navy simply relied
on the quantitative percentages of monthly delinquencies in evaluating its
past performance.

This argument is without merit. As discussed, the agency's evaluation began
with a quantitative analysis of each offeror's past performance. While the
information assessed was in different formats for Eagle (percentages of
delinquencies) and Yardney (total number of delinquent contracts), the
information for both firms indicated the timelines of their past
performance, the very thing the RFP stated would be evaluated under
subfactor 1(b). Subsequently, and contrary to Eagle's position, the Navy
performed a qualitative analysis of both offerors' past performance by
looking beyond the numbers to determine the reasons for the delinquencies.
We conclude that the agency assessed the two firms' past performance in the
same manner.

Eagle maintains that the agency's failure to provide it with the contract
numbers where delinquencies occurred, as it did for Yardney, was unfair and
deprived it of an adequate opportunity to rebut the negative past
performance information. We agree that a greater burden was imposed on Eagle
than Yardney due to the agency's inability to furnish it with the contract
numbers. However, the record shows that this occurred, not due to
favoritism, but because the agency did not have the contract numbers
available. In any case, this inequity did not prejudice Eagle in the
evaluation. In this regard, despite its alleged difficulty in responding to
the agency's request during discussions, Eagle was able to identify and
provide explanations for four battery contracts on which its performance was
deficient. AR at 18. For three of those contracts, Eagle attributed the
delivery delays to causes that the agency viewed as tied to the firm's own
actions rather than to the government's. Eagle has not shown that the agency
unreasonably viewed the firm as responsible for those delays. Further, after
the protest was filed, the agency provided Eagle with the contract numbers
for 12 DCMA-administered contracts listed as delinquent in the MOCAS
database, and an opportunity to explain those delinquencies. In responding
to this information, Eagle identified [DELETED] of the 12 as silver/zinc
battery contracts; [DELETED] of the [DELETED] were the contracts the
delinquencies under which it had attributed during discussions to what the
agency viewed as the firm's own actions. Of the remaining two contracts,
DCMA, in fact, did not consider one to be delinquent, and Eagle acknowledged
the late delivery, without explanation, for the other. SAR at 10-11. We
conclude that, even had Eagle been provided with the contract numbers during
discussions, there is no basis for finding that Eagle might have explained
the deficiencies in a way that would have resulted in a higher rating for
past performance. Charleston Marine Containers, Inc., B-283393, Nov. 8,
1999, 99-2 CPD para. 84 at 6.

YARDNEY'S PROPOSAL

Offerors were required to propose a fixed price to perform all work
requested by the RFP, including task 1, Establishment of Documentation.
Under task 1, the contractor is required to provide documentation for the
equipment, tooling, materials and processes used to produce the batteries.
RFP at 3-4. This documentation, together with the drawing package provided
in the solicitation, would be used to produce the batteries. Following
discussions, Yardney submitted an FPR that included the following statement:

As previously discussed in our telcon of Aug. 14th and 16th the battery
drawing package may require revision for replacement of obsolete specs and
or possible material changes. Any and all of these corrections to the
subject drawing package will be addressed during The 'Review of
Documentation' (para 3.2.1.5) phase of task 1 of the SOW [Statement of
Work]. Yardney Reserves the right to submit separate costing for the update
of the documentation (as agreed during the noted telcons) prior to the start
of the battery follow-on production option phase of any subsequent contract.

Yardney FPR, Aug. 30, 2001, at 1. Asked by the agency to explain the
reservation language, Yardney responded that it was intended to reserve its
right to submit a priced Engineering Change Proposal (ECP) [5] for updating
the drawing package. The agency concluded that, since updating the drawing
package was not included in the SOW, the statement did not qualify Yardney's
proposal.

Eagle argues that the language Yardney included in its FPR reserved to
Yardney the right to seek an upward price adjustment to update the drawing
package before proceeding to production. In this regard, Eagle does not
agree with the agency that updating the drawing package was not included in
the SOW. Rather, Eagle believes that an updated drawing package may be
necessary to fabricate the production quantity required, and that the RFP
therefore required the contractor to accept the risk that it would have to
update the drawing package at the fixed price it proposed. Eagle concludes
that the reservation language qualified Yardney's fixed price and rendered
its proposal unacceptable.

The statement in question did not qualify Yardney's proposal. We find
nothing in the RFP that requires the contractor to update the drawing
package. Rather, the solicitation only requires the contractor "to document
the equipment, tooling, materials and processes used to be used to fabricate
batteries," and that the batteries then be produced in accordance with the
current drawings and the documentation generated. RFP sect.sect. 3.1, 3.2.3.1. This
being the case, to the extent the agency may determine that an updated
drawing package is required prior to commencement of the production portion
of the contract, it will have to obtain the drawing package outside of
Yardney's contract (or by modifying that contract). Accordingly, Yardney's
reserving the right to separately cost the updating of the drawing package
did not qualify its fixed-price offer.

The protest is denied.

Anthony H. Gamboa

General Counsel

Notes

1. The solicitation also provided for the evaluation of the small business
subcontracting plan, a nonweighted factor.

2. While the record does not provide separate ratings for the two
subfactors, it is clear from the past performance evaluation that both
offerors were considered highly acceptable under subfactor 1(a). See Past
Performance Evaluation at 253 and 254; Business Clearance Memorandum at 250.

3. Eagle asserts that the contemporaneous evaluation record does not state
that the silver/zinc batteries produced by Yardney were similar to the
SE-13G because they used the same electrolyte delivery design, and that this
aspect of the agency's rationale therefore is a post hoc rationalization
that should carry little or no weight. See Boeing Sikorsky Aircraft Support,
B-277263.2, B-277263.3, Sept. 29, 1997, 97-2 CPD para. 91 at 15. We do not
agree. Since the contemporaneous record does show that the agency considered
Yardney's silver/zinc battery contract experience to be similar to the
current requirement, the agency's stating in response to the protest that
this finding was based on the design constitutes merely an explanation of
its evaluation conclusions, rather than a new rationale.

4. This resulted because the person who generally accessed the MOCAS
database in Witchita was away at the time, and his temporary replacement was
unfamiliar with how to retrieve data from the database. During the course of
the protest, when the permanent employee returned, the information regarding
Eagle's past performance was provided to Eagle and our office in the same
format that it was provided for Yardney.

5. An ECP is a request for modification to the contract that must be
evaluated by the agency for its impact on the technical requirements, cost
and delivery schedule of the contract. A contractor may submit an ECP at any
time during performance of the contract, and it can be accepted or rejected
by the agency. If it is accepted, the contract will be modified in
accordance with the ECP. See Defense Federal Acquisition Regulation
Supplement sect. 243.205-70; RFP sect. at 15; AR at 32.