TITLE:  Alaska Mechanical, Inc.--Costs, B-289139.2, March 6, 2002
BNUMBER:  B-289139.2
DATE:  March 6, 2002
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Decision

Matter of: Alaska Mechanical, Inc.--Costs

File: B-289139.2

Date: March 6, 2002

John Lukjanowicz, Esq., Oles Morrison Rinker & Baker, for the protester.

John P. Ahlers, Esq., Barokas Martin Ahlers & Tomlinson, for the GHEMM
Company, an intervenor.

Scott R. Marchand, Esq., U.S. Army Corps of Engineers, for the agency.

Aldo A. Benejam, Esq., and Christine S. Melody, Esq., Office of the General
Counsel, GAO, participated in the preparation of the decision.

DIGEST

General Accounting Office (GAO) recommends that protester be reimbursed the
reasonable costs of filing and pursuing its protest challenging the
evaluation and selection process where the contracting agency unduly delayed
taking corrective action in response to a clearly meritorious protest;
corrective action was taken only after the protester filed comments on the
agency report and after GAO expressed concerns regarding the lack of
adequate documentation.

DECISION

Alaska Mechanical, Inc. (AMI) requests that we recommend that the firm be
reimbursed the costs of filing and pursuing its protest challenging the
award of a contract to the GHEMM Company under request for proposals (RFP)
No. DACA85-01-R-0026, issued by the Department of the Army Engineer
District, Alaska, to construct an emission reduction facility for six
operating boilers at the central heat and power plant located at Fort
Wainwright, Alaska.

We recommend that the Army reimburse AMI its protest costs.

The RFP, issued on May 2, 2001, contemplated the award of a fixed-price
contract, and listed the following technical evaluation factors in
descending order of importance: past performance, specialized experience,
key personnel/organization, construction scheduling, and subcontracting plan
and small business participation. Award was to be made on the basis of the
proposal deemed to represent the best value to the government.

Five firms, including AMI and GHEMM, responded to the RFP. A source
selection evaluation board (SSEB) evaluated those firms' proposals, and
assigned an overall rating to each proposal. Based on that initial
evaluation, the SSEB rated all five proposals marginal overall, and
recommended that the contracting officer (CO) retain all five firms'
proposals within the competitive range. The CO concurred with that
recommendation and conducted discussions and requested revised technical
proposals from all five firms.

The SSEB reevaluated revised proposals based on the responses to discussion
items, and ultimately recommended a revised competitive range consisting of
only AMI's and GHEMM's proposals. The CO adopted the SSEB's recommendation
and reopened discussions by requesting AMI and GHEMM to submit breakdowns of
their prices. Although the SSEB reevaluated the specific price information
the offerors submitted, it was unable to reach consensus on which of the two
proposals represented the best value to the government.

The source selection authority (SSA) reviewed AMI's and GHEMM's proposals,
and the results of the SSEB's evaluations. Based on his independent review,
the SSA selected GHEMM's proposal as representing the best overall value to
the government. By letter dated October 1, the Army notified AMI of the
award to GHEMM. AMI filed its protest in our Office following a debriefing.

In its protest, AMI challenged the evaluation of its proposal in several
areas. In particular, AMI argued that in evaluating the firm's past
performance, the Army unreasonably relied on performance evaluations AMI
received on other projects that were either not final ratings or were under
appeal. AMI also contended that the Army unreasonably downgraded its
proposal under the key personnel/organization area, and the construction
scheduling area.

By notice to the parties on November 19, after receipt of the Army's report
and AMI's comments, the General Accounting Office (GAO) attorney handling
the protest expressed concern regarding the Army's position with respect to
several specific issues, and asked the Army to address those concerns prior
to scheduling a hearing. The GAO notice informed the Army that the specific
issues were identified because the record appeared to lack adequate
documentation supporting the Army's position in response to the protest. The
notice also raised questions regarding the extent and adequacy of the Army's
discussions.

By letter dated November 20, the Army informed our Office that, based on its
review of AMI's comments on the agency report and GAO's notice, the Army had
decided to take corrective action. Specifically, the Army stated that it
would terminate GHEMM's contract, request revised proposals from all
offerors that responded to the solicitation, appoint a new SSEB, reevaluate
proposals, and make a new source selection. Based on the Army's decision to
take corrective action, AMI withdrew its protest on November 28.

AMI requests that we recommend that the Army reimburse AMI the costs of
filing and pursuing the protest. Bid Protest Regulations, 4 C.F.R. sect. 21.8(e)
(2001). The Army has elected not to file a response to AMI's request.

When we determine that a solicitation, proposed award, or award does not
comply with statute or regulation, the Competition in Contracting Act of
1984 (CICA), 31 U.S.C. sect. 3554(c)(1)(A) (Supp. IV 1998), authorizes our
Office to recommend that the contracting agency pay the protester the costs
of filing and pursuing its protest, including reasonable attorneys' fees.
When a procuring agency takes corrective action in response to a protest,
our Office may recommend, pursuant to 4 C.F.R. sect. 21.8(e), that the agency
reimburse the protester its protest costs where, based on the circumstances
of the case, we determine that the agency unduly delayed taking corrective
action in the face of a clearly meritorious protest, thereby causing the
protester to expend unnecessary time and resources to make further use of
the protest process in order to obtain relief. Pemco Aeroplex, Inc.--Recon.
and Costs, B-275587.5, B-275587.6, Oct. 14, 1997, 97-2 CPD para. 102 at 5. A
protest is clearly meritorious when a reasonable agency inquiry into the
protest allegations would show facts disclosing the absence of a defensible
legal position. The Real Estate Ctr.--Costs, B-274081.7, Mar. 30, 1998, 98-1
CPD para. 105 at 3.

Here, there is no dispute that a prompt and reasonable agency inquiry would
have disclosed the absence of a defensible legal position rebutting AMI's
allegations regarding the evaluation of its proposal. Such an inquiry also
would have disclosed the absence of adequate documentation supporting the
agency's position and should have alerted the agency to irregularities
during discussions. As a result, we conclude that the protest was clearly
meritorious. Further, the agency delayed taking corrective action until
after it submitted its report; after AMI had incurred the time and expense
necessary to respond the report; and after our Office expressed concerns
with the record. Under the circumstances, we do not consider the agency's
corrective action to have been prompt.

Accordingly, we recommend that AMI be reimbursed the reasonable costs of
filing and pursuing the protest. AMI should file its certified claim for
costs with the Army within 60 days after receipt of this decision. [1] 4
C.F.R. sect. 21.8(f)(1).

Anthony H. Gamboa

General Counsel

Notes

1. GHEMM also requests that we recommend that it be reimbursed the costs of
participating in AMI's protest. While the firm, as the awardee in the
protested procurement, was permitted to intervene in AMI's protest, see 4
C.F.R. sect. 21.0(b), neither CICA nor our Regulations provide any basis for our
Office to recommend the award of costs incurred by an intervenor such as
GHEMM.