TITLE:  Aulson & Sky Company
BNUMBER: B-290159 
DATE:  May 21, 2002
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Decision

Matter of:   Aulson & Sky Company

File:            B-290159

Date:              May 21, 2002

Song Fong Eui, Esq., for the protester.
Maj. David T. Crawford, and Raymond M. Saunders, Esq., Department of the
Army, 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

Contracting officer reasonably determined that the protester was
nonresponsible and, therefore, ineligible for award where the pre-award
survey revealed that the protester's recent record of past performance of
construction-type requirements included repeated delays in contract
performance.

DECISION

Aulson & Sky Company protests the award of a contract to Dura Corporation
Ltd. under request for proposals (RFP) No. DAJB03-02-R-0021, issued by the
United States Army Contracting Command Korea, Department of the Army, for
repair and turnover maintenance of family housing in Seoul, Korea.  Aulson
challenges the agency's determination that the firm was nonresponsible,
based on its record of past performance, and, therefore, ineligible for
award.

We deny the protest.

The RFP, issued on December 12, 2001, contemplated the award of a
fixed-price, indefinite-delivery/indefinite-quantity contract for a base
period and four 1-year option periods.  The RFP stated that the award would
be made to the responsible offeror whose proposal represented the best value
to the government, considering (in descending order of importance) past
performance,[1] technical capability (contract management, quality control
plan, accident prevention/safety plan, and mobilization/transition), and
price.  The RFP stated that past performance and technical capability, when
combined, would be considered significantly more important than price;
however, as proposals became more equal in terms of past performance and
technical capability, price would become more important.  The RFP also
provided that the agency reserved the right to make award to other than the
firm proposing the lowest price.  RFP at 9-12.

In addition, and as relevant here, the RFP included a clause captioned
"Notice of Evaluation of Past Performance," which provided that as part of
the responsibility determination, the contracting officer would evaluate
past performance to determine the offeror's capability to perform the
contract.  RFP at 25.

Fifteen firms, including Aulson (a Korean-owned business concern) and Dura
(the incumbent contractor) submitted proposals by the closing time on
January 18, 2002.  The agency's technical evaluation board (TEB)[2]
evaluated proposals.  The proposals of Aulson and Dura were evaluated as
follows:[3]

                     Aulson      Dura

Past Performance     Average     Outstanding

Technical Capability Good        Outstanding

Agency Report (AR), Tab 9, Technical Evaluation Report, at 2.  Aulson's
proposed price was lower than Dura's proposed price.

In the technical evaluation report sent to the contracting officer, who
served as the source selection authority, the TEB explained that while
Aulson had many past performance records with the federal government, its
past performance was primarily in the areas of construction and civil work,
not turnover maintenance of family housing units.  Accordingly, the TEB
identified as a weakness Aulson's lack of experience directly relevant to
the requirements of this RFP.  AR, Tab 9, Technical Evaluation Report for
Aulson, at 4.  Regarding technical capability, the TEB concluded that Aulson
satisfied the minimum requirements for contract management, quality control
plan, and accident prevention/safety plan; however, the TEB was concerned
that while Aulson addressed mobilization/transition, Aulson did not fully
understand the RFP requirement since its proposed equipment breakdown was
not feasible in terms of supporting the requirement.  Id.

The contracting officer subsequently requested pre-award surveys for Aulson
and Dura; the surveys were performed by the agency's Quality Assurance
Branch (QAB), which reviewed the offerors for responsibility based on
technical capability, quality assurance capability, financial capability,
and past performance.  The QAB determined that Dura was responsible, but
that Aulson was not responsible based on its recent record of past
performance.  More specifically, the QAB reported that Aulson was currently
performing contracts in Korea and had encountered schedule delays.

For example, in December 2001, despite receiving an overall satisfactory
rating for its performance of contract No. DAJB03-01-C-0121 (barracks
upgrade and renovation at Camp Carroll, Korea), Aulson received a letter
from the contracting officer dated December 10, 2001, in which the
contracting officer expressed concern to Aulson that progress schedules had
been modified more than once (i.e., three times in a 60?day period) and that
the project was behind schedule, even though Aulson's revised schedule
indicated that the deadline for completion would be met.  In addition, the
contracting officer advised Aulson to raise engineering plan and service
section issues within a reasonable time with the contracting officer's
representative.  The contracting officer concluded by stating that the
referenced matters could endanger Aulson's contract performance.  AR, Tab
15, Letter from Contracting Officer to Aulson (Dec. 10, 2001).[4]  As
requested, by letter dated December 18, Aulson responded to the contracting
officer's concerns, acknowledging that "for the subject contract, we have
had some difficulty in adapting ourselves to the typical regional
differences . . . [i]n fact, the initial preparation work took longer than
we planned[;] [m]oreover, the terror on [September 11, 2001] ha[d] further
delayed the overall performance for about a month."  AR, Tab 16, Letter from
Aulson to Contracting Officer (Dec. 18, 2001).  Aulson provided a written
plan for correcting noted deficiencies and for preventing the recurrence of
such problems, including closer supervision of work progress; Aulson also
promised "not to revise the 'revised-revised' schedule."  Id.  On January
30, 2002, the contracting officer met with Aulson personnel to discuss
on-going schedule delays and to request an updated progress schedule; Aulson
promised compliance with the original contract completion deadline.  AR, Tab
17, Contracting Officer's E-mail and Notes of Meeting.

As another example, in assessing Aulson's performance under contract No.
DAJB03-02-C-0019 (barracks upgrade and renovation at Camp Stanton, Korea),
the contracting officer's representative assigned an overall unsatisfactory
rating to Aulson for its performance in December 2001, noting that the
quality and conduct of work, the adequacy of contractor inspections, the
adherence to work or delivery schedules, and the adequacy of personnel were
unsatisfactory; the contracting officer's representative commented that
Aulson needed a qualified safety engineer present at all times of operation
and needed increased manpower and material.  AR, Tab 19, Form 173-R,
Aulson's Performance Rating for Dec. 2001.  In January 2002, the agency met
with Aulson personnel to stress the importance of staying on schedule and to
request an action plan to bring the firm back on schedule.  AR, Tab 7,
Pre-Award Survey for Aulson, Spreadsheets at 2.  The contracting officer's
representative, while assigning an overall satisfactory rating to Aulson for
its performance in January 2002, nevertheless assigned individual
unsatisfactory ratings to the firm in the areas of resolution of delays and
submission of updated and revised progress schedules.  AR, Tab 20, Form
173-R-E, Aulson's Performance Rating for Jan. 2002.

Based on Aulson's record of past performance for recent contracts in Korea,
the QAB recommended that no award be made to Aulson.  AR, Tab 7, Pre-Award
Survey for Aulson, at 2.[5]  In contrast, the QAB recommended that the award
be made to Dura, the incumbent contractor determined responsible in all
areas surveyed.  AR, Tab 6, Pre?award Survey for Dura, at 2.  On February
15, the contracting officer awarded the contract to Dura, the responsible
offeror whose proposal was determined to represent the best value to the
government.

Aulson protests the nonresponsibility determination that made the firm
ineligible for award.  In this regard, Aulson claims that "most" of the
schedule delays under its contract at Camp Carroll were caused by the
government, and that despite these delays, it will finish the contract on
time.  Comments at 2.[6]  Aulson believes that it should have been found
responsible, and as the offeror submitting the low-priced, technically
acceptable proposal, it should have received the award.

In making a responsibility determination, a contracting officer is vested
with a wide degree of discretion and, of necessity, must rely upon his or
her business judgment in exercising that discretion.  See Blocacor, LDA,
B-282122.3, Aug. 2, 1999, 99-2 CPD para. 25 at 4.  We generally will not
question a negative determination of responsibility unless the protester can
demonstrate a lack of any reasonable basis for the contracting officer's
determination.  Id.  Here, Aulson has failed to make the required showing.

As discussed above, the record shows that the agency had a reasonable basis
for concern regarding Aulson's performance under two construction-type
contracts recently performed by the firm in Korea.  For example, for the
contract at Camp Carroll, the contracting officer issued a letter of concern
to Aulson, pointing out, among other things, that the schedule had to be
modified a number of times in a short timeframe and that the project was
behind schedule, even though Aulson believed it would finish by the contract
completion date; the contracting officer also met with Aulson regarding
on-going schedule delays and to request an updated progress schedule.  Other
than disagreeing with the agency's assessment of the cause of the
performance delays, Aulson does not meaningfully rebut its past performance
record at Camp Carroll and, in fact, admits responsibility for delays
related to startup and initial preparation work.  Moreover, Aulson is silent
regarding its performance record at Camp Stanton, as described above.  On
this record, we have no basis to question the reasonableness of the
contracting officer's conclusion that Aulson was not responsible in terms of
being capable to perform the RFP's requirements.[7]

The protest is denied.[8]

Anthony H. Gamboa
General Counsel

                          -------------------------

[1] Under the past performance evaluation factor, the RFP stated that the
agency would evaluate the risks and strengths identified with an offeror's
recent, current, and relevant contract performance.  An offeror's proposal
would receive one of the following overall past performance confidence
assessment ratings:  outstanding/high confidence; good/significant
confidence; average/confidence; marginal/little confidence; and
unacceptable/no confidence.
[2] In its comments on the agency report, Aulson expresses concern that
there may not have been any engineers on the TEB.  The unredacted technical
evaluation report furnished to our Office shows that there were engineering,
as well as housing, representatives on the TEB.
[3] The proposals of the other 13 offerors were rejected as technically
unacceptable.
[4] The record shows that the agency took responsibility for some of
Aulson's performance problems under the Camp Carroll contract as a result of
government delays in the processing of personnel, material, and equipment
access passes and as a result of differing site conditions.  AR, Tab 7,
Pre-award Survey for Aulson, Spreadsheets at 1.
[5] The Small Business Administration's certificate of competency procedures
do not apply to foreign-owned business concerns, such as Aulson, even if
these concerns are small businesses.  See Federal Acquisition Regulation sect.
19.601(e).
[6] We note that Aulson neither comments on its record of past performance
at Camp Stanton nor makes any claims that the government caused any of the
delays under this contract.
[7] In the legal memorandum accompanying the agency report, there is a
reference to a third contract allegedly performed by Aulson, this one at
Camp Hovey, Korea.  The contemporaneous past performance documentation
included in the agency report shows, however, that the Camp Hovey contract
was performed by another contractor, not Aulson.  AR, Tab 7, Pre-Award
Survey for Aulson, Spreadsheets at 3.  The agency subsequently addressed
this discrepancy, acknowledging that Aulson was not the contractor at Camp
Hovey, and correctly pointing out, as confirmed by our review, that any
delays under the Camp Hovey contract were not attributed to Aulson.
[8] To the extent Aulson challenges the evaluation of its technical proposal
and the agency's decision to pay a price premium to Dura, Aulson is not an
interested party to challenge these matters because, in light of our
decision that the contracting officer reasonably determined the firm
nonresponsible, Aulson would not be in line for award in any event.  See
Blocacor, LDA, supra, at 3 n.4.