TITLE:  Holiday Inn-Laurel, B-290364, June 10, 2002
BNUMBER:  B-290364
DATE:  June 10, 2002
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Holiday Inn-Laurel, B-290364, June 10, 2002

DOCUMENT FOR PUBLIC RELEASE
The decision issued on the date below was subject to a GAO Protective
Order.  This redacted version has been approved for public release.
Decision

Matter of:   Holiday Inn-Laurel

File:            B-290364

Date:              June 10, 2002

Donald A. Tobin, Esq., and Lori Ann Lange, Esq., Bastianelli, Brown &
Kelley, for the protester.
Maj. Robert W. Clark and Col. Michael R. Neds, Department of the Army, for
the agency.
Tania Calhoun, Esq., and Christine S. Melody, Esq., Office of the General
Counsel, GAO, participated in the preparation of the decision.

DIGEST

Protester's challenge to the evaluation of its proposal is denied where the
record shows that the evaluation was reasonable and consistent with the
stated evaluation criteria.

DECISION

Holiday Inn-Laurel (HIL) protests the award of a contract to Command
Management Services, Inc. (CMS) by the Department of the Army's Directorate
of Contracting, Fort Knox, Kentucky, pursuant to request for proposals (RFP)
No. DABT23-02-R-0005, issued to procure meals, lodging, and transportation
for applicants arriving for processing at the Military Entrance Processing
Station (MEPS) in Baltimore, Maryland.  HIL primarily argues that the agency
improperly evaluated proposals against unstated evaluation criteria.

We deny the protest.

The RFP is a standard solicitation developed by the Directorate of
Contracting for procuring meals and lodging for armed forces applicants
arriving at the Army's 65 MEPS locations.  These MEPS RFPs are issued as
commercial acquisitions using simplified acquisition procedures, and
anticipate award of a fixed-price, indefinite-quantity requirements
contract, for a base period followed by four 1-year option periods, to the
offeror whose proposal is considered most advantageous to the government.

The RFP requires offerors to submit separate technical/quality and price
proposals.  Offerors are advised that award will be made, without conducting
discussions, to the firm whose proposal represents the best value to the
government, based on the following evaluation factors:  facility quality,
transportation, quality control, past performance, and price.  The facility
quality factor is comprised of six subfactors:  sanitation and cleanliness,
room condition, meals, security, special features, and facility location.
Among the non-cost factors, facility quality is more important than
transportation, which is more important than past performance, which is as
important as quality control.  The non-price factors are more important than
price.

The Army received 12 proposals in response to the solicitation, including
those of HIL and CMS, using Comfort Inn BWI.[1]  These proposals were
evaluated by a three-member team, which then conducted a videotaped
inspection of each offeror's lodging and dining facilities.  The contracting
officer explains that inspection teams spend no more than 45 minutes at each
location to verify information that was proposed by the properties and,
among other things, ask to see one or two guest rooms planned for use by the
applicants, the kitchen and dining room, and vehicles that will be used for
transporting applicants.  Contracting Officer's Statement at 2.

At the conclusion of the inspection, the evaluation panel prepared a
narrative assessment and overall adjectival consensus rating for each
offeror based on the results of the inspection and on the panel's review of
the proposal.  The adjectival ratings used here--excellent, good,
satisfactory, marginal, and unsatisfactory--were identified and defined in
the solicitation.  This information, together with the selection decision,
was memorialized in a document prepared by the contracting officer.

For HIL, the incumbent contractor, the evaluation narrative focused mostly
on the results of the inspection.  The evaluation team had ?big concerns?
with housekeeping in the rooms and the overall cleanliness of the kitchen,
which the contracting officer stated had been a concern for a while.  The
evaluation team found that ?[a]ll mattress covers contained hair and stains
and underwear was found between a mattress.?  Source Selection Statement at
3.  In addition, surveys on file regarding the quality of the food and the
hotel's standards showed that they were not what MEPS was looking for using
best value procedures.  The contracting officer was also concerned that the
only security cameras on the premises monitored the section of the hotel
that was not used to house applicants.  Because the property failed to
improve its housekeeping and kitchen cleanliness, lacked security
surrounding the area housing applicants, and did not have good quality
assurance and past performance ratings, the proposal was rated marginal.
Id. at 3.

HIL's overall rating of marginal made it the 10th highest-rated proposal of
the twelve.  The consensus rating assigned to each proposal, and that
proposal's total price for the base year and all four option years, is set
forth below:

CMS-Comfort Inn BWI         Excellent                    $  7,869,944.30

Offeror B                                Good                          $
9,353,704.60
Offeror C                                Good                          $
8,185,775.20
Offeror D                               Good                          $
7,543,485.62

Offeror E                                Satisfactory                $
7,718,884.60
Offeror F                                Satisfactory                $
8,186,173.20
Offeror G                               Satisfactory                $
7,793,275
Offeror H                               Satisfactory
$10,171,704

Offeror I                                 Marginal                     $
8,886,904.20
Holiday Inn-Laurel                Marginal                     $  5,514,110

Offeror J                                 Unsatisfactory           $
5,719,500
Offeror K                                Unsatisfactory           $
6,200,314.80

Based on these findings, the contracting officer concluded that the offer
submitted by CMS represented the best value to the government.  Among its
benefits was its proposal of a liaison person dedicated to assisting
applicants and monitoring their activities.  The contracting officer found
that such a liaison would help the agency ensure that applicants were
properly rested when they arrived at the MEPS for testing or shipping, avoid
incidents of misconduct, and maintain on-going coordination between the
hotel and the MEPS for the arrival and departure of applicants.  In addition
to finding that CMS proposed recreational activities and facilities within
the facility that were specially designed for applicants' enjoyment, the
contracting officer found that its security plan was in place and appeared
to be functioning well, and that the layout of the hotel, presence of
security cameras, and around-the-clock security guards indicated that
security for applicants would be high and consistent.  She concluded that
selection of the firm ensured that the agency's ?Red Carpet?[2] treatment of
applicants would be maintained.  While the firm's price was slightly higher
than that of one of the offerors whose proposal was rated good, the
contracting officer determined that CMS's higher quality, added benefits
resulting from the presence of a liaison and rooms set aside for the
entertainment of applicants, sanitary nature of the kitchen and dining
facility, and assurance of higher security for applicants, indicated a
better value for the government.  Id. at 4.  She reviewed the evaluation
results for the remaining proposals and, in each case, determined that the
price premium for selecting CMS was worth its advantages.  Id. at 4-5.  CMS
was selected for award and this protest followed.

HIL primarily argues that the RFP failed to advise potential offerors that
the Army was looking for hotels with higher quality, nicer rooms, better
meals, more amenities, and higher security than would normally be
available.  The protester asserts that if it had known that the Army was
seeking higher quality, it could have offered its newly renovated wing and
upgraded its meal service.

Our standard in reviewing evaluation challenges is to examine the record to
determine whether the agency's judgment was reasonable and consistent with
stated evaluation criteria and applicable statutes and regulations.  ESCO,
Inc., B-225565, Apr. 29, 1987, 87-1 CPD para. 450 at 7.  HIL's complaint
reflects a misunderstanding of the nature of a best value procurement.

As the contracting officer explains, in the past, MEPS contracts were
awarded to the lowest-priced responsible bidder using sealed bidding
procedures.  The agency found that such a strategy was not always consistent
with the government's interest in ensuring the safety of applicants and
making a good impression.  Contracting Officer's Statement at 1.  For this
reason, MEPS contracts are now awarded on a best value basis, consistent
with the ?Red Carpet? policy.  The solicitation did not request the
submission of low-priced, technically acceptable proposals but, instead,
requested the submission of best value proposals and outlined areas where
quality would be considered.  As a result, HIL was on notice that proposing
higher-quality facilities and additional amenities would likely result in a
higher rating, and must itself suffer the consequences of failing to do so.

HIL's allegation that the agency evaluated proposals against unstated
requirements for certain types of meals and multiple security cameras is
similarly unfounded.  First, the record shows that the agency was not
concerned with the type of meals served by the hotel but with their quality;
surveys submitted by prior applicants were not favorable.  In any event,
meals and security were two subfactors under the facility quality factor,
and food quality and security levels are reasonably encompassed therein.
JoaQuin Mfg. Corp., B-275185, Jan. 29, 1997, 97-1 CPD para. 48
at 2.

HIL next argues that its proposal was unreasonably evaluated because it was
largely based on one 45-minute inspection and the deficiencies found were
minor problems that were correctable.  The protester does not dispute the
accuracy of the inspection findings but asserts that, for example, the state
of the kitchen was due to an
in-progress clean-up after a large wedding reception.

Although HIL may be right about the correctable nature of some of the
deficiencies, we think the agency reasonably viewed the inspected rooms and
facilities as representative of those available in the hotel, and the
defects noted clearly bear on the condition of the rooms and of the hotel
overall.  Hilton Knoxville, B-289478,
Feb. 26, 2002, 2002 CPD para. 45 at 5.  Further, HIL's contention that the state
of the kitchen was due to a recent event is undermined by the contracting
officer's statement that the overall cleanliness of the kitchen had been a
concern for a while, which HIL does not dispute.  To the extent HIL is
arguing that the inspection was too hurried, it has made no showing as to
how it was harmed by the duration of the inspection, and there is no basis
to conclude it was treated unfairly since the inspections of all the
offerors' facilities were conducted in a similar manner.

HIL finally argues that the competition was not a level playing field
because CMS holds more than 40 percent of the MEPS contracts and has,
therefore, gained insider knowledge concerning what the Army is seeking in
these procurements.  A particular offeror may possess unique advantages and
capabilities due to its prior experience under a government contract or
otherwise and the government is not required to attempt to equalize
competition to compensate for it, unless there is evidence of preferential
treatment or other improper action.  Crofton Diving Corp., B-289271, Jan.
30, 2002, 2002 CPD para. 32 at 6.  The existence of this advantage, by itself,
does not constitute preferential treatment by the agency, nor does it
otherwise represent an unfair competitive advantage.[3]  Id.

The protest is denied.

Anthony H. Gamboa
General Counsel

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

[1]CMS is not a hotel, but a management company that subcontracts with local
hotels to perform MEPS contracts throughout the country.  The contracting
officer acknowledges that CMS currently holds approximately 40 percent of
the contracts awarded by the Army for its 65 MEPS locations.  Contracting
Officer's Statement     at 3.  Using various hotels, CMS submitted 9 of the
12 offers here.
[2] The ?Red Carpet? treatment refers to USMEPCOM Regulation 601-23, Chapter
14 (Nov. 1999), which outlines the command's policy to treat MEPS applicants
professionally and courteously.
[3] We have previously addressed assertions, such as those raised here by
HIL, regarding the propriety of awarding MEPS contracts to CMS acting as a
?middleman? for various hotels.  Hilton Knoxville, supra, at 7-8.  For the
same reasons as discussed in that decision, there is nothing objectionable
in the agency's conclusion that CMS's approach offers the best value to the
government.