TITLE: Vantage Associates, Inc., B-290802.2, February 3, 2003
BNUMBER: B-290802.2
DATE: February 3, 2003
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Vantage Associates, Inc., B-290802.2, February 3, 2003
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: Vantage Associates, Inc.
File: B-290802.2
Date: February 3, 2003
Brian J. Donovan, Esq., Jones & Donovan, for the protester.
Randall B. Pennington, Esq., Naval Sea Systems Command, for the agency.
Paul I. Lieberman, Esq., and Michael R. Golden, Esq., Office of the
General Counsel, GAO, participated in the preparation of the decision.
DIGEST
1. Agency determination to make award on the basis of lower price under
solicitation which provided that technical considerations were more
important than price is unobjectionable where the technical proposals were
reasonably evaluated as essentially equal.
2. Favorable consideration of offeror's past performance and technical
capability in producing item identical to that being procured with the
exception of a change in the color of a required coating is reasonable
under solicitation which contemplated evaluation of offeror's previous
production of the same or similar item.
DECISION
Vantage Associates, Inc. protests the award of a contract to Raytheon
Systems Company under request for proposals (RFP) No. N63394-02-R-4001,
issued by the Department of the Navy, Port Hueneme Division, Naval Surface
Warfare Center, for the production of certain radomes under a fixed-price
contract. Vantage asserts that it has better experience and
qualifications to produce the radomes than Raytheon, and that the Navy
unreasonably evaluated Raytheon's technical proposal as equal to Vantage's
and improperly determined to award to Raytheon on the basis of its lower
price.
We deny the protest.
BACKGROUND
The solicitation, issued on March 11, 2002, seeks the production and
delivery of 60 search radar radomes, 60 track radar radomes, and related
data for the MK 15 close‑in weapon system (CIWS), known as the
*Phalanx,* a ship self-defense system designed to detect and engage
high-speed incoming airborne threats. The 60-unit production requirements
include first article test units. The currently deployed radomes are
painted white, while the remainder of the Phalanx CIWS (for which the
radomes provide protective cover) and the majority of the ships are
painted haze gray. This solicitation is for Phalanx radomes painted gray
in order to present a less conspicuous target. The radomes consist of a
coated fiberglass sandwich structure with a foam core fabricated to
provide watertight integrity for the CIWS mount while allowing
transmission and reception of the search and track radar beams without
loss of radio-frequency power, constructed to Navy specifications.
The solicitation sets forth five technical factors consisting of: (1)
technical capability, (2) past performance, (3) production capability, (4)
test equipment and (5) quality control system, and indicates that factors
2 and 3 are equal in importance and more important than factor 1, and that
factors 4 and 5 are equal in importance and less important than factor 1.
The RFP states that the five technical factors *combined are significantly
more important than price,* but that the importance of price *will
increase with the degree of equality* of technical proposals, and *price
may be the deciding factor between two or more highly rated Technical
Proposals.* RFP S: M; RFP amend. 1, S: M.
The agency received three proposals and, after conducting discussions,
determined to award to Raytheon on the basis that it offered a higher
technically rated proposal than Vantage, at a lower price. After
receiving a debriefing, Vantage protested the propriety of the evaluation
and award determination to our Office, in response to which the agency
determined to take corrective action consisting of a reevaluation
conducted by new evaluators, using a revised source selection plan
modified to comport with the RFP evaluation criteria.[1] Our Office
dismissed the protest on July 12, 2002, based on the agency's
determination to take corrective action.
The agency conducted a reevaluation on October 7, as a result of which the
technical proposals were both rated as *outstanding* overall. Agency
Report (AR), Tab 15, Source Selection Board (SSB) Evaluation Summary, at
1. Raytheon's total price was $1,621,080; Vantage's total price was
$[DELETED]. AR, Tab 16, Business Clearance Memorandum, at 9. The agency
determined that because both proposals were rated
technically outstanding, price became the deciding factor and made award
to
Raytheon. After receiving a debriefing, Vantage filed this protest on
November 12. Vantage again questions the propriety of the technical
evaluation and also asserts that the agency improperly conducted a pure
price competition.[2]
AWARD ON THE BASIS OF LOW PRICE
Raytheon's technical proposal was evaluated as *outstanding* under four
factors, technical capability, past performance, test equipment and
quality control system, and as *good* under one factor, production
capability. Vantage's proposal was evaluated as *outstanding* under
[DELETED] factors, [DELETED], and as [DELETED] under [DELETED] factors,
[DELETED]. Overall, Raytheon's proposal was evaluated as *outstanding.*
With respect to Vantage's proposal, the SSB initially recommended an
overall evaluation of [DELETED],* but eventually reached an overall rating
of *outstanding* because of the relative importance of the [DELETED]
factors under which Vantage's proposal was evaluated as *outstanding.*
AR, Tab 15, SSB Evaluation Summary, at 1. Nonetheless, the SSB determined
that *[a]lthough both vendors are rated [o]utstanding, the Raytheon
proposal was superior to the Vantage proposal.* Id. The agency concluded
that Raytheon's lower price was determinative in view of the *outstanding*
evaluations received by both technical proposals. AR, Tab 16, Business
Clearance Memorandum, at 9.
Vantage asserts that the award to Raytheon on the basis of its low price
is contrary to the RFP award criterion which provides that evaluation
factors other than price are significantly more important than price, and
impermissibly converted the procurement into a competition under which
*low price wins.* Protester's Comments at 8-9.
In a negotiated procurement with a *best value* evaluation plan where
selection officials reasonably regard proposals as being essentially equal
technically, price can become the determining factor in making award,
notwithstanding that the evaluation criteria assigned price less
importance than technical factors. M-Cubed Info. Sys., Inc., B 284445;
B-284445.2, Apr. 19, 2000, 2000 CPD P: 74 at 8. Here, the RFP evaluation
scheme explicitly provides that price would increase in importance as the
technical proposals become close to equal, and that price may be the
deciding factor between highly rated proposals. At best, Vantage's
technical proposal was evaluated as equal to Raytheon's; in fact, the
record reflects that the agency consistently evaluated the Raytheon
proposal as technically superior, notwithstanding that the same
*outstanding* ratings were given to both proposals. Accordingly,
Vantage's objection that the agency improperly considered price to be
determinative is without merit because the agency's decision to use low
price as the determining factor between two equally highly rated technical
proposals was fully consistent with the RFP award criteria.
TECHNICAL PROPOSAL EVALUATION
Vantage asserts that its technical proposal should have been evaluated as
superior to Raytheon's because Vantage is the only offeror that has
successfully manufactured production units of the gray radomes for the
Navy, and because Raytheon has allegedly supplied the Navy with a
non‑compliant gray radome unit. In these circumstances, Vantage
contends that only its proposal could reasonably be evaluated as
outstanding under the past performance and production capability factors,
and it is irrational for Raytheon to have received a rating other than
unsatisfactory under these two factors.
In reviewing a protest against an agency's evaluation of proposals, we
examine the record to determine whether the agency's judgment was
reasonable and consistent with the stated evaluation criteria and
applicable statutes and regulations. Support Servs., Inc., B-282407,
B-282407.2, July 8, 1999, 99-2 CPD P: 30 at 3. The protester's mere
disagreement with the agency's judgment does not establish that the
evaluation was unreasonable. Hard Bodies, Inc., B-279543, June 23, 1998,
98-1 CPD P: 172 at 3. Here, as discussed below, the record establishes
that the agency's evaluation of Raytheon's proposal under the past
performance and production capability factors was reasonable and
consistent with the RFP evaluation criteria.
The predicate to all of Vantage's evaluation arguments is its view that
gray Phalanx radomes are *an item markedly differently from the white
version,* and that *gray Phalanx radomes are a unique item for which prior
experience with white radomes was largely if not totally irrelevant.*
Protester's Comments at 1. The protester claims that this position is
substantiated by the RFP's requirement for a first article test, which is
not required under white Phalanx radome procurements, and because there
was a question about the possible impact of the darker color on the radar
frequency transmissions and the covered electronic equipment, as a result
of which the Navy did not permit deployment of the gray radomes that had
been produced by Vantage without first having a pilot lot inspection test
conducted. Protester's Comments at 2. Vantage contends that this
production history of the gray radomes *confirms what appears in the
solicitation read as a whole, that expertise and experience with gray
radomes was the essential requirement of this procurement action.*
Protester Comments at 3. Vantage also asserts that this view of the focus
of this RFP is consistent with conversations that its representatives have
had with agency officials concerning the focus of the procurement. Id.
The SSB chairman has explained that *there are no significant technical
differences between the gray and white radomes,* pointing out that the
source control drawings for the white and gray radomes are virtually
identical with the exception of a note calling for the use of light gray,
low solar absorbency (LSA) gel coat. Supplemental AR, Tab 22, Statement
of SSB, at 2. In his view, there are *no technical reasons why a
manufacturer of white radomes could not produce gray radomes, assuming
they use the LSA gray gel coat.* Id. In our view, the solicitation
evaluation criteria are consistent with the SSB chairman's view.
The protester correctly points out that the solicitation states that the
production efforts for the contract will encompass the activities required
to qualify the contractor to manufacture the low solar absorbent gray
track and search radomes for the Phalanx CIWS in accordance with specified
drawings in the RFP. However, this is within the context of what the
solicitation states is a production effort for the gray track and search
radomes. RFP S: C. Nothing in the solicitation overall, or more
particularly in the evaluation criteria substantiates Vantage's allegation
that production of white Phalanx radomes was not relevant, or that
production of gray radomes was a prerequisite to receiving a favorable
evaluation.
Thus, while the protester insists that the evaluation of past performance
should be limited to consideration of the production of gray radomes, the
RFP simply does not contain any such limitation. On the contrary, the RFP
requires the submission of past performance information for *current or
previous contracts for the same or similar product(s),* RFP S: L, with
respect to which the past performance evaluation factor calls for an
assessment of *the degree to which the Offeror has satisfied its
customers.* RFP S: M(B). The record makes clear that Raytheon has a long
history of producing the white Phalanx radomes under Navy contracts, and
Vantage does
not question Raytheon's record of successful past performance in this
regard, which the agency evaluated as consistently positive with no known
problems. As to Vantage's assertion that Raytheon should have been
downgraded for having supplied the Navy with a defective gray radome, this
is based on the fact that in December 2001, the Navy had returned a
dimensionally noncompliant gray radome to Vantage (which was the only
entity that had supplied production radomes to the Navy), which Vantage
states that it had not produced. Vantage asserts that it *learned that
this was a radome produced by Raytheon,* Protest at 4, and so advised the
Navy.[3] However, with Navy authorization, the unit was destroyed. Id.
at 5. The Navy states that it has no knowledge of any noncompliant gray
radome supplied by Raytheon, and Vantage, which it is clear from record is
the only company that has supplied any production units of the gray
Phalanx radomes to the Navy, has not provided any meaningful evidence that
the radome in question was a production item made by Raytheon. Vantage's
speculation regarding the origin of this noncompliant unit provides no
basis for our Office to find that the agency was required to downgrade
Raytheon's technical proposal.
Vantage also asserts that Raytheon's proposal should have been rated as
*unsatisfactory* rather than *good* under the production capability
factor.[4] The RFP provides that the production capability factor will
assess *capability to manufacture the [s]earch radome and [t]rack radome
to the requirements of the US Navy drawings,* and calls for the offeror to
state what production tooling is in place and has to be procured to
complete the effort. RFP S: M(C). Raytheon's proposal was evaluated as
good under production capability based on its possession of all the molds,
tooling and test equipment in place to manufacture the gray radomes. AR,
Tab 16, Business Clearance Memorandum, at 5. Vantage again bases its
objection on the fact that Raytheon has not successfully produced the gray
radome, which is simply not a requirement under the production capability
criterion.
In short, none of the RFP evaluation criteria require that an offeror have
produced gray radomes in order to receive a favorable evaluation. In its
evaluation of Raytheon's proposal, the agency recognized that in addition
to a long history in design, manufacturing, testing and delivery of the
white radomes, Raytheon participated in the development of the LSA gray
radomes as well. Id. Vantage's premise that, as the only successful
previous producer of LSA gray radomes, it is the only offeror whose
proposal could be highly rated is not consistent with the RFP evaluation
criteria, which were reasonably applied by the agency in its evaluation of
Raytheon's proposal.[5]
The protest is denied.
Anthony H. Gamboa
General Counsel
------------------------
[1] Under the corrective action, the reevaluation was limited to the
Raytheon and Vantage proposals; the third proposal was excluded from the
competitive range.
[2] Vantage also argues for the first time that the agency should have
disqualified Raytheon from receiving the award because the firm allegedly
has an unavoidable organizational conflict of interest (OCI) based on
Raytheon's participation in designing and preparing the radome
specifications. This allegation is untimely. The solicitation contained
design drawings for the radome that were designated as having been
prepared by Raytheon, and the RFP designated Raytheon as a qualified
source for the gray radomes. When Vantage received notice of the original
award to Raytheon, it protested the technical evaluation and alleged that
the determination to award to Raytheon was improperly made on the basis of
low price, without raising the OCI issue, and the agency's subsequent
corrective action in response to that protest consisted only of a
technical reevaluation and resulting award determination. Vantage was
aware of all of the relevant information pertaining to the alleged OCI at
the latest when it received its initial debriefing on June 24, but did not
raise the OCI issue until November 12, after it was apprised of the
technical reevaluation results. Accordingly, the OCI allegation is
untimely and will not be considered. 4 C.F.R. S: 21.2(a)(2) (2002);
LeBoeuf, Lamb, Greene & MacRae, B‑283825, B-283825.3, Feb. 3, 2000,
2000 CPD P: 35 at 11.
[3] Vantage's belief that Raytheon produced this radome is based on its
observation that the radome profile was *typical of the Raytheon profile
and could not have been produced on Vantage's tooling,* coupled with
conversations with a Navy official indicating that Raytheon had *made a
few gray radomes.* Protester's Comments, Statement of Louis J. Alpinieri,
at 6. Vantage reasons that *based on the fact that there is essentially a
zero possibility that anyone else could have made a gray P[halanx] radome,
since this is not a common item made by commercial sources or even other
Government contractors, there is a 100% certainty that it was produced by
Raytheon.* Id. at 6-7.
[4] To the extent that this argument is also premised on Vantage's
speculation that Raytheon has produced a noncompliant gray radome, as
explained above, this provides no basis for objection.
[5] Vantage also objects that its proposal should have been evaluated as
*outstanding* rather than [DELETED] under the [DELETED] factors in
addition to the [DELETED] factors under which it was evaluated as
*outstanding.* Protester's Comments at 8. However, the Vantage proposal,
like the Raytheon proposal, received an overall evaluation of
*outstanding,* the highest available rating. As noted above, the
solicitation expressly contemplates award on the basis of low price where
there are two or more highly rated proposals. Accordingly, even if
Vantage's technical rating improved to a stronger *outstanding* overall,
under the RFP award criteria no tradeoff would be required, and award to
Raytheon would still be appropriate on the basis that Raytheon offered the
lower priced of two highly rated proposals.