TITLE:  Industrial Property Management, B-291336.2, October 17, 2003
BNUMBER:  B-291336.2
DATE:  October 17, 2003
**********************************************************************
Industrial Property Management, B-291336.2, October 17, 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:   Industrial Property Management
    
File:            B-291336.2
    
Date:              October 17, 2003
    
Joseph C. Port, Jr., Esq., and Harvey J. Nathan, Esq., Sidley Austin Brown
& Wood, for the protester.
Robert L. Duecaster, Esq., Department of the Army, for the agency.
Ralph O. White, Esq., and Christine S. Melody, Esq., Office of the General
Counsel, GAO, participated in the preparation of the decision.
DIGEST
    
Protester*s contention that the agency failed to perform a proper *best
value* analysis among competing proposals is denied where the record shows
that:  (1) the agency properly documented the benefits associated with
selecting the awardee*s higher-priced, higher-rated proposal over the
lower-priced, lower-rated proposal of another offeror; and (2) there was
no need for the agency to make a second tradeoff decision between the
overall equally-rated proposals of the awardee and the protester, given
the protester*s 20 percent higher price. 
DECISION
    
Industrial Property Management (IPM) protests the award of a contract to
Ferguson-Williams, Inc. under request for proposals (RFP) No.
DASW01-02-R-0017, issued as a small business set-aside by the Department
of the Army*s Defense Contract Command--Washington (DCC-W). The RFP sought
proposals for caretaker services, and operations and maintenance, for the
closed Stratford Army Engine Plant, Stratford, Connecticut. IPM, the
incumbent contractor, contends that the selection of Ferguson-Williams for
award was unreasonable, and that IPM*s higher-priced proposal should have
been selected instead.
    

   We deny the protest.
    
BACKGROUND
    
The RFP here was issued on May 28, 2002, and contemplated award of a
fixed-price, indefinite-delivery/indefinite-quantity contract to the
offeror whose proposal was found to present the best value to the
government.  The RFP identified three evaluation factors--technical
approach, past performance, and price, in descending order of
importance--and four equally-weighted subfactors under the technical
approach factor:  (1)  understanding requirements/plan of operation; (2)
staffing and organization; (3) quality control; and (4) transition
(phase-in) plan.  RFP at 236-37.  In addition, with respect to the price
factor, the RFP advised that price would be *a significant evaluation
factor and will become more critical as technical ratings approach
equality.*  Id. at 238. 
    
The agency received four proposals in response to the RFP.  Each proposal
was evaluated and adjectival ratings were assigned under each of the four
technical approach subfactors and under the past performance factor; the
adjectival ratings were:  exceptional, good, acceptable, marginal, and
unacceptable.  Source Selection Plan at 10.  After initially excluding,
and then restoring, one of the offers to the competitive range, the agency
called for final revised proposals.  At the conclusion of the evaluation,
the overall results and proposed prices were as follows, and proposals
were ranked in the order shown:
    

   +------------------------------------------------------------------------+
|                            |OVERALL RATING     |                       |
|OFFEROR                     |                   |PRICE                  |
|----------------------------+-------------------+-----------------------|
|1. Ferguson-Williams        |Good               |$10.5 million          |
|----------------------------+-------------------+-----------------------|
|2. Offeror A                |Acceptable         |       $  9.7 million  |
|----------------------------+-------------------+-----------------------|
|3. IPM                      |Good               |$12.6 million          |
|----------------------------+-------------------+-----------------------|
|4. Offeror B                |Acceptable         |$13.8 million          |
+------------------------------------------------------------------------+

    
Memorandum of Source Selection Decision, Apr. 28, 2003, at 1-3.
    
The table below shows the ratings of Ferguson-Williams and IPM on the four
technical approach subfactors that, when considered in the aggregate,
resulted in overall ratings of *good* for both companies.
    

   +------------------------------------------------------------------------+
|TECHNICAL APPROACH SUBFACTORS        |                  |               |
|                                     |Ferguson-Williams |IPM            |
|-------------------------------------+------------------+---------------|
| 1.  Understanding Requirements/     |                  |               |
|       Plan of Operation             |Good              |Acceptable     |
|-------------------------------------+------------------+---------------|
| 2.  Staffing and Organization       |Acceptable        |Exceptional    |
|-------------------------------------+------------------+---------------|
| 3.  Quality Control                 |Good              |Acceptable     |
|-------------------------------------+------------------+---------------|
| 4.  Transition (Phase-In) Plan      |Good              |Acceptable     |
+------------------------------------------------------------------------+

    
Id. at 2.
    
Based on these results, the contracting officer performed a
price/technical tradeoff analysis that ultimately concluded that the
Ferguson-Williams proposal offered the best value to the government.  In
reaching this conclusion, the contracting officer adopted the evaluation
team*s conclusion that the technical merit of the two higher-priced
proposals (one of which was IPM*s) did not justify paying their higher
prices.  Id. at 6.  The selection decision then turned to a detailed
tradeoff between Offeror A and Ferguson-Williams.  Id. at 6-9.
    
DISCUSSION
    
In its initial protest, IPM points to its experience as the incumbent
contractor for these services and asserts that any rating under any
technical subfactor given Ferguson-Williams or Offeror A that exceeds the
rating given IPM was irrational.  In addition to a specific challenge to
the agency*s assessment of Ferguson-Williams*s staffing plan, IPM argues
that the evaluation of IPM*s proposal was unreasonable under three of the
four technical subfactors, and under the past performance factor. 
Finally, IPM argues that the review of prices and the best value
determination were irrational. 
    
In its comments, IPM shifts its focus from the specifics of the evaluation
to the agency*s ranking of the four proposals in the order shown above,
and to the price/technical tradeoff included in the best value decision. 
Specifically, IPM complains that the agency irrationally ranked Offeror
A*s proposal higher than IPM*s proposal, and then unreasonably limited the
price/technical tradeoff to the two lowest-priced proposals.  In IPM*s
view, the detailed tradeoff should have been between its proposal and the
proposal submitted by Ferguson-Williams, and the IPM proposal should have
been selected for award.
    
In reviewing a protest against an agency*s evaluation of proposals and
award, including tradeoff determinations, we examine the record to
determine whether the agency*s judgment was reasonable and consistent with
the solicitation*s evaluation criteria, and with applicable statutes and
regulations.  Ostrom Painting & Sandblasting, Inc., B-285244, July 18,
2000, 2000 CPD P: 132 at 4.  A protester*s disagreement with the agency*s
determinations as to the relative merit of competing proposals, and its
judgment as to which proposal offers the best value to the agency, does
not establish that the evaluation or source selection was unreasonable. 
Weber Cafeteria Servs., Inc., B-290085.2, June 17, 2002, 2002 CPD P: 99 at
4. 
    
With respect to IPM*s challenge to the agency*s ranking of proposals, the
first table above shows that after completing the evaluations, the agency
ranked the proposals of Ferguson-Williams and Offeror A first and second,
respectively, followed by IPM*s and Offeror B*s proposals.  Since IPM
received an overall rating of *good* while Offeror A*s rating was only
*acceptable,* and since technical merit was more important than price
under the RFP*s stated evaluation scheme, IPM contends that the decision
to rank the proposal of Offeror A higher than the IPM proposal shows that
the agency was improperly emphasizing the importance of price, in
violation of the evaluation scheme.
    
In reviewing this record, we need not consider in detail the reasons for
the rankings assigned these proposals, as we see no evidence that IPM was
prejudiced in any way.   Offeror A*s proposal was rated overall as
*acceptable,* and was also the proposal with the lowest price.  Under
Federal Acquisition Regulation S: 15.308, an agency*s source selection
decision must include the rationale for any tradeoffs made, including the
benefits associated with the additional costs of a higher-priced offer. 
Thus, regardless of whether Offeror A*s proposal was ranked above or below
the proposal of IPM, an explanation of the benefits offered by the
selection of any higher-priced proposal over Offeror A*s lower-priced
proposal was required to be part of any proper price/technical tradeoff
decision.  The selection decision here documents the consideration of
these benefits in great detail.  Memorandum of Source Selection Decision,
supra, at 6-9.
    
Once the agency completed its tradeoff between the lowest-priced proposal
and the higher-rated, higher-priced Ferguson-Williams proposal--a tradeoff
required by regulation, regardless of any assigned ranking--there was no
requirement that it conduct a second tradeoff between the
Ferguson-Williams and IPM proposals.  Bella Vista Landscaping, Inc.,
B-291310, Dec. 16, 2002, 2002 CPD P: 217 at 6, recon. denied, B-291310.2,
Apr. 4, 2003.  Both the Ferguson-Williams and IPM proposals received
overall ratings of *good,* while the IPM proposal was priced approximately
20 percent higher than the proposal submitted by Ferguson-Williams.  As
explained above, the source selection decision document included an
express determination that there was nothing about the two highest-priced
proposals that justified their selection over a proposal with the same
overall rating of *good* (Ferguson-Williams*s proposal), as the
highest-rated of the two higher-priced proposals (IPM*s proposal). 
Memorandum of Source Selection Decision, supra, at 6.
    
In addition, IPM*s argument that there should have been a second detailed
tradeoff analysis between its proposal and the Ferguson-Williams proposal
is premised on an assumption that the IPM proposal, by virtue of the
company*s status as an incumbent, must have been better than the
Ferguson-Williams proposal, even though both proposals received the same
overall rating.  The record here suggests no basis for such an assumption.
    
Our review of the technical approach subfactor ratings awarded to the IPM
and Ferguson-Williams proposals, shown above, gives no clear indication
that IPM*s *good* rating in fact represents a better rating than
Ferguson-Williams*s *good* rating.  Specifically, Ferguson-Williams
received three *good* ratings and one *acceptable* rating under the four
technical subfactors; IPM received one *exceptional* rating and three
*acceptable* ratings.  Without evidence in the record that the IPM
proposal was regarded as superior to the Ferguson-Williams proposal
despite their identical adjectival ratings, we know of no reason the
agency was required to conduct a second tradeoff between these two
offerors with equal overall ratings.  Bella Vista Landscaping, Inc.,
supra.
    
As a final matter, we note that IPM*s comments on the agency report
incorporated each of its initial protest issues and challenges--with one
exception, which it expressly withdrew--but did not provide any
substantive reply to the detailed responses provided by the agency in
answer to the initial challenges.  During the course of this protest,
IPM*s counsel was provided with all of the evaluation materials and the
competing proposals, under our protective order process.  Without a
substantive rebuttal to the agency*s explanations, and given that our
review of the record leads us to conclude that the agency*s positions are
reasonable, IPM has given us no basis for questioning the evaluation
conclusions here.  Atmospheric Research Sys., Inc., B-240187, Oct. 26,
1990, 90-2 CPD P: 338 at 3. 
    
The protest is denied.
    
Anthony H. Gamboa
General Counsel
    
    

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

   [1] The Stratford Army Engine Plant was closed in 1997, after a 1995
review conducted as part of the Base Realignment and Closure process. 
Until the closed facility is turned over to new owners, it must be
maintained by the government.