TITLE: Preferred Systems Solutions, Inc., B-292322; B-292322.2; B-292322.3, August 25, 2003
BNUMBER: B-292322; B-292322.2; B-292322.3
DATE: August 25, 2003
**********************************************************************
Preferred Systems Solutions, Inc., B-292322; B-292322.2; B-292322.3, August 25,
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: Preferred Systems Solutions, Inc.
File: B-292322; B-292322.2; B-292322.3
Date: August 25, 2003
William L. Walsh, Jr., Esq., J. Scott Hommer III, Esq., and Benjamin A.
Winter, Esq., Venable, Baetjer & Howard, for the protester.
J. Michael Slocum, Esq., Slocum & Boddie, for Aaron B. Floyd Enterprises,
Inc., an intervenor.
Patricia A. Papas, Esq., Defense Information Systems Agency, for the
agency.
Charles W. Morrow, Esq., and James A. Spangenberg, Esq., Office of the
General Counsel, GAO, participated in the preparation of the decision.
DIGEST
1. Under procurement that gave technical factors more importance than
cost, source selection decision selecting the low-priced,
technically-inferior proposal as the best value, instead of the
protester*s higher-priced, higher-rated proposal, was not reasonably
based, where the agency did not reasonably explain why the benefits
associated with the evaluated technical superiority of the protester*s
proposal were not worth the price premium and where the source selection
authority was not aware of the actual differences in costs that would be
incurred under the competing proposals.
2. Protest that agency misevaluated proposals under a subfactor which
contemplated a qualitative evaluation is sustained where the proposals
received the same ratings, even though the supporting narrative indicated
that there should be differences in the ratings.
DECISION
Preferred Systems Solutions, Inc. (PSS) protests the award of a contract
to Aaron B. Floyd Enterprises, Inc. (ABF) under request for proposals
(RFP) No. DCA100-03-R-4019, a small business set-aside issued by the
Defense Information Systems Agency (DISA), for technical support services.
We sustain the protest.
The RFP, issued December 23, 2002, sought technical support services on
behalf
of the Joint Staff Support Center (JSSC) to support its Integrated
Information Management System in the areas of operating systems software
support, application support, security analysis and risk assessment, data
communications installation
and management, database management/administration, network
monitoring/administration, visual information systems support, development
and
use of training materials for designated computer systems, and management
of the training process within JSSC.[1] The defined work efforts under
this contract were included in eight separate task orders: (1)
installation and management of data communications networks, (2) systems
administration support, (3) Global Command and Control System (GCCS)
enterprise management services implementation, (4) Automated Information
Systems security support, (5) visual information systems support,
(6) Joint Operations Support Center GCCS Helpdesk Support, (7) GCCS and
National Military Command Center user training support, and (8) Global
Status of Resources and Training System applications user and operation
support. Most of the tasks had a number of sub-tasks.
The RFP contemplated the award of an indefinite-delivery/indefinite
quantity contract, under which either fixed-price,
cost‑reimbursement, or time-and-material task orders could be
issued. The total amount of all task orders issued cannot exceed
$70 million over the base period plus six 1-year options.
The RFP provided for award to the offeror whose proposal *contain[ed] the
combination of factors offering the best overall value to the Government*
and that *[i]n making this evaluation, the Government is more concerned
with obtaining superior technical skills than with making an award to the
Offeror with the lowest proposed price.* RFP S: M.3.c. The following
factors and subfactors were listed in the RFP for proposal evaluation
purposes:
Factor 1: Task Order Competence (Technical Solutions)
Sub-factor A: Corporate Experience
Sub-factor B: Key Personnel Experience
Sub-factor C: Labor Mix Analysis
Factor 2: Corporate Past Performance[2]
Factor 3: Cost and Price
RFP S: M.4.1.a. Task order competence was the most important evaluation
factor,[3] which was followed by corporate past performance, which was
followed by cost/price. The task order competence and corporate past
performance factors were also assessed for risk (high, moderate, or low),
considering the *potential for disruption of service, degradation of
performance, the need for increased Government oversight, as well as the
likelihood of unsuccessful contract performance.* RFP S: M.4.1.e.
The RFP explained that the evaluation of the task order competence factor
would be based on the offeror*s response to the eight task orders,
including each sub-task. Each offeror was required to provide a technical
solution to each task and sub-task by proposing the appropriate
operational, engineering, and associated direct support. For the
corporate past performance factor, offerors were to identify no more than
three relevant contracts performed during the past 3 years.
Cost and price proposals were requested in two forms. First, in section B
of the RFP, offerors were to submit fixed rates for 16 labor categories
for the base and each option period. The agency specified the total hours
and labor mix for these labor categories, which represented the
government*s estimated total contract effort for all eight tasks. In
addition, each offeror had to submit a separate cost proposal for each
task, under which each offeror was to propose its own labor mix and level
of effort for each task. The RFP explained that *[s]ection B and the task
order spreadsheets shall enable the Government to establish a yearly total
amount for each Offeror covering all initial task orders as well as for
all contract types (enabling the Government to decided which contract type
to select for each task order) . . .* RFP S: L.13.c. To determine the
evaluated cost, *[t]he total price of each Task Order is . . . added to
the Section B cost to compute the total price.* RFP S: M.4.2. *Offerors
will be evaluated based on cost reasonableness, cost realism,
affordability, and overall total of the base/option periods to the
Government based on prices in Section B and for the task orders for the
specified task order performance period.* Id.
Five offerors, including PSS and ABF, submitted proposals in response to
the RFP by the January 30, 2003 closing date. A source selection
evaluation board (SSEB) evaluated the proposals under the task order
competence factor, a past performance evaluation board (PPEB) evaluated
proposals under the corporate past performance factor, and a cost team
evaluated the proposed prices and costs. After the initial evaluation,
the agency established a competitive range composed of PSS*s and ABF*s
proposals. DISA conducted written discussions tailored to the weaknesses
and strengths identified in each offeror*s proposal. ABF*s discussions
related to six items involving corporate experience, security, labor mix,
direct labor categories, proposed labor categories, and cost. PSS
received discussions related to three items: security, direct labor
categories, and direct labor rates.[4] See Agency Report, Tab 8,
Discussion Questions.
Final proposal revisions were submitted by each offeror, which were rated
as follows: [5]
+------------------------------------------------------------------------+
| |Factor 1 -- Task Order |Factor 2 -- Past| |
| |Competence |Performance |Cost/Price |
|---+----------------------------+----------------+----------------------|
| | | |Section B Price |
| | | |Total |
| | | |[DELETED] |
|PSS|Blue |Blue |Task Order Total Cost |
| | | |[DELETED] |
| | | |Total Cost/Price |
| | | |[DELETED] |
|---+----------------------------+----------------+----------------------|
| | | |Section B Price Total |
| | | |[DELETED] |
|ABF|Green |Blue |Task Order Total Cost |
| | | |[DELETED] |
| | | |Total Cost/Price |
| | | |[DELETED] |
+------------------------------------------------------------------------+
Agency Report, Tab 13, SSAC Report at 3-5.
To arrive at its ratings, the SSEB rated each task and sub-task response
of the offerors. It supported its ratings in detailed *official consensus
reports* and *evaluator summary reports,* which documented the basis for
each rating, including a detailed discussion of the strengths and
weaknesses under each task and sub-task.[6] PSS*s proposal received
blue/low risk ratings for [DELETED] of the 8 tasks and [DELETED] of the
24 sub-tasks and green/low risk ratings for [DELETED] of the tasks and
[DELETED] of the subtasks; the SSEB found that its proposal exceeded most
statement of work requirements. ABF*s proposal received blue/low risk
ratings for [DELETED] of the tasks and [DELETED] of the sub‑tasks
and green/low risk ratings for [DELETED] of the tasks and [DELETED] of the
subtasks.
The source selection advisory council (SSAC) reviewed the SSEB*s and
PPEB*s evaluation results, as well as the evaluated cost/price, and
recommended award to ABF. None of the specific strengths identified by
the SSEB in distinguishing the proposals was mentioned in the SSAC
report. Although the SSAC recognized PSS*s higher rating and summarized
the proposal ratings under each task, it concluded that *[c]learly, either
offeror can successfully provide [the] services.* Agency Report, Tab 13,
SSAC Report, at 3. The SSAC*s *best value* analysis stated:
As the evaluated ratings of the technical factors and the past performance
factors for the two Offerors become closer, the cost proposal takes on
greater weight. Although the technical proposal of [PSS] was more highly
rated (receiving a score of Blue) than that [of ABF] (receiving a score of
Green), the technical advantages noted in the [PSS] proposal did not merit
the difference in price. Therefore, the cost/price proposed became the
discriminating factor in the source selection decision recommendation.
Id. at 6. No further elaboration was contained in the SSAC Report as to
the nature of PSS*s technical advantages or why they did not merit the
payment of the associated cost/price premium.
After being briefed by the SSAC Chair, the source selection authority
(SSA) selected ABF*s proposal for award. In doing so, the SSA highlighted
ABF*s proposal*s total evaluated price of *[DELETED] . . . derived by
using the Section B and Task Order pricing* and PSS*s total evaluated
price of [DELETED], derived in the same manner. See Agency Report, Tab
14, Source Selection Decision Memorandum, at 2-3. The SSA also concluded
that both proposals *met* the requirements, with ABF*s proposal receiving
a green rating and PSS*s proposal a blue rating for the task order
competence factor. Both proposals were found to contain *numerous
strengths* under this factor: ABF--*most notably addressing the
[DELETED]* and PSS--*[DELETED].* The SSA then stated that both proposals
were *highly rated* with *low risk,* and that *[d]ue to the nearly
equivalent ratings in the non-cost areas, the cost proposed took on
greater weight in the best-value analysis.* Id. at 3. Based on this
analysis, the SSA selected ABF as the best value.
Award was made to ABF on May 6 and this protest followed.[7] PSS*s
protest challenges the agency*s cost/technical tradeoff decision, arguing
that it was undocumented, did not consider PSS*s evaluated technical
advantages and superiority, and gave too much weight to cost/price in
contravention of the RFP*s evaluation scheme, which indicated that the
government was more concerned with obtaining superior technical skills
than selecting the lowest-priced proposal. PSS also contends that, in
making the cost/technical tradeoff determination, the SSA improperly
considered only the total costs of the aggregate of the offerors* section
B and task order pricing, which inflated the actual cost difference
between the two proposals; PSS argues that the actual cost/price
difference between the proposals was not [DELETED] as stated in the source
selection document, but was actually only approximately [DELETED].
In a negotiated procurement, contracting officials have broad discretion
in determining the manner and extent to which they will make use of
technical and cost results. PharmChem Labs., Inc., B-244385, Oct. 8,
1991, 91-2 CPD P: 317 at 4. Federal Acquisition Regulation (FAR) S:
15.308 states:
The [SSA*s] decision shall be based on a comparative assessment of
proposals against all source selection criteria in the solicitation. While
the SSA may use reports and analyses prepared by others, the source
selection decision shall represent the SSA*s independent judgment. The
source selection decision shall be documented, and the documentation shall
include the rationale for any business judgments and tradeoffs made or
relied on by the SSA, including benefits associated with additional
costs. Although the rationale for the selection decision must be
documented, that documentation need not quantify the tradeoffs that led to
the decision.
An agency which fails to adequately document its source selection decision
bears the risk that our Office may be unable to determine whether the
decision was proper. While source selection officials may reasonably
disagree with evaluation ratings and results of lower-level evaluators,
they are nonetheless bound by the fundamental requirement that their own
independent judgments be reasonable, consistent with the stated evaluation
factor and adequately documented. Johnson Controls World Servs., Inc.,
B-289942, B-289942.2, May 24, 2002, 2002 CPD P: 88 at 6.
Moreover, the propriety of a cost/technical tradeoff turns not on the
difference in technical score, per se, but on whether the contracting
agency*s judgment concerning the significance of that difference was
reasonable in light of the solicitation*s evaluation scheme. Where cost
is secondary to technical considerations under a solicitation*s evaluation
scheme, as here, the selection of a lower-priced proposal over a proposal
with a higher technical rating requires an adequate justification, i.e.,
one showing the agency reasonably concluded that notwithstanding the point
or adjectival differential between the two proposals, they were
essentially equal in technical merit, or that the differential in the
evaluation ratings between the proposals was not worth the cost premium
associated with selection of the higher technically rated proposal. Where
there is inadequate supporting rationale in the record for a decision to
select a lower-priced proposal with a lower technical ranking
notwithstanding a solicitation*s emphasis on technical factors, we cannot
conclude that the agency had a reasonable basis for its decision. MCR
Fed., Inc., B-280969, Dec. 14, 1998, 99-1 CPD P: 8 at 5.
Here, as noted above, the SSA*s and SSAC*s source selection documents
reflecting the agency*s best-value analysis did not include any meaningful
analysis of the differentiating features of the two proposals upon which
the SSA based the cost/technical tradeoff. Although the SSA and SSAC
acknowledged PSS*s proposal*s technical superiority under the task order
competence factor, there was no analysis as to why the well-documented
technical superiority of PSS*s proposal with its attendant advantages was
not worth the associated cost/price premium. Instead, the source
selection document simply concluded that the proposals had *nearly
equivalent ratings in non-cost areas,* with no analysis discussing the
SSEB report justifying PSS*s proposal*s superior technical rating. The
general statements in the SSAC*s and SSA*s source selection documents as
to why PSS*s technical superiority did not offset the price/cost premium
fall far short of the requirement to justify cost/technical tradeoff
decisions. See Johnson Controls World Servs., Inc., supra, at 7.
To address the protester*s specific arguments challenging the
cost/technical tradeoff, DISA, in its second supplemental report, filed
over 2 months after the protests were filed, provided a declaration
prepared by the Chairman of the SSAC purporting to describe, for the first
time, the SSAC*s contemporaneous deliberations in this matter. This
declaration discussed three examples of tasks where PSS*s proposal
received a blue rating, explaining why, in the SSAC*s view, the
innovations proposed by PSS to do more than specifically required by the
statement of work were not of great value or did not warrant any increased
expenditure, and asserting that the SSAC did a similar analysis in
determining that the advantages offered by PSS did not offset ABF*s
cost/price advantage. Second Agency Supplemental Report, Tab 35,
Declaration of SSAC Chairman. While we consider the entire record,
including the statements and arguments made in response to a protest, in
determining whether an agency*s selection decision is supportable, we
accord greater weight to contemporaneous source selection materials rather
than documents, such as the SSAC*s Chairman*s declaration, prepared in
response to the protest. Johnson Controls World Servs., Inc., supra.
Because of this late-breaking evidence, we convened a hearing to take
testimony from the SSEB Chairman, SSAC Chairman and SSA regarding the
source selection decision.
The record, including the hearing testimony, established that, even
assuming that the reasons advanced in the SSAC Chairman*s declaration for
finding the specific strengths/advantages in PSS*s technical approach were
not of great value or did not warrant additional expenditures were well
founded--an analysis not evident in the contemporaneous SSAC evaluation
documentation--the SSA responsible for the decision was not cognizant of
this analysis.[8] The record established that the SSA relied exclusively
on the SSAC*s Chairman*s briefing, which included the SSAC*s report and
attached briefing charts, and did not independently review any of the
underlying documentation to make her best-value analysis and source
selection decision. See Hearing Transcript (Tr.) at 277-79. As indicated
above, this documentation did not reasonably support the cost/technical
tradeoff.
There was an oral briefing of the SSA by the SSAC as well. However,
neither the SSA*s nor the SSAC*s Chairman*s testimony established that the
SSA was provided with any detailed discussion as to why the identified
strengths and superiority in PSS*s proposal were not worth the cost/price
premium. For example, the SSA testified that she did not receive any
detailed information concerning the technical merits of the proposals at
this briefing and that regarding the cost/technical tradeoff analysis what
she recalled was *[o]ne offeror was technically rated higher than another
offeror, but because they were both acceptable and because there was a
significant difference in cost, the recommendation was made to go with the
lower technical lower cost [proposal].* See Tr. at 277-78, 282, 285-86.
The SSAC Chairman confirmed that in discussing the matter with the SSA, he
did not attempt to differentiate in detail the underlying basis for the
cost/technical tradeoff as reflected in his subsequent declaration, but
only discussed the process and the basis for the decision in general
terms.[9] See Tr. at 58‑62, 66. Thus, the record shows that the
SSA did not have a reasonable basis for the cost/technical tradeoff.
The record provides a basis for concern about the cost/technical tradeoff
analysis here beyond the lack of documentation. Specifically, the record
raises concern about how the agency took cost into account in that
analysis, how the agency considered the evaluated technical superiority of
PSS*s proposal in its analysis, and whether the source selection decision
was consistent with the RFP*s weighting of technical and cost factors.
Agencies have considerable discretion in determining the particular method
used in evaluating cost or price; however, the method used should, to the
extent possible, accurately measure the cost to be incurred under
competing proposals. Eurest Support Servs., B-285813.3 et al., July 3,
2001, 2003 CPD P: __ at 7. Where the SSA bases his source selection
decision on figures that do not reasonably represent the differences in
costs to be incurred under competing proposals, this source selection is
not reasonably based. See Gemmo Impianti SpA, B-290427, Aug. 9, 2002,
2002 CPD P: 146 at 5-6.
The RFP*s cost/price evaluation scheme essentially provided for adding two
different costs/prices (by Section B rates and by task orders) for
performing the same eight tasks in order to determine the total evaluated
cost/price, essentially doubling the actual contemplated costs under the
contract. This resulted in an evaluated cost/price well in excess of the
contractual cost ceiling of $70 million. In fact, the record shows that
the actual cost difference between the competing proposals was only
approximately [DELETED], rather than the [DELETED] reflected in the source
selection document.
While this evaluation scheme cannot be timely challenged because it was
expressly disclosed in the RFP and was not protested prior to the closing
date for receipt of initial proposals, Bid Protest Regulations, 4 C.F.R.
S: 21.2(a)(1) (2003), we do not believe that the agency could rationally
treat the essentially doubled costs as the actual expected cost of
performance--or, of greater relevance here, that it could treat the
double-counted difference between the cost of the two proposals as the
actual expected cost of obtaining the evaluated technical superiority of
PSS*s proposal. The record shows that the SSA apparently was not
cognizant that utilizing the evaluation scheme does not reasonably
represent the differences in cost to be incurred under competing proposals
when she made her source selection decision. Although the SSAC Chairman
testified that in considering costs the SSAC did focus on the approximate
[DELETED] differential (that is, with the double counting eliminated), and
this factor was made known to the SSA, Tr. at 30-31, 33, 60-61, the record
does not indicate that the SSA was aware of this fact. The only
cost/price figures mentioned in the source selection document were the
aggregate Section B and Task Order pricing totals ([DELETED] and
[DELETED]) (that is, reflecting double counting). Moreover, the SSA
testified that she considered that the delta between the two proposals was
[DELETED] in making her cost/technical tradeoff.[10] Tr. at 241, 244,
279‑80. Since the record shows that the SSA apparently was not
cognizant of the double-counting nature of the cost evaluation scheme,
which exaggerated the actual cost difference between the competing
proposals, we cannot find the cost/technical tradeoff was reasonably
based.
Moreover, the source selection documents, and testimony of the SSA and
SSAC Chairman suggest that the agency may have improperly converted the
source selection to one based upon technical acceptability and low price,
instead of one emphasizing technical superiority and skills as announced
in the RFP evaluation scheme. An agency does not have the discretion to
announce in the solicitation that it will use one evaluation plan, and
then follow another; once offerors are informed of the criteria against
which their proposals will be evaluated, the agency must adhere to those
criteria in evaluating proposals and making its award decision, or inform
all offerors of any significant changes made in the evaluation scheme.
Dewberry & Davis, B‑247116, May 5, 1992, 92-1 CPD P: 421 at 5.
The SSA*s source selection document contains the statement *[d]ue to the
nearly equivalent ratings in the non-cost areas, the cost[s] proposed and
evaluated took on greater weight in the best value analysis,* even though
the record contradicts that the ratings were nearly equivalent.[11] This
evidences that cost has become the predominant basis for award. This is
consistent with the SSA*s testimony that she understood that PSS*s
proposal was superior, but the selection was made based on low cost
because both offers were *acceptable* and because she believed that there
was a *significant difference in cost.* Tr. at 285-86.
The SSAC Chairman, while acknowledging the technical superiority of PSS*s
proposal, testified that the case could not be made for paying the
additional cost because objectively quantifying the advantages in dollar
terms was *nearly difficult and next to impossible.*[12] See
Tr. at 55-56, 68. This is not a reason for failing to perform a
cost/technical tradeoff. First, FAR S: 15.308 expressly states that a
cost/technical tradeoff need not be quantified.[13] More fundamentally,
however, a cost/technical tradeoff requires a comparative assessment of
the proposals considering all of the stated selection criteria, even where
the value of a technically superior proposal cannot be quantified. Beacon
Auto Parts, supra, at 7; see Clean Venture, Inc., B-284176, Mar. 6, 2000,
2000 CPD P: 47 at 7 (agency reasonably found that awardee*s more desirable
past performance was worth price premium). An agency cannot avoid making
a cost/technical tradeoff analysis because of its difficulty, especially
where it has encouraged offerors to compete on the basis of technical
superiority. See Sturm, Ruger & Co., Inc., B‑250193, Jan. 14, 1993,
93-1 CPD P: 42 at 4‑5.
Furthermore, the SSAC Chairman testified that various budgetary
considerations made it difficult to justify spending more money for the
additional capabilities reflected in PSS*s proposal, when ABF*s
lower-priced proposal was acceptable. See Tr. at 89‑90. Based on
the foregoing, it appears on this record that the agency may have
improperly converted the procurement from one which gave greatest weight
to technical factors, to one based upon technical acceptability and low
cost.
In sum, we find that the record does not reasonably support the
cost/technical tradeoff and sustain the protest on this basis.
We also find meritorious PSS*s challenge to the reasonableness of the
agency*s evaluation under the labor mix subfactor of the task order
competence factor, under which PSS*s and ABF*s proposals both received
green ratings for each of the eight tasks. This challenge primarily stems
from the Declaration of the SSEB Chairman in response to the protest in
which he states:
[T]he Labor Mix subfactor did not receive more than a green rating [on]
any offeror[*]s proposals during this evaluation. This is due to a number
of inherent attributes to this subfactor. First, the specific nature of
the work being solicited presents a limited number of possible staffing
solutions. In addition, the labor categories specified in the RFP further
limited possible responses. This subfactor was being used to assess the
offeror[*]s understanding of the work activities and the application of
resources to accomplish this work. Since the understanding of the work is
not inherently something that can be *exceeded*, a green rating was given
if the offeror showed sufficient understanding to perform the requirement.
Agency Report, Tab 23, SSEB Chairman*s Declaration, at 2. PSS maintains
that if the agency had not *capped* possible ratings under this subfactor
at the *green* level, as the declaration indicated was done, and if the
offerors* various labor mixes had been comparatively evaluated, PSS*s
proposal would have received a blue rating under this subfactor.
At the hearing, the SSEB Chairman explained that this statement, which was
meant to offer an explanation as to why the proposals both received a
green rating under this subfactor, was simply inartfully drafted, and that
this subfactor was reasonably evaluated by the SSEB. See Tr. at 307-09.
However, our review of the contemporaneous SSEB evaluation, where both
proposals uniformly received a green rating for this subfactor under each
of the eight tasks, does not support the reasonableness of the SSEB*s
evaluation under this subfactor. For example, despite rating PSS*s
proposal green (acceptable) under this subfactor for each task, the SSEB
stated in its Official Consensus Report for PSS*s Proposal with regard to
certain tasks: *Exceptional Labor mix* and *Offeror*s Labor Mix exceeds
our requirements as outlined in the [statement of work]*--statements that
suggest a blue rating should have been awarded for this subfactor under
these tasks. Agency Report, Tab 9, SSEB Official Consensus Report for
PSS*s Proposal, at 11, 15. The record thus evidences that the evaluation
of this subfactor may have essentially been done on a *go/no go* basis in
derogation of the evaluation scheme, which contemplated a comparative
evaluation under this subfactor. While procuring agencies have broad
discretion in determining the evaluation plan they use, they do not have
the discretion to announce in the solicitation that a factor will be
evaluated for technical merit on a comparative basis and then evaluate the
factor on a go/no go basis. See Trijicon, Inc., B-244546, Oct. 25, 1991,
91-2 CPD P: 375 at 5-7. We therefore sustain the protest on this basis
as well.
PSS raises numerous other protest issues concerning the propriety of the
evaluation of the proposals. While not all of these issues are herein
discussed, we have reviewed them and find them meritless.
For instance, PSS maintains that the agency should have downgraded ABF*s
proposal in the risk assessment based upon the risk associated with
transitioning to another contractor from the incumbent, particularly since
the RFP at section H.32 identified transition as a concern. The agency,
however, advises that the risks associated with the ABF non-incumbent
proposal were considered, but assessed as being low risk because the
*Offeror demonstrated a good understanding of all task areas and provided
an all-around solid proposal with no significant weaknesses.* Agency
Report at 30; Tab 9, Official Consensus Report for ABF*s Proposal, at 1.
We see nothing unreasonable with the agency*s determination in this
regard, given the quality otherwise associated with ABF*s proposal.[14]
PSS also challenges the agency*s evaluation of the corporate past
performance factor, where the agency gave the prime contractor references
equal weight to that given to the totality of the subcontractor
references. The evaluation of past performance is a matter within the
discretion of the contracting agency. In reviewing an agency*s evaluation
of past performance, we will not reevaluate proposals, but instead will
examine the agency*s evaluation to ensure that it was reasonable and
consistent with the solicitation. Sterling Servs., Inc., B-286326, Dec.
11, 2000, 2000 CPD P: 208, at 2‑3. Here, the RFP specifically
advised that the government would assess the offeror*s capability by
evaluating the offeror*s past performance as a prime contractor. See RFP
S: M.4.2.a. Thus, we believe the agency*s method of evaluating past
performance, which attached more weight to the offerors* prime contract
past performance record than that of each of the individual
subcontractors, was reasonable and consistent with the evaluation scheme.
We have also considered PSS*s other allegations challenging the evaluation
of this factor, and find the agency*s evaluation to be reasonable.[15]
PSS also challenges the reasonableness of the agency*s cost evaluation.
For example, PSS asserts that the RFP required offerors* labor rates to be
fully burdened, but ABF submitted labor rates based on the *Economic
Research Institute Salary Assessor* (ERISA),[16] which assertedly did not
include fringe benefits, yet the agency did not consider this in the cost
evaluation. We find no merit to this contention. ABF*s proposal
specifically states that its direct labor rates include a fringe benefit
rate of [DELETED] percent. See Agency Report, Tab 5, ABF Proposal, vol.
III, at 1. Moreover, DCAA examined these proposed labor rates and found
them acceptable. Based on our review, we find the agency*s cost
evaluation to be reasonable.
The protest is sustained.
In view of its budgetary concerns, we recommend that DISA consider whether
or not the solicitation emphasizing technical skills over low price
adequately described the agency*s needs. If the terms in the solicitation
do not, then the agency should amend the solicitation, reopen discussions
if appropriate, obtain revised proposals, and make a new source
selection. If the solicitation*s terms are appropriate, we recommend that
the agency reevaluate proposals under the labor mix analysis subfactor of
the task order competence factor, and make and document a reasoned source
selection determination in accordance with the stated evaluation factors
for award. If a firm other than ABF is selected for award, we recommend
that the agency either terminate ABF*s contract, or, if more appropriate
in light of the state of contract performance at the time, not exercise
the remaining options under ABF*s contract, and make an award for the
remaining period of performance to the successful offeror.[17] We also
recommend that the agency reimburse PSS the reasonable costs of filing and
pursuing the protest, including attorneys* fees. 4 C.F.R. S: 21.8(d)(1).
PSS*s certified claim for costs, detailing the time spent and the costs
incurred, must be submitted to the agency within 60 days of receiving this
decision. 4 C.F.R. S: 21.8(f)(1).
The protest is sustained.
Anthony H. Gamboa
General Counsel
------------------------
[1] JSSC provides operation, systems maintenance, deployment and direct
customer support of information systems to support the Joint Staff, the
Unified and Specified Commands and the Office of the Secretary of Defense.
[2] Under the corporate past performance factor, the elements to be
evaluated were personnel/staffing, cost control, schedule, quality, and
business relations.
[3] Within the task order competence factor, the corporate experience and
key personnel experience subfactors were *comparatively equal* in value,
and the labor mix analysis subfactor was of less importance.
[4] We find no merit to the protester*s contention that it did not receive
meaningful discussions because it did not receive any questions related to
cost/price, as did ABF. The record shows that DISA conducted discussions
pertaining to the weaknesses found in PSS*s proposal, which did not
include any related to cost/price, whereas ABF*s proposal raised questions
in the cost/price area.
[5] The non-cost factors and subfactors were evaluated under a color-coded
rating scheme with possible ratings of blue (proposal exceeds requirements
and clearly demonstrates the offeror*s capability to deliver exceptional
performance), green (proposal is satisfactory and the offeror is capable
of meeting performance requirements), yellow (minimally adequate
proposal), orange (inadequate proposal), and red (highly inadequate
proposal).
[6] Similarly, the PPEB prepared a detailed report supporting the blue
ratings of the two competitive range offerors.
[7] On May 22, DISA determined that urgent and compelling circumstances
justified continuing with performance under the contract, notwithstanding
this protest.
[8] To the extent that the agency has offered the SSAC*s Chairman*s
declaration and testimony as support for the reasonableness of the source
selection decision, we note that this information is only evidence of the
SSAC*s Chairman*s considerations, not the SSA*s, but it is the SSA who is
the agency official that should have engaged in some consideration of the
relative merits and costs of the competing proposals and arrived at a
reasonable conclusion regarding which of the competing proposals
represented the best value to the government. Thus, the declaration may
not properly support the otherwise undocumented decision. See Beacon Auto
Parts, B‑287483, June 13, 2001, 2001 CPD P: 116 at 8.
[9] The SSAC Chairman testified that he attempted to objectively quantify
the advantages flowing from PSS*s higher ratings, but abandoned this
effort because it was *difficult if not impossible* to quantify these
advantages; that this was an *agonizing* process which took approximately
10 days. See Tr. at 55-56, 64, 67-68. However, the SSA testified that
she had no recollection of being made aware of the difficulties of making
a cost/technical tradeoff. See Tr. at 275-76.
[10] As indicated above, in her testimony, the SSA stated that the cost
difference was *significant* and indicated that this became the
determining basis for award. Tr. at 285-86.
[11] As indicated above, ABF*s and PSS*s proposals were not rated *nearly
equivalent* in the non-cost areas. PSS*s proposal received the highest
rating under the most important technical factor, while ABF was rated only
green under this factor. The agency does not argue that these ratings
were not justified. As noted previously, the SSEB found that this rating
was justified because PSS*s proposal exceeded the requirements, and
possessed superior experience. Indeed, the SSAC Chairman*s declaration
and testimony confirmed that PSS*s blue rating was not unfounded or
illusory, but was based on offering *innovative approaches to improving
the JSSC processes and operations.* Second Supplemental Agency Report,
Tab 35, Declaration of SSAC Chairman. Tr. at 42, 45-48.
[12] The SSAC Chairman*s requested the SSEB Chairman for support
justifying the award to the technically superior PSS proposal prior to
briefing the SSA with regard to the source selection, stating *I do not
possess the understanding/knowledge of what is required upon which a
survivable *best value* argument can be based.* In response, the SSEB
Chairman provided several concrete examples of what he believed were cost
savings under the task orders that could be associated with the technical
superiority of PSS*s proposal. See Agency Report, Tab 33, SSAC Chairman*s
Request for and SSEB Chairman*s Analysis of Strengths in PSS*s Proposal.
While at the hearing, the SSAC Chairman testified that he discounted the
SSEB Chairman*s advice because he did not believe that the assumptions
that the new creative and innovative processes that were being proposed by
PSS would result in cost savings were credible (*My experience has been
you don*t realize cost savings by instituting new and creative
processes.*), see Tr. at 42‑44, there was no contemporaneous
evidence of the SSAC*s discounting the SSEB*s analysis, nor is there any
indication that the SSA was apprised that the SSEB Chairman believed that
the strengths in PSS*s proposal would result in cost savings, which the
SSAC discounted. See Tr. at 275-76, 279-82.
[13] As indicated above, the record shows that the SSAC Chairman
acknowledged that he lacked the understanding/knowledge of what is
required for a survivable cost/technical tradeoff, which was apparently
why he believed that an objective quantification of the benefits of PSS*s
technical superiority was required. See Agency Report, Tab 33, SSAC
Chairman*s Request for and SSEB Chairman*s Analysis of Strengths in PSS*s
Proposal.
[14] We find no merit to the protester*s contention that ABF engaged in a
*bait and switch* tactic by allegedly proposing personnel it did not
intend to utilize, inasmuch as ABF proposed that it planned to hire
incumbent personnel where appropriate. See Agency Report, Tab 5, ABF*s
Final Proposal Revision at 18.
[15] For example, PSS argues that the agency*s evaluation was unreasonable
because it did not consider a Department of Defense (DoD) Inspector
General (IG) report that assertedly evidenced that a principal contract
relied upon by ABF reflected poor performance. Our review does not
confirm the validity of this assertion or that the agency was required to
lower ABF*s past performance score on the basis of this report. As noted
by the agency, the DoD IG report audited the overall GCCS system, not
ABF*s contract specifically, and the report does not conclude that ABF
performed poorly on this contract. On the other hand, the agency has
produced information indicating that ABF*s performance under this
particular contract was highly successful.
[16] The ERISA is a database, which contains mean wage and salary
information on various job categories, that can be utilized as guidance
for developing labor rates.
[17] Because the agency overrode the automatic stay on the basis of urgent
and compelling circumstances, we take the ongoing performance into account
in our recommendation.