TITLE:  SWR, Inc., B-292896.3, June 7, 2004
BNUMBER:  B-292896.3
DATE:  June 7, 2004
**********************************************************************
   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

   A 

   Matter of:   SWR, Inc.

   A 

   File:            B-292896.3

   A 

   Date:           June 7, 2004

   A 

   Benjamin M. Bowden, Esq., Albrittons, Clifton, Alverson, Moody & Bowden,
for the protester.

   Maj. Jacqueline B. Posner, Department of the Air Force, for the agency.

   Jacqueline Maeder, Esq., and John Melody, Esq., Office of the General
Counsel, GAO, participated in the preparation of the decision.

   DIGEST

   A 

   1.  Protest that protester*s current contract for same type of corrosion
prevention services as required by solicitation should have been assigned
a performance rating and carried greater weight in past performance
evaluation, is denied where record shows administrator of that contract
reasonably determined that no meaningful performance rating was possible
because protester had performed relatively small portion of the work under
that contract.

   A 

   2.  Protest that awardee*s performance under contract for corrosion
prevention services on tactical vehicles should not have been considered
relevant past performance in evaluation under solicitation for aircraft
corrosion prevention services, is denied where solicitation language did
not limit relevant contracts to those for aircraft corrosion prevention
services.

   DECISION

   A 

   SWR, Inc. protests the award of a contract to U.S. Logistics, Inc. (USL)
under request for proposals (RFP) No. F38610-03-R-0015, issued by the
Department of the
Air Force, Charleston Air Force Base, South Carolina, for aircraft
corrosion prevention cleaning services. SWR principally challenges the Air
Force*s evaluation of its and USL*s past performance/performance risk.

   A 

   We deny the protest.

   A 

   The RFP, issued June 23, 2003 as a set-aside for historically
underutilized business zone (HUBZone) business concerns, contemplated the
award of a fixed-price requirements contract for a base year, with four
1-year options.  The RFP provided for award to the offeror whose
conforming proposal was determined to be the *best value* to the
government, considering past performance/performance risk (pp/pr) and
price, with pp/pr significantly more important than price.  Under the
pp/pr factor, offerors were to submit a description of no more than seven
relevant contracts performed within the last 3 years, and were to have
references complete and separately submit Past Performance
Questionnaires.  RFP at 14-15.  The solicitation defined relevant
contracts as including *but not limited to* contracts for *aircraft
corrosion cleaning and lubrication services . . . of similar scope,
magnitude and complexity to the services required to be performed at
Charleston .A . .A .*  Id.
at 15.  Proposals were to be rated for both performance (exceptional, very
good, satisfactory, marginal, or unsatisfactory) and relevance (not
relevant, relevant, or highly relevant), which would result in an overall
rating of exceptional, very good, satisfactory, none, marginal or
unsatisfactory.  The pp/pr evaluation was to take into account past
performance information regarding subcontractors that would perform major
or critical aspects of the requirement.  Id. at 15, 16. 

   A 

   Eight proposals were received by the closing time, and the agency
conducted telephonic discussions with, and received final proposal
revisions from, the offerors in the competitive range, including SWR and
USL.  The agency considered seven SWR contracts in the pp/pr
evaluation--four were rated not relevant and three highly relevant. 
Agency Report (AR), Tab 11, Overall Risk Assessment Spreadsheet, at 1. 
The highly relevant contracts included a 3-year contract at Kaneoche Bay,
Hawaii, under which SWR*s performance was rated exceptional, and a 5-year
contract at Cherry Point, North Carolina, under which SWR*s performance
was rated marginal.  Id.  The third contract, for services at Westover Air
Force Base, Massachusetts, was not assigned a performance rating.  In
evaluating USL under the pp/pr factor, the agency considered two USL
contracts and eight contracts for USL*s subcontractor, Vertex Aerospace. 
Both of USL*s contracts were rated relevant; five of Vertex*s contracts
were rated relevant, two very relevant, and one not relevant.  Id. at 2. 
Based on these ratings, the agency assigned SWR and USL overall risk
ratings, respectively, of satisfactory and very good.  AR, Tab 12,
Integrated Assessment Best Value Decision, at 2.  Although USL*s offered
price--$ 7,983,805--was approximately $374,000 higher than
SWR*s--$7,609,906--the agency determined that USL*s pp/pr rating offset
SWR*s price advantage, and made award to USL.  Id. at 1, 14. 

   A 

   SWR PAST PERFORMANCE

   A 

   SWR alleges that the Air Force failed to appropriately evaluate its
current relevant past performance under the Westover contract, which
requires *substantially the same services* as the requirement here. 
Protest at 2.  SWR suggests that its performance under the Westover
contract, coupled with its performance at Kaneoche Bay, supports the
position that its problems at Cherry Point were an *anomaly,* and that its
overall rating should be higher.  Protester*s Comments at 5.

   A 

   The evaluation of proposals is a matter within the contracting agency*s
discretion, since the agency is responsible for defining its needs and the
best method of accommodating them.  Eastern Colorado Builders, Inc.,
B-291332, Dec. 19, 2002,

   2003 CPD P 17 at 2.  Thus, in reviewing an agency*s evaluation, we will
not reevaluate proposals; rather, we will examine the record to ensure
that the evaluation was reasonable and in accordance with the stated
evaluation criteria and applicable procurement laws and regulations.  Id.

   A 

   The evaluation here was unobjectionable.  As noted above, the Westover
contract was referenced in the Overall Risk Assessment Spreadsheet, a
summary of the contracts reviewed for each competitive range offeror that
generally includes the rating, relevance, and value of each contract. 
While the Spreadsheet indicates that the agency rated the Westover
contract as highly relevant, it included no assigned evaluation rating for
the contract.  The agency explains that this is because, notwithstanding
that the contract administrator and flight chief for that contract were
*very happy* with SWR*s performance to date, AR, Tab 12, Integrated
Assessment Best Value Decision, at 11, the contract administrator believed
there was too little data for a meaningful evaluation.  AR, Tab 2,
Contracting Officer*s Statement, at 2.  In this regard, the Air Force
reports that the Westover contract calls for 300 aircraft washings per
year and that, at the time the agency evaluated SWR*s past performance,
SWR had performed only 9A washings.  As a result, the contracting officer
explains, the Westover contract was not assigned a performance rating and
was not weighted as significantly as other SWR contracts.  AR, Tab 2,
Contracting Officer*s March, 2004 Statement, at 3.  We find nothing
unreasonable in the agency*s judgment.  We think the agency reasonably
could determine that, given SWR*s brief performance on the Westover
contract at the time of the pp/pr evaluation, the fact that the firm so
far was performing well was not sufficient to offset the concerns raised
by SWR*s performance of the Cherry Point contract.  We conclude that both
the agency*s evaluation of the Westover contract and its overall rating
for the protester were reasonable.

   A 

   USL PAST PERFORMANCE

   A 

   SWR alleges that the agency misevaluated the relevance of USL*s prior
contracts and that, as a result, its pp/pr rating was improperly
inflated.  Specifically, the protester asserts that USL has not performed
any contracts for aircraft corrosion prevention services, and that its
past performance consists solely of experience as a subcontractor
maintaining and washing tactical vehicles and aerospace ground equipment
for the U.S. Army.  Supplemental Protest at 2.

   A 

   This aspect of the evaluation was unobjectionable.  As noted above, the
solicitation defined relevant contracts as *including, but not limited to*
contracts requiring aircraft corrosion cleaning and lubrication services
of the same scope, magnitude and complexity as required under the instant
solicitation.  RFP at 15.  Based on this language, the agency properly
could determine that different types of contracts were relevant for
purposes of the pp/pr evaluation; the protester*s interpretation
essentially ignores the *not limited to* language.  The agency explains
that it found USL*s work on tactical vehicles relevant because it involved
*much of the magnitude and complexity that this solicitation requires with
respect to corrosion control measures (to include corrosion
identification, wash services, prevention, and abatement, fleet servicing,
maintenance, modification, repair and vehicle upgrade).*  AR, Tab 2,
Contracting Officer*s March, 2004 Statement, Addendum 1, at 1.  The
agency*s determination of relevance was consistent with the RFP language,
and was reasonable.

   A 

   TEAMING ARRANGEMENT INFORMATION

   A 

   SWR alleges that USL*s proposal failed to include adequate information
about its arrangement with its subcontractor.  Specifically, SWR asserts
that the teaming agreement USL provided fails to specify the
responsibilities of each firm and the extent of each firm*s participation,
and that the agreement shows that USL*s contribution to staffing is
improperly capped at 49 percent, leaving Vertex to furnish more than half
of the staffing.  In this regard, the RFP incorporated by reference the
clause at Federal Acquisition Regulation (FAR) S 52.219-14, Limitation on
Subcontracting, which provides that, in a contract for services, at least
50 percent of contract costs for personnel shall be incurred by the prime
contractor.  RFP at 12.

   A 

   This argument is without merit.  The RFP required offerors proposing a
teaming arrangement to *provide complete information as to the
arrangement.*  RFP at 15, 16.  The teaming agreement in USL*s proposal
lists Vertex as USL*s  subcontractor, gives the addresses of the prime
contractor (USL) and the subcontractor (Vertex), and specifies that, among
other things, USL will provide day-to-day management, tools, equipment,
and vehicles necessary to accomplish the work, be the primary contact with
the customer, and bear responsibility for financial funding and billing. 
USL Proposal, Tab 7, Teaming Agreement, at 1, 2, 7 and exh.1, at 1.  This
information appears sufficient to permit the agency to understand how USL
and Vertex will partition and perform the contract work; the RFP required
no other specific information.  Further, contrary to the protester*s
characterization of the staffing breakdown between USL and Vertex, the
agreement actually states that *USL will give Vertex no less [than] 25%,
but up to 49% of the manning requirements.*  Id., exh.1, at 1.  This
breakdown is consistent with FAR S 52.219a**14.  Thus, the awardee meets
the subcontracting regulatory requirement, noted above, since USL will
perform no less than 51 percent of the contract, and Vertex will perform
no more than 49 percent.[1]

   A 

   USL FINANCIAL HISTORY

   A 

   The RFP advised that the agency would consider the offerors* financial
history as part of the pp/pr evaluation, including past payments to
suppliers and/or contractors, company credit history with banks and other
lending institutions, timely payments to employees and other
business-related accounts with federal, state, or local governments.  RFP
at 15.  SWR argues that the agency failed to fully consider USL*s
financial history in the evaluation.  Protest at 3; Protester*s Comments
at 5. 

   A 

   The record shows that the agency included only one question, regarding
timely payment of subcontractors and suppliers, on its past performance
questionnaire, and the Air Force states that it *was never [its] intent to
perform a detailed financial analysis of all offerors, since an official
determination of a small business*s overall financial capability is
reserved for the U.S. Small Business Administration . . . .*  AR,A Tab 2,
Contracting Officer*s March, 2004 Statement, at 4.  Instead, the agency
contacted USL*s bank to verify financial information only after it
determined to award to USL, as part of its assessment of USL*s
responsibility.  The record shows that the bank*s vice president provided
the agency with USL*s approximate balance, its average balance, and its
history of overdrafts.  While USL had an initial line of credit to
establish its business, this line of credit has been canceled because the
firm has not had to borrow again.  The vice president stated that USL has
an *excellent relationship* with the bank.  AR, Tab 13, Determination of
Contractor Responsibility, at 1. 

   A 

   While the agency states that it did not intend to perform a detailed
evaluation of the offerors* financial history, the solicitation required
it to do so; because the agency did not consider all of the listed
information in the evaluation, the evaluation was inconsistent with the
solicitation.  However, competitive prejudice is a necessary element of
every viable protest; where the record does not demonstrate that the
protester would have had a reasonable chance of receiving the award but
for the agency*s actions, we will not sustain the protest.  Base Techs.,
Inc., Ba**293061.2, Ba**293061.3, Jan. 28, 2004, 2004 CPD P 31 at 10 n.16;
see Statistica, Inc. v.A Christopher, 102 F.3d 1577, 1581 (Fed. Cir.
1996).  There is no showing of prejudice here, since the agency ultimately
gathered and reviewed USL*s relevant financial information in connection
with its responsibility determination, and that information was all
positive.  Thus, had the information been incorporated into the pp/pr
evaluation as the RFP required, there is no reason to believe that it
would have had a negative effect on USL*s evaluation or on the award
decision.  Accordingly, this argument does not provide a basis for
sustaining the protest.

   A 

   The protest is denied.

   A 

   Anthony H. Gamboa

   General Counsel

     

   A 

   A 

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

   [1]SWR asserts that, regardless of how USL characterizes its arrangement
with Vertex, the arrangement must be treated as a joint venture under
Small Business Administration (SBA) regulations, and that, since Vertex is
not a HUBZone small business, USL did not qualify as a HUBZone small
business and was ineligible for award.  This matter is not for our
consideration.  Under 15 U.S.C. S 637(b)(6) (2000), SBA has conclusive
authority to determine matters of size status for federal procurement
purposes and our Office will neither make nor review size status
determinations.A  Bid Protest Regulations, 4 C.F.R. SA 21.5(b)(1)
(2004).A  Similarly, SBA is the designated authority for determining
whether a firm is an eligible HUBZone small business concern, and it has
established procedures for interested parties, including procuring
agencies, for challenging a firm*s status as a qualified HUBZone small
business concern. 15 U.S.C. SS 632(p)(5)(A), 657a (c)(1) (2000); 13 C.F.R.
SSA 126.503, 126.801 (2004); Federal Acquisition Regulation (FAR) SS
19.306, 19.1303.A  As a consequence, our Office will neither make nor
review HUBZone status determinations.  Ashe Facility Servs., Inc.,
B-292218.3, B-292218.4, Mar. 31, 2004, 2004A CPD P __.