TITLE: Locus Technology, Inc., B-293012, January 16, 2004
BNUMBER: B-293012
DATE: January 16, 2004
**********************************************************************
Locus Technology, Inc., B-293012, January 16, 2004
Decision
Matter of: Locus Technology, Inc.
File: B-293012
Date: January 16, 2004
Ragnhild Larkins for the protester.
Mike Colvin, Department of Health and Human Services, for the agency.
Jennifer D. Westfall-McGrail, Esq., and Christine S. Melody, Esq., Office
of the General Counsel, GAO, participated in the preparation of the
decision.
DIGEST
Protest challenging proposal evaluation is sustained where record reveals
that agency failed to consider significant portions of protester*s revised
proposal in its evaluation and failed to consider offerors* prices in
source selection decision.
DECISION
Locus Technology, Inc. protests the rejection of its proposal and the
issuance of a purchase order to Topaz Technologies, Inc. under request for
proposals (RFP) No. NHLBI-PS-2002-105, issued by the National Institutes
of Health (NIH)/National Heart, Lung, and Blood Institute for animal
facility management software for NIH*s Veterinary Research Program (VRP).
We sustain the protest.
The RFP, which was originally issued on August 21, 2002, sought
commercially available software to assist the VRP in managing its animal
facilities and resources. The RFP specified required functionalities of
the software pertaining to animal health, animal husbandry, animal
husbandry reporting, animal procurement, protocol management, protocol
reporting, billing for services, query, and additional functionality. For
example, under the heading animal husbandry, the RFP required the ability
to collect data on animal holding; to create a species room inventory; to
enter census records manually; and to scan, track and report census data
electronically from a barcode reading device.
The solicitation instructed offerors to format their technical proposals
*to clearly identify that the proposed commercially available
off-the-shelf (COTS) *Animal Facility Management Software* meets/does not
meet the requirements of the statement of work,* and to indicate whether
the proposed commercially available software required customization to
meet the RFP*s requirements. RFP at 20. The RFP advised offerors that
they would be required to provide an *active demonstration* of their
software. It also instructed them to submit past performance information.
The RFP provided for award to the responsible offeror whose proposal was
determined most advantageous to the government, price and other factors
(technical approach, product demonstration, and past performance)
considered.[1] The RFP did not specify the relative importance of the
evaluation factors.
Five offerors, including Locus, submitted proposals by the closing date,
as extended, of September 16, 2002. The contract specialist contacted
Locus by e-mail on November 18, and again on November 19, to schedule its
product demonstration and to seek supplemental and clarifying information
regarding its proposal.[2] Locus*s demonstration was scheduled for
December 4, and Locus submitted additional information in response to the
contract specialist*s inquiries by e-mail message of December 5.
The technical evaluation panel (TEP) convened on January 16, 2003.
Proposals were evaluated in accordance with the following point scheme:
Evaluation factor Maximum available points
Technical proposal/approach 25
Product demonstration 55
Past performance 20
Technical scores ranged from a high of 77.3 for Topaz to a low of 40.5 for
Locus. The discrepancy between the two offerors* scores was almost
entirely attributable to the differences in their scores under the two
areas: (1) the technical proposal/approach factor, under which Locus
received only 5.3 (of 25) points, due in large part to the protester*s
perceived failure to identify clearly in its written proposal the
requirements of the statement of work that its software did or did not
meet; and
(2) their scores under the past performance factor, under which Locus
received a score of 0 (of 20) points, apparently based on its failure to
submit past performance references with its initial proposal. Under the
product demonstration factor, the two proposals received similar scores.
Despite the range of scores, the evaluators determined all proposals to be
technically acceptable and recommended that all be included in the
competitive range.
The procurement was placed on hold between January and May of 2003 while
the VRP conducted an assessment of its information technology needs; then,
on May 21, the VRP notified offerors via e-mail (without explanation as to
the basis for the action) that the solicitation had been cancelled.
Approximately 2 months later, in late July, the contract specialist
notified offerors, apparently via telephone, that the solicitation had
been reopened.[3] Offerors were given the opportunity to revive and
revise their proposals, to furnish updated information regarding their
software and technical capabilities, and to provide a demonstration of
their upgraded/updated product.[4] On August 8, Locus provided a
PowerPoint demonstration of updates to its software and submitted a
revised/updated proposal, which included updated past performance
information.
It is unclear what transpired upon receipt of the revised proposals.
While in the agency*s report on the protest the contracting officer
responds as if Locus*s revised proposal had been evaluated, as discussed
below, the contemporaneous documentation furnished does not support this
position.
By memorandum dated September 12, 2003, the project officer recommended
award to Topaz based on its superior technical proposal, its strong past
performance, and the high quality of its software products and
technology. Memorandum from Project Officer to Contract Specialist at 1.
The memorandum summarized the strengths of Topaz*s proposal and the
weaknesses of Locus*s, but included no discussion of other offerors*
proposals and made no reference to price (other than to recommend award to
Topaz at its proposed price of $159,000).[5]
On September 30, the contracting officer issued a purchase order in the
amount of $82,000 for some, but not all, of the items proposed by Topaz.
In this connection, while Topaz proposed two software programs (with
support and training for both) to satisfy the RFP*s requirements, the
agency was able to fund the purchase of only one of the programs at the
time of award *due to budgetary constraints.* Contracting Officer*s
Statement at 5. The contracting officer notes that the remaining items
are to be purchased when funds become available.
By letters dated September 30 and received by the protester, via regular
mail, on October 6, the contracting officer notified Locus of the award to
Topaz and furnished it with a written debriefing. Locus protested to our
Office on October 8. The agency reports that it did not suspend
performance upon receipt of the protest because Topaz*s product was
*delivered and accepted* on October 6. Agency Report at 3.
Upon receipt of Locus*s protest, which (among other things) objected to
the evaluation of the protester*s past performance, the TEP agreed to
award the protester an additional 5 points under the past performance
evaluation factor, raising its overall score from 40.5 to 45.5. According
to an October 10 memorandum from the project officer to the contract
specialist:
The Technical Evaluation Panel determined that while Locus Technology,
Inc.*s *Colony* product, the product upon which they based their past
performance references, is NOT a good fit for our technical needs, and
that the product that they demonstrated and offered to us, *Facility,*
does not address the various and sundry current needs of our end users,
Locus Technology, Inc. has successfully demonstrated that they possess a
client base and have successfully sold their products to the government.
The contracting officer concluded that despite the increase in Locus*s
technical score, Topaz*s proposal continued to represent the best value to
the government.
In considering a protest such as Locus*s objecting to an agency*s
evaluation of proposals, we will not reevaluate the proposals, but will
instead review the record to determine whether the evaluation was
reasonable and consistent with the terms of the solicitation and
applicable procurement statutes and regulations. Atlantic Research Mktg.
Sys., Inc., B-292743, Dec. 1, 2003, 2003 CPD P: __. As explained below,
we see material flaws in the agency*s evaluation of Locus*s proposal.
First, it is apparent from the record that the agency failed to consider
significant portions of Locus*s final revised proposal in the evaluation.
With regard to the technical proposal/approach evaluation factor, under
which Locus*s proposal was significantly downgraded, the record simply
does not establish that the agency*s evaluation even considered the
revisions Locus made in its initial proposal. The contemporaneous
evaluation record consists of two documents, the Evaluation Summary Report
(ESR) and the Recommendation of Award prepared by the project officer.[6]
While the members of the TEP who signed the ESR dated their signatures in
late August or September 2003, the date on the first page of the ESR is
January 16, 2003, and the subject line of the report reads *Initial
Technical Evaluation Report.* As noted above, initial proposals were
submitted in September 2002, and revisions to those proposals were
submitted in early August 2003. Thus both the date and the subject line
on the ESR itself indicate that the document in fact reflects evaluation
findings based on the initial proposals.
More important, the actual narrative describing the evaluators* findings
with regard to Locus*s proposal in no way acknowledges that Locus
submitted revisions; on the contrary, the observations reflect only the
initial proposal. Thus, for example, the ESR notes that Locus*s
*technical proposal included statement *N/A* as response to many specific
government requirements.*[7] ESR at 4. The record shows, however, that
while Locus*s initial proposal did use the notation *N/A* in response to
two of the ten specific requirements listed in the solicitation (protocol
management and *query*), the protester*s revised proposal included no
notations of *N/A,* instead adding brief statements responding to the two
requirements to which it had initially responded *N/A.* In our view, the
statement in the ESR regarding Locus*s *N/A* notations can only be
interpreted to mean that the evaluation reflected therein, and on which
the award recommendation was made, was based on review of only Locus*s
initial proposal.
This conclusion is further supported by the discussion in the ESR of the
second evaluation factor, product demonstration. The narrative in the ESR
regarding Locus*s product demonstration clearly relates to a live
demonstration, apparently conducted in December 2002. An opportunity for
a second product demonstration was offered in connection with revised
proposals, in August 2003. The contracting officer*s post-protest
submission describes the second product demonstration that Locus provided
as a *static *PowerPoint* presentation and not a live demonstration.*
Contracting Officer*s Statement at 7. All the comments in the ESR relate
to a live, not a *static,* demonstration, however, further confirming that
the findings in the ESR do not reflect consideration of Locus*s revised
proposal.
Similarly, with regard to the past performance factor (under which Locus
received zero points), it is clear that the agency failed to consider
Locus*s revised proposal in the evaluation. In this regard, the ESR
states that Locus *did not furnish references for evaluation of past
performance after multiple requests.* ESR at 6. In fact, Locus submitted
a list of 11 references with its final revised proposal. While the agency
purported to acknowledge and remedy this error after receipt of Locus*s
protest by raising the protester*s score under the past performance
evaluation factor from
0 to 5, even the memorandum summarizing the corrective action taken
ignores the content of Locus*s final revised proposal, incorrectly stating
that Locus*s past performance references were for its *Colony* product
when, in fact, a majority of the references were for the *Facility*
software offered by Locus in response to the RFP here.
Next, there is no evidence in the contemporaneous record that the
contracting officer performed a proper price/technical trade-off--or, for
that matter, even considered offerors* prices--prior to selecting Topaz
for award. There is no evaluation of offerors* prices--on either an
individual or comparative basis--in any of the source selection
documentation. This is contrary to the requirement that price be
considered in every source selection decision, 41 U.S.C. S: 253a(c)(1)(B)
(2002); Federal Acquisition Regulation (FAR) S: 15.304(c)(1), and the
requirement that a source selection decision be based on a comparative
assessment of proposals against all source selection criteria in the
solicitation and that it be documented. FAR S: 15.308; Beacon Auto Parts,
B-287483, June 13, 2001, 2001 CPD P: 116 at 7. Furthermore, even the
contracting officer*s post-protest trade-off analysis rests upon the
incorrect assumption that technical factors were entitled to considerably
greater weight than price in determining best value under this
solicitation. In this regard, the contracting officer states as follows:
Based on the order of importance of the evaluation factors for an award,
technical factors are of paramount consideration; it is clear to the
Contracting Officer that the difference in costs did not outweigh Topaz*s
technical superiority to Locus.
Contracting Officer*s Statement at 11. This is contrary to our
well-settled rule that where, as here, a solicitation fails to specify the
relative weights of technical and price factors, it must be presumed that
they are of equal weight. Intermagnetics Gen. Corp., B-286596, Jan. 19,
2001, 2001 CPD P: 10 at 8, n. 7.
In sum, because the agency essentially ignored Locus*s revised proposal
and failed to consider price in the evaluation, we sustain the protest.
Since the software has already been delivered and accepted, termination of
Topaz*s order is no longer an available remedy. Rotair Indus., Inc.,
B-232702, Dec. 29, 1988,
88-2 CPD P: 636 at 3. Accordingly, we do not recommend that the agency
reevaluate proposals. Instead, as in other cases where remedial action is
no longer practicable, we recommend that Locus be reimbursed its proposal
preparation costs. Bid Protest Regulations, 4 C.F.R. S: 21.8(d)(2)
(2003). We also recommend that the protester be reimbursed for the costs
of filing and pursuing its protest. 4 C.F.R. S: 21.8(d)(1). In
accordance with our regulations, Locus*s certified claim for such costs,
detailing the time expended and the costs incurred, must be submitted
directly to the agency within 60 days after receipt of the decision.
The protest is sustained.
Anthony H. Gamboa
General Counsel
------------------------
[1] The RFP was inconsistent on its face in that it provided for the
evaluation of proposals on the basis of technical approach, product
demonstration, and price, i.e., it did not list past performance as an
evaluation factor, but elsewhere stated that *[t]echnical and past
performance, when combined, are 100 points.* RFP at 19. There is no
indication that the protester was misled by the inconsistency into
assuming that past performance would not be considered in the evaluation.
[2] The propriety of these contacts is not an issue in this protest.
[3] There is no record of the contract specialist*s communication in the
agency file; there is, however, a copy of a July 30 e-mail message from
the protester to the contract specialist acknowledging his telephone call
notifying the protester of the reopening of the competition.
[4] Again, there is no contemporaneous record documenting the agency*s
actions.
[5] Locus*s final revised price was $50,000.
[6] Since the latter document is evidently based on the ESR, any
deficiencies in the ESR likewise make the award recommendation flawed.
[7] This point is repeated by the contracting officer in both the written
debriefing and in her statement in response to the protest, as support for
the evaluators* findings regarding Locus*s proposal. Debriefing Letter at
2; Contracting Officer*s Statement at 6.