TITLE:  First Federal Corporation--Costs, B-293373.2, April 21, 2004
BNUMBER:  B-293373.2
DATE:  April 21, 2004
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First Federal Corporation--Costs, B-293373.2, April 21, 2004

   Decision
    
    
Matter of:   First Federal Corporation--Costs
    
File:            B-293373.2
    
Date:              April 21, 2004
    
Richard J. Vacura, Esq., and Peter C. Sales, Esq., Morrison & Foerster,
for the protester.
Seth Binstock, Esq., Social Security Administration, for the agency.
Paul E. Jordan, Esq., and John M. Melody, Esq., Office of the General
Counsel, GAO, participated in the preparation of the decision.
DIGEST
    
Where agency took corrective action (amendment of solicitation and
resolicitation) in response to protest challenging agency*s relaxation of
solicitation*s geographical location requirement, GAO nevertheless will
not recommend reimbursement of protest costs, since relaxation did not
result in competitive prejudice to protester, and corrective action
therefore was not in response to a clearly meritorious protest.
DECISION
    

   First Federal Corporation requests that we recommend that it be reimbursed
the costs of filing and pursuing its protest challenging the award of a
contract to Independent Services Corp. (ISC) under request for quotations
(RFQ) No. SSA-RFQ-03-0159, issued by the Social Security Administration
(SSA) for storage of magnetic media.
    

   We deny the request.
    
The solicitation, a small business set-aside, sought quotations for
transportation and storage of magnetic media from SSA*s National Computer
Center (NCC).  Quotations were to be evaluated on a *best value* basis,
taking into consideration price, experience, past performance, and
acceptability of the proposed facility.  Among other requirements, the RFQ
specified that a proposed facility shall be located not less than 25
miles, point-to-point, from the SSA complex in Woodlawn, Maryland.  The
minimum distance requirement was intended to provide adequate separation
of geographic areas and subsequent protection from fire, flood,
earthquakes, and other acts of nature.  ISC and First Federal submitted
quotations, both of which were found acceptable under all factors,
including the geographic location of their proposed facilities.  The
contracting officer concluded that the quotations were technically equal,
and made award to ISC based on its significantly lower price.  After the
agency denied First Federal*s agency-level protest, it filed a protest
with our Office. 
    
Among other issues, First Federal argued that the award was improper
because a surveyor*s report it obtained indicated that ISC*s facility was
less than 25 miles away from the NCC, and thus did not meet the
geographical restriction in the RFQ.  In its response to the protest, SSA
explained that its evaluator used mapping software from the Internet to
measure the point-to-point distance for each vendor.  Because the NCC is a
secure facility located in a heavily wooded area and is not physically
located near its street address, the evaluator used the software*s zoom
feature to approximate the physical location of the NCC.  Using this
method, he reportedly determined that ISC*s facility was at least 25 miles
away and that the quotation was acceptable.  However, he did not print out
the results of his measurements. 
    
After reviewing the agency*s explanation, we requested that it re-run the
ISC measurements and produce both a printout of that calculation, and a
declaration from the evaluator recounting his methodology in the original
and re-run measurements.  SSA reportedly repeated the evaluator*s
measurement several times using the same methodology as before, but could
not obtain a result showing ISC*s facility to be at least 25 miles away
from the NCC.  According to SSA, it most often obtained a result of 24.4
miles.  Reasoning that another half-mile of distance did not provide any
additional security from acts of nature, SSA determined that the 25-mile
requirement did not reflect its actual needs, and informed us that it
intended to determine its true needs, then amend the specification and
release a new solicitation.  Based on this corrective action, we dismissed
First Federal*s protest as academic  (B‑293373, Jan. 30, 2004). 
    
First Federal now requests that we recommend that it be reimbursed the
reasonable costs of filing and pursuing its protest, including reasonable
attorneys* fees.  Bid Protest Regulations, 4 C.F.R. S: 21.8(e) (2004).  In
its view, the agency unduly delayed taking corrective action on a clearly
meritorious protest. 
    
Where a procuring agency takes corrective action in response to a protest,
we may recommend that it reimburse the protester its protest costs where,
based on the circumstances of the case, we determine that the agency
unduly delayed taking corrective action in the face of a clearly
meritorious protest, thereby causing a protester to expend unnecessary
time and resources to make further use of the
protest process in order to obtain relief.  Pemco Aeroplex, Inc.--Recon.
and Costs, B‑275587.5, B-275587.6, Oct. 14, 1997, 97-2 CPD P: 102 at
5.  We consider a protest to be clearly meritorious when a reasonable
agency inquiry into the protester*s allegations would show that the agency
lacked a defensible legal position, Georgia Power Co.; Savannah Elec. and
Power Co.--Costs, B-289211.5, B-289211.6, May 2, 2002, 2002 CPD P: 81 at
5; that is, that the protest did does not involve a close question.  East
Penn Mfg. Co., Inc.--Costs, B-291503.4, Apr. 10, 2003, 2003 CPD P: 83
at 3.  The mere fact that an agency decided to take corrective action does
not establish that a statute or regulation clearly has been violated. 
Id.      
    
The protest here was not clearly meritorious.  SSA asserts that, since the
RFQ did not state how the point-to-point distances would be measured, and
since the approximately one-half mile deviation is of no value in
providing additional physical security, its calculation, though not
precise, was reasonable.  Agency Response at 2‑3.  In essence, the
agency is arguing that the deviation in IST*s point-to-point distance was
immaterial. 
    
Where a proposal deviates from a specification by a negligible amount, the
agency may waive the requirement, so long as it did not prejudice other
vendors.  Gulf Copper Ship Repair, Inc., B‑292431, Aug. 27, 2003,
2003 CPD P: 155 at 4 (deviation of 1 inch water depth specification
properly waived by agency); Magnaflux Corp., B‑211914, Dec. 20,
1983, 84-1 CPD P: 4 at 3-4 (agency permitted to waive deviation from
specification which was minor and did not result in prejudice); Champion
Road Mach. Int*l Corp., B‑200678, July 13, 1981, 81-2 CPD P: 27 at 4
(deviation of two horsepower is minor and should have been waived by
agency where price, quantity, quality, and delivery were not affected). 
In our view, since the approximately one-half mile deviation from the
25-mile requirement appears minor on its face and, according to SSA, did
not diminish the purpose of the restriction, it could reasonably be viewed
by SSA as negligible.  The deviation therefore was waivable, so long as
First Federal, the only other vendor in the competition, was not
prejudiced.   There is no evidence of competitive prejudice.  In this
regard, while First Federal asserts that the waiver gave ISC an *unfair
competitive advantage,* (Protest at 9), it does not show how it would have
altered its proposal to improve its competitive standing had it been given
an opportunity to respond to the relaxed requirement.  See Copper Ship
Repair, Inc., supra.  For example, it does not assert that knowledge of
the relaxation would have affected its price or the location of its
proposed facility.  Given the absence of any evidence of prejudice to
First Federal, we conclude that the agency had a defensible legal position
and, thus, that the protest was not clearly meritorious.  It follows that
there is no basis to recommend reimbursement of protest costs in this
case. 
    
The request for costs is denied.
    
Anthony H. Gamboa
General Counsel