TITLE:  Ben-Mar Enterprises, Inc., B-295781, April 7, 2005
BNUMBER:  B-295781
DATE:  April 7, 2005
**********************************************************************
   Decision

   Matter of:   Ben-Mar Enterprises, Inc.

   File:            B-295781

   Date:              April 7, 2005

   David R. Moffitt, Esq., Saul Ewing, for the protester.

   Daniel S. Koch, Esq., and David P. Shapiro, Esq., Paley, Rothman,
Goldstein, Rosenberg, Eig & Cooper, for Tech Systems, Inc., an intervenor.

   Talbot J. Nicholas II, Esq., Department of Homeland Security, for the
agency.

   Linda S. Lebowitz, Esq., and Michael R. Golden, Esq., Office of the
General Counsel, GAO, participated in the preparation of the decision.

   DIGEST

   Where proposals were reasonably evaluated as technically equal, agency
properly selected for award the proposal of the firm submitting the lower
price.

   DECISION

   Ben-Mar Enterprises, Inc. protests the award of a contract to Tech
Systems, Inc. (TSI) under request for proposals (RFP) No.
HSCG23-04-R-PUD642, issued by the Department of Homeland Security for
fitting, alteration/tailoring, and garment pressing services at the United
States Coast Guard Training Center in Cape May, New Jersey.  Ben-Mar
challenges the evaluation of TSI's substantially lower-priced proposal.

   We deny the protest.

   The RFP, issued on August 23, 2004, contemplated the award of a
fixed-price, indefinite-delivery/indefinite-quantity contract for a base
period and four 1-year option periods to the offeror whose proposal
represented the best value to the government, considering technical
evaluation factors and price.  The RFP listed, in descending order of
importance, the following technical evaluation factors, as well as the
technical evaluation subfactors, which were of equal importance: 
(1)A technical understanding and capability (performance processes and
facilities and equipment); (2) relevant past performance (product quality,
timelines, cost control, and customer satisfaction); and (3)A program
management (staffing plan, quality control plan, and loading of
"accession" personnel, i.e., Coast Guard trainees entering military
service).  With respect to "relevant past performance," the RFP stated
that

   Offerors shall provide relevant past performance information to include
five references and related information to include (the contract number,
type, dollar value, period of performance, description, technical and
contracting points of contact, telephone/fax and e-mail contact
information, and any other related information).  Past performance
information that is older than three years after completion of a contract
will not be evaluated.

   RFP at 41.

   The RFP also stated that "[i]f an offeror does not have relevant past
performance, the Coast Guard will not evaluate the offeror favorably or
unfavorably on this factor."  RFP at 42.

   The RFP stated that the technical evaluation factors, when combined, would
be considered significantly more important than price.

   Ben-Mar, the incumbent contractor for the past 20 years, and TSI, which
has a current contract to fit and alter garments for Air Force trainees at
Lackland Air Force Base (AFB) in Texas, submitted initial proposals, both
of which were included in the competitive range.  The consensus
evaluation[1] results for initial proposals were as follows:[2]

   +------------------------------------------------------------------------+
|A                               |Ben-Mar            |TSI                |
|--------------------------------+-------------------+-------------------|
|Technical Understanding/Approach|Green/Satisfactory |Yellow/Marginal    |
|                                |                   |                   |
|                                |Low Risk           |Moderate Risk      |
|--------------------------------+-------------------+-------------------|
|Relevant Past Performance       |Green/Satisfactory |Green/Satisfactory |
|                                |                   |                   |
|                                |Low Risk           |Low Risk           |
|--------------------------------+-------------------+-------------------|
|Program Management              |Green/Satisfactory |Green/Satisfactory |
|                                |                   |                   |
|                                |Low Risk           |Low Risk           |
+------------------------------------------------------------------------+

   With respect to price, Ben-Mar's price was more than twice TSI's price and
approximately 7 percent higher than the government estimate, which was
based on Ben-Mar's historical prices as the incumbent contractor.  TSI's
price was approximately 50A percent of the government estimate.  AR, Tab
8, Prenegotiation Memorandum, at 3. 

   With respect to Ben-Mar, the agency concluded that the firm satisfied all
of the RFP's technical requirements and that there were no areas in
Ben-Mar's initial technical proposal that required discussion.  In this
regard, the agency concluded that Ben-Mar, the successfully performing
incumbent contractor for the past 20A years, clearly demonstrated its
technical understanding and capability to perform the CoastA Guard
requirements.  Among other things, the agency noted that Ben-Mar had
established a "fitting" procedure that expedites the measuring process to
benefit training personnel and that Ben-Mar had established its ownership
of the equipment necessary to perform the RFP requirements.  Regarding
past performance, the agency noted that Ben-Mar, as the successfully
performing incumbent contractor, clearly demonstrated its ability to
repeatedly deliver quality services on time and under adverse conditions. 
Regarding program management, the agency noted that Ben-Mar's proposed
general manager, a former Coast Guard warrant officer, has been with the
firm for 19 years and was very familiar with the Coast Guard organization
and the details and importance of uniform requirements.  In addition, the
agency noted that Ben-Mar demonstrated a strong quality control inspection
protocol in describing the functions of its employees and that Ben-Mar
demonstrated its ability to handle varying size ranges of training
personnel, making sure that the required services were accomplished in a
timely manner.  Id. atA 4-5.  While the agency determined that there were
no areas in Ben-Mar's initial technical proposal requiring discussions,
the agency nevertheless decided to advise Ben-Mar during discussions that
its price was "slightly higher" than the government estimate. 
Id.A atA 7.        

   With respect to TSI, for the technical understanding and capability
evaluation factor, the agency noted that the firm currently performs
"similar" work at Lackland AFB, although the Air Force requirements did
not appear to be as extensive as the CoastA Guard requirements.  The
agency believed that TSI did not provide sufficient detail in its initial
technical proposal to demonstrate its ability to perform complex work,
such as work on service dress blue coats which are considered "specialized
work," requiring expert and experienced tailoring skills and possibly
requiring "re-building an issued coat or building a new coat from the
cutting stage to the finished garment" using industry manufacturing
techniques.  Id. at 5-6.  In addition, while TSI proposed to employ a
master tailor who has performed work on dress coats, the agency believed
that this individual's stated responsibilities appeared to be more
administrative in nature, rather than reflecting the skills necessary to
perform complex coat fittings and alterations.  Moreover, the agency
believed that TSI did not provide sufficient detail to clearly explain its
manufacturing techniques, particularly with respect to complex
alterations.  Finally, the agency had some concern with respect to whether
TSI understood that the contractor, not the government, was required to
furnish all of the alteration equipment necessary to satisfy the RFP
requirements.

   With respect to past performance, the agency pointed out that TSI has
performed other military uniform fitting and alterations work, citing the
favorable performance evaluation from Lackland AFB.  In this respect, the
reference from Lackland AFB described the work performed by TSI as
"[1-]day fitting and alteration of Air Force service uniforms for an
estimated 35,000 recruits yearly."  AR, Tab 7, Past Performance Reference
for TSI, Lackland AFB.  The reference reported that TSI delivered fittings
and alterations on schedule; that the quality of the products delivered by
TSI received high praise from the customers; and that no performance
problems were encountered with TSI.  The reference reported that he would
hire TSI again, commenting that TSI "is very responsive to any change or
modifications to service requirements," with TSI "[c]ontinually looking
for ways to improve the service."  Id.

   With respect to the program management evaluation factor, the agency noted
that TSI clearly demonstrated a good staffing plan layout and described
how its employees would be monetarily rewarded for quality performance. 
In addition, the agency noted that TSI proposed to send a conversion
manager from its Lackland AFB operations to the Coast Guard's training
center in order to minimize the risks associated with transitioning to
another contractor; that TSI described its plan to review employee job
performance and to correct performance deficiencies as they occurred in
order to ensure timely and immediate resolution; that TSI described how it
would use feedback from Coast Guard trainees; and that TSI described its
use of overtime and/or seasonal crews to accommodate surge requirements. 
AR, Tab 8, Prenegotiation Memorandum, at 7.  Based on the evaluation of
TSI's initial technical proposal, the agency determined that the areas to
be discussed with TSI involved the technical understanding and capability
evaluation factor and TSI's "significantly lower" price as compared to the
government estimate.  Id.   

   During discussions, Ben-Mar was asked to address its "proposed price
[which was] slightly higher than" the government estimate.  AR, Tab 10,
Discussions with Ben-Mar.  TSI was asked to address its "proposed price
[which was] significantly lower" than the government estimate, as well as
its capabilities regarding the performance of "specialized work," its
manufacturing techniques, and the alteration equipment requirements.  AR,
Tab 11, Discussions with TSI. 

   In response to discussions, Ben-Mar reduced its price by approximately 3
percent and made no changes to its technical proposal.  AR, Tab 12,
Ben-Mar's Revised Business Proposal.  TSI raised its price by
approximately [Deleted] percent, AR, TabA 13, TSI's Revised Price
Proposal, and submitted responses to the agency's discussion questions. 
To demonstrate its ability to perform "specialized work," TSI pointed to,
among other things, its work at Lackland AFB, where it is required to fit
and alter up to 3,000 garments per day (work that is subject to
100-percent government inspection), explaining that it has reworked
garments to account for weight loss or weight gain, and its work with a
"non-homogenous class of recruits by size."  TSI stated that it "rebuilds
all necessary garments to fit every recruit in accordance with the [Air
Force requirements] and has done it professionally at a low cost."  Id. at
1.  For example, TSI explained that in rebuilding garments, it must
integrate exact fabric pieces into the garment.  TSI also explained that
it cross-trains its employees so that they become versatile and can
reconstruct "just about anything in the clothing line."  Id. at 2.

   With respect to its manufacturing techniques, TSI explained that it has a
great deal of experience in reconstructing very complex fabric products
for the Department of Defense.  TSI pointed out that it is the only
commercial firm in the United States that repairs and reconstructs
personnel and cargo parachutes for the Army and Navy (work that is subject
to 100-percent government inspection).  TSI further stated that, based on
its experience at Lackland AFB, it knows how to timely and professionally
build a garment from scratch.  (TSI noted that in its experience at
Lackland AFB, the need to build a garment from scratch is rare.)  TSI
explained that most manufactured standard size garments can be altered to
appropriately match individual body sizes and that this is preferable to
actually manufacturing a garment from raw materials.  TSI then explained
how it would reconstruct a garment for both a small-sized and a
large-sized person and the circumstances under which garment patterns
would be used.  TSI also discussed its plan to hire qualified incumbent
personnel and TSI's use of tailor/fabric worker position descriptions.

   With respect to alteration equipment, TSI acknowledged its obligation to
provide all necessary equipment to perform the RFP requirements.  TSI
explained that it incorporated the cost for new equipment and facilities
in its revised price proposal.  Id. at 4.  TSI also explained that it had
a line of credit for equipment purchases and the firm identified equipment
vendors, stating that "[i]nstallation of new machinesA .A .A . is measured
in hours not days."  AR, Tab 14, TSI E-mail to Contracting Officer. 
Finally, TSI provided a detailed, 14-page quality control plan that
discussed, among other things, the use of customer feedback and the role
of TSI's quality control inspector in assessing performance.  TSI's
quality control plan also addressed how employees would be monetarily
rewarded for meeting and exceeding TSI's performance standards. 

   In evaluating final revised proposals, Ben-Mar's technical ratings
remained the same and the agency believed, as a result of discussions,
that Ben-Mar had satisfactorily addressed its still slightly higher price
vis-`a-vis the government estimate.  AR, Tab 16, Competitive Price
Negotiation Memorandum, at 2.  With respect to TSI, the agency raised the
firm's rating for the technical understanding and capability evaluation
factor to green/satisfactory and low risk because it was the consensus of
the evaluators that as a result of discussions, TSI had clearly
demonstrated in its final revised proposal, as described above, its
technical understanding of, and capability to perform, the RFP
requirements.  AR, Tab 15, Final Technical Evaluation Report, atA 1-2. 
The agency noted that although TSI's revised price was still significantly
lower than the government estimate, the information in TSI's final revised
proposal clearly showed that TSI understood the technical requirements of
the RFP and was capable of successfully performing those requirements. 
AR, TabA 16, Competitive Price Negotiation Memorandum, at 2-3.

   Since, as a result of the raising of TSI's rating, the proposals of
Ben-Mar and TSI were rated technically equal, price became the determining
factor for award.  Accordingly, the agency determined that TSI's
lower-priced proposal represented the best value to the government.  AR,
Tab 16, Best Value Determination, at 1-2.

   The essence of Ben-Mar's protest is that a "company [i.e., TSI] with no
experience in meeting the Coast Guard's strict requirements for fitting
and alterations of working and dress uniforms for recruits was selected
over an incumbent with a flawless service record over a twenty-year
period."  Protester's Comments at 1.  Ben-Mar continues that the agency
unreasonably failed to distinguish between the past performance of it and
TSI, based on the "relevance and quality of all available past performance
information."  Id. at 15.[3]

   In reviewing a protest against an agency's proposal evaluation, we will
consider whether the evaluation was reasonable and consistent with the
terms of the solicitation and applicable statutes and regulations.  Kira,
Inc.; All Star Maint., Inc., B-291507, B-291507.2, Jan. 7, 2003, 2003 CPD
P 22 at 5.  Mere disagreement with an agency's evaluation is not
sufficient to render the evaluation unreasonable.  Bevilacqua Research
Corp., B-293051, Jan. 12, 2004, 2004 CPD P 15 at 8 n.8.

   Contrary to Ben-Mar's suggestion, the RFP did not restrict this
competition to firms with experience in altering and tailoring Coast Guard
uniforms.  Rather, the RFP required an offeror to provide "relevant" past
performance information for evaluation in the areas of product quality,
timelines, cost control, and customer satisfaction.  In requiring an
offeror to provide "relevant" past performance information, the RFP did
not define "relevant" in terms of an offeror having past performance that
was identical to the requirements described in the RFP.  In other words,
the RFP did not require an offeror to have past performance in providing
fitting, alteration/tailoring, and garment pressing services for the Coast
Guard in order to be eligible to compete in this procurement.

   Here, as detailed above, the record shows that the agency recognized
Ben-Mar's successful performance over the past 20 years as the incumbent
contractor.  The record also shows that the agency considered TSI's past
performance at Lackland AFB, in terms of fitting and altering garments for
Air Force trainees, to be "relevant" to the Coast Guard requirements as
described in the RFP.  To the extent the agency had concerns, based on
TSI's initial technical proposal, with the work the firm did at Lackland
AFB, TSI responded to these concerns, as raised by the agency during
discussions, in its final revised proposal.  Other than disagreeing with
the agency's assessment that TSI's Lackland AFB past performance was
relevant to the CoastA Guard requirements, Ben-Mar has provided no
meaningful basis for our Office to question the reasonableness of the
agency's assessment that TSI had a record of past performance that was
"relevant" to the Coast Guard requirements.

   Moreover, we have no basis to object to the agency's assignment of a
green/satisfactory and low risk rating to TSI's proposal for each of the
technical evaluation factors.  While Ben-Mar contends that TSI failed to
"demonstrate," for example, its capability to perform "specialized work"
in terms of service dress blue uniforms, the record shows, as described
above, that this matter was raised in discussions with TSI and that the
agency concluded that TSI satisfactorily explained how it handles these
types of requirements under its Lackland AFB contract.  TSI also provided
details regarding how it makes adjustments to account for small-sized and
large-sized individuals under its Lackland AFB contract.  Moreover, the
cover page of TSI's revised technical proposal has a picture showing
recruits at Lackland AFB being fitted into dress uniforms; on another page
of TSI's revised technical proposal, there is a picture showing recruits
being outfitted with tailored service dress coats; and, finally, in a
chart entitled "Lackland AFB Fittings and Alterations," there are four
columns for types of alterations involving Air Force "service coats,"
which the agency states is the equivalent to the Coast Guard's service
dress coat.  On this record, we have no basis to dispute the
reasonableness of the agency's determination that TSI had "demonstrated"
its technical understanding of, and capability to perform, the Coast
Guard's requirements.  AR, Tab 13, TSI's Revised Proposal.

   Ben-Mar further argues that TSI's substantially lower price reflects a
lack of understanding of the RFP requirements.  As discussed above, the
agency satisfied itself during discussions that TSI understood these
requirements.  Moreover, in a fixed-price procurement, such as this one,
the fact that a firm, like TSI, in its business judgment, submits a price
that is low because it may not include any profit, is below-cost, or may
be an attempted buy-in, does not render the firm ineligible for award,
since below-cost pricing is not prohibited.  The Refinishing Touch,
B-293562 et al., Apr. 15, 2004, 2004 CPD P 92 at 2-3.  In this case, where
the agency was aware of TSI's substantially lower price, the agency
determined that TSI's price, based on its proposed approach to performing
the work, was fair and reasonable.  AR, Tab 16, Best Value Determination,
at 2.  We have no basis to question the agency's conclusion in this
regard.

   Finally, Ben-Mar challenges the agency's decision to select TSI at a
substantially lower price.  However, an agency is vested with broad
discretion to determine the manner and extent to which it will make use of
evaluation results.  PharmChem, Inc., B-291725.3 et al., July 22, 2003,
2003 CPD P 148 at 9.  Where, as here, an agency reasonably determines that
proposals are essentially technically equal, price becomes the determining
factor in making the award, notwithstanding that under the RFP, price was
assigned less importance than the combination of technical evaluation
factors.  Id. 

   Here, notwithstanding the fact that Ben-Mar had satisfied the agency's
requirements for many years, the agency determined that there were several
benefits to be derived from TSI's technical approach.  For example, the
agency concluded that TSI had the ability to rebuild all necessary
garments to accommodate different recruit body features that might exceed
normal manufacturer sizes; that TSI would use exact fabric pieces for
integration into garments to overcome fitting and alteration problems; and
that TSI would cross-train tailors so that they could reconstruct all
types of garments.  The agency believed that these benefits, as well as
TSI's internal quality controls, provided assurance that all Coast Guard
uniform requirements would be satisfied and that availability and quality
would not be issues in terms of TSI's performance.  AR, Tab 16, Best Value
Determination, at 1.

   In light of the benefits associated with TSI's technical approach, and the
fact that there is no basis on this record to question the reasonableness
of the agency's assignment of the same technical ratings to the proposals
of Ben-Mar and TSI, we conclude that it was reasonable for the agency to
determine that TSI's technically equal, lower-priced proposal represented
the best value to the government in accordance with the terms of the RFP.

   The protest is denied.[4]

   Anthony H. Gamboa

   General Counsel                          

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

   [1] After each member of the agency's technical evaluation team
individually evaluated each proposal, the technical evaluation team met in
order to reach a consensus in terms of the merits of each proposal for
each technical evaluation factor and subfactor.

   [2] While not disclosed in the RFP, the agency's source selection plan
provided that proposals (for the technical understanding and approach and
program management evaluation factors) could receive one of the following
color/adjectival ratings:  blue/superior; green/satisfactory;
yellow/marginal; and red/unsatisfactory.  As relevant here, a
green/satisfactory rating was defined as "[m]eets all requirements;
proposal offers no significant benefits beyond the stated requirements,
yet [no] significant weaknesses or deficiencies exist" and a
yellow/marginal rating was defined as "[f]ails to meet the minimum
requirements or has one or more significant weaknesses.  Deficiencies and
significant weaknesses are correctable without major [proposal]
revisions."  Agency Report (AR), Tab 3, Source Selection Plan at 9.  For
the relevant past performance technical evaluation factor, proposals could
receive one of the following color/adjectival ratings:  white/neutral;
blue/superior; green/satisfactory; yellow/marginal; and
red/unsatisfactory.  As relevant here, a green/satisfactory rating was
defined as "[p]ast performance [meets] requirements."  Id.  Finally, for
each technical evaluation factor, a risk assessment rating of high,
moderate, or low could be assigned.  As relevant here, a low risk
assessment was defined as the "offeror's proposal has little potential to
cause disruption of schedule, increase in cost, or degradation of
performance.  Normal contractor effort and normal government monitoring
shall probably be able to overcome difficulties" and a moderate risk
assessment was defined as the "offeror's proposal can potentially cause
some disruption of schedule, increase in cost, or degradation of
performance; however, special contractor emphasis and close government
monitoring shall probably be able to overcome difficulties."  Id. atA 6. 
The color/adjectival and risk ratings were supported by narratives
addressing the strengths, weaknesses, significant weaknesses,
deficiencies, and risks in each offeror's proposal.    

   [3] There was nothing in the RFP requiring the agency to assign Ben-Mar's
proposal the highest technical ratings simply because of its status as the
incumbent contractor.  Other than for the fact, which is not disputed,
that Ben-Mar had successfully performed the Coast Guard requirements as
the incumbent contractor, Ben-Mar does not meaningfully argue, based on
the contents of its technical proposal, that it was entitled to higher
technical ratings.  (We note that Ben-Mar's technical proposal consisted
of approximately four, single-spaced pages where the firm basically
addressed each technical evaluation subfactor in a single paragraph. 
Ben-Mar also included in its technical proposal four letters of
commendation from the CoastA Guard.) 

   [4] Ben-Mar has raised other collateral issues and arguments, each of
which we have considered and find without merit.  As discussed above, our
review of the record shows that the agency's evaluation was reasonable and
in accordance with the terms of the RFP.