TITLE: B-296435.5; B-296435.10, Nu-Way, Inc., September 28, 2005
BNUMBER: B-296435.5; B-296435.10
DATE: September 28, 2005
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B-296435.5; B-296435.10, Nu-Way, Inc., September 28, 2005

   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: Nu-Way, Inc.

   File: B-296435.5; B-296435.10

   Date: September 28, 2005

   John Lukjanowicz, Esq., Oles Morrison Rinker & Baker LLP, for the
   protester.

   Harold M. Nelson, Big Sky Mobile Catering, an intervenor.

   Byron W. Waters, Esq., Department of Agriculture, for the agency.

   Louis A. Chiarella, Esq., and Christine S. Melody, Esq., Office of the
   General Counsel, GAO, participated in the preparation of the decision.

   DIGEST

   1. Protest that agency unreasonably evaluated the protester's technical
   proposal as unacceptable under evaluation factor relating to proposed
   equipment is denied where the protester's proposal was ambiguous regarding
   whether the offered equipment met one of the material requirements in the
   solicitation.

   2. Protest alleging that, in its evaluation of the protester's proposal,
   the agency unreasonably ignored information that was "too close at hand"
   (but not contained in the protester's proposal) is denied where the
   information in question bears on whether the protester's proposed
   equipment satisfied the technical requirements of the solicitation, and
   thus by nature could vary in response to the individual solicitation.

   3. Protest that agency should have engaged in clarifications with
   protester to resolve material ambiguity in its proposal is denied since
   any such exchange would have constituted discussions, not clarifications,
   and agency generally has no obligation to hold discussions where, as here,
   it put offerors on notice of its intent to make award on the basis of
   initial proposals.

   DECISION

   Nu-Way, Inc. protests the decision by the National Interagency Fire
   Center, Forest Service, Department of Agriculture, not to award Nu-Way a
   contract under request for proposals (RFP) No. 49-05-07 for mobile food
   services. Nu-Way argues that the agency's evaluation of proposals,
   including the evaluation of its technical proposal, was improper.

   We deny the protest.

   BACKGROUND

   The RFP, issued on February 9, 2005, contemplated multiple awards of
   fixed-price requirements contracts for a base year and four 1-year
   options. The successful contractors under the RFP would be required to
   provide hot and cold meals and various supplemental items at 27 field
   locations (referred to as designated dispatch points, or DDPs) during
   wildland fires and other types of activities throughout the contiguous
   western United States and Alaska by means of mobile food service units
   (MFSU). The solicitation permitted offerors to propose for multiple DDPs,
   but contemplated the award of one contract for each location.

   In addition to price, the solicitation identified the following technical
   evaluation factors in descending order of importance: proposed equipment,
   past performance, experience, and technical approach. The RFP informed
   offerors that the technical factors, when combined, were approximately
   equal in importance to price. Contract awards were to be made to the
   offerors submitting the proposals determined to meet the minimum
   requirements of the solicitation and to be the most advantageous (i.e.,
   "best value") to the government. Relevant to the protest here, the RFP
   also stated that contract awards might be made without discussions. RFP
   sect. M.2, at 105.

   The RFP contained detailed instructions for the preparation of proposals,
   and required that the offerors' proposals consist of two parts--a
   technical proposal and a business/price proposal. Offerors were instructed
   that the technical proposals would be used to determine, among other
   things, whether the proposals met the requirements of the RFP. In this
   regard, the RFP required that offerors "clearly and concisely provide"
   written specifications and drawings of the MFSU offered, "indicating
   equipment location, traffic flow, layout, size, and capacity of the unit."
   RFP sect. L.6, at 101. The RFP also established minimum equipment
   requirements for an MFSU, and required offerors to complete an equipment
   requirements checklist for each unit offered. RFP sect. C.3, at 21-27;
   exh. M.2, at 112-18. The solicitation stated that the equipment
   requirements would be evaluated on a pass/fail basis, and that "any unit
   that fails to meet any of these minimum requirements will be unacceptable
   and may not be considered any further." RFP, exh. M.2, at 112.

   Twenty-five offerors, including Nu-Way, submitted proposals by the March
   11 closing date. Nu-Way offered one MFSU for three DDP locations.[1] An
   agency technical evaluation board (TEB) evaluated the offerors' technical
   proposals using an adjectival rating system: exceptional, acceptable,
   marginal, or unacceptable for those technical factors other than past
   performance; and exceptional, acceptable, neutral, marginal, or
   unacceptable for past performance.[2] The TEB completed its evaluation of
   the offerors' technical proposals on June 2. The TEB's ratings of Nu-Way's
   proposal were as follows: unacceptable for proposed equipment; acceptable
   for past performance; acceptable (+) for experience; excellent for
   technical approach; the proposal's overall rating was marginal (+). AR,
   Tab 12, TEB Consensus Report, at 2. The TEB rated Nu-Way's proposal as
   unacceptable under the proposed equipment factor based on its
   determination that Nu-Way had failed to demonstrate compliance with all
   minimum equipment requirements of the solicitation. Id. at 14.

   The TEB subsequently considered the offerors' evaluated prices and
   technical ratings, and made award recommendations for each DDP. AR, Tab
   13, TEB Best Value Analysis Report. The contracting officer then concurred
   with the TEB's recommendations, decided not to conduct discussions with
   offerors, and forwarded the award recommendations and associated materials
   to the agency's source selection authority for review and approval. AR,
   Tab 14, Source Selection Decision; Contracting Officer's Statement, July
   19, 2005, at 7. The source selection authority accepted the findings and
   recommendations of the TEB and made contract award to 12 offerors for 21
   DDPs. AR, Tab 14, Source Selection Decision. Nu-Way was not selected to
   receive any awards. These protests followed. The agency has authorized the
   offerors who had received awards to begin performance notwithstanding the
   protests, based on a written determination that urgent and compelling
   circumstances significantly affecting the interests of the United States
   would not permit waiting for the decision of our Office. See 31 U.S.C.
   sect. 3553(d) (2000).

   DISCUSSION

   Nu-Way first protests the agency's evaluation of its technical proposal
   under the proposed equipment factor. Specifically, Nu-Way argues that the
   Forest Service unreasonably determined that its proposal was unacceptable
   for failing to meet a minimum equipment requirement, namely, sufficient
   "gray water" storage capacity.[3] The protester contends that its proposal
   clearly reflected that its MFSU possessed a gray water storage capacity
   that exceeded the requirements of the RFP, and the agency's erroneous
   conclusion to the contrary improperly resulted in Nu-Way's
   disqualification from contract award consideration.

   Where a protester challenges an agency's evaluation of a proposal's
   technical acceptability, our review is limited to considering whether the
   agency's judgment was reasonable and consistent with the stated evaluation
   criteria and applicable procurement statutes and regulations. See Knoll,
   Inc.; Steelcase, Inc., B-294986.3, B-294986.4, Mar. 18, 2005, 2005 CPD
   para. 63 at 3. Clearly stated RFP technical requirements are considered
   material to the needs of the government, and a proposal that fails to
   conform to such material terms is technically unacceptable and may not
   form the basis for award. Id.; National Shower Express, Inc.; Rickaby Fire
   Support, B-293970, B-293970.2, July 15, 2004, 2004 CPD para. 140 at 4-5.
   An offeror is responsible for affirmatively demonstrating the merits of
   its proposal and risks the rejection of its proposal if it fails to do so.
   HDL Research Lab, Inc., B-294959, Dec. 21, 2004, 2005 CPD para. 8 at 5. As
   with any evaluation review, our chief concern is whether the record
   adequately supports the agency's conclusions. Innovative Logistics
   Techniques, Inc., B-275786.2, Apr. 2, 1997, 97-1 CPD para. 144 at 9. A
   protester's mere disagreement with the agency's judgment does not
   establish that the evaluation was unreasonable. C. Lawrence Constr. Co.,
   Inc., B-287066, Mar. 30, 2001, 2001 CPD para. 70 at 4. Our review of the
   record provides us no basis to find the agency's evaluation here was
   unreasonable or otherwise objectionable.

    

   As set forth above, the solicitation informed offerors, with regard to the
   proposed equipment factor, that the agency would evaluate each offeror's
   proposed MFSU(s) to determine the extent to which the unit(s) would meet
   or exceed the solicitation's minimum requirements. RFP sect. M.3, at 106.
   Relevant to this protest, the solicitation required that each MFSU
   proposed have a hand-washing unit with a minimum gray water storage
   capacity of 400 gallons, and a kitchen unit with a minimum gray water
   storage capacity of 500 gallons (900 gallons total). RFP sect. C, at
   24-25. In performing its evaluation the TEB found that Nu-Way's proposal
   planned to pump its hand-washing unit gray water to the kitchen unit, and
   that Nu-Way's "kitchen unit carries 2 -- 400 gallon gray water bags." See
   AR, Tab 6, Nu-Way Proposal, at 57; Tab 12, TEB Consensus report, at 14.
   The TEB concluded that the total gray water storage capacity proposed by
   Nu-Way (i.e., 800 gallons) did not meet the 900-gallon total gray water
   storage capacity required by the solicitation. AR, Tab 12, TEB Consensus
   Report, at 14.

   Nu-Way does not dispute that in one instance its proposal represented a
   gray water storage capacity of 800 gallons. Rather, the protester
   characterizes this particular representation as inadvertent, and asserts
   that in three other instances its proposal clearly indicated a gray water
   storage capacity of 1,600 gallons. Protester's Comments, Aug. 5, 2005, at
   6. Nu-Way argues that the agency's decision to "ignore Nu-Way's [multiple]
   recitations of 1,600 gallons of gray water storage capacity in favor of a
   one-time assertion of 800 gallons of gray water storage capacity" was
   unreasonable. Id.

   In addition to the reference in Nu-Way's proposal, quoted above, to "2 --
   400 gallon gray water bags," our review of the record indicates a total of
   four other instances where Nu-Way's proposal discusses its gray water
   storage capacity, as follows: 1) "In addition to the equipment on the next
   several pages, we also provide the following: . . . 2 -- 800 gallon gray
   water storage bags"; 2) "Gray water will be plumbed into kitchen 800 gal.
   gray water storage bags"; 3) "The gray water will be plumbed into the
   kitchen 800 gallon gray water storage bags"; and 4) "The gray water will
   be pumped into the kitchen unit gray water bags (800 gallon)." AR, Tab 6,
   Nu-Way Proposal, at 24, 31, 36, 55.

   As an initial matter, we think that Nu-Way glosses over the fact that
   three of these excerpts from its proposal are themselves unclear as to
   whether, as the protester claims, the proposed equipment has a gray water
   storage capacity of 1,600 gallons: the references to "800 gallon gray
   water storage bags" and "the kitchen unit gray water storage bags (800
   gallon)" could be read to indicate either the total capacity of the bags
   or the size of individual storage bags. In any event, it is an offeror's
   obligation to submit a clear and unambiguous proposal, and it must bear
   the consequences where its proposal does not reflect its intended
   approach. United Def. LP, B-286925.3 et al., Apr. 9, 2001, 2001 CPD para.
   75 at 19. Here, the representations in Nu-Way's proposal regarding its
   gray water storage capacity cannot be reconciled; in one instance the
   offeror expressly indicated a total storage capacity of 800 gallons (which
   did not meet the solicitation's minimum requirement), while in another
   instance the offeror expressly indicated a total storage capacity of 1,600
   gallons. In light of the contradictory representations within Nu-Way's
   proposal regarding its total gray water storage capacity, we cannot find
   the agency's evaluation here to be unreasonable.

   Nu-Way also argues that its proposal should not have been found
   unacceptable under the proposed equipment factor because the Forest
   Service failed to consider information known to the agency regarding
   Nu-Way's equipment. Specifically, the protester argues that the TEB
   chairman had conducted examinations of Nu-Way's equipment during the prior
   year, and had personal knowledge that Nu-Way actually possessed a gray
   water storage capacity that exceeded the solicitation requirement. Nu-Way
   contends that this information was "too close at hand" for the agency to
   ignore in the evaluation of Nu-Way's proposal. Therefore, Nu-Way argues,
   the agency's failure to consider information known to it here was
   unreasonable.

   An offeror has the burden of submitting an adequately written proposal,
   and an agency may downgrade a proposal for the lack of requested
   information. Formal Mgmt. Sys., Inc., B-259824, May 3, 1995, 95-1 CPD
   para. 227 at 3. Our Office has recognized that in certain limited
   circumstances, however, an agency evaluating an offeror's proposal has an
   obligation (as opposed to the discretion) to consider "outside
   information" bearing on the offeror's proposal. International Bus. Sys.,
   Inc., B-275554, Mar. 3, 1997, 97-1 CPD para. 114 at 5; G. Marine Diesel;
   Phillyship, B-232619, B-232619.2, Jan. 27, 1989, 89-1 CPD para. 90 at 4-5.
   Where we have charged an agency with responsibility for considering such
   outside information, the record has demonstrated that the information in
   question was "simply too close at hand to require offerors to shoulder the
   inequities that spring from an agency's failure to obtain, and consider,
   this information." International Bus. Sys., Inc., supra; see GTS Duratek,
   Inc., B-280511.2, B-280511.3, Oct. 19, 1998, 98-2 CPD para. 130 at 14.

   The facts here are distinguishable from those in our decisions
   articulating the "too close at hand" principle. In the decisions cited
   above, we addressed situations where an agency failed to include in its
   evaluation past performance information that was specifically known to the
   officials handling the protested procurement. For example, the G. Marine
   Diesel; Phillyship decision dealt with a contracting officer's failure to
   consider information, personally known to the contracting officer, that
   the awardee's performance on a predecessor contract had been deficient;
   the GTS Duratek decision dealt with the agency's failure to consider the
   offeror's performance of a prior contract where the contract was discussed
   in the offeror's past performance proposal and the contracting officer's
   technical representative for the contract was a member of the technical
   evaluation team for the subject solicitation.

   Here, Nu-Way argues that because the TEB chairman personally knew that
   Nu-Way had mobile food services equipment which met the RFP's
   requirements, the agency was required to take this knowledge into account
   in performing its evaluation. Even accepting that Nu-Way's contention is
   factually accurate, the protester's argument requires the Forest Service
   to assume that Nu-Way intended to employ the same equipment as it had in
   the past. An offeror's proposed technical capabilities, including
   equipment, may be varied by the offeror in response to the specifics of
   each solicitation, and merely because certain equipment may have been
   proposed or used in the past does not require the offeror to propose it on
   subsequent occasions. Incident Catering Servs., LLC, B-296435.2 et al.,
   Sept. 7, 2005, 2005 CPD para. __ at 8. In sum, we see no basis here to
   regard the information regarding Nu-Way's equipment as falling within the
   category of data that we deem "too close at hand" for the agency to
   ignore.

   Nu-Way also argues that it was unreasonable for the Forest Service not to
   have allowed the firm to clarify the ambiguity regarding the proposed gray
   water storage capacity in its proposal. Nu-Way contends that just as the
   agency contacted the firm to clarify other minor aspects of its proposal,
   the Forest Service should have sought clarification from Nu-Way regarding
   its gray water storage capacity.

   Federal Acquisition Regulation (FAR) sect. 15.306 describes a spectrum of
   exchanges that may take place between an agency and an offeror during
   negotiated procurements. Where a solicitation notifies offerors that
   contract award may be made without discussions, an agency may engage in
   clarifications that provide offerors with the opportunity to clarify
   certain aspects of proposals or to resolve minor or clerical errors. FAR
   sect. 15.306(a). Discussions, on the other hand, occur when an agency
   indicates to an offeror significant weaknesses, deficiencies, and other
   aspects of its proposal that could be altered or explained to enhance
   materially the proposal's potential for award. FAR sect. 15.306(d)(3).
   When an agency conducts discussions with one offeror, it must conduct
   discussions with all other offerors in the competitive range. FAR sect.
   15.305(d)(1). The "acid test" for deciding whether discussions have been
   held is whether it can be said that an offeror was provided the
   opportunity to revise or modify its proposal. Park Tower Mgmt. Ltd.,
   B-295589, B-295589.2, Mar. 22, 2005, 2005 CPD para. 77 at 7; Priority One
   Servs., Inc., B-288836, B-288836.2, Dec. 17, 2001, 2002 CPD para. 79 at 5.

   When an offeror is given the opportunity to remove an ambiguity from its
   proposal, especially where the information to be provided by the offeror
   is essential for determining the proposal's acceptability, such an
   exchange constitutes discussions. Integrated Sys. Group., B-272336;
   B-272336.2, Sept. 27, 1996, 96-2 CPD para. 144 at 5. Accordingly, in this
   case, had the Forest Service communicated with Nu-Way to resolve the
   ambiguity in the firm's proposal regarding gray water storage capacity,
   such an exchange would have constituted discussions, not clarifications.
   As there is generally no obligation that a contracting agency conduct
   discussions where, as here, the RFP specifically instructs offerors of the
   agency's intent to award a contract on the basis of initial proposals,
   Incident Catering Servs., LLC, supra, at 9, and the protester has not
   argued (and we see nothing in the record to suggest) that the agency's
   decision not to hold discussions with offerors was unreasonable, we find
   no basis to object to the agency's action.

   Lastly, Nu-Way challenges the agency's evaluation of other offerors'
   proposals. Specifically, the protester contends that the technical
   proposals submitted by each of the awardees for the locations for which
   Nu-Way submitted a proposal (i.e., [DELETED], [DELETED], and [DELETED])
   failed to meet the minimum equipment requirements of the solicitation. The
   agency specifically addressed and refuted these contentions in its report,
   explaining that the proposals submitted by the other offerors here were
   properly determined to have met all minimum equipment requirements. In its
   comments, Nu-Way expresses disagreement with the agency report but makes
   no substantive rebuttal to the agency's position. Protester's Comments,
   Sept. 6, 2005, at 2. Our review of the record provides no basis to find
   the agency's evaluation here unreasonable or otherwise objectionable.

   The protest is denied.

   Anthony H. Gamboa
   General Counsel

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

   [1] In accordance with the RFP instructions, Nu-Way's proposal set forth
   the award location preferences for its MFSU. Agency Report (AR), Tab 6,
   Nu-Way Proposal, at 16.

   [2] The TEB rated each offeror's MFSU(s) separately. The TEB also employed
   the use of "+" and "-" (e.g., "acceptable plus") in its rating system. AR,
   Tab 12, TEB Consensus Report, at 2-3.

   [3] Gray water refers to the waste water generated as a result of the
   contractor's hand-washing and mobile food service operations. While the
   RFP required the contractor to provide sufficient gray water holding
   facilities, the solicitation established that the agency would arrange for
   the actual removal of the gray water.