TITLE: B-296915; B-296915.2; B-296915.3; B-296915.4; B-296915.5, Cherry Road Technologies; Electronic Data Systems Corporation, October 24, 2005
BNUMBER: B-296915; B-296915.2; B-296915.3; B-296915.4; B-296915.5
DATE: October 24, 2005
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B-296915; B-296915.2; B-296915.3; B-296915.4; B-296915.5, Cherry Road Technologies; Electronic Data Systems Corporation, October 24, 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: Cherry Road Technologies; Electronic Data Systems Corporation

   File: B-296915; B-296915.2; B-296915.3; B-296915.4; B-296915.5

   Date: October 24, 2005

   Devon E. Hewitt, Esq., John E. Jensen, Esq., Walter F. Zenner, Esq.,
   Daniel S. Herzfeld, Esq., Jack Y. Chue, Esq., and Orest J. Jowyk., Esq.,
   Pillsbury Winthrop Shaw Pittman LLP, for Cherry Road Technologies; Scott
   M. McCaleb, Esq., Rand L. Allen, Esq., Charles C. Lemley, Esq., and
   William J. Grimaldi, Esq., Wiley Rein & Fielding LLP, for Electronic Data
   Systems Corporation, the protesters.

   David A. Churchill, Esq., Kevin C. Dwyer, Esq., Kristen G. Schulz, Esq.,
   Darren Lubetzky, Esq., and Heather M. Trew, Esq., Jenner & Block LLP, for
   Lockheed Martin Integrated Systems & Solutions, an intervenor.

   Capt. Peter G. Hartman and Raymond M. Saunders, Esq., Department of the
   Army, for the agency.

   Sharon L. Larkin, Esq., Guy R. Pietrovito, Esq., and James A. Spangenberg,
   Esq., Office of the General Counsel, GAO, participated in the preparation
   of the decision.

   DIGEST

   1. Protest challenging awardee's use of leased government facilities is
   denied, where solicitation did not preclude the use of leased government
   facilities but stated only that agency would not be providing facilities
   as "government furnished property" under this contract.

   2. Protest contending that agency failed to eliminate the awardee's
   competitive advantage from using leased government facilities as
   assertedly required by Federal Acquisition Regulation (FAR) Part 45 is
   denied because FAR Part 45 does not apply to leases that are executed
   pursuant to statutory leasing authority, and unfair advantage does not
   otherwise exist because leases were executed at fair market value.

   3. Protest challenging source selection decision and evaluation ratings
   under each evaluation factor is denied, where the record demonstrates a
   reasoned and rational evaluation, and protesters' arguments amount to mere
   disagreement with the agency's conclusions.

   DECISION

   Cherry Road Technologies (CRT) and Electronic Data Systems Corporation
   (EDS) protest the award of a contract to Lockheed Martin Integrated
   Systems and Solutions (LM) under the Department of the Army's request for
   proposals (RFP) No. W91QUZ-05-R-0001 for the operation and maintenance of
   the Army Knowledge Online (AKO) enterprise information portal.

   We deny the protests.

   BACKGROUND

   The AKO was started as a pilot program in 1997 as the first step in
   building the Army intranet to provide Army personnel with web-based access
   to job-related, mission-oriented knowledge in real time. The program has
   been so successful that the Secretary of the Army has mandated that all
   data, information, and systems be moved to this portal. The ultimate goal
   of the AKO is to become the single point of entry into a robust and
   scalable knowledge management system "providing global secure access to
   accurate, relevant, and authoritative information at anytime, from
   anywhere to ensure mission success." RFP, Statement of Objectives (SOO),
   sect. 1.0.

   The RFP sought a contractor to provide Information Technology (IT)
   solutions throughout all operating levels of the AKO. RFP sect. B.1. These
   services included systems operation and maintenance, network and systems
   engineering support, hardware and software integration, identification of
   future capabilities, software development and maintenance, application
   development and maintenance, Army-wide help desk support, and senior-level
   technology and program management support services. The RFP required that
   the services be provided on a continuous 24 hours, 7 days a week, 365 days
   a year basis to the Active Army, Army National Guard, and Army Reserve
   soldiers and their families; Army civilians; and applicable contractors.
   RFP, SOO, sect. 2.0

   The RFP contemplated that the services would be provided in two "blocks."
   "Block A" identified required services for "support and administration,"
   and included program management and responsibility for future system
   design work. "Block B" identified optional services for "operations and
   maintenance," and included operating primary and secondary data centers.
   The performance of Block A (the required services) was scheduled to
   commence on October 1, 2005, with the performance of Block B (the optional
   services) to begin no earlier than October 1, 2006. RFP sect. B.1.e. The
   Army explains that the lag in time was due to the fact that Block B
   services are currently being performed by CRT under an existing contract
   that is not set to expire until October 1, 2006.

   Under its existing contract, CRT provides AKO services from two sites--a
   primary site on Fort Belvoir, Virginia and a secondary site in [REDACTED].
   Hearing Transcript (Tr.) at 73-74.[1] The Fort Belvoir site is being
   provided to CRT as government furnished property (GFP) under that
   contract. Army Hearing exh. 4, IT Services Statement of Work, sect. F. In
   discussing these sites, the RFP provided:

   Offerors must keep in mind, while considering their solution for the Block
   B option, that when the CRT contract expires or is otherwise terminated,
   that 100% of the Secondary Site (including the facility) and 80% of the
   Primary Site is owned or leased by Cherry Road and will no longer be
   available for use. It is imperative that the solution offered take this
   into consideration. It is also extremely important that the proposed
   transition period for the option (Block B) be realistic and accurate.
   There cannot be a break in service.

   RFP sect. B.1.e.

   The solicitation further required the selected contractor to provide "all
   personnel, products, material, facilities, travel, services and other
   items needed to satisfy the mission and functions of the AKO and the
   [RFP's SOO]." RFP sect. B.1.a. In this regard, the RFP provided that
   "[t]he Government presently does not intend to make any Government
   Property to include real property/facilities available to the successful
   offeror, except as noted in subparagraph L.2.g" (which dealt with Defense
   Information System Network (DISN) connectivity). RFP amend. 1, sect.
   L.2.f. When asked in written pre-proposal "requests for clarification"
   (RFC) whether this provision required offerors to propose non-government
   facilities, the Army responded, "There is no constraint on whether the
   facility is a Government facility or non-Government facility; it is,
   however, not being provided under this contract." RFP amend. 1, attach.
   10, RFC No. 18.c. Offerors were also informed that the Fort Belvoir site
   (that is, the site provided to CRT as GFP under its incumbent contract)
   "is currently encumbered by another contract" and "is not available" and
   "cannot be provided as [government furnished equipment (GFE)] at the
   present time."[2] Id., RFC Nos. 12.b and c.

   The RFP provided for award on a "best value" basis, considering technical,
   management, performance risk, and price/cost factors. The technical factor
   was said to be more important than the management factor, and the two were
   each more important than the performance risk and price/cost factors. The
   performance risk factor was approximately equal in weight to the
   price/cost factor. All non-price/cost evaluation factors, when combined,
   were said to be "significantly more important than" the price/cost factor.
   RFP sect. M.3.

   With regard to price/cost, the RFP contemplated that proposals would
   include a mix of fixed-price and time-and-materials (T&M) elements, as
   determined by the offerors. In their proposals, offerors were to identify
   each contract line item number (CLIN) and special line item number (SLIN)
   by contract type (i.e., fixed-price or T&M) and provide the pricing
   structure chosen for each. Section M of the RFP provided, under the
   price/cost factor, that proposals would be evaluated under two subfactors:
   cost and risk assessment. With regard to the cost subfactor, the agency
   was to evaluate the "Total Contract Life Price/Cost (TCLP/C), that is, the
   total price/cost for all options added to the total price/cost of the
   basic requirements" and "the total price/cost per year to consider
   affordability." Id. In addition, for the T&M portion of the price
   proposals, the RFP required, as part of the cost subfactor evaluation,
   that "[r]ealism will be assessed for any proposed T&M line items" and
   stated that the offeror's "failure to completely account for all such
   costs or proposing unrealistically low estimated costs may pose an
   unacceptable risk to the Government and may result in rejection of the
   proposal." Id. Under the risk assessment subfactor, the agency was to
   "evaluate the extent to which the offeror selects a contract type (or
   combination of types) that reduces Government risk and will appropriately
   tie profit to contractor performance. Furthermore, the Government will
   assess the proposed contract type(s) as they relate to the understanding
   of the requirement and feasibility." Id.

   CRT, EDS, and LM submitted proposals in response to the RFP.[3] As part of
   its fixed-price efforts, LM proposed to use two government facilities as
   its primary and secondary data centers, while CRT and EDS proposed to use
   non-government facility data centers obtained through commercial leases.
   The government facilities proposed by LM were leased from the government
   by one of its subcontractors, who paid fair market value for the leases.
   The fixed-price portion of LM's proposal accounted for [REDACTED] percent
   of the proposed work, while the fixed-price portion of CRT's and EDS's
   proposals each provided for [REDACTED] percent of the proposed work.

   The Army held multiple rounds of discussions with the offerors during the
   evaluation. After each evaluation round, the source selection evaluation
   board (SSEB) evaluated proposals, identifying "advantages" and
   "disadvantages" in each proposal and assigning a color rating to proposals
   for each evaluation factor. The SSEB also briefed the source selection
   authority (SSA) after each evaluation round. During the final round of
   discussions, which were conducted telephonically, the agency informed CRT
   that "the Government did not deem telephonic discussions to be necessary,"
   and CRT was not requested to submit additional proposal revisions.
   Contracting Officer's Statement (Aug. 17, 2005) at 3. After the final
   evaluation round, the SSEB rated proposals as follows:

   +------------------------------------------------------------------------+
   |                         |       LM       |    CRT     |      EDS       |
   |-------------------------+----------------+------------+----------------|
   |Technical                |blue/outstanding| green/good |   green/good   |
   |-------------------------+----------------+------------+----------------|
   ||Operations              |      blue      |   green    |     green      |
   ||------------------------+----------------+------------+----------------|
   ||Architecture (Block B)  |      blue      |   green    |     green      |
   ||------------------------+----------------+------------+----------------|
   ||Engineering             |      blue      |   green    |     green      |
   |-------------------------+----------------+------------+----------------|
   |Management               |blue/outstanding| green/good |   green/good   |
   |-------------------------+----------------+------------+----------------|
   ||Performance-Based       |      blue      |   yellow   |     green      |
   ||Approach/Program        |                |            |                |
   ||Management (PBA/PM)     |                |            |                |
   ||------------------------+----------------+------------+----------------|
   ||Transition Methodology  |      blue      |    blue    |     green      |
   ||------------------------+----------------+------------+----------------|
   ||Business Processes      |      blue      |   green    |     green      |
   ||------------------------+----------------+------------+----------------|
   ||Customer Relationship   |      blue      |   green    |     green      |
   ||Management (CRM)        |                |            |                |
   ||------------------------+----------------+------------+----------------|
   ||Small Business          |     green      |   green    |     green      |
   ||Participation (future)  |                |            |                |
   ||------------------------+----------------+------------+----------------|
   ||Follow-on Transition    |     green      |   yellow   |     green      |
   |-------------------------+----------------+------------+----------------|
   |Performance Risk         |blue/outstanding| green/good |blue/outstanding|
   |-------------------------+----------------+------------+----------------|
   ||Past Performance        |      blue      |   green    |      blue      |
   ||------------------------+----------------+------------+----------------|
   ||Small Business          |     green      |   yellow   |      blue      |
   ||Participation           |                |            |                |
   ||------------------------+----------------+------------+----------------|
   ||Corporate Experience    |      blue      |    blue    |      blue      |
   |-------------------------+----------------+------------+----------------|
   |Price/Cost               |  $180,828,717  |$368,308,685|  $413,448,009  |
   |-------------------------+----------------+------------+----------------|
   ||Cost (TCLP/C[4])        |  $180,828,717  |$368,308,685|  $413,448,009  |
   ||------------------------+----------------+------------+----------------|
   ||Risk Assessment         |      low       |    low     |      low       |
   +------------------------------------------------------------------------+

   The SSA accepted the SSEB's judgments and determined that LM's proposal
   was superior to the other offers under both the technical and management
   factors. For example, the SSA determined that the two data centers
   proposed by LM offered "significant advantages" because the facilities
   already had DISN connectivity, were "DITSCAP" accredited,[5] and had
   approved physical security procedures in place that met Army standards.
   Agency Report (AR), Tab 124, Source Selection Decision, at 5, 10. EDS's
   proposal was found to be superior to the others under the lesser important
   performance risk factor (although both LM and EDS received the highest
   ratings), based on EDS's superiority under the small business
   participation subfactor. However, the SSA found that this "superiority is
   slight" in view of LM's "very low risk" ratings under the past performance
   and corporate experience subfactors. Id. at 15.

   In evaluating LM's "substantially lower" price, the SSA determined that
   the firm's T&M prices were realistic for the required efforts and that the
   overall proposal was low risk because LM "has chosen appropriate contract
   types with the appropriate distribution of risk between it and the
   Government." Id. at 16. The SSA selected LM for award based on its
   technical superiority and lower price, and these protests followed.

   DISCUSSION

   The protesters raise numerous objections to the Army's evaluation of
   proposals and source selection decision. They contend that LM's proposed
   use of leased government facilities violates the terms of the RFP and
   poses substantial risk to performance that was overlooked by the Army.
   They challenge the ratings assigned under each of the evaluation factors
   and the adequacy of the price evaluation. They contend that offerors were
   treated disparately, that discussions were inadequate, and that the
   best-value evaluation was flawed.

   Our Office reviews challenges to an agency's evaluation of proposals only
   to determine whether the agency acted reasonably and in accord with the
   solicitation's evaluation criteria and applicable procurement statutes and
   regulations. Manassas Travel, Inc., B-294867.3, May 3, 2005, 2005 CPD
   para. 113 at 2-3. A protester's mere disagreement with the agency's
   judgment is not sufficient to establish that an agency acted unreasonably.
   Entz Aerodyne, Inc., B-293531, Mar. 9, 2004, 2004 CPD para. 70 at 3.

   We have reviewed all of the numerous evaluation challenges protested here
   and find them to be without merit.

   Government Facilities

   The protesters first contend that LM's proposed use of government
   facilities as data centers is prohibited by the RFP and that the agency
   should have rejected LM's proposal as a result. They base this argument on
   Section L.2.f. of the RFP, which states, in pertinent part, that the
   "Government presently does not intend to make any Government Property . .
   . available," and on the Army's response to RFC No. 18, which, in relevant
   part, provides as follows:

   18.a. Please clarify the Section L.2.f statement regarding
   non-availability of Government Property (is this all inclusive, restricted
   to facilities, prevent the use of Ft. Belvoir, etc.) . . .

   REVISED RESPONSE: The Government does not presently intend to provide
   Government Furnished Property [GFP], Equipment [GFE], or Facilities [GFF],
   except as provided in L.2.g, under the contract resulting from this
   acquisition. However, pursuant to clause H.22, during performance of the
   contract the Government may, at its discretion, provide GFE.

   18.b. Will reuse of government owned or even contractor owned materials be
   taken into consideration for purposes of award evaluation or must all
   bidders propose new equipment and software licenses?

   REVISED RESPONSE: All offerors must propose their solution without relying
   on any GFP/GFE/facilities, except as provided for in L.2.g.

   18.c. Will all vendors be required to propose two non-government
   facilities.

   REVISED RESPONSE: All vendors are required to propose a solution that
   meets the Government's objectives without considering the use of
   GFE/GFP/facilities, except as provided for in L.2.g. There is no
   constraint on whether the facility is a Government facility or
   non-Government facility; it is, however, not being provided for under this
   contract.

   RFP amend. 1, attach. 10, RFC No. 18.

   The protesters rely specifically on RFC No. 18.b, which they argue
   instructed them to exclude all government facilities from their proposals.
   However, the Army contends, and we agree, that RFC No. 18.b., along with
   RFC No. 18.a, states only that the Army would not be providing GFF under
   this contract and does not speak to whether offerors were permitted to
   propose government facilities acquired by other means. RFC No. 18.c
   addresses that issue, stating unambiguously that there was "no constraint"
   on whether the proposed facility was government-owned or
   commercially-owned. Although the protesters contend that RFC No. 18.c. is
   "nonbinding" under the "order of precedence" clause of the solicitation,
   which gives precedence to the solicitation provisions over inconsistent
   statements in the RFC responses attached to the solicitation, we find that
   the Army's responses to RFC No. 18 are consistent with the RFP and where
   there are no inconsistencies, we need not refer to the "order of
   precedence clause" to resolve the RFP's meaning.[6] SRI Int'l, Inc.,
   B-250327.4, Apr. 27,1993, 93-1 CPD para. 344 at 5.

   CRT complains that even if RFC No. 18 permitted the use of government
   facilities, the firm was treated unfairly because it was not permitted to
   propose the use of Fort Belvoir, the government facility that it was
   currently using in performing its incumbent contract. CRT asserts that the
   purpose of this prohibition was to "level the playing field," which is
   unfair since LM was not similarly prohibited from using government
   facilities. CRT states it was instructed not to use Fort Belvoir by
   Section B of the RFP and RFC No. 12, which stated that the site "cannot be
   provided as GFE" and "is not available at this time."[7]

   However, as discussed above, amendment 001 to the solicitation (which
   included the RFCs) informed offerors in RFC No. 18 that they could propose
   government facilities, although the facilities would not be furnished by
   the government under this contract. Any alleged unfairness in treatment
   between Fort Belvoir and other government facilities was thus apparent on
   the face of the solicitation and should have been protested as a
   solicitation defect before the date set for receipt of proposals. Because
   it was not, this protest ground is dismissed as untimely.[8] 4 C.F.R.
   sect. 21.2(a)(1)(2005). In any event, LM and CRT are not similarly
   situated in this regard. LM's subcontractor leased the government
   facilities that LM relied upon in its proposal at a fair market price,
   unlike CRT whose "assumption was that after the contract award [the Army]
   would modify the contract so that [CRT] would be able to have access to
   the facility" as GFP. Tr. at 111.

   The protesters also allege that even if LM was permitted to use government
   facilities, the agency is required under Federal Acquisition Regulation
   (FAR) Part 45 to eliminate LM's competitive advantage, for example, by
   amending the solicitation to include a rental equivalent factor.[9]
   However, FAR Part 45 is inapplicable to this solicitation. FAR sect.
   45.000 provides:

   This part prescribes policies and procedures for providing Government
   property to contractors, contractors' use and management of Government
   property, and reporting, redistributing, and disposing of contractor
   inventory. It does not apply to providing property under any statutory
   leasing authority . . . .

   Here, the LM leases were executed by the firm's subcontractor under
   statutory leasing authority,[10] and thus FAR Part 45 is inapplicable.[11]
   In any event, the record shows that the LM leases were executed by the
   subcontractor for fair market value, and thus no rental equivalent would
   be necessary.[12]

   The protesters also assert that the agency inflated LM's proposal ratings
   under the technical and management factors, and failed to properly
   consider the risk under these factors for LM's proposed use of government
   facilities.[13] Specifically, the protesters complain that the agency did
   not evaluate the leases or the program contracts under which the leases
   were executed.[14] They speculate that these contracts could constrain the
   use of the facilities, or that other government action could interfere
   with the use of these facilities, thus creating a risk that performance
   would be interrupted and the government's objectives would not be met.

   The agency explains, however, that the RFP did not require the evaluation
   of leases or the underlying programs under which the leases were executed,
   and thus the agency did not evaluate the leases for any of the offerors,
   including the protesters. Moreover, the LM leases--which, although not
   evaluated, were included as part of the record--do not contain any
   constraints on performance.

   The agency further asserts, and the record confirms, that the assessment
   of LM's proposed facilities under the technical and management factors was
   reasonable and consistent with the RFP. In this regard, the evaluation
   record documents a number of "significant advantages" associated with LM's
   proposed use of existing data centers, including:

   .        existing DISN connectivity and accreditation and existing support
   infrastructure that enables the government to "leverage existing
   operational policies and procedures, rather than creating and implementing
   new ones from scratch," which the Army reasonably concluded "reduces
   operational risks" (AR, Tab 88, LM Final SSEB Report (Technical Factor),
   at 2);

   .        "approved physical security procedures [already] in place that
   meet Army standards," which the agency reasonably found resulted in a
   "high degree of confidence that [LM] can successfully implement the
   appropriate level of physical security required to meet the AKO
   objectives" (AR, Tab 89, LM Final SSEB Report (Management Factor), at
   3-4);

   .        existing "cleared personnel, accredited Data Centers, Help Desks
   and Network Operations Centers" with "established applications monitoring
   processes and tools," which the agency reasonably determined resulted in a
   "high degree of confidence that the offeror can successfully implement the
   proposed transition plan and meet the transition objectives with minimal
   disruption to the user" (Id. at 5); and

   .        existing DITSCAP accreditation, which the Army reasonably
   concluded "poses low risk to the Government in implementing the help desk
   and precludes the long and uncertain DITSCAP accreditation process" (Id.
   at 9).

   Although the protesters disagree with the Army's assessment of advantages
   and ratings based on features of the proposed data centers, the protesters
   have not demonstrated that these recognized advantages are unreasonable or
   that LM's proposal presents "substantial risk" as alleged. For example,
   EDS asserts that there is no advantage to LM's facilities being DITSCAP
   accredited, since the firm will still have to go through a
   "re-accreditation" process. However, the agency reasonably explains that
   the re-accreditation process is much less time consuming and
   "significantly less risky" than the "long, arduous, and uncertain" initial
   accreditation process, and thus LM's existing accreditation was reasonably
   found to be an advantage to the government. Contracting Officer's
   Statement (Aug. 29, 2005) at 19. In another example, EDS asserts that
   sharing space in the government facilities poses a risk to system
   reliability and the facilities' physical security; however, the agency
   reasonably determined that LM had adequately addressed issues of
   reliability, and that the physical security procedures already in place in
   the government facilities met the Army's standards and were an advantage,
   not a risk. Id. at 20. EDS mounts a similar challenge to LM's proposed
   personnel, contending that sharing personnel with other contracts also
   presents a risk to performance; however, the record does not evidence that
   LM's proposed staffing cannot adequately support the AKO function.[15]
   Based on our review of the record, we find that the agency's assessment of
   the government facility data centers was reasonable and consistent with
   the RFP.

   Rating Scheme

   CRT and EDS challenge the specific color ratings assigned by the agency to
   various factors and subfactors. They contend that the rating scheme
   "lacked coherent standards," and that the color ratings assigned were
   inconsistent with the advantages and disadvantages of the offerors'
   proposals.

   Ratings, be they numerical, adjectival, or color, are merely guides for
   intelligent decision-making in the procurement process. Citywide Managing
   Servs. of Port Washington, Inc., B-281287.12, B-281287.13, Nov. 15, 2000,
   2001 CPD para. 6 at 11. Where the evaluators and the source selection
   decision reasonably consider the underlying bases for the ratings,
   including advantages and disadvantages associated with the specific
   content of competing proposals, in a manner that is fair and equitable and
   consistent with the terms of the solicitation, the protesters'
   disagreement over the actual adjectival or color ratings is essentially
   inconsequential, in that it does not affect the reasonableness of the
   judgments made in the source selection decision. See id.; National Steel
   and Shipbuilding Co., B-281142, B-281142.2, Jan. 4, 1999, 99-2 CPD
   para. 95 at 15.

   In response to the protest, the Army provided a detailed record of its
   evaluation and source selection decision.[16] This analysis shows that the
   agency evaluated the relative merits of the proposals and assessed ratings
   in a fair and impartial manner, consistent with both the RFP and rating
   definitions. Although not every advantageous feature of each proposal was
   formally labeled as such and the source selection decision may not have
   discussed each and every asserted strength and weakness, as the protesters
   would have liked, the record demonstrates that the SSEB and SSA considered
   all of the information available, and issued a well-reasoned and rational
   SSEB report and source selection decision that highlighted the key
   discriminators among the offerors' proposals. Based on this reasonable
   discussion and assessment of relative advantages and disadvantages
   associated with the specific content of proposals, we find that the
   protesters'

   disagreements with the actual color ratings are inconsequential, given
   that they do not affect the reasonableness of the judgments made in the
   source selection decision. See Citywide Managing Servs. of Port
   Washington, Inc., supra, at 11.

   Technical and Management Factors

   CRT complains that the agency failed to upwardly adjust its ratings under
   the technical and management factors, even though the agency deleted
   disadvantages from its evaluation document (presumably because CRT
   adequately addressed those concerns during discussions) and identified one
   or more advantages under these factors.[17] For example, it complains that
   the agency did not raise the proposal's ratings from green to blue under
   the business processes, CRM, or small business participation subfactors of
   the management factor, even though, in some cases, all disadvantages had
   been removed after discussions. However, as the agency explains, and the
   record confirms, the elimination or absence of the noted disadvantages did
   not establish CRT's superiority over the other proposals and the remaining
   proposal features considered under these factors did not warrant higher
   color ratings.

   CRT also asserts that the color ratings were "inconsistently applied" to
   its proposal, based on a mathematical count of advantages and
   disadvantages identified by the SSEB for each evaluation subfactor. That
   is, CRT complains that it received lower ratings under some subfactors, as
   compared to other subfactors, even though the Army may have noted more
   advantages (or fewer disadvantages) under the lower-rated subfactor.
   However, the record shows that the agency considered the relative
   significance of CRT's proposal advantages and disadvantages under each
   evaluation subfactor and factor and reasonably assessed color ratings as a
   result. Given the discretion accorded an agency in evaluating proposals,
   we find the Army's consideration of the merits of the proposal features,
   as opposed to the mathematical count of advantages and disadvantages, to
   be unobjectionable.

   CRT also complains that the ratings assigned to CRT's and LM's proposals
   were "inconsistent." For example, it challenges the assertedly "equal"
   ratings (blue) assigned to both firms under the transition methodology
   subfactor of the management factor, arguing that this is unreasonable
   because CRT was the incumbent contractor and therefore presented lower
   risk. The record shows, however, that the Army recognized that CRT's
   incumbency resulted in reduced transition risk, but found also that LM's
   proposal offered a number of "significant advantages" that similarly
   reduced transition risk and justified a blue rating. For example, the Army
   noted that LM's proposed management process "implements a standardized,
   repeatable transition methodology that includes clear exit criteria at key
   decision points during all phases of the transition," "utiliz[es] existing
   cleared personnel, accredited Data Centers, Help Desks and Network
   Operations Centers to implement the transition," and "utilize[s]
   established applications monitoring processes and tools." AR, Tab 124,
   Source Selection Decision, at 10. These features, in addition to a number
   of less important advantages, led the agency to reasonably conclude that
   LM's proposal was deserving of the highest rating under this subfactor.

   EDS complains that the Army did not recognize the "proper significance" of
   the strengths in its proposal. For example, under the technical factor, it
   complains that the agency either failed to recognize, or recognized only
   as a "minor advantage," its proposed use of [REDACTED]. However, as noted
   above, an agency is not required to address in the evaluation documents
   each and every feature asserted to be advantageous, and the record shows
   that the Army did in fact address the important proposal features of EDS's
   solution that it found to be advantageous, including many of the features
   cited by EDS.[18] EDS's arguments amount only to mere disagreement with
   the agency, which does not establish that the evaluation was unreasonable.
   Entz Aerodyne, Inc., supra, at 3.

   EDS also complains that LM's proposal should not have been rated blue
   under the operations and architecture subfactors under the technical
   factor because LM failed to comply with a solicitation requirement that
   the primary and secondary sites "operate in an `active-active' environment
   at all times." RFP, SOO, sect. 5.1. As the agency explains, the term
   "active-active" "generally refers to a situation in which multiple servers
   run their own applications, but reserve resources to allow the servers to
   perform failover duty for each other. If one server fails, the working
   server takes on the identity of the failed server while maintaining its
   own identity." Army Legal Memo (Aug. 19, 2005), at 48. Because the Army
   determined it was not feasible for all applications to be "active-active"
   at all times and that this term did not properly express the agency's
   requirements, the Army deleted the "active-active" requirement from the
   solicitation by amendment, replacing the requirement with another less
   stringent one that required only that the "AKO shall run simultaneously in
   at least two separate geographically dispersed locations" and that, in the
   event of failure, "the other installation(s) will pick up the traffic and
   users will notice nothing more than a momentary interruption" and "minimal
   loss of data." RFP amend. 1, SOO, sect. 5.1. We find nothing in the record
   that suggests that LM did not meet the revised requirement.

   EDS nevertheless asserts that the distances between LM's proposed data
   centers--which are greater than the distances between EDS's proposed data
   centers--will make synchronization between the sites "problematic," and
   will result in less connectivity, less capacity, higher latency,[19] and
   greater risk. However, the agency found, and our review of the record
   supports the reasonableness of the agency's finding, that LM's proposal
   adequately addressed synchronization and sufficiently explained how LM's
   solution eliminated distance limitations so as to ensure continuous
   availability and reliability. For example, LM's proposal described how
   [REDACTED]. The proposal also explained how [REDACTED]. From these and
   other elements in the proposal, the agency reasonably concluded that LM's
   proposal "presents a complete and feasible approach to ensuring continuous
   availability and reliability of [the] AKO that includes geographically
   distributed sites and yearly disaster recovery testing. This reduces the
   risk that a catastrophic failure will result in a loss of service, which
   in turn reduces overall risk associated with Operations." Tab 88, LM Final
   SSEB Report (Technical Factor), at 2-3. Although EDS disagrees with this
   assessment, it has not shown it to be unreasonable.

   EDS challenges a number of other "advantages" assessed to LM's proposal
   under the technical and management factors and alleges it was treated
   disparately. For example, it complains that the agency assigned LM's
   proposal a "significant advantage" and EDS's proposal only a "minor
   advantage" under the architecture subfactor of the technical factor, even
   though the SSEB used the identical language to describe each proposal in
   its final report. However, as the agency explains, LM's proposal was rated
   more favorably because it was "both more detailed and more complete than
   EDS's approach, and clearly indicated that [LM] had a better understanding
   of the problem." Declaration of SSEB Technical Team Leader (Aug. 29, 2005)
   para. 3.

   In other examples, EDS asserts that LM's proposal contains errors
   regarding its hardware solution ([REDACTED]), which assertedly calls into
   question whether LM's server has the capacity to perform, and that LM
   failed to include [REDACTED] in its proposal to ensure connectivity. EDS
   also contends that its proposal is more favorable in terms of the number
   of server-class machines, connectivity to the "NIPRnet" or "SIPRnet,"[20]
   greater bandwidth, and generally "represents a reduced risk in terms of
   performance, growth capacity, and failure redundancy." Declaration of EDS
   Consultant (Aug. 18, 2005) para. 28; see also Declaration of EDS
   Consultant (Sept. 6, 2005). Based on our review of the record, however,
   EDS's arguments reflect either a misreading of LM's proposal or its mere
   disagreement with the agency's judgment. We have reviewed these, and all
   of the other technical challenges asserted by EDS and CRT, and find them
   to be without merit.

   Performance Risk Factor

   CRT complains that it deserved higher than a yellow rating for the small
   business participation subfactor under the performance risk factor. It
   contends that it was unfairly criticized for failing to meet its small
   business goals, given that it had only recently been classified as a large
   business and had a "short history" of setting and achieving small business
   goals. It asserts that the Army unreasonably ignored the recommendation of
   the Associate Director of the Army's Small and Disadvantaged Business
   Utilization Office to not assess a weakness based on this short history,
   and that the Army further ignored the fact that CRT had exceeded several
   of its small business goals. It also complains that LM received a green
   rating, arguing that LM should have received a lower rating since it, too,
   had not achieved its small business goals.

   Our review of the record, however, confirms the reasonableness of the CRT
   and LM proposal ratings. In this regard, the record shows that the agency
   considered the Associate Director's recommendation, along with CRT's
   responses to discussion questions, and recognized that while CRT exceeded
   some of its goals, it did not meet many of its goals and that this
   presented a moderate proposal risk, warranting a yellow rating. While it
   is true that LM also missed some of its small business goals, the agency
   recognized that LM "only slightly" missed the goals and to a lesser degree
   and frequency than did CRT, thus presenting lesser risk proposal and
   warranting a green rating. Contracting Officer's Statement (Aug. 29, 2005)
   at 6. Although CRT disagrees with this assessment, it has not shown it to
   be unreasonable.

   EDS complains that the Army unreasonably evaluated LM's past performance
   and treated the offerors unequally in the evaluation of this subfactor.
   Specifically, it complains that the Army ignored negative past performance
   relating to LM's performance of an Air Force Integrated Space Command and
   Control (ISC2) contract, unfairly rating LM blue under the past
   performance factor, while criticizing EDS for performance issues that
   arose under its Navy Marine Corps Intranet (NMCI) contract.

   The record, however, demonstrates that the agency's past performance
   analysis was reasonable and not unfair. In this regard, both LM's and
   EDS's proposals were rated blue (the highest rating) under this subfactor,
   although both offerors' past performance contained a few negative
   comments. Contrary to EDS's assertion, the record shows that the Army
   considered LM's performance for the ISC2 contract, including comments
   contained in a Contractor Performance Assessment Report (CPAR) and from
   the ISC2 program manager, and found that while the CPAR contained some
   negative comments, there were "numerous highly favorable comments" that
   suggested LM deserved the high past performance rating. Contracting
   Officer's Statement (Aug. 29, 2005) at 15. In addition to this contract,
   the Army also considered 11 other contracts identified by LM, as well as
   its Dun & Bradstreet report and other relevant past performance
   information, all of which suggested to the Army that LM's proposal should
   receive the highest blue rating under this subfactor. Our review of this
   information confirms that the Army's evaluation of past performance was
   reasonable.

   Price Factor

   The protesters also challenge the agency's price evaluation, contending
   that the Army failed to perform an adequate price analysis (which the
   protesters argue must include a price realism and reasonableness analysis)
   and failed to consider the risk to the government associated with LM's low
   price.[21]

   We find from our review of the record that the agency did perform an
   adequate price analysis consistent with the solicitation requirements. In
   this regard, the price evaluators confirmed that each offeror fully priced
   its solution[22] and held discussions with the offerors on areas that
   required further information. The evaluators performed a cost realism
   analysis for the T&M elements, evaluated the TCLP/C for each proposal, and
   performed a risk assessment in accordance with the solicitation's
   requirements. The SSEB documented its analysis of each offeror's proposal
   under the price factor and briefed the SSA on this analysis at each step
   of the evaluation.

   Based on our review of the record, we find no defect regarding the
   agency's determination that LM's proposed fixed price was reasonable.
   In this regard, it is well settled that price reasonableness refers to
   price not being unreasonably high, as opposed to unreasonably low.
   Portfolio Disposition Mgmt. Group, LLC, B-293105.7, Nov. 12, 2004, 2004
   CPD para. 232 at 3. Since the protesters do not contend that LM's price is
   too high, no concern about its reasonableness arises. Rodgers Travel,
   Inc., supra, at 3 n.1.

   With regard to the protesters' specific allegation that the Army failed to
   perform a price realism analysis for the fixed-price elements of the
   contract, we note that the RFP required only that a realism analysis be
   performed for the T&M elements of the work, not the fixed-price elements
   as the protesters' allege.[23] As noted above, [REDACTED] percent of LM's
   proposed effort was fixed-price, including the data center work that the
   protesters assert forms the basis for LM's significant cost savings.
   Where, as here, an RFP contemplates award based on fixed-price elements,
   an agency is not required to conduct a realism analysis for these
   fixed-price elements of the contract. Rodgers Travel, Inc., B-291785, Mar.
   12, 2003, 2003 CPD para. 60 at 2.

   We also find no basis to question the agency's risk assessment under the
   price/cost factor. In this regard, as noted above, the RFP stated that the
   agency would "evaluate the extent to which the offeror selects a contract
   type (or combination of types) that reduces Government risk and will
   appropriately tie profit to contractor performance. Furthermore, the
   Government will assess the proposed contract type(s) as they relate to the
   understanding of the requirement and feasibility." RFP sect. M.3. The
   record documents the Army's assessment of each offeror's proposal risk as
   it relates to the proposed contract types and its conclusion that each
   offeror (all of which proposed a primarily fixed-price contract structure)
   "has chosen the appropriate contract types with an appropriate
   distribution of risks between the offeror and the Government reflecting a
   clear understanding of the requirement." AR, Tabs 91, 103, and 115, LM,
   CRT, and EDS Final SSEB Reports (Price/Cost Factor); Tab 124, Source
   Selection Decision, at 16. Specifically with regard to LM, the record
   documents the agency's finding that LM's proposed solution presented a low
   risk based on its [REDACTED] fixed-price structure and demonstrated
   understanding of the RFP's requirements. AR, Tab 91, LM Final SSEB Report
   (Price/Cost Factor) at 4. Although the protesters assume that LM's low
   price increases the risk to the government, they have not shown that LM, a
   large established contractor, cannot successfully perform under the terms
   proposed with an acceptable price risk.[24]

   Discussions

   Both protesters contend that the Army failed to conduct meaningful
   discussions. Contracting agencies have wide discretion in determining the
   nature and scope of discussions, which our Office will not question unless
   it is clearly shown to be without a rational basis. PRB Assocs., Inc.,
   B-277994, B-277994.2, Dec. 18, 1997, 98-1 CPD para. 13 at 6. Although
   discussions must be "meaningful," that is, sufficiently detailed so as to
   lead an offeror into areas of its proposal requiring amplification or
   revision, an agency is not required to "spoon feed" an offeror as to each
   and every item that must be revised to improve their proposal or to
   achieve the maximum score, or advise the offeror of weaknesses that are
   not significant even if those weaknesses become the determinative factor
   in the award. Uniband, Inc., B-289305, Feb. 8, 2002, 2002 CPD para. 51 at
   11. An agency is also not required to hold successive rounds of
   discussions until all proposal defects have been corrected. Metro Mach.
   Corp., B-295744, B-295744.2, Apr. 21, 2005, 2005 CPD para. 112 at 19.

   CRT complains that the discussions it received were inadequate on issues
   that led to yellow ratings. For example, it argues that it was not advised
   of a "significant disadvantage" noted by the SSEB under the PBA/PM
   subfactor of the management factor. However, the record shows that the
   agency did in fact twice raise with CRT during discussions the very issue
   that led to the assessment of a disadvantage--that is, CRT's lack of
   performance-based measures and metrics--and that its proposal rating
   improved from red to yellow as a result. The fact that CRT did not fully
   alleviate the agency's concern in this respect, and therefore did not
   receive a higher rating, does not obligate the agency to hold successive
   rounds of discussions. See Metro Mach. Corp., supra, at 19.

   CRT also argues that it was not informed of weaknesses assessed under the
   follow-on transition subfactor of the management factor and the small
   business participation subfactor of the performance risk factor. In both
   instances, however, the agency did not assess any "disadvantages" to CRT's
   proposal and although it noted areas that presented "moderate risk" in
   CRT's proposal (which led to the yellow rating), it otherwise found the
   proposal to be acceptable and without significant weaknesses under these
   subfactors. In any event, even if discussions should have been conducted,
   CRT has not shown that it was prejudiced because, even if CRT's proposal
   had received the highest (blue) rating under the challenged subfactors,
   CRT has not shown that it would have received higher ratings under the
   overall factors or been found to be technically superior to LM, in order
   to overcome the significant differential in price. Since CRT has not
   demonstrated a reasonable possibility that it was prejudiced by the
   agency's actions, that is, but for the agency's actions, it would have had
   a substantial chance of receiving the award, we cannot sustain the protest
   on this ground.[25] McDonald-Bradley, B-270126, Feb. 8, 1996, 96-1 CPD
   para. 54 at 3; see Statistica, Inc. v. Christopher, 102 F.3d 1577, 1581
   (Fed. Cir. 1996).

   EDS asserts that the discussions it received were inadequate, and in fact
   misleading, concerning its higher price. In this regard, it asserts that
   the Army's failure to raise concerns about the proposal's high price and
   the agency's focus on technical deficiencies encouraged EDS to increase
   its technical capability, which in turn resulted in increased cost.
   However, we find nothing in the discussions that were misleading. There is
   no requirement that an agency inform an offeror during discussions that
   its price is too high, where the offeror's price is not considered
   excessive or unreasonable. Uniband, Inc., supra, at 12. As discussed
   previously, the agency conducted a price analysis of proposed prices and
   determined that EDS's price was fair and reasonable and, for the T&M
   effort, realistic for its approach. Given this determination, the agency
   was not required to advise EDS during discussions that its price was high
   in comparison to LM. Id.

   Best-Value Analysis

   The protesters also challenge the Army's best-value analysis, which they
   contend is based on a flawed technical and price evaluation. However, as
   discussed above, we find the agency's evaluation under each of the
   evaluation factors to be well documented, reasonable, and consistent with
   the RFP. Based on our review of the record, as discussed above, we find no
   error in the Army's selection of LM, the offeror with the highest
   technically rated and lowest priced proposal.

   The protests are denied.

   Anthony H. Gamboa

   General Counsel

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

   [1] This Office conducted a hearing in this matter on September 16, 2005.

   [2] The RFCs and the Army's responses were attached as an amendment to the
   solicitation.

   [3] One other offeror submitted a proposal, but was eliminated from the
   competitive range after the initial evaluation.

   [4] The independent government estimate was $555,381,406.

   [5] DITSCAP refers to the Department of Defense Information Technology
   Security Certification and Accreditation Process.

   [6] Where the parties dispute the meaning of solicitation terms, we will
   resolve the matter by reading the solicitation as a whole in a manner that
   gives effect to all of its provisions. Sea-Land Serv., Inc., B-278404.2,
   Feb. 9, 1998, 98-1 CPD para. 47 at 18. Reading all of the solicitation
   terms together, including the RFC responses, there is no inconsistency. We
   disagree with the protesters' assertion that the RFC responses are not
   part of the solicitation, particularly since they were included in
   amendment 001. See Linguistic Sys., Inc., B-296221, June 1, 2005, 2005 CPD
   para. 104 at 2.

   [7] CRT cites also to an "Item for Negotiation" (IFN) received during
   discussions. That IFN questioned the firm's proposed inclusion of two
   buildings from Fort Belvoir as "Government Furnished
   Property/Facilit[ies]," stating that the "RFP specifically states that no
   Government Property is being made available." AR, Tab 75, CRT IFN No.
   KDKC001 (quoting RFP sect. L.2.f). The language of this IFN is consistent
   with the language of the RFP and RFCs.

   [8] EDS also generally contends that it was treated unfairly, but this
   stems from its belief that it was not permitted to lease government
   facilities under the RFP. Since we find that such leases were permitted
   and that this was evident from the RFP, we find no basis to conclude that
   EDS was treated unfairly in the evaluation.

   [9] In support of their arguments, the protesters cite our decision in 46
   Comp. Gen. 578 (1966). However, that case is distinguishable because that
   awardee, unlike here, proposed to use government property that it had
   acquired on a rent-free basis.

   [10] One lease was executed pursuant to 10 U.S.C. sect. 2667 (2000) and
   the other was executed pursuant to 16 U.S.C. sect. 470H-3 (2000).

   [11] EDS parses the language of FAR sect. 45.000, contending that the
   statutory leasing authority exception for "providing property" applies
   only to the first clause in the preceding sentence since only that clause
   similarly refers to "providing property." We find this interpretation
   unreasonable. Rather, we find that the "it" ("It does not apply") in the
   second sentence refers to "this part" (Part 45) in the first sentence, not
   just one of the clauses in the first sentence, as EDS argues.

   [12] Although the protesters suggest that LM was provided the use of the
   facilities "rent free," the record shows that LM's subcontractor is paying
   fair market value for the facilities and indeed is charging LM for the use
   of the facilities. AR, Tabs 144 and 168, LM Subcontractor Leases;
   Declaration of LM's Subcontractor Director of Finance and Administration
   (Sept. 21, 2005) paras. 4-5.

   [13] Although the RFP did not identify that "risk" would be assessed under
   the technical and management factors, the RFP did state that the agency
   would assess "feasibility of approach," which included an assessment of
   the "extent to which the proposed approach is workable and the end results
   achievable" and "whether the Offeror's methods and approach in meeting the
   objectives provide the Government with a high level of confidence to
   ensure successful performance." RFP sect. M.3.

   [14] EDS also complains that the LM leases had expired before contract
   award, which "raise[s] more questions" about these facilities. EDS
   Comments (Aug. 29, 2005) at 3 n.2. However, the record shows that the
   leases have been, or are in the process of being, renewed at fair market
   value. LM Comments (Aug. 29, 2005) at 6-7; Declaration of Legal Counsel to
   LM's Subcontractor (Aug. 26, 2005) paras. 11-15. Furthermore, valid leases
   were not required by the RFP and the record indicates that the protesters
   also did not have signed contracts for their data facilities at the time
   of evaluation. See AR, Tab 40, CRT Management Proposal, sect. 2.2.6
   (stating that "[c]ontracts and engineering plans will be finalized with
   facility providers"); Tab 53, EDS Management Proposal, sect. 2.3.2
   (stating that "[d]ata center contracts for the data center space will be
   finalized with the subcontractor companies"). Thus, in any event, it
   appears that all offerors were treated similarly in that none were
   downgraded for lacking facility contracts.

   [15] EDS also complains that the agency failed to assess whether the
   existing facilities had sufficient cooling and power, but the RFP did not
   require that cooling and power capacity be evaluated and none of the
   offerors submitted information such that these features could be
   evaluated. In any event, LM's proposal identifies that its proposed data
   centers have "redundant cooling systems and sources of conditioned power,"
   that its proposed hardware and network architectures also have "built-in
   internal redundancy such as power supplies, fans, and network
   connections," and that its proposed network circuits have "redundant
   routes between data centers and the DISA network." AR, Tab 23, LM
   Technical Proposal, sect. 1.3. Nothing in the record suggests that the
   Army should have questioned these statements during the evaluation, and
   EDS has not shown the statements to be untrue.

   [16] The protesters contend that the final SSEB evaluation documents do
   not reflect a consensus judgment because several are not marked
   "consensus." However, the agency explains that this was an administrative
   oversight and that the documents do, indeed, reflect the consensus
   evaluation of the SSEB. Contracting Officer's Statement (Aug. 29, 2005) at
   7.

   [17] CRT mounts a similar challenge to the evaluation of performance risk
   and, there too, we find the agency's evaluation reasonable.

   [18] In some instances, such as with EDS's offer to [REDACTED], the Army
   found that the solution, [REDACTED] actually increased the risk to the
   government that the solution will not provide users with a "seamless
   experience." AR, Tab 112, EDS Final SSEB Report (Technical Factor), at 4.
   The Army raised this concern with EDS during discussions, but EDS did not,
   in the agency's view, adequately respond to the Army's concerns.

   [19] Latency is the measure of how long information takes to travel in a
   network. Higher latency indicates increased transmission times.
   Declaration of EDS Consultant (Sept. 6, 2005) para. 13.

   [20] "NIPRnet" is the Department of Defense Non-Secure Internet Protocol
   Router Network, and "SIPRnet" is the Department of Defense Secret Internet
   Protocol Router Network.

   [21] EDS also asserts that this risk should have resulted in LM's proposal
   receiving lower technical and management factor ratings. Because the
   protesters assert that LM's cost savings appears to be associated with its
   use of government facilities, the use of which we found was permitted by
   the RFP, we find no basis to conclude that LM's technical and management
   ratings should be downgraded based on the firm's proposed low price.

   [22] To the extent that EDS asserts that some evaluation worksheets state
   that LM's proposal was not fully priced, the agency explains that these
   worksheets were abandoned "part way through the evaluation" and that all
   concerns with LM's proposal were resolved during discussions. Contracting
   Officer's Statement (Aug. 29, 2005) at 2.

   [23] The protesters do not contest the realism analysis of the T&M
   components of LM's proposal.

   [24] To the extent the protesters also assert that LM's low price poses a
   risk to performance under the technical and management factors, we find no
   basis in the record to question the Army's ratings. As discussed above, we
   find the Army's analysis of LM's proposal under those factors to be
   reasonable.

   [25] CRT also complains that discussions were "unfair" in that CRT was
   excluded from the final round of discussions, but LM and EDS were given an
   additional chance to revise their proposals. CRT points only to the issues
   discussed above as areas for which discussion should have been held and,
   as we have found, discussions were not required on these issues, and, in
   any event, CRT was not prejudiced by the agency's failure to hold further
   discussions with CRT on these issues.