TITLE: B-297294, Shaw Environmental, Inc., December 2, 2005
BNUMBER: B-297294
DATE: December 2, 2005
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B-297294, Shaw Environmental, Inc., December 2, 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: Shaw Environmental, Inc.

   File: B-297294

   Date: December 2, 2005

   Richard L. Moorhouse, Esq., and David T. Hickey, Esq., Greenberg Traurig,
   LLP, for the protester.

   Capt. Geraldine Chanel, Department of the Army, for the agency.

   Paul E. Jordan, Esq., and John M. Melody, Esq., Office of the General
   Counsel, GAO, participated in the preparation of the decision.

   DIGEST

   1. Where solicitation was clear on applicable requirements and responses
   to offerors' questions were consistent with those requirements, agency had
   no duty to amend the solicitation to clarify protester's unilateral
   misinterpretation of solicitation.

   2. Agency was not required to hold discussions to allow protester to make
   its proposal technically acceptable where solicitation advised offerors of
   the possibility of award without discussions.

   DECISION

   Shaw Environmental, Inc. protests its elimination from the competitive
   range and the award of a contract to Clayton Group Services, Inc. under
   request for proposals (RFP) No. W91ZLK-05-R-0009, issued by the Department
   of the Army for environmental restoration services in California. Shaw
   asserts that the agency improperly concluded that its proposal was
   technically unacceptable, misled it, and improperly failed to conduct
   discussions.

   We deny the protest.

   The RFP contemplated the award of a fixed-price contract, for a period of
   10 years, to provide environmental restoration services to remediate the
   Joint Forces Training Base at Los Alamitos and Camp Roberts in California.
   The work includes both remediation and long-term management at 15 sites at
   the installations. The largest single component of the requirement and
   subject of this protest is the Los Alamitos Landfill.

   Proposals were to be evaluated on the basis of three factors--technical,
   management, and price. The technical factor was divided into three
   subfactors--technical approach, project schedule, and personnel
   qualifications--and the management factor was divided into four
   subfactors--management plan, past experience, proof of insurability, and
   subcontracting plan. A proposal had to be evaluated as technically
   acceptable under all factors and subfactors in order to be considered for
   award. Price was to be evaluated on the basis of the cost/price analysis
   techniques in Federal Acquisition Regulation (FAR) sect. 15.404. The RFP
   advised that award could be made on the basis of initial proposals,
   without discussions, and that offerors thus should ensure that their
   initial proposals contained their most favorable terms and best efforts.
   RFP sect. M.1. Award was to be made to the offeror submitting the
   lowest-priced, technically acceptable proposal.

   Four offerors, including Shaw and Clayton (the incumbent contractor),
   submitted proposals, which were evaluated by a technical evaluation board
   (TEB).[1] Based on a review of initial proposals, the TEB concluded that
   only Clayton's proposal was technically acceptable. Shaw's proposal was
   rejected because its technical approach for the landfill was found
   technically unacceptable. Based on the evaluation of initial proposals,
   and without conducting discussions, the contracting officer, as source
   selection authority, awarded the contract to Clayton. After receipt of a
   written debriefing, Shaw filed this protest.

   BACKGROUND

   This protest centers on Shaw's failure to comply with one provision of the
   performance work statement (PWS). The provision at issue describes the
   condition of the landfill, noting specifically that the groundwater under
   it had been affected by landfill leachate, and that landfill material had
   been in contact with the top of the aquifer and continued to cause
   significant groundwater contamination. The PWS provision also provided as
   follows:

   Formal closure of this landfill will require compliance with State
   regulations in which it is necessary to produce and sustain a five foot
   difference between the depth of the waste and the water table. There may
   be numerous mechanisms by which this may be achieved.

   PWS para. 6.2.3. The applicable state regulation, Title 27, California
   Code of Regulations (CCR), sect. 22040, provides that new and existing
   landfills must be "operated to ensure that wastes will be a minimum of
   five feet (5 ft.) above the highest anticipated elevation of underlying
   ground water." Title 27 elsewhere addresses the closure of landfills,
   requiring that infiltration of water into waste be minimized in order to
   minimize the production of leachate and gas. 27 CCR
   sect. 20950(a)(2)(A)(1). This provision is silent regarding the 5-foot
   separation requirement.

   Shaw's technical approach provided for [deleted]. Shaw Proposal at I-1. It
   further provided that, if [deleted]. Id. at I-2. Shaw assumed that "five
   feet separation of waste to groundwater [was] [deleted]." Id. at I-3.

   Cognizant of Shaw's failure to address the 5-foot separation requirement,
   the TEB further reviewed the requirement. Agency Report (AR), Tab 19, at
   3. Noting that 27 CCR sect. 20950 (general closure and post-closure
   maintenance standards) does not explicitly discuss the 5-foot separation,
   the TEB recognized that a literal 5-foot separation was not required under
   the regulations. In this regard, the RFP did not prescribe the method for
   achieving the separation, providing that there "may be numerous mechanisms
   by which this may be achieved." PWS para. 6.2.3. In the agency's view, an
   alternative method--such as physical removal of the waste, construction of
   a liner system, or lowering the water table--was acceptable so long as it
   achieved the same result. AR at 15. The evaluators also considered that
   the agency could possibly face more expensive remedies if closure or
   corrective action under the Resource Conservation Recovery Act (RCRA) were
   required, and noted that a state regulator previously had recommended RCRA
   corrective action if waste containing hazardous constituents were left in
   contact with the groundwater. AR, Tab 19, at 3. The evaluators concluded
   that an acceptable remedy had to address the minimum 5-foot separation
   standard, and verified this conclusion with the local RWQCB. Id. The
   agency evaluated Shaw's proposal as failing to meet the Title 27
   requirements, including mitigation of current and future contamination
   release to groundwater, and therefore rejected it as unacceptable. Id. at
   5.

   DISCUSSION

   In its initial protest, Shaw asserted that the agency erred in finding its
   technical approach unacceptable, maintaining that 27 CCR sections 20080
   and 209550 allow for the alternative type of landfill closure it proposed,
   without requiring a 5-foot separation between waste and groundwater.
   However, in its comments on the agency report, Shaw asserts that its
   compliance with Title 27 is no longer the issue; rather, the issue is
   whether the agency failed to notify Shaw of a change in its requirements.
   Comments at 9. Specifically, Shaw asserts that, while the RFP called for
   offerors to produce and maintain a 5-foot separation between groundwater
   and waste, agency responses to offeror questions effectively negated this
   language and made acceptable any solution that generally complied with
   Title 27. Comments at 11. Shaw concludes that, when the agency
   subsequently determined that the 5-foot separation in fact was required,
   it was obligated to notify offerors of this shift back to the original
   requirement. In this regard, where, before or after the receipt of
   proposals, an agency's solicitation requirements change, the agency must
   issue an amendment to notify offerors of the changed requirements and
   afford them an opportunity to respond. FAR sect. 15.206(a); Northrup
   Grumman Info. Tech, Inc., et al., B-295526 et al., Mar. 16, 2005, 2005 CPD
   para. 45 at 13.

   The agency's actions were unobjectionable; the RFP requirements remained
   the same throughout the procurement, so there was no need for the agency
   to amend the solicitation. The RFP clearly required compliance with state
   regulations that made it "necessary to produce and sustain a five foot
   difference between the depth of waste and the water table." PWS
   sect. 6.2.3. Shaw does not dispute the clarity of this requirement.
   Thereafter, while, as Shaw alleges, the agency responded to various
   questions regarding the requirement, all of its answers were consistent
   with the RFP. For example, Shaw asked if "the performance standard [was]
   regulator approval or sustaining a 5 foot difference." RFP, amend. 8, at
   7, Question No. 25. The agency responded that the "performance standard
   [was] to meet the requirements in Title 27." Id., Answer No. 25. The
   agency addressed other offerors' questions similarly, by either referring
   offerors to the Question 25 response, or otherwise calling for the
   contractor to meet the regulatory requirements in Title 27. Id.,
   Question/Answer Nos. 75-76. Nothing in these responses, calling for
   compliance with Title 27 as a whole, indicated that the otherwise clearly
   stated 5-foot requirement had been relaxed. Although the regulatory
   provisions dealing with closure of landfills (sections 20080 and 20950) do
   not mention the 5-foot requirement, this silence did not serve to relax
   the requirement which, again, was clearly stated in the RFP. There is
   nothing inherently inconsistent in requiring the 5-foot separation to meet
   the section 20950 requirement to minimize infiltration of water into
   waste, and the section 20080(b) allowance of the use of alternative
   methods that afford "equivalent protection against water quality
   impairment." 27 CCR sect. 20080(b)(2)(B). Shaw therefore had no reasonable
   basis to believe that the agency had modified the PWS to eliminate the
   5-foot separation requirement, and it follows that there was no basis for
   the agency subsequently to advise Shaw that the requirement was
   reinstated.[2] Since Shaw's alternative approach did not address the
   separation requirement, its proposal was reasonably rejected as
   technically unacceptable.

   Our conclusion is not changed by Shaw's claim that it relied on input it
   obtained from a representative of the RWQCB concerning application of the
   5-foot separation requirement. In this regard, prior to submitting its
   proposal, an RWQCB representative opined to Shaw that 5 feet of separation
   was not a "strict requirement" if the firm could control groundwater as it
   had on another project using a [deleted]. Shaw Proposal Preparation
   Minutes. While this same representative later served as an advisor to the
   TEB and advised it of the necessity for the 5-foot requirement, he was not
   a voting member of the TEB and lacked any authority to amend the RFP. Oral
   advice does not operate to amend a solicitation or otherwise legally bind
   the agency. Digital Imaging Acquisition Networking Assoc., Inc.,
   B-285396.3, Nov. 8, 2000, 2000 CPD para. 191 at 5 n.6. An offeror chooses
   to rely on such advice, and to propose an approach contrary to the RFP, at
   its own risk. Northrop Grumman Tech. Servs., Inc.; Raytheon Tech. Servs.
   Co., B-291506 et al., Jan. 14, 2003, 2003 CPD para. 25 at 13.

   Shaw also asserts that the agency was required to conduct discussions with
   it to apprise it of its failure to meet the requirements. However, there
   generally is no obligation for an agency to conduct discussions where, as
   here, the RFP specifically instructs offerors that award may be made on
   the basis of initial proposals. FAR sect. 15.306(a)(3); Colmek Sys. Eng'g
   , B-291931.2, July 9, 2003, 2003 CPD para. 123 at 7. An agency is not
   precluded from awarding on an initial proposal basis merely because an
   unacceptable lower-priced offer might be made acceptable through
   discussions. Integration Techs. Group, Inc., B-274288.5, June 13, 1997,
   97-1 CPD para. 214 at 6. The contracting officer's discretion in deciding
   not to hold discussions is quite broad. Our Office will review the
   exercise of that discretion only to ensure that it was reasonable based on
   the particular circumstances of the procurement. Id. We find no
   circumstances here that call into question the agency's decision not to
   engage in discussions.

   The protest is denied.

   Anthony H. Gamboa

   General Counsel

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

   [1] The TEB was assisted by various non-voting subject-matter experts,
   including representatives of the Santa Ana Regional Water Quality Control
   Board (RWQCB) and the National Guard Bureau.

   [2] Shaw observes that the agency's answers did not expressly state that
   the 5-foot methodology was an "absolute requirement." Comments at 4, 11.
   However, since the requirement was clearly stated in the RFP and the
   agency did not expressly change the requirement in its responses to
   offerors' questions, the agency's failure to restate the requirement did
   not make it any less absolute. While Shaw asserts that it believed that
   PWS sect. 6.2.3 "reflected a misinterpretation of Title 27's
   requirements," its question did not bring that view to the agency's
   attention. Shaw Declaration, Nov. 3, 2005, para. 7.