TITLE: B-297686, CRAssociates, Inc., March 7, 2006
BNUMBER: B-297686
DATE: March 7, 2006
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B-297686, CRAssociates, Inc., March 7, 2006
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: CRAssociates, Inc.
File: B-297686
Date: March 7, 2006
Devon E. Hewitt, Esq., Pillsbury, Winthrop, Shaw & Pittman, for the
protester.
Douglas Kornreich, Esq., Department of Health & Human Services, for the
agency.
David A. Ashen, Esq., and John M. Melody, Esq., Office of the General
Counsel, GAO, participated in the preparation of the decision.
DIGEST
Protest that agency was required under the provisions of Office of
Management and Budget Circular A-76, as revised on May 29, 2003, to
include technically unacceptable private sector offer in the initial
competitive range under solicitation issued as part of a Circular A-76
cost comparison study, is denied where solicitation clearly indicated that
the agency contemplated conducting discussions only with offerors in the
competitive range, and that not all offerors would be included in the
competitive range; to the extent that protester believed it should be
entitled to discussions even if its proposal were excluded from the
competitive range, it was required to protest on this ground prior to the
closing date for receipt of proposals.
DECISION
CRAssociates, Inc. (CRA) protests the rejection of its proposal as
technically unacceptable, and the resultant elimination of its proposal
from the competitive range, under Department of Health & Human Services
(HHS) solicitation No. A-76Study01(05)AM. The solicitation was issued on
August 5, 2005 as part of a cost comparison study, conducted pursuant to
Office of Management and Budget (OMB) Circular A-76, as revised on May 29,
2003, to determine whether to contract out--rather than continue to have
performed in-house by HHS's Health Resources and Services Administration
(HRSA), Division of Immigration Health Services (DIHS) employees--medical
and support services for detainees in the custody of the Department of
Homeland Security, Immigration Customs Enforcement (ICE). CRA primarily
asserts that members of the agency's evaluation panel had impermissible
conflicts of interest, and that HHS improperly failed to provide the firm
an opportunity to remedy the evaluated deficiencies in its proposal.
We deny the protest.
DIHS provides on-site medical, dental and mental health care to ICE
detainees coming from more than 100 countries and speaking more than 150
languages, some of whom are extremely violent and/or display significant
mental health disorders, and many of whom come from countries with a high
prevalence of infectious diseases that are of public health importance.
These detainees are housed in a variety of secure environments, including
county or local jails, as well as ICE processing centers and contract
detention facilities. Performance Work Statement (PWS) sect. 1.1.
The solicitation provided for use of a lowest-cost/technically acceptable
source selection method. In this regard, the solicitation stated that
award will comply with the rules of OMB Circular A-76. This includes the
conduct of a cost comparison between the Agency Tender and the
low-cost/technically acceptable commercial offer/reimbursable tender.
RFP sect. M.1. Offerors were generally advised that in order to be
considered technically acceptable, "all the requirements (services and
service levels) and standards" in the PWS must be met. Id. The RFP
specifically provided for the determination of technical acceptability to
be based upon evaluation of the following factors: (1) technical
(including criteria for (a) technical approach, (b) management approach,
including staffing approach and minimizing attrition, (c) transition plan
and phase-in plan, (d) quality control plan, (e) accreditation plan of
actions and milestones, (f) medical deployment plan, and (g) key personnel
resumes); (2) past performance; and (3) price/cost (including criteria for
(a) realism and balance and (b) business capacity). Offers were to receive
either an excellent, good, marginal or poor rating under the technical and
price/cost criteria, or an excellent, good, none, marginal or poor rating
under the past performance factor. The RFP further provided in this regard
that to be considered technically acceptable, an offer "must be evaluated
as good or excellent in all technical criteria, all past performance
criteria, and all price/cost criteria." RFP sect. M.4.[1]
An agency tender based upon a most efficient organization (MEO) and a
proposal from CRA were received in response to the solicitation. The
agency tender was rated excellent under the transition/phase-in, quality
control, accreditation and medical deployment criteria, and good under the
technical approach, management approach, key personnel resumes, and
price/cost realism and balance criteria, for an overall technically
acceptable rating. In contrast, CRA's proposal was rated as marginal under
the quality control, accreditation, and price/cost realism and balance
criteria, and poor under the technical approach, management approach,
transition/phase-in, medical deployment plan, and key personnel resumes
criteria, for an overall unacceptable rating.
Among the numerous evaluated deficiencies and weaknesses in CRA's proposal
was the omission of required key personnel resumes. In this regard, the
solicitation specifically required private sector offerors to "[p]rovide
resumes for all key personnel identified by the Offeror." RFP sect.
L.2.5.G. The PWS defined key personnel as including, at a minimum, the
project manager, alternate project manager(s), and "[h]ighest-level
personnel at each site," and listed 14 medical clinics in various parts of
the United States (including Puerto Rico). PWS sections 1.4.4.4, 3.2.1. In
its proposal, however, CRA only named and furnished resumes for the
corporate project manager, project manager, assistant project manager, and
medical director. CRA Proposal, Appendix E. CRA stated in its proposal
that, "[a]lthough CRA agrees that the position of facility Health Services
Administrator (HSA) should be considered a `Key Personnel' position under
any resulting contract, we take exception to the RFP requirement to
provide resumes of proposed key personnel." CRA Proposal, Executive
Summary. CRA explained its failure to furnish resumes on the basis that
"it is uncertain whether any of the existing HSAs would be interested in
continuing their current capacity as a contractor employee," "[t]he short
proposal due date has made it impractical to conduct a complete search for
14 qualified candidates," and "many of the best qualified candidates are
extremely hesitant to sign any commitment letters at this stage for a
prospective job opportunity that is speculative, at best." Id.
In view of the deficiencies and weaknesses in CRA's proposal, which led to
unacceptable ratings under 8 of 10 evaluation criteria and an unacceptable
rating overall, HHS excluded CRA's proposal from the competitive range.
According to the agency's competitive range determination, "[m]any of
[CRA's] weaknesses were considered so substantive (including their
exception to providing the identity of many key personnel . . .) as to
preclude the possibility of improving their score to an acceptable level
without a major rewrite of their proposal which would be tantamount to
submission of a new proposal." Competitive Range Determination at 1-2.
Upon learning of the exclusion of its proposal from further consideration,
CRA filed this protest with our Office.
CONFLICT OF INTEREST
CRA asserts that three of the seven evaluators on the agency's Technical
and Past Performance Review Panel and two of the four evaluators on the
Cost Evaluation Review Panel were employed within DIHS, and thus had a
conflict of interest that should have precluded their participation in the
evaluation. HHS responds that the evaluators in question held positions
that were inherently governmental, and that therefore were outside the
scope of the A-76 study.
In conducting government business, including the evaluation of proposals
as part of an A-76 study, the general rule is to avoid any conflict of
interest or even the appearance of a conflict of interest. Federal
Acquisition Regulation (FAR) sect. 3.101-1. In applying this general
principle, we have held that at least the appearance of a conflict of
interest exists where, in an A-76 cost comparison, an evaluator holds a
position that is within the scope of the study and is subject to being
contracted out. See DZS/Baker LLC; Morrison Knudsen Corp., B-281224 et
al., Jan. 12, 1999, 99-1 CPD para. 19 at 5. However, we have also held
that the appointment of evaluators who hold positions in the function
under study is not necessarily improper if the positions are not directly
affected, that is, are not in jeopardy of being contracted out. IT
Facility Servs.--Joint Venture, B-285841, Oct. 17, 2000, 2000 CPD para.
177 at 12.
Circular A-76, as revised, itself specifically provides for the agency to
appoint an evaluation team, referred to as the Source Selection Evaluation
Board (SSEB), and specifies that:
Directly affected personnel (and their representatives) and any
individual (including, but not limited to, the [Agency Tender Official],
[Human Resource Advisor], MEO team members, advisors, and consultants)
with knowledge of the agency tender (including the MEO and agency cost
estimate) shall not participate in any manner on the SSEB (e.g., as
members or advisors).
OMB Circular A-76, attach. B, sect. D.2.c (May 29, 2003). Circular A-76
defines "Directly Affected Government Personnel" as "[g]overnment
personnel whose work is being competed in a streamlined or standard
competition." OMB Circular A-76, attach. D.
Here, the record indicates that four of the seven evaluators on the
agency's Technical and Past Performance Review Panel, and two of the four
evaluators on the Cost Evaluation Review Panel occupy positions outside
DIHS, the organization whose functions are under study. In addition,
according to HHS, while the remaining evaluators on the panels occupy
positions within DIHS, these positions are inherently governmental and
thus not within the scope of the A-76 study. Specifically, the four
reportedly inherently governmental evaluators (one individual served on
both panels) are members of the U.S. Public Health Service Commissioned
Corps, and occupy the following, managerial, DIHS positions: DIHS Chief
Pharmacist and Telehealth Coordinator, Associate Director for Management
and Budget for DIHS, program manager for the DIHS Detention Management and
Control Program, and DIHS Information Technology Manager. Agency Comments,
Jan. 24, 2006, at 2-3, Declaration of DIHS Competitive Sourcing Management
Analyst.
CRA challenges HHS's characterization of these four evaluators' positions
as inherently governmental, asserting that the agency's claim is
inconsistent with HHS's 2004 inventory of positions, published as required
under the Federal Activities Inventory Reform (FAIR) Act of 1998, 31
U.S.C.A. sect. 501 note, which directs federal agencies to issue annually
an inventory of all commercial activities performed by federal employees.
Specifically, CRA argues, since the 2004 FAIR Act inventory indicates
(without specifying the specific position in question) that only 10
positions within all of DIHS are inherently governmental, and a number of
these inherently governmental positions undoubtedly are those of the DIHS
director, deputy director, chief of staff, and various branch chiefs, it
is unlikely that the positions held by the evaluators here also were
inherently governmental.
HHS responds by explaining that the mission of DHIS was enlarged in fiscal
year 2005, resulting in an increase in the number of FTEs assigned to
DIHS, and that, in preparation for the 2005 inventory, the process used to
define the functions performed within HHS was revised. As a result, the
number of inherently governmental positions within DIHS reported in the
draft 2005 inventory increased significantly above the number in the 2004
inventory, to approximately 35 positions. HHS Comments, Feb. 3, 2006.
Having reviewed a copy of the relevant worksheet of inherently
governmental positions within DIHS, as included in HHS's submission of the
2005 inventory to OMB for review, we find no basis to question HHS's
assertion that the four evaluators occupy inherently governmental
positions and thus are outside the scope of the A-76 study. In this
regard, we note that the worksheet for the 2005 inventory specifically
identified the positions held by the four evaluators in question as
inherently governmental. Id. Accordingly, there is no basis to conclude
that a number of the evaluators should have been precluded from
participating in the evaluation on account of conflicts of interest.
PROPOSAL DEFICIENCIES
CRA asserts that HHS was required under Circular A-76 to afford it an
opportunity to remedy the evaluated deficiencies in its proposal. In this
regard, CRA cites the following:
If the [contracting officer] perceives that a private sector offer,
public reimbursable tender, or agency tender is materially deficient,
the [contracting officer] shall ensure that the [Agency Tender
Official], private sector offeror, or the public reimbursable tender
official receives a deficiency notice. The [contracting officer] shall
afford the [Agency Tender Official], the private sector offeror, or the
public reimbursable tender official a specific number of days to address
the material deficiency and, if necessary, to revise and recertify the
tender or offer. . . . If the [contracting officer] determines that a
private sector offeror or public reimbursable tender official has not
corrected a material deficiency, the SSA may exclude the private sector
offer or public reimbursable tender from the standard competition.
OMB Circular A-76, attach. B, sect. D.5.c(3).
Here, the agency acted consistently with the terms of the solicitation. As
noted by HHS, the solicitation set forth the following FAR provision,
included in section L, "Instructions, Conditions, and Notices to Offerors
or Quoters":
The Government intends to evaluate proposals and award a contract after
conducting discussions with Offerors whose proposals have been
determined to be within the competitive range. If the Contracting
Officer determines that the number of proposals that would otherwise be
in the competitive range exceeds the number at which an efficient
competition can be conducted, the Contracting Officer may limit the
number of proposals in the competitive range to the greatest number that
will permit an efficient competition among the most highly rated
proposals. Therefore, the Offeror's initial proposal should contain the
Offeror's best terms from a price and technical standpoint.
FAR sect. 52.215-1, Instructions to Offerors--Competitive Acquisition,
Alternate I (Oct. 1997). We agree with HHS that this solicitation
provision clearly indicated that the agency contemplated conducting
discussions only with offerors in the competitive range, and that not all
offerors would be included in the competitive range.
Our Bid Protest Regulations contain strict rules requiring timely
submission of protests. These rules specifically require that protests
based upon alleged improprieties in a solicitation that are apparent prior
to the time set for receipt of proposals be filed prior to that time. 4
C.F.R. sect. 21.2(a)(1) (2005). At best, there was a patent ambiguity in
the solicitation between the Circular A-76 requirement that a private
sector offeror be provided an opportunity to address material proposal
deficiencies (arguably incorporated into the solicitation by the statement
that "award will comply with the rules of OMB Circular A-76," RFP sect.
M.1), and the clear notice in the solicitation instructions that not all
proposals would be included in the competitive range for discussion
purposes. Such an ambiguity constitutes a solicitation impropriety; thus,
if CRA believed it should be entitled to discussions even if its proposal
were excluded from the competitive range, it was required to protest on
this ground prior to the closing date for receipt of proposals. Because
CRA did not protest until after its proposal was rejected, its protest in
this regard is untimely and will not be considered. See University
Research Co., LLC, B-294358.6, B-294358.7, Apr. 20, 2005, 2005 CPD para.
83 at 19 n.17. [2]
In any case, our Office will not sustain a protest absent a showing of a
reasonable possibility of prejudice, that is, unless the protester
demonstrates that, but for the agency's actions, it would have had a
substantial chance of receiving the award. McDonald Bradley, B-270126,
Feb. 8, 1996, 96-1 CPD para. 54 at 3; see Statistica, Inc. v. Christopher,
103 F.3d 1577, 1581 (Fed. Cir. 1996). We find no prejudice from the
agency's failure to conduct discussions with CRA. Although CRA was
furnished with the nine-page list of proposal deficiencies and weaknesses
during its debriefing, see CRA Protest at 5, 9, CRA has made no showing
that it would or could have remedied the numerous shortcomings in its
proposal through discussions. This is especially significant since: (1) by
admission in its proposal, it was unable to meet the solicitation
requirement for resumes for the "[h]ighest-level personnel" at each of the
14 medical clinic sites, notwithstanding that it agreed with the agency
that such "facility Health Services Administrator[s] should be considered
a `Key Personnel' position," PWS sections 1.4.4.4, 3.2.1; CRA Proposal,
Executive Summary; and (2) it was required under the terms of the
solicitation to raise each of its eight marginal or poor evaluation
ratings to good or excellent in order for its proposal to be considered
acceptable. RFP sect. M.4.
The protest is denied.
Anthony H. Gamboa
General Counsel
------------------------
[1] The agency tender was not required to include resumes for key
personnel, and was not to be evaluated under the past performance factor
or business capacity criterion of the price/cost factor. RFP sections
L.2.G, M.3.
[2] Given the solicitation language here, we need not address what the
significance of the Circular A-76 language cited by CRA would be in other
circumstances.