TITLE: B-297758.3, JWK International Corporation, August 31, 2006
BNUMBER: B-297758.3
DATE: August 31, 2006
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B-297758.3, JWK International Corporation, August 31, 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: JWK International Corporation
File: B-297758.3
Date: August 31, 2006
Wayne A. Keup, Esq., for the protester.
David B. Dempsey, Esq., and Kristen E. Ittig, Esq., Holland & Knight LLP,
for Four Winds Services, Inc., an intervenor.
Major Jeffrey Branstetter, Department of the Air Force, for the agency.
Jennifer D. Westfall-McGrail, Esq., and Christine S. Melody, Esq., Office
of the General Counsel, GAO, participated in the preparation of the
decision.
DIGEST
1. Protest that agency should have considered experience of protester's
proposed key personnel in evaluating protester's past performance is
denied where record demonstrates that agency had a reasonable basis for
deciding not to consider the qualifications of individual employees under
the past performance evaluation factor.
2. Agency reasonably determined that exceptional performance by
protester's proposed subcontractor on contracts that involved only a
portion of the work required under the solicitation was insufficient to
demonstrate that protester could be expected to perform the effort
solicited at issue successfully.
DECISION
JWK International Corporation (JWK) protests the failure of the Department
of the Air Force to select its proposal for award under request for
proposals (RFP) No. FA8601-05-R-0050, for fuels management services at
Wright-Patterson Air Force Base, Ohio. This protest follows the agency's
reevaluation of proposals and reselection of an awardee in response to our
decision sustaining a protest by United Paradyne Corporation (UPC). United
Paradyne Corp., B-297758, Mar. 10, 2006, 2006 CPD para. 47. JWK argues
that the Air Force's evaluation of its past performance and the agency's
"best value" tradeoff determination were unreasonable.
We deny the protest.
BACKGROUND
The RFP, which was issued on June 2, 2005, contemplated the award of a
fixed-price contract and provided for the evaluation of proposals on the
basis of three factors: mission capability, past performance, and price.
Mission capability was to be evaluated on an acceptable/unacceptable
basis, with only those proposals receiving ratings of acceptable
proceeding to evaluation of past performance and price. Past performance
and price, which were of approximately equal weight, were to be traded off
against one another to determine which proposal represented the best value
to the government.
The solicitation provided for the assignment of performance confidence
ratings to offerors based on their past performance. There were six
possible ratings: exceptional/high confidence, very good/significant
confidence, satisfactory/confidence, neutral/unknown confidence,
marginal/little confidence, and unsatisfactory/no confidence. RFP at 45.
Of significance to this protest, the RFP defined a rating of
marginal/little confidence as follows:
Based on the offeror's performance record, substantial doubts exist that
the offeror will successfully perform the required effort. Changes to the
offeror's existing processes may be necessary in order to achieve contract
requirements.
Id. The RFP advised that the evaluation of past performance would be
accomplished by reviewing offerors' relevant present and recent past
performance; the solicitation defined relevant contracts as contracts for
similar services with similar scope and complexity. The RFP provided that
a "relevancy determination" of the offeror's present and past performance,
including joint venture partners and/or major subcontractors, would be
made. Contracts were to be rated for relevance in accordance with the
following scale:
Highly Relevant: Past/present effort involved essentially the same
magnitude of effort and complexities this solicitation requires including
both facility and support operations.
Relevant: Past/present effort involved much of the magnitude of effort and
complexities this solicitation requires including both facility and
support operations.
Somewhat Relevant: Past/present effort involved some of the magnitude of
effort and complexities this solicitation requires including facility or
support operations.
Not Relevant: Past/present effort involved little of the magnitude of
effort and complexities that solicitation requires.
RFP at 46.
Nine proposals were received by the July 13, 2005 closing date. All were
determined to be technically acceptable. After evaluation of past
performance and price, the source selection authority (SSA) selected the
proposal of Four Winds Services, Inc. (FWSI), to which the agency
evaluators had assigned a performance confidence rating of
satisfactory/confidence and which offered a price of $7,898,073, as
representing the best value to the government. The agency awarded FWSI a
contract on December 1.
UPC subsequently filed a protest with our Office challenging the Air
Force's evaluation of its past performance. By decision dated March 10,
2006, we sustained UPC's protest, finding that the agency's approach to
evaluating offerors' past performance was unreasonable. We explained that
the agency had used the following methodology, which was not disclosed to
offerors in the RFP, to arrive at a performance confidence rating for each
offeror. After assessing the relevance of each contract identified by the
offeror in its proposal, the Air Force had averaged these ratings to
arrive at an overall relevance rating. It had then integrated this rating
with a quality of performance rating, which it obtained by averaging the
point scores on the performance questionnaires furnished by the offeror's
references. We found that the agency's approach--averaging together
relevant and non-relevant experience--was unreasonable because it
penalized offerors with relevant experience, such as UPC, for their
non-relevant experience. We concluded that the agency's methodology was
further unreasonable in that it gave equal weight in the calculation of
offerors' quality of performance ratings to highly relevant and
non-relevant performance. We recommended that the agency reevaluate the
past performance of UPC and the other offerors using an appropriate
methodology, that is, one that took into consideration the relevance of a
particular contractual effort in determining the weight to be assigned the
offeror's performance of it. We further recommended that the agency make a
new source selection decision, and, if a firm other than FWSI were
selected, that it terminate the award to FWSI and make award to the
offeror selected.
The Air Force performed a reevaluation of offerors' past performance in
response to our decision. To avoid penalizing offerors with more relevant
experience for their less relevant experience, the agency evaluators
assigned each offeror the relevance rating of its most relevant contract.
In JWK's case, this resulted in a contract relevance rating of somewhat
relevant, while in FWSI's case, it resulted in a rating of highly
relevant.[1] The agency also reevaluated offerors' quality of performance,
excluding from consideration performance on non-relevant contracts. The
reevaluation resulted in quality of performance ratings of exceptional for
JWK (and all other offerors except FWSI); FWSI's quality of performance
was rated as very good.
The evaluators then integrated the relevance ratings with the quality of
performance ratings to derive a performance confidence rating for each
offeror. In JWK's case, the agency assigned a performance confidence
rating of marginal/little confidence, finding that since the protester's
most relevant performance was only somewhat relevant, there was
substantial doubt that it would perform successfully.[2] In this
connection, the evaluators noted that it was "a logical conclusion . . .
to have little confidence in a contractor that only performed a small
portion of the critical elements, even though those few elements were
performed exceptionally." Reevaluation Summary Assessment, May 12, 2006,
at 3-4. The evaluators assigned FWSI a performance confidence rating of
very good/significant confidence.
The performance confidence ratings and prices of all offerors were as
follows:
Offeror Performance Confidence rating Price
JWK Marginal/Little Confidence $7,411,769
FWSI Very Good/Significant Confidence $7,898,092
Offeror A Exceptional/High Confidence [deleted]
Offeror B Marginal/Little Confidence [deleted]
Offeror C Exceptional/High Confidence [deleted]
Offeror D Exceptional/High Confidence [deleted]
Offeror E Exceptional/High Confidence [deleted]
Offeror F Exceptional/High Confidence [deleted]
Offeror G Exceptional/High Confidence [deleted]
Source Selection Decision Document, Reevaluation, May 15, 2006, at 2.
The SSA determined that FWSI's offer represented the best value to the
government, reasoning as follows:
The price for JWK is 6.56% lower than the cost of the selected contractor
(FWSI), and I considered the $486,304 savings. However, JWK received a
Marginal/Little Confidence Integrated Assessment rating, that as defined,
indicates, "substantial doubts exist that the offeror will successfully
perform the required effort." I felt this was a fair [rating] since this
offeror had only limited experience in Fuels Management. I considered the
savings offered but compared it against the associated risks. The
environmental and safety issues, which are a significant part of this
contract, rely on the experience level of the contractor and the Very
Good/Significant Confidence rating received by FWSI is well worth the
6.56% additional cost.
I also considered [Offeror A], with a rating of Exceptional/High
Confidence, and the third lowest [price]. However, with past performance
and price being considered as approximately equal on this acquisition, the
expenditure of additional monies for a degree of better performance is not
considered to be in the best interest of the Government.
Source Selection Decision, May 15, 2006, at 4.
DISCUSSION
JWK initially asserted that the assignment to its proposal of a relevance
rating of only somewhat relevant was unreasonable because the proposal
included a detailed explanation of the experience of JWK's proposed
subcontractor, Maytag, in performing "undeniably relevant" fuels
management contracts. Protest at 5. The protester also argued that it was
inconsistent with the agency's original rating scheme, pursuant to which a
relevance rating of somewhat relevant combined with a quality of
performance rating of exceptional yielded a performance confidence rating
of satisfactory/confidence, for the agency to have assigned its proposal a
performance confidence rating of marginal/little confidence.
As we noted in our decision on UPC's protest, as a general matter, the
evaluation of an offeror's past performance is within the discretion of
the contracting agency, and we will not substitute our judgment for
reasonably based past performance ratings. United Paradyne Corp., supra,
at 4. A protester's mere disagreement with the agency's judgment does not
establish that an evaluation was unreasonable. Hard Bodies, Inc.,
B-279543, June 23, 1998 98-1 CPD para.172 at 3.
The Air Force responded to the protester's first argument by explaining
that in assessing the relevance of previously performed contracts, the
evaluators had considered the extent to which the contracts involved
performance in each of five areas in which services were required under
the instant RFP (i.e., distribution, bulk storage, cryogenics, fuels lab,
and accounting). According to the agency, the protester and its
subcontractor demonstrated little or no experience in several of these
areas; accordingly, the agency argued, since the protester's past efforts
involved only some of the magnitude of the effort and complexities
required by the instant RFP, a rating of somewhat relevant was
appropriate. In support of its position, the agency furnished a "relevancy
chart" for the contracts submitted by JWK/Maytag, which showed that the
evaluators had assigned all four of the JWK contracts and three of the
five Maytag contracts point scores of 0 for relevance, and that they had
assigned the remaining two Maytag contracts point scores of 6 and 4 (out
of 10) for distribution, 3 for bulk storage (both contracts), 8 for
cryogenics (both contracts), 1 and 0 for fuels lab, and 0 for accounting
(both contracts).[3] The "relevancy chart" also showed that prior
contracts had been evaluated in a final "roll-up" category based on the
number of the above areas that they encompassed (i.e., a contract that
involved work in all five areas was to be awarded a score of 10; a
contract that involved work in four of the five, a score of 8; a contract
that involved three of the five, a score of 6; etc.); both Maytag
contracts received scores of 6 under this criterion.
With regard to the protester's second argument, the agency explained that
in its initial evaluation, it had given equal weight to relevance and
quality of performance in determining performance confidence ratings,
while in its reevaluation, it had "assigned greater weight to more
relevant past performance by eliminating Non-Relevant contracts and
considering only those contracts determined to be Somewhat Relevant,
Relevant, or Highly Relevant." Memorandum of Law at 4. According to the
agency, "[s]ince the `quality' and `relevancy' components were weighted
differently in the original evaluation and the re-evaluation, it is only
logical that the integrated past performance confidence ratings resulting
from the two evaluations would differ." Id.
In response to the agency's explanation, the protester took issue with the
agency's rating of its past performance, arguing that it should have
received a score of 8 rather than a score of 6 in the "roll-up" category
for one of the Maytag contracts and that the agency had improperly failed
to take into account the experience of its proposed key personnel. JWK
further argued that in its reevaluation the agency had improperly reduced
the significance of quality of performance and placed too much
significance on relevance. According to the protester, since the RFP was
silent as to the relative weights to be accorded these factors, they
should have been treated as equal. The protester also argued that it was
inconsistent with the terms of the RFP for the agency to have assigned its
proposal a performance confidence rating of marginal/little confidence
since this rating contemplated a finding by the agency that an offeror's
performance was in need of improvement, and the agency made no such
finding in its case.
In response to the protester's argument regarding the scoring of one of
the Maytag contracts in the "roll-up" category, the contracting officer
conceded that an error had been made and that the score should have been 8
rather than 6. The contracting officer maintained that the error had not
resulted in any prejudice to JWK, however, because even with the
additional points, the contract would still have been rated as somewhat
relevant, a position that the protester does not dispute. Accordingly, we
need not consider this argument further. See GC Servs. Ltd. P'ship,
B-298102, B-298102.3, June 14, 2006, 2006 CPD para. 96 at 7-8 (prejudice
is an essential element of every viable protest).
Regarding JWK's argument that the experience of its proposed key personnel
should have been considered in the evaluation of its past performance, we
recognize that the Federal Acquisition Regulation (FAR) advises that
"[t]he evaluation [of past performance] should take into account past
performance information regarding predecessor companies, key personnel who
have relevant experience, or subcontractors that will perform major or
critical aspects of the requirement when such information is relevant to
the instant acquisition." FAR sect. 15.305(a)(2)(iii). We have previously
interpreted this section as permitting an agency to decide that
information concerning key personnel is not relevant, however. Olympus
Bldg. Servs., Inc., B-282887, Aug. 31, 1999, 99-2 CPD para. 49 at 3-4; see
also Blue Rock Structures, Inc., B-287960.2, B-287960.3, Oct. 10, 2001,
2001 CPD para. 184 at 5. Here, the contracting officer explains that the
agency assessed the potential ability of offerors to perform under the
mission capability evaluation factor and their actual experience in
performing the type of work required under the past performance factor. In
the contracting officer's view, the individual skills and qualifications
of personnel do not provide information as to how the company or its
subcontractors have performed the requirements of the performance work
statement on other contracts, nor do they give any indication as to the
offeror's quality of performance on contracts similar in scope and
complexity to the effort here. Addendum to Contracting Officer's Statement
of Facts, July 12, 2006, at 1. We think that this explanation provides a
reasonable basis for the agency's decision not to consider the experience
of proposed key personnel in evaluating JWK's past performance.
Accordingly, we conclude that the agency reasonably exercised its
discretion in deciding not to consider the qualifications and experience
of proposed key personnel in its evaluation of JWK's past performance.
The protester also argues that because the RFP was silent as to the
weights to be assigned relevance and quality of performance, these two
subfactors should have been treated as equal in the evaluation of past
performance. The cases cited by the protester in support of its argument,
Stone & Webster Eng'g Corp., B-255286.2, Apr. 12, 1994, 94-1 CPD para. 306
and Informatics, Inc., B-194734, Aug. 22, 1979, 79-2 CPD para. 144, are
distinguishable from the case at hand in that they involved solicitations
that identified separate subfactors to be considered in the evaluation
under a factor, which the RFP here did not do. In this connection, while
the solicitation here clearly contemplated consideration of relevance and
quality of performance as part of an integrated assessment of past
performance, it did not establish relevance and quality of performance as
separate subfactors. In any event, we do not think that the record before
us demonstrates that the agency in fact gave greater weight to relevance
than to quality of performance in the evaluation of past performance;
rather, the record demonstrates that the agency considered the relevance
of the protester's prior performance in determining the weight to give
that performance, and that, in the protester's case, because the relevance
of the performance was low, the weight given to the quality of that
performance was low.
In support of its argument that the solicitation contemplated the
assignment of a performance confidence rating of marginal/little
confidence only where the agency found an offeror's prior performance to
be in need of improvement, the protester cites the second sentence of the
RFP definition of that rating: "Changes to the offeror's existing
processes may be necessary in order to achieve contract requirements."[4]
The protester contends that this language indicates that an offeror's
ability to perform will be questioned only to the extent that the agency
has identified changes that the offeror will need to make to perform
successfully. We disagree. The sentence in question provides that changes
to the offeror's existing processes may be required, not that they
necessarily will be required. Thus, we think that it was consistent with
the solicitation for the agency to conclude that, based on the protester's
lack of more than minimally relevant experience, there existed substantial
doubt as to its ability to perform successfully.
Finally, with regard to the protester's complaint that under the first
evaluation, exceptional performance on somewhat relevant contracts yielded
a performance confidence rating of satisfactory/confidence, whereas under
the reevaluation, exceptional performance on somewhat relevant contracts
yielded a performance confidence rating of marginal/little confidence, the
methodology used by the agency in its initial evaluation was flawed in
that, among other things, it failed to take into account the relevance of
a particular contractual effort in determining the weight to be assigned
an offeror's performance of it; as a result, the fact that the second
evaluation yielded a different result in no way indicates that the
reevaluation was flawed.
The protest is denied.
Gary L. Kepplinger
General Counsel
------------------------
[1] While JWK submitted information on four contracts that it had
performed itself and five contracts that its proposed subcontractor,
Maytag Aircraft Corporation, had performed, the Air Force determined that
none of JWK's own contracts was even somewhat relevant since none of its
contracts was a fuels management contract and only two of the Maytag
contracts were somewhat relevant. FWSI submitted information on seven
contracts; of the seven, four were determined to be not relevant, two were
determined to be somewhat relevant, and one was determined to be highly
relevant. Five of the remaining seven offerors were assigned relevance
ratings of highly relevant and two were assigned ratings of somewhat
relevant.
[2] The other two offerors with relevance ratings of somewhat relevant and
quality of performance ratings of exceptional also received performance
confidence ratings of marginal/little confidence, whereas the five
offerors with relevance ratings of highly relevant and quality of
performance ratings of exceptional all received performance confidence
ratings of exceptional/high confidence.
[3] The "relevancy chart" contained very detailed guidelines for the
assignment of points for relevance. In the area of "distribution," for
example, the chart provided for the assignment of points as follows:
All including mobile and hydrants and vehicle maintenance 10
Mobile and Hydrants only 7
Mobile with Vehicle Maintenance 6
Mobile only 4
Hydrants only 4
Vehicle Maintenance only 2
Agency Report, Tab 3(g).
[4] As previously noted, the RFP defined a rating of marginal/little
confidence as follows:
Based on the offeror's performance record, substantial doubts exist that
the offeror will successfully perform the required effort. Changes to the
offeror's existing processes may be necessary in order to achieve contract
requirements.
RFP at 45.