TITLE: B-298020; B-298020.2, IPlus, Inc., June 5, 2006
BNUMBER: B-298020; B-298020.2
DATE: June 5, 2006
***********************************************
B-298020; B-298020.2, IPlus, Inc., June 5, 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: IPlus, Inc.
File: B-298020; B-298020.2
Date: June 5, 2006
John S. Pachter, Esq., Jonathan D. Shaffer, Esq., Tamara F. Dunlap, Esq.,
and David S. Stern, Esq., Smith Pachter McWhorter PLC, for the protester.
Janice Davis, Esq., Davis & Steele, for Dynamic Systems Technology, Inc.,
an intervenor.
David H. Turner, Esq., Department of the Navy, for the agency.
Jonathan L. Kang, Esq., and Michael R. Golden, Esq., Office of the General
Counsel, GAO, participated in the preparation of the decision.
DIGEST
1. Agency's post-proposal submission exchanges with awardee regarding
price proposal were clarifications rather than discussions where the
errors corrected were obvious on the face of the awardee's proposal. Other
exchanges with awardee that may have resulted in discussions were not
prejudicial to protester.
2. Agency reasonably considered experience and past performance of both
prime and subcontractor who were participants in Small Business
Administration 8(a) mentor-protege program.
DECISION
IPlus, Inc. protests the award of a contract to Dynamic Systems
Technology, Inc. (DysTech) under request for proposals (RFP)
N00140-05-R-1526, issued by the Department of the Navy for services in
support of the Navy College Program (NCP). The protester contends that the
agency conducted unequal discussions, improperly evaluated offerors'
proposals, and made an improper source selection decision.
We deny the protest.
BACKGROUND
The agency sought proposals to provide support for the NCP, which is a
"voluntary education program" that provides assistance for active duty and
retired military and eligible civilian personnel to pursue personal and
professional academic development. Offerors were required to propose all
labor, management, and supervision to perform the support services
required for the NCP. The RFP identified three categories of personnel
required to perform the statement of work (SOW), education advisors, test
examiners, and call center agents. RFP at 48. The RFP anticipated the
award of a fixed-price contract, with a base performance period of 1 year,
with four 1-year option periods. Id. at 94. The competition was restricted
to participants in the Small Business Administration (SBA) 8(a) program
for small, disadvantaged businesses. Id. at 80.
The RFP stated that proposals would be evaluated on the basis of four
non-price factors, each of which was of equal importance: management plan,
technical approach, corporate experience, and past performance. RFP at 94.
For purposes of award, the RFP stated that award would be made to the
"responsible offeror whose proposal represented the best value," and that
"[t]he evaluation of proposals will consider the offeror's technical
proposal more important than the offeror's price proposal." Id.
The agency received seven proposals in response to the RFP. Agency Report
(AR), Tab 16, Contract Review Board Presentation, at 4. The agency
evaluated DysTech's and IPlus's proposals as the two most highly rated,
overall, and rated them as follows:
+------------------------------------------------------------------------+
| | DysTech | IPlus |
|--------------------------+----------------------+----------------------|
|Management Plan | Highly Acceptable | Acceptable |
|--------------------------+----------------------+----------------------|
|Technical Approach | Highly Acceptable | Acceptable |
|--------------------------+----------------------+----------------------|
|Corporate Experience | Acceptable | Acceptable |
|--------------------------+----------------------+----------------------|
|Past Performance | Acceptable | Acceptable |
|--------------------------+----------------------+----------------------|
|Overall Rating | Highly Acceptable | Acceptable |
|--------------------------+----------------------+----------------------|
|Proposed Price | $42,870,717 | [deleted] |
+------------------------------------------------------------------------+
AR, Tab 17, Source Selection Decision (SSD), at 1-2.
The agency determined that although IPlus had proposed a lower price, the
technical advantages offered by DysTech's proposal outweighed the price
differential, and therefore DysTech's proposal was selected for award. Id.
at 8-9. Following its debriefing, IPlus filed this protest.
EXCHANGES WITH DYNAMIC REGARDING PRICE PROPOSAL
The protester argues that a series of exchanges between the agency and
DysTech allowed DysTech to revise its price proposal, and that the
exchanges constituted unequal discussions. The agency contends that it
conducted clarifications with DysTech, rather than discussions.
Federal Acquisition Regulation (FAR) sect. 15.306 describes a spectrum of
exchanges that may take place between an agency and an offeror during
negotiated procurements. Clarifications are "limited exchanges" between
the agency and offerors that may allow offerors to clarify certain aspects
of proposals or to resolve minor or clerical errors. FAR sect.
15.306(a)(2). Discussions, on the other hand, occur when an agency
indicates to an offeror significant weaknesses, deficiencies, and other
aspects of its proposal that could be altered or explained to enhance
materially the proposal's potential for award. FAR sect. 15.306(d)(3).
When an agency conducts discussions with one offeror, it must conduct
discussions with all other offerors in the competitive range. FAR sect.
15.305(d)(1). The "acid test" for deciding whether discussions have been
held is whether it can be said that an offeror was provided the
opportunity to modify its proposal. National Beef Packing Co., B-296534,
Sept. 1, 2005, 2005 CPD para. 168 at 11; Park Tower Mgmt. Ltd., B-295589,
B-295589.2, Mar. 22, 2005, 2005 CPD para. 77 at 7.
Offerors were required to complete section B of the solicitation by
submitting price information for each contract requirement line item
number (CLIN) and sub-line item number (SubCLIN). RFP at 47. In evaluating
DysTech's price proposal, the contracting officer determined that
additional information was required "in order to fully analyze DysTech's
pricing." Contracting Officer's Statement at 2. The contracting officer
states that the agency "knew exactly what [DysTech's] proposed firm-fixed
price was for each line item of the contract," but also "believed that it
would be prudent to seek clarification of DysTech's Price Proposal." Id.
The agency thus contacted DysTech to ask for clarifications regarding its
price:
By telephone call to DysTech on or about 29 December 2005, I informed
DysTech of our concerns and asked them to provide those clarifications.
. . . I was quite explicit in stating that these were purely . . .
matters of clarification, that we were not holding discussions, that we
were not asking for final proposal revisions, and that we would not
entertain any changes to DysTech's proposal.
Id. at 3.
DysTech responded to the requests for clarification via email on December
29, 2005 and via email and hardcopy on January 19, 2006. See AR, Tabs 13
and 14, DysTech responses. IPlus contends that, notwithstanding the
agency's characterization of these exchanges as clarifications, DysTech
was allowed to revise its proposal and that, therefore, the agency engaged
in discussions with the awardee. Because the protester was not given a
similar opportunity for discussions, IPlus contends that the award to
DysTech was improper. We review the three areas where exchanges took place
below.[1]
(1) SubCLIN totaling errors
The summary chart in DysTech's proposal identified a total price of
$42,276,769.50. AR, Tab 8, DysTech Proposal Vol. II, at summary appendix.
CLIN prices were intended to be a summary of the SubCLIN prices; the
agency's calculation of all CLIN prices in DysTech's proposal also yielded
a total of $42,276,769.50. Contracting Officer's Statement at 2. The
agency's total of the SubCLIN prices, however, yielded a price of
$42,870,717.86.[2] Id.
The agency believed that the higher SubCLIN totals were DysTech's intended
proposal price: "Because billing under the Contract would reflect SubCLIN
pricing, we believed that the SubCLIN pricing accurately reflected
DysTech's intended Contract pricing as, in fact, the SubCLIN pricing was
the pricing that the Navy would be required to pay." Contracting Officer's
Statement at 3.
The agency requested that DysTech clarify the apparent errors in adding
the SubCLIN amounts. Contracting Officer's Statement at 2. DysTech
addressed the error by providing a summary chart that recalculated the
total contract price by adding all of the SubCLIN amounts. AR, Tab 14,
Email from DysTech to Contracting Officer, Dec. 29, 2005. The agency
viewed the submission by DysTech as verifying that the $42,870,717.86
amount was correct.[3]
IPlus contends that the exchanges between the agency and DysTech allowed
DysTech to revise its price proposal, and that, therefore, discussions
took place. An agency may allow an offeror to correct a clerical error in
a cost or price proposal through clarifications, as opposed to
discussions, where the existence of the mistake and the amount intended by
the offeror is clear from the face of the proposal. Joint Threat Servs.,
B-278168, B-278168.2, Jan. 5, 1998, 98-1 CPD para. 18 at 12-13. The record
here shows that the agency believed that the $42,870,717.86 amount
reflected the addition of the SubCLIN amounts, and DysTech's response to
the agency's question confirmed that figure. The record further shows that
none of DysTech's SubCLIN prices changed as the result of the
clarification of the CLIN totals. Furthermore, the exchange resulted in
the agency confirming a higher price for DysTech under this fixed-price
contract. Under these circumstances, we believe that this exchange did not
constitute discussions, but rather was a clarification of an obvious
error. See Joint Threat Servs., supra.
(2) CLIN No. 4
The agency requested that DysTech address what the agency believed was a
mistakenly listed entry in its CLIN pricing. Offerors were instructed not
to provide a price for CLIN No. 4, which was for data in support of CLINS
0001 and 0002: "This CLIN is Not-Separately-Priced (NSP)." RFP at 10.
DysTech, however, listed in its proposal a price of $[deleted] for CLIN
No. 4. Although DysTech listed this price for CLIN No. 4, the accompanying
narrative text repeated the RFP language that the CLIN was
"Not-Separately-Priced." AR, Tab 8, DysTech Proposal Vol. II, at 15. The
agency noted that the $[deleted] value was the sum of the values for CLINs
0001 and 0002. See id. at 13-14. Based on these two indicia, the agency
believed that the $[deleted] price for CLIN No. 4 had been listed in
error, and requested that DysTech clarify that this CLIN was not intended
to be priced: "[W]e believed that that amount was mistakenly listed next
to CLIN 0004. However, I wished to confirm that that amount was not
intended to be part of DysTech's price." Contracting Officer's Statement
at 3.
During the contracting officer's December 29, 2005 call, DysTech confirmed
that the $[deleted] amount for CLIN No. 4 had been listed in error.
Contracting Officer's Statement at 3. IPlus contends that DysTech's
response constituted discussions because it resulted in a $[deleted]
reduction to DysTech's proposed price.
Here, the record shows that DysTech's proposed overall price did not
change. The approximately $[deleted] value for CLIN No. 4 was not included
in the bottom-line price for DysTech's proposal; that is, the sum of all
CLINs, excluding CLIN No. 4, yields a price of approximately $42 million,
and not $[deleted]. Thus, DysTech's confirmation that CLIN No. 4 should
have been unpriced did not change the overall price of approximately $42
million. As noted above, the overall price was inaccurately totaled by
DysTech in its proposal price summary; the corrected amount as calculated
by the agency and confirmed by DysTech is consistent with the exclusion of
the $[deleted] price for CLIN No. 4. Thus both the existence of an error
and the intended bid was apparent from the face of the proposal.[4] See
CIGNA Gov't Servs., LLC, May 04, 2006, B-297915.2, 2006 CPD para. __ at 9.
Under these circumstances, we believe that this exchange did not
constitute discussions, but rather was a clarification of an obvious
error. See Joint Threat Servs., supra.
(3) Backup data
Finally, IPlus contends that the agency improperly allowed DysTech to
revise its proposal by providing backup data regarding labor rates that
were not included in DysTech's original proposal. The RFP stated that
offerors were required to provide "[s]upporting data including labor rates
and hours, burdened rates, material lists and costs, travel changes, and
`other direct' costs used in developing the price." RFP at 93. Although
DysTech had provided backup data for its other labor categories, there
were no similar data for the test examiner position. The contracting
officer concluded that, "while the pricing for test examiners was clearly
stated and did not appear out of line, I believed that it would be helpful
to have DysTech clarify its pricing further by providing that additional
back-up information." Contracting Officer's Statement at 3. DysTech
provided the data in response to the agency's request via email and hard
copy delivery. See AR, Tab 15, DysTech Supplemental Price Data. The agency
concluded that "[t]he totals for that breakdown corresponded with the
pricing totals that had already been provided in DysTech's price proposal
and did not revise its proposed firm-fixed pricing." Contracting Officer's
Statement at 4.
Unlike the other two exchanges between DysTech and the agency, this
exchange appears to have constituted discussions. The exchange allowed
DysTech to revise its proposal by submitting the required backup data that
the agency believed was necessary to confirm DysTech's price. Nonetheless,
>because the discussions related to backup data for a fixed-price labor
rate, as opposed to the rates themselves or any other deficiency, we do
not believe that, on this record, IPlus was prejudiced by the agency's
actions. Even where an agency conducts discussions with an offeror that
are required to make that awardee's proposal acceptable, we will not
sustain a protest unless the agency's actions were prejudicial to the
protester. USATREX Int'l, Inc., B-275592, B-275592.2, Mar. 6, 1997, 98-1
CPD para. 99. Here, DysTech did not change any of its labor rates, nor did
its proposed fixed price change as the result of this submission of data.
While the backup data submitted by DysTech may have been required by the
solicitation, there is no basis in the record to believe that this
information had any material impact on the evaluation of DysTech's
proposal or its selection for award. In this regard, the agency evaluated
DysTech's technical proposal, and, as noted above, calculated DysTech's
proposed price prior to these exchanges. In sum, we find no basis on this
record to sustain the protest based on any of the exchanges between the
agency and DysTech regarding price.
CORPORATE EXPERIENCE AND PAST PERFORMANCE
The protester contends that the agency unreasonably evaluated the
offerors' corporate experience and past performance records. Both
offerors' proposals were evaluated as "acceptable" under these evaluation
factors. AR, Tab 17, SSD, at 1-2. Our Office examines an agency's
evaluation of offerors' experience and past performance records to ensure
that it was reasonable and consistent with the stated evaluation criteria
and applicable statutes and regulations; however, the necessary
determinations regarding the relative merits of offerors' past performance
records are primarily matters within the contracting agency's discretion.
Prudent Techs., Inc., B-297425, Jan. 5, 2006, 2006 CPD para. 16 at 4. In
this regard, our Office will not question an agency's determinations
absent evidence that those determinations are unreasonable or contrary to
the stated evaluation criteria. Id.
For the corporate experience factor, offerors were required to
"demonstrate either similar or directly related work experience of similar
size, scope, magnitude and complexity to the statement of work (SOW)" by
addressing "history, organization, qualifications and work experience
within the last 5 years as they related to the requirements of the SOW,
and any other information the offeror considers relevant to the SOW." RFP
at 92. For past performance, offerors were required to describe
performance "on similar contracts it has held within the last five (5)
years which are of similar scope, magnitude and complexity to that which
is detailed in the RFP." Id.
IPlus's Corporate Experience and Past Performance
In its proposal, IPlus did not identify any corporate experience or past
performance for itself; rather, it relied upon the experience and past
performance records of its subcontractors, Manufacturing Engineering
Systems, Inc. (MES) and NonPublic Educational Services, Inc. (NESI). AR,
Tab 9, IPlus Proposal Vol. I, at 28-29. IPlus contends that the agency's
evaluation failed to give it adequate credit for the information submitted
regarding its subcontractors. In particular, IPlus argues that the agency
should have given it a higher evaluation rating because one of the
subcontractors, MES, was IPlus's mentor under the SBA mentor-protege
program for 8(a) contractors.
As an initial matter, the agency notes that IPlus's proposal represented
that a mentor-protege relationship existed between IPlus and MES when, in
fact, the SBA had not granted final approval of the mentor-protege
agreement (MPA).[5] IPlus's proposal stated:
IPLUS is a certified 8(a) company and protege firm of MES, as defined in
our Mentor-Protege Agreement (MPA) in accordance with U.S. Small
Business Administration (SBA) guidelines. [deleted]
AR, Tab 9, IPlus Proposal Vol. I, at 2.
During its evaluation of proposals, the agency attempted to verify the
status of the MPA. The SBA advised the agency that although "informal
approval" had been granted to the MPA, there had been no formal, written
approval at that time. AR, Tab 12, IPlus Technical Evaluation, at 2. The
agency concluded that the inaccurate representation of the status of the
MPA in IPlus's proposal was evidence of a performance risk:
Therefore, it is evident that the IPLUS MPA is pending, but has not been
officially approved. The TEB [technical evaluation board] recognizes the
offeror, IPLUS, submitted their proposal prior to receiving but with the
expectation of official approval of their Mentor-Protege status.
However, as of the date of this evaluation, IPLUS does not officially
hold the MPA status that they claim to hold, which is seen by the TEB as
an increased risk to successful contract performance because this is
another example of the offeror's performance of providing minimal effort
to meet requirements.
Id.
IPlus acknowledges that, at the time its proposal was submitted, the SBA
had not formally approved the relationship. Protester's Comments at 13.
IPlus argues, however, that the SBA had "informally" approved the
relationship and had "said that IPlus could use the MPA and mentor-protege
relationship in its federal government proposals." Id., Exh. A, Decl. of
IPlus President, at 1. Regardless of what IPlus now argues it was advised
on an informal basis by the SBA, IPlus did not explain the distinction
between a formal and informal approval status in its proposal. Thus, when
the agency investigated the status of the MPA with the SBA, it found that
IPlus did not have an approved MPA.[6] We believe that the agency was
reasonably concerned that IPlus had not accurately explained the approval
status of its MPA.
Contrary to the protester's assertion, the agency did credit IPlus with
the past performance and experience of its subcontractors:
IPLUS was rated as Acceptable for the Corporate Experience (CE) factor .
. . . Being a relatively newly established company, IPLUS's technical
proposal did not address their history, organization, qualifications or
work experience within the last five years as it relates to the SOW. . .
. IPLUS's technical proposal also details its teaming relationship with
the team of MES and NESI, the contractors currently supporting the NCP
program. Based on the fact that both MES and NESI will share some of the
program management responsibilities . . . their experience in supporting
the NCP requirement under those contracts is considered relevant
experience of similar scope, magnitude and complexity to the current RFP
requirements. . . .
IPLUS's technical proposal was rated as Acceptable for . . . Past
Performance (PP). As a recently established company, IPLUS did not list
any directly related PP. However, its team-members MES and NESI clearly
demonstrated past-performance experience that was of similar scope,
magnitude and complexity to the RFP requirements under such contracts as
. . . the current NCP contracts.[7]
AR, Tab 17, SSD, at 4.
IPlus next argues that its subcontractor's past performance and corporate
experience records should have been rated higher by the agency. IPlus
contends that, as the incumbent contractors proposed to perform work under
the contract, MES and NESI should have received "highly acceptable" scores
for corporate experience and past performance, and that those scores
should have been credited to IPlus's proposal because of the MPA between
IPlus and MES.
As discussed above, the agency did credit IPlus with the experience and
past performance of its subcontractors. There is no requirement, however,
that an agency must directly "credit" or otherwise substitute a
subcontractor/mentor's experience or past performance for a prime
contractor/protege that lacks past performance of its own.[8] Instead, an
agency may consider the prime contractor/protege's lack of experience and
past performance and balance that information against the
subcontractor/mentor's experience and past performance.[9] J.A. Farrington
Janitorial Servs., B-296875, Oct. 18, 2005, 2005 CPD para. 187 at 5. In
J.A. Farrington, our Office held that an agency may reasonably determine
that a prime contractor who lacks past performance of its own warrants a
"confidence" rating, as opposed to a higher rating, given that it would be
the entity responsible for performing the contract, even where its mentor
or subcontractor has "considerable positive past performance." Id.
As to the actual ratings, the agency evaluated IPlus's corporate
experience as "acceptable." AR, Tab 17, SSD, at 4. The agency noted that
MES and NESI had "relevant experience of similar scope, magnitude, and
complexity to the current RFP requirements" based on their performance of
the current contract for the NCP. AR, Tab 17, SSD, at 4. The agency also
noted that IPlus's proposed personnel had relevant experience based on
their prior work for the subcontractors under the current NCP contract.
Id. at 5. Despite the relevant experience of its subcontractors, however,
the agency believed that IPlus's lack of corporate experience was a
concern that had to be considered in evaluating the proposal as a whole:
"Even though IPLUS has proposed both incumbent contractors to perform
portions of the solicitation's requirements the fact that IPLUS has no
corporate experience of its own precludes a higher-than-acceptable rating
in this factor." AR, Tab 17, SSD, at 4. The agency was not required to
ignore IPlus's lack of corporate experience or substitute its
subcontractors' experience. J.A. Farrington, supra, at 5. We therefore
conclude that the agency's evaluation of IPlus corporate experience was
reasonable.
The agency also evaluated IPlus's past performance record as "acceptable."
AR, Tab 17, SSD, at 4. IPlus's proposal cited five contract references,
two for MES and three for NESI. AR, Tab 9, IPlus Proposal Vol. I, at
28-29. Of these five references, both of MES's references were for
performance of the current NCP contract requirements; two of NESI's
references were for performance of the current contract requirements as a
subcontractor to MES, and a third NESI reference was as a prime contractor
under a Department of Education contract. Id. The agency concluded that
MES was performing contract requirements "identical" to those in the RFP,
but that, in addition to positive remarks, the past performance ratings
also contained negative comments regarding the quality of MES's
performance, with ratings ranging from "exceptional to unsatisfactory."
AR, Tab 12, IPlus Technical Evaluation, at 4-5. For example, the past
performance references for MES noted a lack of supervision of staff
activities: "Only when the government notified them that there were
problems such as time and attendance or work priorities did they become
aware of the problems." Id. at 4. Additionally, a member of the evaluation
team who was familiar with MES's performance under the current contract
noted "a history of high turnover/retention." Id. For NESI, the agency
concluded that its performance of certain requirements as a subcontractor
to MES under the current NCP contract did not involve enough work for the
entire reference to be considered relevant. For the Department of
Education contract, the agency concluded that NESI's performance was of
"somewhat similar scope," with "good to exceptional" ratings. Id.
The protester argues that the agency improperly focused on MES's
performance problems and did not give adequate credit to the quality of
that company's past performance. As with the corporate experience
evaluation, the protester also objects to the agency's determination that
IPlus could not merit a "highly acceptable" rating based on the
evaluations of its subcontractors, alone, in light of the fact that IPlus
had no past performance of its own. Id. We believe that the agency's
evaluation of the proposed subcontractors' past performance references, in
conjunction with its concern regarding IPlus's lack of past performance,
was reasonable, and that the protester provides no basis to challenge the
agency's determination that its proposal warranted an "acceptable" rating,
aside from disagreement as to the overall resulting score. A protester's
mere disagreement with the agency's evaluation of past performance is not
sufficient to establish that the agency acted unreasonably. Chenega Tech.
Prods., LLC, B-295451.5, June 22, 2005, 2005 CPD para. 123 at 3-4.
>
DysTech's Past Performance and Corporate Experience
IPlus next contends that the agency unreasonably evaluated DysTech's past
performance and experience as "acceptable." As was the case with its
evaluation of IPlus's proposal, the agency evaluated both DysTech's own
corporate experience and past performance, as well as that of its
subcontractor, ESI. AR, Tab 12, DysTech Technical Evaluation, at 5-8.
Although the protester argues that the agency unreasonably considered the
scope and size of the experience and past performance references as
similar to the RFP requirements, the agency considered all of the
objections that the protester raises in its protest. For example, the
agency addressed the fact that although the past performance ratings for
DysTech ranged "from very good to excellent," certain of the past
performance references were for contracts of smaller magnitude than that
called for in the RFP. AR, Tab 12, DysTech Technical Evaluation, at 8. We
believe that the agency reasonably evaluated DysTech's proposal as
acceptable under both the corporate experience and past performance
evaluation factors. To the extent that IPlus argues that the awardee's
ratings should have been lower, the protester's disagreement with the
agency's evaluation of DysTech's experience and past performance provides
no basis to challenge the evaluation. Chenega Tech. Prods., supra, at 3-4.
TECHNICAL EVALUATION
The protester next contends that the agency conducted an improper
technical evaluation of both offerors' proposals. In reviewing a procuring
agency's evaluation of an offeror's technical proposal, our role is
limited to ensuring that the evaluation was reasonable and consistent with
the terms of the solicitation and applicable statutes and regulations. L-3
Communications Westwood Corp., B-295126, Jan. 19, 2005, 2005 CPD para. 30
at 5.
As a preliminary matter, IPlus alleges that the agency's evaluation was
flawed because it placed a high value on proposal elements that exceeded
the RFP's minimum requirements. IPlus argues that such an evaluation
approach was improper because the RFP did not disclose that the agency
would so heavily favor proposals that exceeded the RFP requirements,
arguing that "[i]f offerors had known that the Navy's primary focus was on
innovations and creative approaches versus addressing the Navy's Section M
criteria, offerors, including IPlus, would have written their proposals
differently to focus on those issues." Supplemental Protest at 10. This
argument is without merit. Where, as here, a solicitation provides for
award on a best-value basis, an agency may reasonably assess as a proposal
advantage the manner in which a proposal exceeds the minimum requirements
of the solicitation. See, e.g., American Material Handling, Inc.,
B-297536, Jan. 30, 2006, 2006 CPD para. 28 at 4. An agency's judgments
regarding the degree to which offerors exceed a solicitation's minimum
requirements are the essence of any price/technical tradeoff. F2W-WSCI,
B-278281, Jan. 14, 1998, 98-1 CPD para. 16 at 7-8. In such procurements,
evaluation strengths properly may be found where a proposal includes
enhancements or features not expressly identified in the solicitation,
provided the strength is consistent with the stated evaluation criteria.
SGT, Inc., B-294722.4, July 28, 2005, 2005 CPD para. 151 at 12.
DysTech's Management Plan and Technical Approach
With regard to the agency's evaluation of DysTech's management plan and
technical approach, IPlus contends that the agency improperly evaluated
DysTech's proposal by awarding scores of "highly acceptable" under these
factors for proposal strengths that IPlus contends were merely those
"expected of a reasonable competent offeror." Supp. Protest at 14. The
only example cited by the protester, however, is DysTech's proposal for a
"recognition program" intended to provide incentives to employees.
Although the protester contends that IPlus provided a similar benefit, the
evaluation record demonstrates that the agency reasonably identified
strengths in DysTech's detailed approach to employee incentives that the
agency believed "caters specifically to the objectives of the Navy's
Voluntary Education program and the services required in the RFP." AR, Tab
12, DysTech Technical Evaluation, at 2. In contrast, the agency concluded
that IPlus's management plan adequately addressed recruitment of
personnel, but did not adequately address retention or prevention of
turnover. AR, Tab 17, SSD, at 4. In the agency's direct comparison of the
offerors, the agency explained that DysTech's proposal's greater detail in
addressing staff retention and its management organization warranted
higher evaluation scores as compared to IPlus's proposal. Id. at 6.
The protester also contends that DysTech intended to rely too heavily on
hiring of the incumbent contractor staff. In its protest, IPlus contends
that "[i]n an email dated February 22, 2006, Dynamic System's Program
Manager/Vice President of Sales and Marketing [] stated that Dynamic
Systems plans to `extend an offer of employment to every incumbent
contractor employee.'" Protest at 11. IPlus contends that this email
indicated that DysTech intended to hire all incumbent staff "without
regard to qualifications, interview or other review," and should have
raised questions regarding DysTech's management plan and technical
approach. Id. The protester, however, has never provided a copy of this
email. Furthermore, the date of the alleged email was after award, and the
protester fails to explain how the email could have been relevant to the
agency's evaluation of the proposals. In any event, DysTech's proposal
specifically stated that "[deleted]," and explains that its proposed
approach involves "[deleted]." AR, Tab 7, DysTech Proposal Vol. I, at 4.
On this record, we believe that the agency's evaluation of DysTech's
proposal under these factors was reasonable, and IPlus provides no basis
to challenge the agency's evaluation.
IPlus's Management Plan
IPlus argues that the agency improperly concluded that it had proposed too
many individuals for its management team:
[W]ith the combination of three organizations [IPLUS and its
subcontractors], the total number on the corporate management team is
[deleted] individuals. [Deleted] of these will be utilized in day-to-day
activities as they accomplish the required services. The TEB considers
these high numbers of corporate management personnel to be excessive for
effective management.
AR, Tab 12, IPlus Technical Evaluation, at 1.
IPlus argues that the agency should not have criticized this approach,
because the additional management personnel should have been deemed a
strength, rather than a liability. We believe that the agency's concern
was reasonable, as it related to the effectiveness and efficiency of
IPlus's management structure. The protester's disagreement provides no
basis to challenge this assessment. Kay & Assocs., supra, at 4.
IPlus also alleges that the agency improperly considered the company's
past performance in evaluating its management plan for retention of
personnel. The agency concluded as follows:
Problems encountered under the current NCP contracts illustrate that
maintaining adequate staff levels and avoiding excessive turnover are
areas of great importance and risk in a requirement requiring worldwide
staffing. High turnover causes loss of productivity, both for the
contractor and the government. The TEB noted the offeror's proposal
fails to provide an adequate plan indicating how they will prevent
excessive staff turnover. Under Risk Mitigation, IPLUS addresses Filling
Staff Vacancies, but it fails to provide any examples of previous
successful risk mitigation methods it has used to prevent staff
vacancies. The TEB realizes that IPLUS has been recently established and
might not have examples to provide, however, many portions of the
proposal do discuss the IPLUS team with references to MES and NESI
activities under their current contracts. Therefore, the lack of
examples describing previous successful avoidance techniques to prevent
staff turnover demonstrates a weakness in their management plan. IPLUS
lists the only risk to their management plan is filling staff vacancies
and staff absences, however, they fail to address the need to maintain
staff once they are hired.
AR, Tab 12, IPlus Technical Evaluation, at 1.
IPlus argues that because the current contract was performed by its
subcontractors MES and NESI, the agency had improperly applied past
performance information in the evaluation of the management plan. We
disagree. An agency may reasonably take into account its own experience
and knowledge with a particular proposal approach in assessing whether
that approach will likely succeed in the performance of contract
requirements. Arctic Slope World Servs., Inc., B-284481, B-284481.2, Apr.
27, 2000, 2000 CPD para. 75 at 7. Here, the agency could reasonably
consider the degree to which IPlus's proposal addressed or failed to
address retention issues in its plan. In any event, the agency's criticism
did not state that the IPlus's proposal was weak based solely on prior
failures by IPlus's subcontractors; rather, the agency stated that IPlus's
proposal did not adequately describe prior successful risk mitigation
methods. AR, Tab 12, IPlus Technical Evaluation, at 1; Tab 17, SSD, at 4.
This protest ground is therefore without merit.[10]
SOURCE SELECTION DECISION
IPlus finally argues that the agency's best value tradeoff and source
selection decision were flawed because of the alleged errors discussed
above, and because the agency failed to give more weight to factors IPlus
contends made its proposal superior to DysTech's. As discussed above, we
find that there is no basis to challenge the agency's evaluation of
proposals. Furthermore, IPlus has not set forth any persuasive challenges
to the source selection; at best, IPlus expresses disagreement with the
agency's determination that features in DysTech's more highly-rated,
higher-priced proposal merited selection for award over IPlus's lower
technically-rated, lower-priced proposal.
The protest is denied.
Anthony H. Gamboa
General Counsel
------------------------
[1] IPlus contends that DysTech and the agency understood DysTech's
responses to the requests for clarification to be, in fact, proposal
revisions in response to discussion questions. In its email responding to
the agency's request for information, DysTech stated: "Per your
instruction, I've revised our price (see attached)." AR, Tab 14, Email
from DysTech to Contracting Officer, Dec. 29, 2005. Our review of this
matter, however, focuses on the substance of the exchanges, rather than
the parties' characterizations. As discussed below, we believe that there
is no basis to sustain the protest with regard to this issue.
[2] The protester does not challenge the agency's calculations of the CLIN
and SubCLIN amounts; rather, its protest challenges only whether the
agency improperly conducted discussions.
[3] DysTech's response actually showed a total of $42,870,711.90. AR, Tab
14, Email from DysTech to Contracting Officer, Dec. 29, 2005, at attach.
1. As noted above, the agency concluded that the sum of the SubCLIN
amounts yielded a total of $42,870,717.86; the agency viewed DysTech's
response as confirming this amount and relied on it in the SSD. See AR,
Tab 17, SSD, at 1. The agency notes that the $5.96 difference resulted
from "rounding variations." Agency Supp. Memorandum of Law, at 8. We view
this discrepancy as immaterial.
[4] Although the protester raises the argument regarding discussions only
with regard to CLIN No. 4, DysTech in fact repeated this error in the
corresponding CLINs for the option years, e.g., CLINs Nos. 9, 14, 19, and
24. The protester does not challenge the agency's evaluation with regard
to these other CLINs. To the extent that DysTech's proposal contains
additional examples of this error, we view them as further support for the
agency's view that the mistake was apparent from the face of the proposal.
See Agency Supp. Memorandum of Law, at 31 n.22.
[5] The SBA mentor-protege program is designed to encourage approved
mentors to provide various forms of assistance (i.e., technical and
contract management assistance, financial aid in the form of equity
investments and/or loans, and subcontract support) to eligible protege
participants in order to enhance the capabilities of the proteges and to
improve their ability to successfully compete for federal contracts. The
amount of work performed by a protege under this type of arrangement is
governed by a written agreement between the protege and mentor, which is
approved by the SBA. For a detailed discussion of this program, see 8(a)
Business Development Mentor-Protege Program, available at:
http://www.sba.gov/8abd/indexmentorprogram.html.
[6] IPlus states that the SBA approved the MPA on September 21, 2006,
nearly two months after its proposal was submitted and approximately three
weeks after the agency inquired to the SBA regarding the status of the
MPA. See Protester's Supp. Comments, Exh. A, Decl. of IPlus President, at
1. The protester argues that the agency could have made additional,
subsequent inquiries to the SBA to determine whether the MPA had been
approved. We do not believe that, under these circumstances, the agency
was required, after first learning that the there was not a formally
approved mentor-protege relationship, to inquire further. IPlus
represented in its proposal that it had an MPA, but did not clarify that
the MPA had only been informally, as opposed to formally, approved.
Offerors are required to submit adequately written proposals, and an
offeror who does not accurately represent facts or fails to submit
complete information runs the risk that its proposal will be evaluated
unfavorably. See Standard Communications, Inc., B-296972, Nov. 1, 2005,
2005 CPD para. 200 at n.2.
[7] IPlus also contends that the agency's characterization of the company
as a "newly established company" was unreasonable. IPlus contends that
"IPlus was incorporated in 1994," and that "[t]he company is approximately
12 years old." Protester's Comments at 11. As discussed above, however,
IPlus did not identify any corporate experience or past performance within
the relevant period of time identified in the solicitation. Thus,
regardless of the characterization of the IPlus as "newly formed," IPlus
did not identify any basis for the agency to credit the company with any
corporate experience or past performance of its own.
[8] Indeed, there are instances where it would be inappropriate for an
agency to give a protege prime contractor credit for its mentor
subcontractor's past performance or experience. For example, under a past
performance criterion regarding management of subcontractors, an agency
cannot reasonably credit a small business protege prime contractor with
the past performance of its large business mentor subcontractor if the
evaluation criterion is meant to measure the prime contractor's ability to
supervise and control the subcontractor's performance. See Accurate
Automation Corp., B-292403, B-292403.2, Sept. 10, 2003, 2003 CPD para. 186
at 8.
[9] The protester also claims that the SBA regulations regarding MPA
require agencies to substitute a mentor's experience and past performance
for a protege who lacks such references. The relevant SBA regulations,
however, are silent as to the evaluation of proposals in the manner
suggested by IPlus. See 13 C.F.R. sect. 124.520.
[10] The protester has also raised other objections to the agency's
evaluation of the offerors' proposals. We have reviewed all of the issues
identified by the protester, and do not find any to have merit.