TITLE: B-298390, Dismas Charities, August 21, 2006
BNUMBER: B-298390
DATE: August 21, 2006
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B-298390, Dismas Charities, August 21, 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: Dismas Charities

   File: B-298390

   Date: August 21, 2006

   Alex D. Tomaszczuk, Esq., and Daniel S. Hersfeld, Esq., Pillsbury Winthorp
   Shaw Pittman LLP, for the protester.

   Michael A. Gordon, Esq., Holmes & Gordon, for Bannum, Inc., an intervenor.

   Tracey L. Printer, Esq., Federal Bureau of Prisons, for the agency.

   Eric M. Ransom, Linda C. Glass, Esq., and Michael R. Golden, Esq.,
   participated in the preparation of the decision.

   DIGEST

   Protest of agency's evaluation of proposals and source selection is denied
   where the evaluation and award decision were reasonable and consistent
   with the solicitation's evaluation terms.

   DECISION

   Dismas Charities protests the award of a contract to Bannum, Inc. under
   request for proposals (RFP) No. 200-0861-SC, issued by the Federal Bureau
   of Prisons (BOP), to procure Comprehensive Sanctions Center (CSC) services
   for federal offenders in Austin, Texas. Dismas argues that the agency
   failed to follow the evaluation criteria set forth in the solicitation and
   that the agency failed to make the award based on best value.

   We deny the protest.

   BACKGROUND

   The solicitation, issued April 15, 2005, requested the services of a
   contractor to provide employment assistance, residence development, and
   other self-improvement opportunities to assist federal offenders in
   becoming law-abiding citizens. The solicitation contemplated the award of
   a requirements contract with fixed unit prices for a 2-year base period
   with three 1-year option periods.

   The award was to be made to the offeror whose proposal was determined to
   represent the best value to the government under three evaluation factors:
   technical/management, past performance, and price. The solicitation stated
   that the technical/management and past performance evaluation factors,
   when combined, were "significantly more important than price," and that of
   the two non-price evaluation factors, "past performance is more
   important." Solicitation sect. M.5, Agency Report, Tab 1. However, the
   solicitation also advised that price, though of lesser importance than the
   technical/management and past performance evaluation factors, could
   contribute substantially to the award decision. Id. A source selection
   evaluation board (SSEB) was to evaluate the offerors' proposals in the
   technical/management area using a color/adjectival rating system:
   blue/very good; green/acceptable; yellow/poor; and red/unacceptable. Id.
   sect. M.3, M.5. The contracting officer (CO) was to evaluate the offerors'
   proposals in the past performance area using the same color/adjectival
   system. Id. sect. M.5, 1.0.

   Timely proposals were received from three offerors, including Dismas and
   Bannum. After an initial review, the SSEB determined that none of the
   proposals met the solicitation's minimum requirements and the agency
   therefore conducted two rounds of written discussions. After discussions,
   Dismas's revised proposal received a blue/very good rating in the
   technical/management area, a blue/very good rating in the past performance
   area, and offered an evaluated price of $[DELETED]. Bannum's revised
   proposal received a green/acceptable rating in the technical/management
   area, a blue/very good rating in the past performance area, and offered an
   evaluated price of $[DELETED]. The third offeror's revised proposal
   received a green/acceptable rating in the technical/management area, a
   blue/very good rating in the past performance area, and offered an
   evaluated price of $[DELETED].

   The CO reviewed the SSEB's evaluation and independently considered the
   subfactor strengths and weaknesses that contributed to each proposal's
   overall color/adjectival ratings. The CO noted that Dismas's
   technical/management proposal was rated higher than the other proposals,
   but also that all three proposals met the minimum solicitation
   requirements and represented a low risk to the government. After
   evaluating the ratings, risk factors and price, the CO determined that,
   "from the business point of view, the value of Dismas's program (non-cost
   factor) did not warrant payment of a premium of $[DELETED] over the lowest
   priced offeror." Agency Report, Tab 13, at 13. The CO then selected
   Bannum's proposal as the best value to the government. The agency notified
   the other offerors that Bannum had been selected for the award on March
   28, 2006, and Dismas submitted a written request for debriefing on March
   29, 2006. The agency provided Dismas with a written debriefing on May 31,
   2006 and Dismas filed its protest with our Office on June 5, 2006.

   Dismas raises three bases of protest. First, Dismas alleges that the
   agency failed to follow the evaluation criteria with regard to Bannum's
   technical/management evaluation and that Bannum's proposal failed to meet
   the minimum technical/management requirements of the solicitation. Second,
   Dismas alleges that the agency improperly evaluated Bannum's past
   performance by overlooking outside negative past performance information
   that Dismas maintains was "too close at hand" to ignore. Third, Dismas
   alleges that the agency conducted a flawed best value determination by
   turning a "best value" procurement into a "lowest-cost technically
   acceptable" procurement.

   DISCUSSION

   With regard to Dismas's allegation that the agency failed to follow the
   evaluation criteria in evaluating Bannum's technical proposal, Dismas
   specifically alleges that the proposal failed to meet two solicitation
   requirements. First, Dismas argues that Bannum's zoning documentation was
   not legally valid and could not meet the solicitation requirements
   regarding zoning and ordinance approvals. Second, Dismas argues that
   Bannum's proposed site location did not meet the solicitation's minimum
   requirement for parking spaces. We find no merit in Dismas's allegations.

   Initially, we point out that in reviewing protests of allegedly improper
   evaluations, our Office will not substitute its judgment for that of the
   contracting agency, but rather will examine the record to determine
   whether the agency's judgment was reasonable and in accord with stated
   evaluation criteria, and whether there were any violations of procurement
   statutes and regulations. Norfolk Ship Sys., Inc., B-219404, Sept. 19,
   1985, 85-2 CPD para. 309.

   The solicitation required offerors to "submit official documentation that
   demonstrates . . . an approval or plan to obtain zoning and/or an
   occupancy permit for their proposed site." Solicitation Section J, Agency
   Report, Tab 1. In the event that discussions were conducted, as was the
   case here, the solicitation further required offerors to "provide the
   Contracting Officer with valid proof of all zoning and local ordinance
   requirements necessary for the operation of [the proposed CSC]." Id.

   Bannum included in its proposal an approved certificate of occupancy (COO)
   for its proposed site location which stated that there was "no limit for
   the number of residents . . . for transitional housing for halfway houses
   for adult offenders making the transition from institutional to community
   living." Agency Report at 6-7; Agency Report, Tab 7. The COO was provided
   to Bannum by the city of Austin as establishing the zoning for the site
   location at issue. Intervenor's Comments at 1. Each agency technical
   panelist reviewed the COO and accepted it as meeting the solicitation
   requirements for zoning and ordinance approvals. Agency Report, Tab 17.

   We agree with the agency that the COO that was provided by the city of
   Austin and included in Bannum's initial proposal met the solicitation
   requirements to "submit official documentation that demonstrates an
   approval or plan to obtain zoning and/or an occupancy permit." [1] In this
   regard, Bannum's initial proposal provided the agency with proof of zoning
   when discussions began, and the agency had no reason to require further
   documentation. Given the solicitation's requirements and the nature of
   this particular COO, the agency acted reasonably in accepting the COO. We
   therefore deny this basis of protest.[2]

   Dismas's other technical evaluation argument, that Bannum's proposed
   facility failed to meet the solicitation's minimum requirement for parking
   spaces, is also without merit. To support its allegation Dismas relies on
   a statement in the source selection decision (SSD) that "[o]ther than the
   parking issue, [Bannum's proposal] met the minimum requirements of the
   solicitation." Agency Report, Tab 13, at 9. The agency responds that
   Dismas's interpretation of the SSD is unreasonable because the
   solicitation itself contained no requirement for a particular number of
   parking spaces.

   While the source selection authority (SSA) may have used a poor choice of
   words, the record does not support the view that Bannum failed to meet a
   minimum requirement for a certain number of parking spaces. The
   solicitation did not include a requirement for a particular number of
   parking spaces within the statement of work or any other section. The
   solicitation simply required each offeror to submit a legible and accurate
   floor plan for the proposed facility, showing "the location buildings,
   roads, fences, parking lots, walkways, and adjacent buildings."
   Solicitation Statement of Work, Ch. 3, at 25, Agency Report, Tab 1. It is
   clear from the technical evaluation of Bannum's proposal that the proposed
   site's six parking spaces were noted as a weakness, not as a failure to
   meet the solicitation's minimum requirements. Agency Report, Tab 16, at 3.
   It is also clear that the SSD itself referred to the parking issue as "one
   weakness that was not significant," and further stated that all proposals
   met the minimum requirements. Agency Report, Tab 16, at 3; Tab 13, at 13.
   Accordingly, this basis of protest is denied.

   With regard to the past performance evaluation, Dismas alleges that the
   agency improperly ignored Bannum's negative performance on a previous
   contract with the BOP. The solicitation required each offeror to submit
   "the 5 most relevant contracts and/or subcontracts that were, or are
   currently being, performed in the past 3 years." Solicitation sect. L.8;
   Section J. Dismas's allegation does not involve negative performance on a
   contract submitted for evaluation in Bannum's proposal. Rather, Dismas
   references a Court of Federal Claims protest decision, Bannum, Inc. v.
   United States, 69 Fed Cl. 311 (2006), in which the Court makes reference
   to Bannum's performance of a prior contract during which Bannum "fail[ed]
   to alert the BOP of an escaped prisoner in a timely manner."[3] 69 Fed.
   Cl. at 316; Protest at 11. Dismas argues that, in light of the negative
   past performance information referenced by the Court in Bannum, it was
   unreasonable for the agency to rate Bannum's past performance as blue/very
   good, asserting that the past performance information referenced in the
   court decision was "too close at hand" for the agency to ignore.[4]
   Protest at 11.

   An agency's past performance evaluation is a matter within its discretion
   and we will not question it unless it is unreasonable or inconsistent with
   the terms of the solicitation or applicable statutes and regulations.
   Continental RPVs, B-292768.2, B-292768.3, Dec.11, 2003, 2004 CPD para. 56.
   There is no legal requirement that all past performance, or even all past
   performance references listed in an offeror's proposal, be checked or
   included in a valid review of past performance. See Dragon Servs., Inc.,
   B-255354, Feb. 25, 1994, 94-1 CPD para. 151 at 8; Questech, Inc.,
   B-236028, Nov. 1, 1989, 89-2 CPD para. 407 at 3. What is critical is
   whether the evaluation is conducted fairly, reasonably, and in accordance
   with the stated evaluation criteria, and whether it is based upon relevant
   information sufficient to make a reasonable determination of the offeror's
   overall past performance rating, including relevant information close at
   hand or known by the contracting personnel awarding the contract. See,
   e.g., International Bus. Sys., Inc., B-275554, Mar. 3, 1997, 97-1 CPD
   para. 114 at 5.

   At the outset, we note that the negative past performance discussed by the
   Court in Bannum appears to have taken place prior to the period
   contemplated by the solicitation for consideration of past performance
   activity. As discussed above, the solicitation required each offeror to
   submit "the 5 most relevant contracts and/or subcontracts that were, or
   are currently being, performed in the past 3 years." Solicitation sect.
   L.8; Section J. As also noted above, the negative past performance
   information discussed by the Court, on which Dismas's protest relies, was
   identified in connection with the agency's evaluation of Bannum's
   responses to three prior solicitations, the latest of which was issued on
   April 29, 2002--almost exactly three years prior to issuance of the April
   15, 2005 solicitation at issue here. Accordingly, although the record does
   not precisely establish when the negative past performance occurred, it
   strongly suggests that the past performance discussed by the Court in
   Bannum, on which Dismas's protest relies, occurred prior to the 3-year
   period contemplated by the solicitation for consideration.

   In any event, Bannum provided five contracts which met the solicitation
   requirement for recent and relevant past performance information. Agency
   Report, Tab 18. Dismas has not questioned the agency's past performance
   evaluation with regard to those five contracts. In evaluating Bannum's
   proposal, the agency considered certain prisoner accountability issues
   similar to those discussed in the court decision, but nonetheless
   determined that Bannum's past performance was properly rated blue/very
   good. Agency Report, Tab 18, at 7. Accordingly, even if the record were to
   establish that the negative past performance information discussed by the
   Court in Bannum took place during the period contemplated by the
   solicitation, and even if we were to conclude that this information was
   "too close at hand" for the agency to ignore, the record does not support
   Dismas's assertion that it was unreasonable for the agency to rate
   Bannum's past performance as blue/very good. Accordingly, we find no basis
   to sustain Dismas's protest challenging the agency's past performance
   evaluation.

   Finally, Dismas alleges that the agency failed to make the award in
   accordance with the best value methodology identified in the RFP. Dismas
   alleges that the CO gave more weight to price than to the technical
   evaluation factors, ignoring the solicitation and converting this best
   value procurement into a lowest cost/technically acceptable procurement.
   In support of its allegation, Dismas points to its debriefing letter, in
   which the CO stated that "[t]here were no tradeoffs used in determining
   the award of the contract" to Bannum. Protest, Exh. 3, at 3. Dismas takes
   this statement to mean that the agency did not consider awarding the
   contract to a higher priced, but technically superior offeror and simply
   awarded the contract to the lowest priced acceptable offeror. We disagree
   with Dismas's assertion.

   Where a solicitation provides for award on a best value basis, it is the
   function of the SSA to determine whether one proposal's technical
   superiority is worth a higher price and that decision is governed only by
   the test of rationality and consistency with the stated evaluation
   criteria. See Chenega Technical Prods., LLC, B-295451.5, June 22, 2005,
   2005 CPD para. 123 at 8; Leach Mgmt. Consulting Corp., B-292493.2, Oct. 3,
   2003, 2003 CPD para. 175 at 3-4. The agency has "broad discretion in
   determining the manner and extent to which [it] will make use of the
   technical and price evaluation results in making price/technical
   tradeoffs." Property Analysts, Inc., B-277266, Sept. 12, 1997, 97-2 CPD
   para. 77 at 6. An agency may "properly award to a lower rated, lower cost
   offeror, even if cost is the least important evaluation factor, if it
   reasonably determines that award to the higher cost offeror is not
   justified given the level of technical competence available at the lower
   cost." Id.

   Notwithstanding the information in the debriefing letter suggesting that
   no tradeoff was made, the SSA provided a well-documented SSD that
   demonstrated a detailed comparison of each offeror's strengths and
   weaknesses and a rationale for the best value award to Bannum. Agency
   Report, Tab 13, at 8-12. The SSA substantiated the SSEB's ratings and risk
   assessments and acknowledged that Dismas received a higher
   technical/management rating than the other offerors. Id. The SSA then
   considered the price premium of an award to Dismas and determined that
   Dismas's higher rated proposal was not worth the additional cost of
   $[DELETED]. Id. at 13. Accordingly, the contracting officer did, in fact,
   make a tradeoff between Dismas's higher technical/management rating and
   Bannum's lower evaluated price, properly adhering to the solicitation's
   stated best value award basis.

   The protest is denied.

   Gary L. Kepplinger
   General Counsel

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

   [1] The COO authorized not only occupancy but also a specific use,
   transitional housing. As the intervenor points out, the Austin City Code
   provides that a COO may not be issued unless the development has been
   completed "in accordance with the released site plan, construction plans,
   and other ordinance requirements." Austin City Code sect. 25-1-363;
   Intervenor's Comments at 2. Where, as here, the COO contained approval of
   the given use, we believe the agency was reasonable in accepting it as
   proof of the required approvals.

   [2] Dismas also argues that the agency had an obligation to further assess
   the legality of Bannum's COO, and has presented evidence that the present
   owner of Bannum's proposed site location applied for additional zoning
   approvals during the evaluation process. Dismas has not, however,
   presented evidence to demonstrate that the tendered COO was revoked at any
   point during the evaluation, nor does the record indicate that the COO was
   otherwise invalid. Where, as here, the solicitation required offerors to
   submit official documentation demonstrating an approval or plan to obtain
   zoning and/or an occupancy permit, the agency's reliance on the COO
   submitted by Bannum was reasonable and sufficient.

   [3] The past performance information referenced by the Court in Bannum had
   been provided by Bannum in response to three solicitations, which had been
   issued on April 29, 2002, January 2, 2002, and August 6, 2001,
   respectively.

   [4] Here, one of the COs in this procurement, Rebecca Canfield, was also
   the CO in the Hattiesburg, Mississippi contract involved in Bannum, Inc.
   v. United States.