TITLE: B-298394.3, Phyllis M. Chestang, November 20, 2006
BNUMBER: B-298394.3
DATE: November 20, 2006
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B-298394.3, Phyllis M. Chestang, November 20, 2006

   Decision

   Matter of: Phyllis M. Chestang

   File: B-298394.3

   Date: November 20, 2006

   Phyllis M. Chestang for the protester.

   Laura Mann Eyester, Esq., U.S. Small Business Administration, for the
   agency.

   Nora K. Doolin, Esq., and John L. Formica, Esq., Office of the General
   Counsel, GAO, participated in the preparation of the decision.

   DIGEST

   Agency's evaluation of the protester's proposal as "poor" overall was
   reasonable where the protester's proposal, submitted in response to a
   solicitation for home and business loan processing, failed to provide
   information specifically requested by the solicitation and necessary for
   evaluation purposes.

   DECISION

   Phyllis M. Chestang protests the failure to be awarded a contract under
   solicitation No. SBAHQ-06-Q-0004, issued by the Small Business
   Administration (SBA) for home and business loan processing to support
   SBA's response to disaster recovery.[1]

   We deny the protest.

   The RFP provided for multiple awards of fixed-price contracts with
   reimbursable items for a base period of 1 year with four 1-year option
   periods. The successful contractors will perform loan processing and loan
   closing functions in support of SBA's response to disaster recovery.
   According to the record, SBA is authorized "to make loans to eligible
   applicants [that experienced losses from] declared disasters," and
   accomplishes this through SBA's Office of Disaster Assistance (ODA). RFP
   at 4. The solicitation explained that ODA's mission "is to help people
   recover from disasters and rebuild their lives by providing affordable,
   timely and accessible financial assistance to homeowners, renters,
   businesses of all sizes and nonprofit organizations." Id. The solicitation
   added that the destruction caused by Hurricanes Katrina, Rita, and Wilma
   in the fall of 2005 caused more home and business owners to apply for ODA
   loans than any previous disaster, and that through this solicitation SBA
   "will, for the first time, partner with the private sector" to process the
   more than 400,000 applications for home and business disaster loans that
   SBA expects to receive. Id.

   The solicitation stated that SBA will provide the successful contractors
   under this RFP with training, the disaster loan program's standard
   operating procedures, rules and regulations, as well as SBA's financial
   analysis tool and "updates on the loan processing and loan closing
   requirements." RFP at 4. In terms of the actual processing of loans, the
   RFP explained that the contractors will receive case files from SBA, which
   will contain, among other things, Internal Revenue Service transcripts,
   credit reports, and loss verification cost information. The contractor
   will then "obtain insurance information; perform credit and repayment
   analysis; review eligibility factors; discuss terms with disaster
   applicants; make approval/decline/withdrawal recommendation[s]; complete
   the loan officer report; and return the file" to SBA. Id. Following this,
   SBA will "[r]eview the file for final approval and preparation of
   documents to be signed," and if the loan is approved and after taking
   certain other actions, SBA "will prepare and review the loan closing
   documents." Once this is accomplished, the successful contractor will
   "[s]chedule closing with [the] disaster applicant and close [the] loan
   with [the] disaster applicant." Id.

   The RFP provided detailed proposal preparation instructions, requesting
   that proposals consist of two volumes, with volume one including sections
   addressing past performance, technical approach, staffing, management
   approach, and representations and certifications, and volume two
   addressing price/cost. RFP at 22. The solicitation provided that awards
   would be made to the firms submitting the proposals determined to
   represent the best value to the government based upon the following
   evaluation factors: past performance, technical approach, staffing,
   management approach, and price/cost. Id. at 28-30. The RFP added here that
   in determining which proposals represented the best value, the agency
   would consider the past performance, technical approach, staffing, and
   management approach factors equal in weight, and these factors combined
   equal in importance to price/cost. Id. at 30. The solicitation
   specifically outlined how the SBA would evaluate proposals and explained,
   for example, that SBA would assign a rating of "poor" to those proposals
   where "serious doubt exists that the Offeror(s) will successfully perform
   the required effort." Id. at 28-30. The solicitation added that the agency
   intended to "evaluate proposals and award a contract without discussions,"
   and thus advised that "the offeror's initial proposal should contain the
   offeror's best terms from a cost or price and technical standpoint." Id.
   at 50.

   The agency received 28 proposals in response to the solicitation. The
   proposals were evaluated, and the agency selected the proposals of Horizon
   Consulting, Inc., Value Finders Appraisal Services, and The Corvus Group,
   Inc., for award of contracts. In this regard, Horizon's proposal received
   an overall rating (past performance, technical approach, staffing, and
   management approach combined) of "excellent" at a total evaluated price of
   $46,672,492.85, Value Finders' proposal received an overall rating of
   "good" at a total evaluated price of $37,784,467, and Corvus' proposal
   received an overall rating of "good" at an evaluated price of $53,834,637.
   Agency Report (AR), Tab 18, Federal Business Opportunity's Award Notice
   (May 23, 2006). The proposal submitted by Phyllis Chestang received
   ratings of "poor" under each of the solicitation's evaluation factors and
   "poor" overall, at an evaluated price of $12,085,164. AR, Tab 12, Disaster
   Loan Processing and Closing RFP Panel Results; Tab 10, Chestang Proposal.

   The protester argues that the agency's evaluation of its proposal was
   unreasonable.[2] In reviewing a procuring agency's evaluation of an
   offeror's proposal, our Office's role is limited to ensuring that the
   evaluation was reasonable and consistent with the terms of the
   solicitation and applicable statues and regulations. Urban-Meridian Joint
   Venture, B-287168, B-287168.2, May 7, 2001, 2001 CPD para. 91 at 2. A
   protester's mere disagreement with the agency's judgment does not
   establish that the evaluation was unreasonable. C. Lawrence Constr. Co.,
   Inc., B-287066, Mar. 30, 2001, 2001 CPD para. 70 at 4.

   As an initial matter, we note that Chestang repeatedly points out that the
   cover letter to the proposal stated that Chestang "agrees with all terms,
   conditions, and provisions included in the solicitation," and appears to
   argue that this statement alone should have provided sufficient assurance
   that Chestang was capable of performing the work required by the
   solicitation. This statement, which is nothing more than a blanket offer
   of compliance, is not an adequate substitute for a detailed and complete
   proposal as was requested by the solicitation and was necessary for the
   agency to determine whether what the offeror proposes will meet the
   agency's needs. T-L-C Sys., B-287452, June 18, 2001, 2001 CPD para. 106 at
   4.

   As illustrated by the following examples, we find that the agency's
   evaluation of Chestang's proposal was reasonable, given the evaluators'
   reasonable conclusions that Chestang's proposal lacked in many instances
   the detail requested by the RFP concerning Chestang's past performance,
   proposed technical approach, staffing, and management approach.

   The solicitation provided that a proposal's technical approach section
   "shall be sufficiently specific, detailed, and complete to clearly and
   fully demonstrate that the Offeror(s) has a thorough understanding of all
   RFP technical requirements." RFP at 24. The solicitation continued in this
   regard by stating, among other things, that "[t]he technical proposal
   shall contain sufficient detail to indicate the proposed means for
   complying with all requirements contained in the Performance Work
   Statement, and shall include a complete explanation of the techniques and
   procedures to be utilized." Id. Consistent with this, the RFP informed
   offerors that the evaluation "shall assess the detailed technical
   description of how all the required work will be accomplished," and that
   this assessment "will include evaluation of proposed methodologies for
   demonstration of an understanding of every requirement included in this
   RFP." Id. at 29. The solicitation specifically provided here that during
   the evaluation the agency would look to see if the proposal demonstrated
   "the ability to accomplish the desired results within the proscribed
   standards and workload, the quality of work in providing services, and how
   policies, procedures, and practices will preserve Government property and
   equipment and minimize life cycle costs." Id. at 29.

   The section of Chestang's proposal addressing the firm's proposed
   technical approach was approximately one-half page long, and consisted
   primarily of general statements, such as the firm has "experience in all
   phases of loan processing and loan closing," and that "[l]oan closing
   procedures will comply with the SBA Standard Operating Procedures." AR,
   Tab 10, Chestang Proposal, at 7. Given that the technical approach section
   of Chestang's proposal failed to address in any meaningful way any aspect
   of how the firm would accomplish the work required, we find the agency's
   evaluation of Chestang's proposal as "poor" under this factor to be
   reasonably based. AR, Tab 12, Disaster Loan Processing and Closing RFP
   Panel Results.

   Similar deficiencies were noted by the agency with regard to the section
   of Chestang's proposal addressing staffing. In this regard, the
   solicitation requested that proposals include, among other things, a
   staffing chart as well as "resumes for the staff, along with statements of
   relevant experience, addressing experience with the specific (or
   comparable) operations, activities, approaches, techniques, hardware,
   software, etc., required under this contract." RFP at 25. The solicitation
   specified here that "[s]taff should include the site manager and a mix of
   other personnel with specific disaster-related experience." Id. The
   solicitation advised offerors that the agency's evaluation of proposals
   under the staffing factor would include an assessment of "the quality and
   competence of the proposed staff, and whether they meet the qualifications
   necessary to accomplish" the work required. Id. at 29. The solicitation
   stated here that the agency would evaluate "whether the proposed
   experience, and/or education demonstrates a thorough understanding of the
   operating principles, and safe provision of services as evidenced by the
   detailed staffing data" that was requested by the solicitation to be
   included in proposals. Id.

   The section of Chestang's proposal addressing staffing was less then
   one-half page in length, and did not include any resumes or statements
   identifying any proposed staff, but rather, only general statements such
   as "PM CHESTANG & Associates is comprised of a team of experienced
   professionals that possess advanced professional degrees (MBA, CPA, CMAs,
   etc.) relevant financial and loan processing experience." AR, Tab 10,
   Chestang Proposal, at 7. Again, given that Chestang's proposal failed to
   include any of the information requested by the solicitation for
   evaluation under the staffing factor, or address in any meaningful way the
   firm's proposed approach to staffing, the evaluators' rating of the
   section of the proposal addressing staffing as "poor" because, among other
   things, "[s]taff [was] mentioned in very general terms" with no
   individuals other than Phyllis Chestang being "mentioned by name to
   perform the work," was reasonably based. AR, Tab 12, Disaster Loan
   Processing and Closing RFP Panel Results.

   As a final example, the evaluators found that the section of the proposal
   addressing Chestang's proposed management approach was similarly brief
   (totaling approximately one page), and also lacking in any sort of detail.
   In this regard, the solicitation requested that proposals include examples
   of the offerors' respective "management plan highlights," which were to
   include the consideration of 13 listed items, such as "[m]anaging the
   complexities of the functions set forth in the RFP," "[r]educing
   turn-over," and "[t]ask management." RFP at 25. Offerors were informed
   that their proposals would be assessed to determine "the quality and
   capacity" of the proposed management and systems in relation to the
   ability "to manage the size, complexities, scope and locations of all the
   functions set forth in the RFP." Id. at 30.

   Here, Chestang's proposal provided that it will comply with the terms of
   the solicitation, repeated the 13 items that the solicitation requested be
   addressed, and stated that it will address these items in "the proposal
   modification."[3] AR, Tab 10, Chestang Proposal, at 8. Given the
   proposal's lack of any meaningful description of a proposed management
   approach, we find reasonable the evaluators' determinations that the
   section of Chestang's proposal addressing Chestang's proposed management
   approach "[p]rovided minimal" or "[i]nsufficient" information, and
   accordingly, find reasonable the agency's evaluation of Chestang's
   proposal under the management factor as "poor." AR, Tab 12, Disaster Loan
   Processing and Closing RFP Panel Results.

   In sum, the solicitation required the submission of a proposal with
   sections addressing the offeror's past performance, technical approach,
   staffing, and management approach, and supplied instructions as to what
   proposals were to address in relation to each of the RFP's evaluation
   factors. Because the agency's evaluation was dependent upon information
   furnished in the proposal, it was Chestang's obligation to submit an
   adequately written proposal for the agency to evaluate, and as evidenced
   by the record here, Chestang simply failed to do so.[4] GEC-Marconi Elec.
   Sys. Corp., B-276186; B-276186.2, May 21, 1997, 97-2 CPD para. 23 at 7. As
   such, the agency's evaluation of Chestang's proposal, and determination to
   not award a contract under this solicitation to Chestang, were consistent
   with the terms of the solicitation and were reasonably based.

   The protest is denied.

   Gary L. Kepplinger

   General Counsel

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

   [1] Although the solicitation is identified in its cover page as a request
   for quotations (RFQ), the term "proposals" and acronym "RFP" repeatedly
   appear in, among other things, the solicitation's proposal preparation
   instructions and descriptions of the evaluation factors and award scheme.
   Given this, as well as the agency's view that the solicitation was
   intended to be a request for proposals (RFP), and the fact that whether
   the solicitation is properly considered an RFQ or RFP does not affect the
   outcome of this protest, we refer to the solicitation in this decision as
   an RFP and the firm's submissions as proposals for the sake of clarity.

   [2] In Chestang's initial protest to our Office, the protester argued that
   the agency had erroneously evaluated the "firm's bid price" as totaling
   $2.4 million, and that the agency had thus erroneously "inferred that my
   bid price was too low to `stay in business' and `make a profit.'" Protest
   at 6. The agency explained in its report that, contrary to the protester's
   belief, it had in fact evaluated the protester's proposal as totaling
   $12.08 million, and the protester did not respond to the agency's position
   in its comments. AR at 8. Accordingly, we consider Chestang to have
   abandoned this aspect of its protest. Uniband, Inc., B-298305, Feb. 8,
   2002, 2002 CPD para. 51 at 5 n.3.

   [3] Chestang was apparently of the belief that it would be permitted to
   submit a modification of its proposal in accordance with Federal
   Acquisition Regulation sect. 52.215-1; see RFP at 49. This clause, which
   allows for the "late modification of an otherwise successful proposal that
   makes it terms more favorable to the Government," generally means that the
   government may accept a favorable late modification of a proposal only
   from the offeror already in line for award. Seven Seas Eng'g & Land
   Surveying, B-294424.2, Nov. 19, 2004, 2004 CPD para. 236 at 4. It does not
   pertain to every proposal submitted, and even though Chestang never
   attempted to submit a modification to its proposal, would not have
   pertained to Chestang given that Chestang's proposal would not have been
   in line for award prior to the late modification.

   [4] For this same reason the "clarifications" and other additions to its
   proposal provided by Chestang during the course of this protest, which
   were submitted in an attempt by Chestang to augment its technical and
   management approaches and staffing plan, do not provide a basis on which
   to find the agency's evaluation of Chestang's proposal unreasonable. Dual,
   Inc., B-279295, June 1, 1998, 98-1 CPD para. 146 at 5.