TITLE: B-298443.4, Partnership for Response and Recovery, December 18, 2006
BNUMBER: B-298443.4
DATE: December 18, 2006
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B-298443.4, Partnership for Response and Recovery, December 18, 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: Partnership for Response and Recovery

   File: B-298443.4

   Date: December 18, 2006

   E. Sanderson Hoe, Esq., and Karri L. Garrett, Esq., McKenna Long &
   Aldridge LLP, for the protester.

   Eric J. Marcotte, Esq., Scott A. Schipma, Esq., and Nathan C. Guerrero,
   Esq., Winston & Strawn LLP, an intervenor.

   Leigh M. Hoburg, Esq., Federal Emergency Management Agency, for the
   agency.

   Katherine I. Riback, Esq., and James A. Spangenberg, Esq., Office of the
   General Counsel, GAO, participated in the preparation of the decision.

   DIGEST

   Agency is not required to limit discussions and revised proposals in
   taking corrective action in response to protest where it found discussions
   and evaluation were inadequate and new requirements have been added to the
   solicitation.

   DECISION

   Partnership for Response and Recovery (PaRR) protests the corrective
   action taken by the Federal Emergency Management Agency (FEMA) in response
   to the protest of Alltech, Inc. of FEMA's award of contracts under request
   for proposals (RFP) No. HSFEHQ-06-R-0013 to PaRR and Michael Baker, Jr.
   Corporation for housing inspection services (HIS). The RFP contemplated
   award of multiple indefinite-delivery, indefinite-quantity contracts for
   HIS, which involves providing individual housing inspectors and managing a
   program to deploy and oversee the inspectors when a disaster occurs. PaRR
   argues that the agency's revised corrective action, which consists of
   reopening discussions and requesting completely revised proposals,
   unfairly favors Alltech and is an abuse of agency discretion.

   We deny the protest.

   Alltech had protested that the agency's evaluation was "irrational,
   unsupported by the record, and punctuated with recurring examples of
   blatant disparate treatment," that the discussions were incomplete, and
   the source selection decision was not explained or documented. Alltech's
   Protest Comments (B-298443, Aug. 7, 2006) at 2. After receipt of the
   agency report and comments thereon, our Office scheduled a hearing to
   address the various problems in the record. The agency then decided to
   take corrective action in response to Alltech's protest, and we dismissed
   Alltech's protest.

   Specifically, the agency found that the entire source evaluation board
   (SEB) had not reviewed the evaluation report, and only a "draft" report,
   which contained a discussion of a number of weaknesses attributed to
   Alltech's proposal that had been resolved during discussions and the
   submission of final proposal revisions, had been provided to the source
   selection official. The final SEB report was only prepared after the
   source selection decision. It was also found that the agency had not
   conducted meaningful discussions regarding Alltech's past performance and
   that there appeared to be a disconnect between the discussion questions
   asked and the agency's true concerns about Alltech's proposal, for
   example, in the training area. Agency Report at 4-5.

   The corrective action first proposed by the agency was to appoint a new
   SEB and source selection official to conduct a de novo evaluation of the
   competitive range offerors' proposals. The new evaluators would evaluate
   proposals based upon the initial submissions and responses to discussion
   questions. FEMA contemplated that the agency would reopen discussions only
   for newly identified significant weaknesses that were not the subject of
   previous discussions and price revisions would only be permitted to the
   extent they could be tied to the technical changes resulting from new
   discussion questions. Contracting Officer's Statement at 8-9; FEMA's
   Corrective Action Letter (Aug. 18, 2006).

   The agency later determined, for a variety of reasons, that the
   evaluation, discussions and proposal revisions, including price revisions,
   should not be restricted. In view of the previous errors in the
   procurement process, the agency determined that it was important for a new
   SEB to function independently of the previous SEB's determinations and not
   be biased by the prior evaluation or the discussion questions formulated
   by the prior SEB. The agency also believed that the limitation on price
   revisions was unworkable because of the difficulty of linking pricing
   changes to particular discussion questions and in view of the changes in
   the period of performance that were necessitated by the prior protest.

   Since discussions were being reopened, the agency also determined to
   implement Homeland Security Presidential Directive 12 (HSPD-12) (Aug. 27,
   2004), which requires that common "personal identify verification" (PIV)
   procedures be established for employees and contractors who have physical
   access to Federal facilities and logical access to Federally-controlled
   information systems. The PIV procedure entails a background check for
   "suitability" for work in the applicable area, which must be at a minimum
   a "National Agency Check with Inquiries," which includes a fingerprint
   check conducted by the Federal Bureau of Investigation (FBI). Contracting
   Officer's Statement at 10. The agency states that in order to comply with
   HSPD-12 and its implementing directives prior to commencement of work,
   each housing inspector had to be fingerprinted, the prints submitted to
   the FBI, the results from the FBI's fingerprint database provided to FEMA,
   an "adjudication" obtained from FEMA that that person was "suitable" for
   employment, and the receipt by FEMA from that person of applicable forms
   for submission to Office of Personnel Management for further
   investigation. Id. at 11. The agency anticipated that this new requirement
   would affect both technical and price proposals. Id.

   Although the protester does not contend that corrective action was not
   warranted, it contends that the agency should have continued with its
   initial "narrowly tailored" corrective action plan, and objects to the
   "astonishing breadth" of the agency's later revised corrective action
   plan. Protest at 5.

   Generally, offerors in response to an agency request that discussions be
   opened or reopened may revise any aspect of their proposals they see
   fit--including portions of their proposals which were not the subject of
   discussions. American Nucleonics Corp., B-193546, Mar. 22, 1979, 79-1 CPD
   para. 197 at 2. However, in appropriate circumstances where the agency has
   established a reasonable basis for doing so, our Office has not objected
   to an agency's decision to limit discussions under a negotiated
   procurement in implementing corrective action in response to a protest.
   See Rel-Tek Sys. & Design, Inc.--Modification of Remedy, B-280463.7, July
   1, 1999, 99-2 CPD para. 1 at 3. In this regard, the details of
   implementing the corrective action are within the sound discretion and
   judgment of the contracting agency, and we will not object to the specific
   proposed corrective action, so long as it is appropriate to remedy the
   concern that caused the agency to take corrective action. Consortium HSG
   Technischer Serv. GmbH and GeBe Gebaeude- und Betriebstechnik GmbH
   Suedwest Co., Mgmt. KG, B-292699.4, Feb. 24, 2004, 2004 CPD para. 44 at 3.
   Moreover, as part of its corrective action, an agency can, as here, amend
   the RFP to add requirements that will require the submission of revised
   proposals and is not required to limit proposal revisions to only address
   these changes. Norvar Health Servs.--Protest and Reconsideration,
   B-286253.2 et al., Dec. 8, 2000, 2000 CPD para. 204 at 4-6.

   In our view, the corrective action here is well within the broad
   discretion afforded to contracting agencies in these circumstances. As
   described above, during the course of defending the previous protest, it
   came to the agency's attention that there were various errors in this
   procurement that warranted reopening discussions; as indicated above, the
   agency is not required to limit the scope of discussions in such
   circumstances.[1] To the extent that PaRR argues that because offerors
   were informed of its low price, rescinding the original award and
   reopening the competition will foster an auction and put PaRR at a
   competitive disadvantage, we have previously noted that the Federal
   Acquisition Regulation does not prohibit auctions, and agencies are not
   otherwise prohibited from taking corrective action in the form of
   requesting revised price proposals where the original awardee's price has
   been disclosed. In this regard, we have repeatedly observed that the
   possibility that the contract may not have been awarded based on a fair
   determination of the most advantageous proposal has a more harmful effect
   on the integrity of the competitive procurement system than does the
   possibility that the original awardee will be at a disadvantage in the
   reopened competition. PCA Aerospace, Inc., B-293042.3, Feb. 17, 2004, 2004
   CPD para. 65 at 4. Moreover, as described above, significant new
   requirements of HSPD-12 that have been added to the solicitation will
   require revised technical proposals and prices. Under the circumstances,
   the agency can choose not to limit discussions and revised proposals.

   The protest is denied.

   Gary L. Kepplinger

   General Counsel

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

   [1] The protester has not cited and we have found no cases where our
   Office has required an agency to limit discussions in taking corrective
   action, but only relies upon cases where our Office found the agency had
   established particular circumstances for limiting discussions.