TITLE: B-298626.2, B-298626.3, Raytheon Company, Space and Airborne Systems, September 27, 2007
BNUMBER: B-298626.2, B-298626.3
DATE: September 27, 2007
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B-298626.2, B-298626.3, Raytheon Company, Space and Airborne Systems, September 27, 2007

   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: Raytheon Company, Space and Airborne Systems

   File: B-298626.2, B-298626.3

   Date: September 27, 2007

   Joseph P. Hornyak, Esq., David S. Black, Esq., Michele Mintz Brown, Esq.,
   Jennifer A. Short, Esq., and Allison V. Feierabend, Esq., Holland & Knight
   LLP, for the protester.

   W. Jay DeVecchio, Esq., Donald B. Verrilli, Jr., Esq., Kevin C. Dwyer,
   Esq., Darren H. Lubetzky, Esq., and Edward Jackson, Esq., Jenner & Block
   LLP, for L-3 Communications Integrated Systems, an intervenor.

   Brian E. Toland, Esq., and Tina Marie Pixler, Esq., Department of the
   Army, for the agency.

   Glenn G. Wolcott, Esq., and Ralph O. White, Esq., Office of the General
   Counsel, GAO, participated in the preparation of the decision.

   DIGEST

   1. Solicitation reasonably put protester on notice that performance of the
   solicitation's aircraft "service ceiling" threshold capabilities would be
   considered in evaluation of proposals.

   2. Agency was reasonably concerned with protester's proposed approach to
   performing "service ceiling" aircraft threshold capabilities in that the
   approach involved protester's application of a "new operational mode"
   relying on [deleted].

   3. Agency reasonably evaluated protester's proposal as "marginal" under
   the air vehicle subfactor, and as creating "high performance risk," where
   protester failed to provide data from engine manufacturer addressing the
   impact of protester's "new operational mode."

   4. Protester's assertion that awardee's proposal contemplated use of
   [deleted] similar to that of the protester's is without merit where record
   shows that awardee's aircraft was able to perform threshold capabilities
   without [deleted], that use of [deleted] was relied on by awardee to
   expedite task performance, and that awardee's proposed use of [deleted]
   was consistent with the existing manufacturer documentation for the
   aircraft engines.

   5. Agency properly assigned only adjectival ratings to offerors' life
   cycle costs where solicitation expressly advised offerors that comparison
   of numerical cost values associated with life cycle costs would not be a
   "driver" in the source selection decision.

   DECISION

   Raytheon Company, Space and Airborne Systems, protests the Department of
   the Army's award of a contract to L-3 Communications Integrated Systems,
   pursuant to request for proposals (RFP) No. W58RGZ-06-R-0213, to provide
   the joint cargo aircraft (JCA) to the government.[1] Raytheon maintains
   that the agency improperly evaluated various aspects of Raytheon's and
   L-3's proposals.

   We deny the protest.

   BACKGROUND

   In March 2006, the Army issued solicitation No. W58RGZ-06-R-0213, seeking
   proposals to provide the JCA--that is, to provide a "multifunctional
   aircraft, able to perform logistical resupply, casualty evacuation, troop
   movement, airdrop operations, humanitarian assistance, and Homeland
   Security support," with a "primary mission . . . to move
   time-sensitive/mission-critical cargo to forward tactical units in remote
   and austere locations."[2] Agency Report (AR), Tab 25, Performance Work
   Statement (PWS) para. 1.1. The solicitation contemplates award of a
   fixed-price requirements contract with three 1-year base ordering periods
   and two 1-year option ordering periods.

   Section M of the solicitation advised offerors that award would be made on
   a "best value" basis and established the following evaluation factors:
   technical, [3] price,[4] logistics, management/production and past
   performance. [5] AR, Tab 2, RFP para. M-3 (1.1). The solicitation also
   contained a purchase description (PD) that established certain aircraft
   performance requirements.[6] Among others, the PD contained headings of
   "self deployment," "enhanced takeoff and landing performance," "cruise
   airspeed," and "service ceiling" under which the particular capabilities
   the government sought were identified. AR, Tab 20, PD paras. 5.3.3, 5.3.4,
   5.3.5, 5.3.6. For example, under the heading "service ceiling," the PD
   identified the following "threshold" capability:

     At the beginning of the cruise segment, the [JCA] will have a minimum
     service ceiling of 25,000 ft pressure altitude while carrying a standard
     crew of four, a 12,000 lb payload and fuel (including a 45 minute
     reserve) for a 1,200 nm[nautical mile] mission.

   AR, Tab 20, PD para. 5.3.6.1.

   Offerors were advised that evaluation would occur in three phases:
   phase I, in which proposals would be evaluated on a pass/fail basis for
   compliance with the MPS requirements; phase II, in which proposals would
   be evaluated against all solicitation requirements[7]; and phase III,
   early user survey (EUS) demonstration, during which the performance of
   each offeror's aircraft would be assessed against its proposal.[8]

   Initial proposals were submitted by Raytheon, L-3, and a third offeror in
   June 2006.[9] Raytheon's proposal was based on the commercially available
   EADS[10]-CASA[11] C-295 aircraft, powered by a Pratt & Whitney engine.
   L-3's proposal was based on the commercially available Alenia C-27J
   aircraft powered by a Rolls-Royce engine.[12] The agency performed an
   initial review and evaluation of proposals and, thereafter, prepared
   multiple written discussion questions for the two offerors.[13]

   In reviewing Raytheon's proposal, the agency had concerns regarding the
   ability of Raytheon's proposed aircraft to meet certain performance
   capabilities. In an EOC to Raytheon dated August 2006, the agency asked
   Raytheon:

     Please provide the specific certificates, performance analysis software,
     test report excerpts, or other official evidence explaining how the CASA
     C-295 aircraft meets the requirements of the RFP PD paragraphs 5.3.3
     [Self Deployment], 5.3.4 [Enhanced Takeoff and Landing Performance],
     5.3.5 [Cruise Airspeed], 5.3.6 [Service Ceiling].

   AR, Tab 44, at EOC 164-1.

   Raytheon responded that it had "used the same aircraft, aerodynamic and
   engine data used during the certification process of the basic C-295
   aircraft," but further stated:

     In addition to the performance validation previously discussed, a new
     operational mode is required using [deleted] to comply with several
     requirements of the RFP . . . .

   Id. at EOC 164-18.

   Reacting to Raytheon's statement that it was proposing a "new operational
   mode" during which [deleted], the agency prepared a follow-up discussion
   question for Raytheon, making the following observations:

     [Raytheon] uses an undefined [deleted] to accomplish performance goals
     in the C-295 proposal. . . . [Raytheon] does not state how [deleted] . .
     . does not indicate how [deleted] will be employed . . . [and] has not
     indicated the impact of [deleted]. . . . These issues affect numerous
     areas of evaluation.

   AR, Tab 46, at EOC 548-1.

   Based on the omissions noted above, the agency sought responses to a
   variety of questions regarding Raytheon's "new operational mode,"
   including a query as to whether the new usage was certified by the Federal
   Aviation Administration (FAA). Id. at EOC 548-2 through EOC 548-3.
   Raytheon responded stating:

     Usage of this new [deleted] mode ([deleted]) is not currently certified
     under FAR [Federal Aviation Regulation Part] 25. However, . . . [t]he
     certification program is already underway. . . . [[14]]

   AR, Tab 46, at EOC 548-6.

   Thereafter, Raytheon participated in phase III of the agency's evaluation,
   the EUS demonstration, during which Raytheon was required to demonstrate
   selected capabilities of its proposed aircraft. In preparing for the EUS
   demonstration, the agency advised Raytheon of various evaluated weaknesses
   in its proposal, including performance of the "service ceiling" threshold
   capabilities, stating:

     The C-295 JCA does not have [deleted] performance to meet the Threshold
     service-ceiling requirement of 25,000 feet. . . . The offer states that
     the C-295M can achieve a cruise altitude of 25,000 ft., but not at
     [deleted]. [[15]]

   AR, Tab 48, at IFN TO4-1.

   Thereafter, during the EUS demonstration, Raytheon demonstrated compliance
   with the "service ceiling" threshold capabilities; however to perform
   these capabilities, the aircraft was required to [deleted]. Protest at 16;
   AR, Tab 36, Raytheon Final Revised Proposal, vol. 3, at 440 (EOC 392-10).
   Confirming the required [deleted] to meet the "service ceiling" threshold
   capabilities, Raytheon stated:

     Compliance with the PD requirement 5.3.6.1 [service ceiling threshold
     capabilities] was demonstrated in the Early User Survey of the C-295
     aircraft. . . . The JCA C-295 achieved a cruise altitude of over 25,000
     ft. at the beginning of the cruise segment by [deleted].

   AR, Tab 48, at IFN T04-2.

   The record shows that, throughout the discussion period, the agency
   repeatedly requested information from Raytheon regarding the impact of its
   "new operational mode" and its proposed [deleted]. In an IFN dated
   December 19, 2006, the agency stated:

     Results from the EUS indicate that [deleted]. It is unclear what percent
     of [deleted] was assumed in the Pratt & Whitney assessment during engine
     certification. Earlier discussions with the offeror (October 2006)
     indicated that [deleted].[[16]]

     Pratt & Whitney Maintenance Manual [deleted], states: "Operators making
     [deleted] must submit their mission profile to Pratt & Whitney Canada
     for analysis."

   AR, Tab 53, at IFN T73-1.

   Accordingly, the agency asked Raytheon to:

     Provide an assessment of the life and maintenance impacts as a
     consequence of [deleted]. Graphs showing the relationship between
     [deleted] and [deleted] should be included (this was requested at
     Discussions in October 2006).

   Id.

   Raytheon responded that the requested information was "not available . . .
   since it requires a detailed study," represented that Pratt & Whitney
   Canada was in the process of conducting the necessary study to address the
   agency's concerns, and concluded, "[t]his study will be fully accomplished
   and the new use of [deleted] in JCA will be certified by May 2007." AR,
   Tab 53, at IFN T73-2, T73-3. Raytheon's response further promised: "Life
   and maintenance impacts as a consequence of extended operation in the
   [deleted] mode . . . will be provided when P&WC [Pratt & Whitney Canada]
   completes their detailed assessment, due by May 2007." Id. Neither the
   information requested by the agency, the "life and maintenance impacts,"
   nor the promised certification were ever provided.

   Final revised proposals were submitted by Raytheon and L-3 on January 31,
   2007, and thereafter evaluated by the agency. Overall, both proposals were
   assigned the same adjectival ratings, as follows:

   +------------------------------------------------------------------------+
   |         |  Technical  |Logistics|Management/ |   Past    |    Price    |
   |         |             |         |            |           |             |
   |         |             |         | Production |Performance|             |
   |---------+-------------+---------+------------+-----------+-------------|
   |---------+-------------+---------+------------+-----------+-------------|
   |Raytheon |Satisfactory |  Good   |Satisfactory| Low Risk  |$1.77 billion|
   |---------+-------------+---------+------------+-----------+-------------|
   |L-3      |Satisfactory |  Good   |Satisfactory| Low Risk  |$2.04 billion|
   +------------------------------------------------------------------------+

   AR, Tab 81, at 5.

   However, Raytheon's proposal was rated "marginal" under the air vehicle
   subfactor within the technical evaluation factor (the most
   heavily-weighted factor), and "high" risk under the air vehicle
   performance element within the air vehicle subfactor. AR, Tab 78, at
   23-24. In this regard, the technical subfactor ratings were as follows:

   +------------------------------------------------------------------------+
   |          | Air Vehicle  | Mission Equipment | Air Safety/Survivability |
   |----------+--------------+-------------------+--------------------------|
   |Raytheon  |   Marginal   |     Excellent     |           Good           |
   |----------+--------------+-------------------+--------------------------|
   |L-3       | Satisfactory |   Satisfactory    |        Excellent         |
   +------------------------------------------------------------------------+

   AR, Tab 78, at 23, 30, 39, 89, 98, 107.

   In making the source selection decision, the source selection authority
   (SSA) stated that he "carefully considered the underlying rationale and
   ratings at all levels of the evaluation" and determined that the C-27J
   aircraft has a "superior military operational envelope," and "provides
   superior military utility." AR, Tab 81, Source Selection Decision
   Document, at 30-31. The SSA elaborated that, although both proposals were
   evaluated as being capable of meeting the same basic performance
   requirements, L-3's proposed aircraft demonstrated an ability to exceed
   many of the performance requirements by significant margins, whereas
   Raytheon's proposed aircraft [deleted]. Further, the SSA noted that
   Raytheon's "predicted performance margin[s] may be easily eroded for
   cruise airspeed, self deployment and service ceiling," elaborating that
   Raytheon's proposed approach "relies heavily on [deleted]" and that
   "[w]ithout sufficient documentation to prove otherwise it is reasonable to
   expect that [deleted]," concluding "[t]his poses a high performance risk."
   Id. at 30-31. Thereafter, the SSA selected L-3's proposal for award
   summarizing his cost/technical tradeoff as follows:

     For the 5-year instant contract, the price proposed by L-3 for the C-27J
     is $2,042,186,555. Raytheon's proposed price for the C-295 is
     $1,744,106,086. This equates to a cost difference of $268,080,469 or
     approximately 15.1%. Based on the high performance risk of the C-295's
     air vehicle, the cost trade-off is justified.

   Id. at 31.

   Raytheon was subsequently informed that L-3's proposal had been selected
   for award, and was provided a debriefing by the agency. This protest
   followed.

   DISCUSSION

   Raytheon first challenges its rating of "marginal" under the air vehicle
   subfactor, and the agency's conclusion that Raytheon's proposed [deleted]
   created "high performance risk," asserting that these assessments were
   unreasonable, or were based on unstated evaluation criteria. More
   specifically, Raytheon complains that it was unreasonable for the agency
   to be concerned with Raytheon's proposed [deleted] to meet the "service
   ceiling" threshold capabilities because those capabilities will not form a
   material portion of the overall contract requirements. In making this
   assertion, Raytheon refers to an appendix to the solicitation's
   performance work statement (PWS), titled "Standard Mission Profiles,"
   which contained the following table:

   +------------------------------------------------------------------------+
   |Mission                                                | Percentage of  |
   |                                                       |                |
   |                                                       |Life Cycle Usage|
   |-------------------------------------------------------+----------------|
   |Aerial Sustainment                                     |      20%       |
   |-------------------------------------------------------+----------------|
   |Self Deployment                                        |       1%       |
   |-------------------------------------------------------+----------------|
   |Air Delivery -- Dual Airdrop with Low-Level            |       2%       |
   |Ingress/Egress                                         |                |
   |-------------------------------------------------------+----------------|
   |Air Delivery -- Single Airdrop                         |       2%       |
   |-------------------------------------------------------+----------------|
   |Cargo Transport                                        |      60%       |
   |-------------------------------------------------------+----------------|
   |Tactical Resupply                                      |      15%       |
   +------------------------------------------------------------------------+

   AR, Tab 27, PWS app. 3.

   Following this table, the document presented profile information for each
   of the above-listed missions, identifying certain characteristics of each
   mission in terms of crew, payload, and length of mission. The document
   also advised offerors that:

     These profiles represent a composite of typical missions likely to be
     flown by the [JCA] in support of military wartime operations,
     non-wartime operations, and homeland security. . . . The profiles shall
     not be construed as all inclusive.

   Id.

   None of the mission profiles specified all three of the "service ceiling"
   threshold capabilities (that is, cruise altitude of 25,000 feet, payload
   of 12,000 lb., and mission length of 1,200 nautical miles).[17]
   Accordingly, Raytheon argues that the mission profile data in appendix 3
   of the PWS effectively eliminated--or should have eliminated--the "service
   ceiling" threshold capabilities from consideration in the agency's
   evaluation of aircraft capabilities. Raytheon's arguments are based on the
   assumption that because the mission profile data in appendix 3 did not
   expressly state that performance of a particular mission (for example,
   aerial sustainment or cargo transport) would require an aircraft to fly at
   25,000 feet for 1,200 nautical miles with a 12,000 lb. payload, those
   combined capabilities will form, at most, an insignificant portion of
   contract performance and therefore, should not have played a meaningful
   role in the source selection process. Raytheon's assertions are neither
   consistent with the provisions of the solicitation, nor otherwise
   reasonable.

   First, as noted above, PWS appendix 3 expressly advised offerors that
   "[t]he profiles shall not be construed as all inclusive." Consistent with
   this provision, paragraph 5.1.10.2 of the solicitation's PD expressly
   notified offerors that, in addition to considering the mission profile
   information at PWS appendix 3, offerors must take into consideration
   "other specific requirements of this document [the PD]"--including, for
   example, the "service ceiling" provisions at PD para. 5.3.6.1. Further,
   the same section of the PWS that directed offerors to appendix 3 also
   reminded them that the "primary mission" of the JCA is "to move
   time-sensitive/mission-critical cargo to forward tactical units in remote
   and austere locations." PWS para. 1.0. At the hearing conducted by GAO in
   connection with this protest,[18] the technical factor lead evaluator
   provided testimony regarding the ongoing requirements associated with
   moving cargo to forward units in remote and austere locations, testifying
   as follows:

    Q. In performing aerial sustainment exercises . . . are they or aren't
       they required to fly . . . at least at 25,000 feet, if you know?

    A. Yes, I do know, and in many environments, especially in Iraq and
       Afghanistan, they are required to fly over mountainous terrain in
       high/hot conditions to avoid threats down below such as missiles.

   . . . . .

    Q. [I]n performing the cargo transport mission . . . are they or aren't
       they, expected to fly . . . at least [at] 25,000 feet[?]

    A. For certain missions they will be expected to do that yes.

    Q. Can you give me an example . . . of missions that would require them
       to do that with regard to cargo transport[?]

    A. Having served my last two years as lead air vehicle engineer for the
       fielded aircraft on the Chinook [one of the aircraft currently
       performing logistics missions], they are constantly delivering loads
       to [deleted]. That's the location of the site. . . [I]f you are going
       to avoid small-arms fire, and missiles, certainly, you would want to
       fly at 25,000 feet to deliver your load that is located at [deleted].

   Hearing Transcript (Tr.) at 23-27.

   Similarly, the SSA testified as follows:

    Q. Do you have a feeling for how often the Army is going to need to [meet
       the "service ceiling" threshold requirements]?

    A. In Iraq and Afghanistan . . . probably daily. Parts of South America,
       every time they are down there. In the Western United States, a lot.
       So over the globe, a lot.

   Tr. at 405.

   Solicitations must inform offerors of the basis for proposal evaluation,
   and the evaluation must be based on the factors set forth in the
   solicitation. Federal Acquisition Regulation (FAR) sect. 15.304. Although
   procuring agencies are required to identify all major evaluation factors,
   they are not required to specifically list under the stated factors every
   area that may be taken into account, provided such areas are reasonably
   related to or encompassed by the stated criteria. E.g. AIA-Todini-Lotos,
   B-294337, Oct. 15, 2004, 2004 CPD para. 211 at 8.

   On the record here, it is clear that the solicitation, along with the
   agency's discussions with Raytheon, reasonably put Raytheon on notice that
   the agency would evaluate an aircraft's ability to perform the "service
   ceiling" threshold capabilities, and that those aircraft capabilities were
   important to the agency. In this regard, we find nothing unreasonable in
   the agency's concern that, in order to perform these capabilities,
   Raytheon was proposing a "new operational mode" that required [deleted],
   and that the impact of this new approach had not been meaningfully
   addressed by the engine manufacturer nor certified by the FAA. Further,
   there is no dispute that the agency repeatedly requested specific data
   from Raytheon regarding the impact of its proposed approach, and that the
   requested data--though promised--was never provided. On this record, there
   is no basis to question the agency's "marginal" rating and "high" risk
   assessment, and Raytheon's protest challenging that rating and assessment
   as inconsistent with the RFP provisions or unreasonable is without merit.

   Raytheon next protests that the agency's source selection decision gave
   undue weight to the air vehicle evaluation subfactor, under which
   Raytheon's proposal was rated "marginal,"[19] and that the agency's
   concerns regarding the risk associated with Raytheon's proposed [deleted]
   were disproportionate to the evaluation scheme established in the
   solicitation. We disagree.

   Evaluating the relative merits of competing proposals is a matter within
   the discretion of the contracting agency since the agency is responsible
   for defining its needs and the best method of accommodating them, and must
   bear the burden resulting from a defective evaluation. Advanced Tech. and
   Research Corp., B-257451.2, Dec. 9, 1994, 94-2 CPD para. 230 at 3.
   Further, there is no requirement that award discriminators be the most
   heavily weighted evaluation factors, Keane Fed. Sys., Inc., B-280595, Oct.
   23, 1998, 98-2 CPD para. 132 at 16, and consideration of risk is always
   proper in the evaluation of technical proposals, particularly where, as
   here, risk is specifically identified as an evaluation factor. E.g.,
   Communications Int'l, Inc., B-246067, Feb. 18, 1992, 92-1 CPD para. 194 at
   6. Finally, information regarding specific proposal advantages or
   disadvantages is the type of information that agencies should make
   available to source selection officials to enable them to reasonably
   determine whether and to what extent adjectival evaluation ratings
   indicate meaningful differences in proposals and the resulting value of
   such differences. Israel Aircraft Indus., Ltd., MATA Helicopters Div.,
   B-274389 et al., Dec. 6, 1996, 97-1 CPD para. 41 at 7. Such considerations
   are the essence of any best value source selection decision. F2M-WSCI,
   B-278281, Jan. 14, 1998, 98-1 CPD para. 16 at 8.

   Here, the record shows that the SSA specifically considered the underlying
   bases for the adjectival ratings assigned at both the factor and subfactor
   level, and the record is replete with documentation of the agency's
   concerns regarding Raytheon's proposed approach and the risk associated
   with Raytheon's failure to meaningfully respond to the agency's
   information requests regarding its "new operational mode." In addition to
   the discussion questions quoted above, the agency's evaluation
   documentation repeatedly address the [deleted] capabilities of Raytheon's
   aircraft. For example, the evaluators stated: "[deleted] may negatively
   affect [deleted] and [deleted], AR, Tab 42, at 16; "[i]f the actual C-295
   JCA [deleted] deviate slightly in the wrong direction, the C-295 JCA's
   actual performance may risk not meeting an MPS and some Threshold
   requirements," id. at 64-65; and "after repeated requests, [Raytheon] has
   failed to document the potential life implications due to [deleted]." Id.
   Finally, as noted above, the solicitation expressly advised offerors that
   risk "shall be an inherent consideration in the evaluation." RFP para. M-3
   (1.3).

   Based on our review of the entire record we find no basis to question the
   agency's determination that the risk to successful contract
   performance--that is, to successful execution of JCA's primary mission to
   move cargo to forward tactical units in remote and austere
   locations--created by Raytheon's proposed "new operational mode"
   outweighed L-3's higher price, and that this assessment was consistent
   with the solicitation's evaluation scheme. Raytheon's protest that the
   agency's source selection decision did not conform to the solicitation's
   stated evaluation factors is without merit.

   Following receipt of the agency report responding to its initial protest,
   Raytheon supplemented its protest by asserting that L-3's proposed
   performance will employ [deleted] in a manner similar to that proposed by
   Raytheon and, thus, maintains that the proposals were evaluated unequally.
   Based on the record, Raytheon is mistaken.

   Raytheon notes that L-3's aircraft flight manuals provide that [deleted].
   Second Supp. Protest, July 30, 2007, at 4. However, the record is clear
   that L-3's proposed aircraft is capable of performing the solicitation's
   threshold capabilities for which L-3 was given credit without [deleted].
   Contracting Officer's (CO) Statement (Second Supp. Protest), Aug. 17,
   2007, at 6. Specifically, in contrast to Raytheon's [deleted] to [deleted]
   meet the "service ceiling" threshold capabilities, L-3's proposal required
   [deleted] for [deleted], but not for [deleted], in order to perform those
   threshold capabilities. Tr. at 95-96. L-3's proposal did provide that if
   [deleted], L-3's aircraft can perform various tasks, including the
   "service ceiling" threshold capabilities, in an expedited manner. CO
   Statement, supra.; Tr. at 108-16. In short, while Raytheon's aircraft
   required [deleted] to [deleted] meet the threshold capabilities, L-3's
   proposal demonstrated that if it [deleted], it could perform the
   capabilities in an expedited manner.[20] Accordingly, there is no merit to
   Raytheon's assertion that the agency performed an unequal evaluation of
   proposals.

   Finally, Raytheon challenges the agency's evaluation with regard to life
   cycle costs, asserting that the agency was required to calculate and
   compare numerical values associated with each offeror's anticipated life
   cycle costs.[21] The terms of the solicitation are to the contrary.

   As discussed above, the solicitation advised offerors that total proposed
   prices for estimated CLIN quantities would be considered, evaluated and
   compared. In contrast, with regard to evaluation of life cycle costs, the
   solicitation expressly advised offerors that "[n]umerical cost values
   [associated with life cycle costs] are not a driver in and of themselves"
   and that the agency would assign each proposal an adjectival rating based
   on program price/cost risk. RFP para. M-3(2.2.2). That is precisely what
   the agency did.[22] Accordingly, there is no merit to Raytheon's assertion
   that the agency was required to perform a numerical comparison of the life
   cycle costs associated with the two proposals.

   The protest is denied.[23]

   Gary L. Kepplinger
   General Counsel

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

   [1] The JCA program evolved from the Department of the Army's preparations
   to procure a "future cargo aircraft" and the Department of the Air Force's
   preparations to procure a "light cargo aircraft." In December 2005, the
   Office of the Secretary of Defense directed the Army and Air Force to
   combine the two aircraft programs to form the JCA program, and provided
   that the Army would serve as the lead agency for the acquisition.

   [2] With regard to where the JCA will be employed, the record states that
   the JCA is intended to "address operational shortfalls within fixed-wing
   cargo mission requirements noted in Operations Enduring Freedom/Iraqi
   Freedom," that is, in Afghanistan and Iraq. Agency Report (AR), Tab 81,
   Memorandum of Source Selection Decision, at 1.

   [3] Under the technical evaluation factor, the solicitation established
   three equally weighted subfactors: air vehicle, mission equipment, and
   aircraft safety. Each of the subfactors was further divided into various
   elements.

   [4] The price evaluation factor was divided into two subfactors: proposal
   price and life cycle costs. Regarding evaluation of proposal price, the
   solicitation stated that the agency would evaluate "the total proposed
   price for the estimated quantities specified for each CLIN [contract line
   item] for all five years." RFP para. M-3 (2.2.2.1). Regarding evaluation
   of life cycle costs, the solicitation stated that each proposal would
   receive an adjectival rating assessing "program price/cost risk," further
   advising offerors that "[n]umerical cost values [associated with life
   cycle costs] are not a driver in and of themselves." RFP para. M-3
   (2.2.2).

   [5] The solicitation provided that the technical factor was more important
   than price, which was more important than either the logistics or
   management/production factors, which were of equal importance and both of
   which were more important than the past performance factor. All of the
   non-price factors combined were significantly more important than price.
   RFP para. M-3 (2.0).

   [6] Specifically, the PD identified certain capabilities as: "minimum
   performance standards" (MPS) that "shall be embodied in the candidate
   aircraft" and "shall not be traded against other technical or
   non-technical requirements"; "threshold" capabilities that "will be
   embodied in the candidate aircraft" but which "may be traded against other
   technical and non-technical requirements"; and "objective" capabilities
   that "should be offered in the candidate aircraft" (underlining in
   original). AR, Tab 20, PD para. 2.0.

   [7] In phase II of the evaluation, the agency applied an adjectival rating
   system using the terms "Excellent," "Good," "Satisfactory," "Marginal,"
   and "Unsatisfactory." AR, Tab 84, Source Selection Plan, at 48. In
   addition, section M of the solicitation specifically advised offerors that
   proposal risk associated with an offeror's proposed approach would be
   evaluated, stating "[r]isk shall be an inherent consideration in the
   evaluation." RFP para. M-3 (1.3).

   [8] The solicitation stated: "The EUS will not receive an adjectival
   rating, but will receive a risk rating." RFP para. M-3 (1.3).

   [9] Raytheon submitted two proposals--one based on the C-295 aircraft
   which is discussed in this decision, and one based on another aircraft.
   The agency subsequently determined that Raytheon's other proposal, along
   with the third offeror's proposal, failed to meet the phase I entry gate
   requirements; accordingly, those proposals were eliminated from the
   competition and are not further discussed.

   [10] European Aeronautic Defense and Space Company.

   [11] Construcciones Aeronauticas, SA. CASA is the Spanish branch of EADS.

   [12] The agency's source selection plan stated that the acquisition
   strategy was "based on leveraging the commercial market," noting that
   "[t]he intent is to procure a previously developed and fielded, low-risk,
   commercially available aircraft." AR, Tab 84, Source Selection Plan, at 6.

   [13] Following its initial evaluation, the agency's discussions questions
   were labeled "Errors, Omissions, and Clarifications" (EOC); subsequently,
   the agency labeled its discussions questions "Items for Negotiation"
   (IFN). The agency also conducted oral discussions with both offerors.

   [14] Raytheon subsequently provided its certification plan with regard to
   its proposed [deleted]. This plan stated, among other things:

     The purpose of this document is to define the Certification Plan for the
     new improved performance of the C-295 using [deleted]. . . .

     [deleted]

     As comprised in the C-295 AFM [aircraft flight manual] ([deleted]) this
     regime is intended for abnormal or special circumstances.

     The proposal of EADS-CASA is to . . . enable using the [deleted] during
     normal phases of [deleted].

   AR, Tab 50, attach. 1, at 5.

   [15] As noted above, the PD identified the following threshold
   capabilities under the heading "service ceiling":

     At the beginning of the cruise segment, the [JCA] will have a minimum
     service ceiling of 25,000 ft pressure altitude while carrying a standard
     crew of four, a 12,000 lb payload and fuel (including a 45 minute
     reserve) for a 1,200 nm[nautical mile] mission.

   AR, Tab 20, PD para. 5.3.6.

   [16] The record contains a Raytheon response to another agency request for
   information in which Raytheon stated: "[deleted]." AR, Tab 51, at IFN
   T71-2.

   [17] In fact, none of the mission profiles identified any particular
   cruise altitude for any of the missions.

   [18] In resolving this protest, GAO conducted a hearing on the record
   during which testimony was provided by the agency's technical factor lead
   evaluator and the SSA.

   [19] As noted above, the air vehicle subfactor was one of three equally
   weighted subfactors within the technical evaluation factor (the most
   heavily weighted factor).

   [20] In any event, the record indicates that even L-3's proposed [deleted]
   to expedite task performance was consistent with the existing engine
   certification, whereas Raytheon's proposed [deleted] was not. CO
   Statement, supra at 1-5; Tr. at 79-88, 108-09.

   [21] The life cycle cost information submitted by the offerors regarding
   anticipated life cycle costs is not binding on the offerors.

   [22] Both proposals received adjectival ratings of "good" with regard to
   life cycle costs. AR, Tab 81, at 29.

   [23] In addition to the arguments specifically addressed above, Raytheon's
   initial and supplemental protests challenge the agency's evaluation of
   virtually every non-price evaluation factor and subfactor, expressing
   disagreement with the agency's judgments and asserting that Raytheon's
   proposal should have been evaluated more favorably and/or that L-3's
   proposal should have been evaluated less favorably. We have considered all
   of Raytheon's arguments and find no basis for sustaining its protest.