TITLE: B-299517; B-299517.2, Sumaria Systems, Inc., June 8, 2007
BNUMBER: B-299517; B-299517.2
DATE: June 8, 2007
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B-299517; B-299517.2, Sumaria Systems, Inc., June 8, 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: Sumaria Systems, Inc.

   File: B-299517; B-299517.2

   Date: June 8, 2007

   David M. Pronchick, Esq., BlueLaw LLP, and Rebecca E. Pearson, Esq.,
   John J. Pavlick, Jr., Esq., and Sharon A. Jenks, Esq., Venable LLP, for
   the protester.

   Richard W. Gates, Esq., and Lary Mohl, Esq., United States Transportation
   Command, Department of Defense, for the agency.

   Paul N. Wengert, Esq., and Ralph O. White, Esq., Office of the General
   Counsel, GAO, participated in the preparation of the decision.

   DIGEST

   Protest is denied where agency reasonably evaluated successful vendor's
   quotation in competition for order under Federal Supply Schedule for
   information technology services, and where additional past performance
   information considered by agency supported improvement in successful
   vendor's evaluation, and agency reasonably took into account both the
   lower staffing of successful vendor's quotation, and evaluated strengths
   of protester's quotation, in determining that protester's technical
   superiority did not overcome successful vendor's lower evaluated cost.

   DECISION

   Sumaria Systems, Inc. protests the issuance of a task order to Dynamics
   Research Corporation (DRC) by the Department of Defense, United States
   Transportation Command (USTRANSCOM), under the General Services
   Administration's Federal Supply Schedule (FSS) contract for general
   purpose commercial information technology equipment, software, and
   services (Schedule 70), and pursuant to request for quotations (RFQ)
   No. HTC711-07-Q-0006 for corporate data office engineering and modeling
   services. Sumaria objects to the evaluation and selection of DRC as the
   successful vendor on the basis of DRC's lower-priced quotation.

   We deny the protest.

   BACKGROUND

   The RFQ, dated November 2, 2006, announced that USTRANSCOM would issue a
   labor hour task order for an initial base period (the remainder of federal
   fiscal year 2007), followed by three 1-year options to the successful FSS
   vendor.[1] Contracting Officer's (CO) Statement at 1. The RFQ set forth
   two equally-weighted non-price factors--past performance, and mission
   capability--which, when combined, were significantly more important than
   price. RFQ attach. 2, Quote Evaluation Criteria, at 1. The mission
   capability factor was divided into two subfactors: staffing and technical
   approach. Id. at 4. For each subfactor, the RFQ described an assessment of
   both the quotation's merit and the "Quote Risk," which it described as a
   measure of "the weaknesses associated with the offeror's proposed approach
   as it relates to accomplishing the requirements of the solicitation." Id.
   at 3-5. The RFQ also stated that "overall price . . . will be evaluated
   for completeness and reasonableness considering the proposed approach in
   terms of labor or skill mix, labor hours, any other direct costs, and
   quoted discounts." Id. at 5.

   After receiving initial quotations and past performance information, the
   evaluators rated DRC's past performance "significant confidence," and
   Sumaria's "high confidence."[2] Under the mission capability factor, DRC
   was rated "yellow" with "moderate" risk for both subfactors, while Sumaria
   was rated "blue" with "low" risk under the staffing subfactor, and "green"
   with "low" risk under the technical approach subfactor.[3] Agency Report
   (AR), Tab 15b, Initial Rating Team Worksheets.

   After conducting multiple rounds of discussions and requesting interim,
   then final, revised quotations, the evaluators rated both vendors "high
   confidence" under the past performance factor. Under the mission
   capability factor, DRC's final revised quotation was rated "blue" with
   "low" risk under the technical approach subfactor, and "green" with "low"
   risk under the staffing subfactor, while Sumaria's was rated "blue" with
   "low" risk under both subfactors. AR, Tab 15d, Final Rating Team
   Worksheets.

   The CO's source selection decision (SSD) discussed the strengths of both
   quotations, and decided that the three strengths identified for Sumaria
   under the technical approach subfactor would provide "more benefit to the
   government than DRC's two strengths." AR, Tab 15, SSD, at 25.[4] Under the
   staffing subfactor, the SSD also recognized that "Sumaria's staffing
   approach has significantly more benefit to the government than DRC's
   staffing approach by offering the strengths identified." Id. at 26.
   Nevertheless, the CO concluded the SSD by selecting DRC to receive the
   task order, at an evaluated cost of $13,013,703.34, over Sumaria's cost of
   $13,787,699.67. Id. at 26. While acknowledging the strong points in
   Sumaria's quotation under the mission capability factor, the CO reasoned
   that she "cannot reasonably determine that the superiority of Sumaria's
   approach outweighs the cost premium of $773,996.33 over the life of the
   contract." Id. at 28.

   In a letter dated February 16, 2007, delivered by e-mail that afternoon,
   the CO announced her new selection. She then offered Sumaria a debriefing,
   thus:

     You may request a post-award debriefing pursuant to FAR [Federal
     Acquisition Regulation] 15.506 by submitting a written request to [the
     e-mail address of the contract specialist] to be received by the
     undersigned [sic] within three days after the date you receive this
     notification in accordance with FAR 15.503(b). Post-award debriefing of
     schedule contractors will be conducted pursuant to FAR 15.506.

   AR, Tab 16, Award Notices to Sumaria, at 2.

   The same day, Sumaria responded with an e-mail, requesting a debriefing
   "as soon as possible." Initially, the agency offered a tentative date of
   February 22, which Sumaria accepted. However, on February 20, the
   contracting specialist rescheduled the debriefing for February 27.
   Supp. Protest exh. 5. After the debriefing, Sumaria filed this protest
   with our Office on February 28.[5]

   DISCUSSION

   Sumaria's initial protest objected that the evaluators failed to properly
   assess the risk posed by DRC, given the company's record, in Sumaria's
   view, of poor past performance. Sumaria also argued that the CO had
   disregarded the significance of non-price factors described in the RFQ, in
   favor of an award based on price.[6] Protest at 6-7. After the agency
   filed its report in answer to the protest, which included relevant
   documents, Sumaria supplemented its protest with arguments that the agency
   misevaluated DRC's past performance and staffing risk, and failed to
   consider the significance of Sumaria's evaluated superiority under the
   mission capability factor. Sumaria also argued that the agency
   unreasonably based its source selection on DRC's lower proposed costs,
   which, in Sumaria's view, will prove illusory because of DRC's inadequate
   staffing levels. Our decision will address these arguments in turn.

   Past Performance Evaluation

   With respect to the evaluation of past performance, Sumaria argues that
   the record did not justify a rating of "High Confidence" for DRC because
   one of DRC's references expressed concern about the firm's ability to
   [deleted], and because the agency failed to consider a "satisfactory"
   contractor performance assessment report (CPAR) about one of DRC's team
   members--even though the agency considered the CPAR in the earlier
   competition for this requirement.

   The agency responds that its assessment of past performance was
   reasonable. The CO acknowledges that one of DRC's references initially
   expressed concerns, and that the concerns contributed to a lower past
   performance evaluation of the initial quotation. The CO also explains that
   the agency subsequently obtained a more favorable past performance update
   for that contract and telephoned the source of the original unfavorable
   reference again for clarification. In the agency's view, which it
   documented in a contemporaneous memorandum, these references, taken
   together, justified the more favorable "high confidence" assessment of
   DRC's past performance in the final evaluation. Sumaria disputes the
   agency's characterization of the additional information, and argues that
   the clarifying phone call was less favorable than the agency claims, and
   thus the concerns reflected in the lower initial evaluation were not
   reasonably resolved.

   The evaluation of an offeror's past performance, including the
   determination of the relevance and scope of an offeror's performance
   history, is a matter of agency discretion that we will not question unless
   shown to be unreasonable, undocumented, or inconsistent with the
   solicitation criteria or applicable statutes or regulations. Family Entm't
   Servs., Inc., B-291997.4, June 10, 2004, 2004 CPD para. 128 at 5. The
   contemporaneous record here documents the evaluators' consideration of the
   differing views from the references and their judgment, thus:

     In light of the new information, the evaluation team determined
     sufficient corrective actions had been taken to address management of
     [deleted] and it no longer posed a concern to the level of confidence of
     performance. DRC's past performance was raised from very highly relevant
     with significant confidence to very highly relevant with high
     confidence.

   AR, Tab 12, Memorandum for Record, at 2.

   Although, as discussed, Sumaria disputes the evaluators' judgment on this
   matter, the protester has not demonstrated that the agency's upward
   revision to DRC's past performance evaluation after reviewing the
   additional performance update and contacting the original reference again,
   was unreasonable.

   The agency also acknowledges that it did not include in the past
   performance evaluation a "satisfactory" CPAR for one of DRC's team
   members, which the agency had obtained in the earlier iteration of this
   competition. Sumaria argues that, by virtue of the fact that the
   evaluators had obtained that particular CPAR during the earlier
   competition, and had rated DRC's past performance lower at that time, the
   agency was obliged to consider that CPAR again during this re-competition,
   and similarly lower DRC's past performance rating. The agency responds
   that the scope of the past performance inquiry under this RFQ was more
   narrowly focused than the one used previously, and the CPAR at issue was
   beyond that scope.[7] Sumaria has not shown that the RFQ required
   consideration of the same past performance information used in the earlier
   competition, and we conclude that the agency's scope of past performance
   inquiry and evaluation were reasonable and were applied in a consistent
   manner to both Sumaria and DRC.[8]

   Mission Capability Evaluation

   With respect to the mission capability evaluation, Sumaria challenges the
   evaluation of DRC under the staffing subfactor, and the role of staffing
   in the ultimate selection. Sumaria argues that DRC's staffing was
   inadequate for the firm's technical approach, and that the "low risk"
   rating under the staffing subfactor was unreasonable. Thus Sumaria
   contends that DRC's staffing levels should have caused the agency to
   conclude that the firm's cost of performance would be significantly higher
   than DRC proposed.

   In response, the agency states that it assessed DRC's staffing as adequate
   to perform the PWS, and that neither the "low" risk rating nor DRC's
   evaluated cost was in error. The agency also maintains that the source
   selection decision reflects an understanding of, and carefully-considered
   judgment about, the significance of DRC's lower staffing.

   Where, as here, an agency issues an RFQ to FSS contractors under FAR
   Subpart 8.4 and conducts a competition (see FAR sect. 8.405-2), we will
   review the record to ensure that the agency's evaluation is reasonable and
   consistent with the terms of the solicitation. In reviewing an agency's
   technical evaluation of quotations under an RFQ, we will not reevaluate
   the quotations; we will only consider whether the agency's evaluation was
   reasonable and in accord with the evaluation criteria listed in the
   solicitation and applicable procurement statutes and regulations. The
   protester's mere disagreement with the agency's judgment does not
   establish that an evaluation was unreasonable. GC Servs. Ltd. P'ship,
   B-298102, B-298102.3, June 14, 2006, 2006 CPD para. 96 at 6-7.

   Here, the evaluation clearly recognizes that Sumaria proposed a superior
   technical and staffing approach, and concludes that Sumaria's approach was
   materially stronger than DRC's proposed approach. We also think that,
   fairly read, the SSD conveys the CO's conclusion that apparent references
   by the evaluators to two additional capabilities in DRC's quotation were
   not, in fact, what DRC had proposed. Specifically, the record reflects
   that the evaluators initially believed that a reference to the agency's
   enterprise capability management process in DRC's initial quotation might
   have meant that DRC intended to provide comprehensive enterprise
   capabilities management as an additional capability. During discussions,
   DRC clarified that it understood the PWS requirements, and expressly
   stated that it intended to provide only [deleted] specified in the PWS.
   AR, Tab 33b, DRC Revised Quotation, at 19-20; AR, Tab 15, Source Selection
   Decision, at 20. Similarly, while DRC's quotation included a discussion of
   support for the configuration control board, the CO observed that this
   support was not required by the PWS (as she noted, the configuration
   control board task is performed by one of DRC's own team members under a
   separate contract), and had not been evaluated as a strength. Nor, for
   that matter, had DRC staffed such a task.

   Sumaria focuses on one sentence in the SSD regarding these two issues,
   which states that DRC's "proposed staffing approach was adequate to meet
   minimum performance capability requirements of the PWS but inadequate to
   support the proposed additional capabilities not required by the PWS." Id.
   In the context of the CO's further discussion of those additional
   capabilities discussed above, we disagree with Sumaria's argument that the
   sentence indicates that the evaluators thought DRC was understaffed.
   Rather, the record confirms that the evaluators reasonably found, and the
   CO correctly understood, that DRC's staffing approach was to perform the
   tasks required by the PWS without additional capabilities or strengths
   (and, as discussed previously, DRC received the final rating of "green"
   with "low" risk under the staffing subfactor, in contrast with Sumaria's
   higher ratings of "blue" with "low" risk under both the technical and
   staffing subfactors).[9]

   Although Sumaria points out that the principal reason for the lower
   evaluated cost of DRC's proposal was its use of staffing at a lower level
   than Sumaria's proposed and historical staffing levels--by approximately
   [deleted] full time equivalent employees--Sumaria has not meaningfully
   challenged the agency's underlying conclusion that DRC can perform in
   accordance with the PWS at its lower staffing level. An agency may
   reasonably find a vendor's staffing level that is lower than the
   protester's to be acceptable because vendors may propose different levels
   of staffing, depending on each offeror's technical approach and proposed
   efficiencies. Remtech Servs., Inc., B-292182, July 17, 2003, 2003 CPD
   para. 133 at 8.

   CONCLUSION

   The CO's consideration of the competing quotations reflects a thorough
   analysis, which considered each of the areas where Sumaria's quotation
   offered significant enhancements over the performance required in the PWS,
   gave proper emphasis to the differences, and appropriately applied greater
   emphasis to the non-price factors. Although Sumaria argues that the price
   differential of $773,996.33 is insufficient to overcome its evaluated
   strengths, the record confirms that the CO's judgment was set forth in
   detail in her source selection decision, and that her judgment was
   reasonable.

   The protest is denied.

   Gary L. Kepplinger
   General Counsel

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

   [1] As discussed further below, this RFQ was issued to re-compete a
   requirement that had originally resulted in selection of Sumaria. The
   decision to issue a new RFQ followed after issues arose at a debriefing of
   DRC, which resulted in the agency concluding that, during discussions, the
   agency had inadvertently failed to make DRC aware of a potentially
   significant concern, and that the omission could have affected the outcome
   of the competition. AR, Tab 21, Memorandum for Record, at 1.

   [2] The relevant adjectival ratings for past performance were described
   thus: "High Confidence--Based on the offeror's performance record,
   essentially no doubt exists that the offeror will successfully perform the
   required effort," and "Significant Confidence--Based on the offeror's
   performance record, little doubt exists that the offeror will successfully
   perform the required effort." RFQ attach. 2, Quote Evaluation Criteria, at
   1. Past performance references for both offerors were considered "very
   highly relevant" throughout.

   [3] The color scheme used for rating vendors quotations described the
   relevant ratings as "Blue (Exceptional)--Exceeds specified minimum
   performance or capability requirements in a way beneficial to the
   [agency]; quote must have one or more strengths and no deficiencies,"
   "Green (Acceptable)--Meets specified minimum performance or capability
   requirements delineated in the Request For Quote," and "Yellow
   (Marginal)--Does not clearly meet some specified minimum performance or
   capability requirements delineated in the Request for Quote; but any such
   uncertainty is correctable." RFQ attach. 2, Quote Evaluation Criteria, at
   3.

   [4] In discussing the two identified technical approach strengths for DRC,
   the contracting officer noted that one provided no advantage over a
   similar technique used by Sumaria, while the other was limited to a fairly
   narrow aspect of the PWS and thus provided limited benefit to the agency.
   AR, Tab 25, SSD, at 25.

   [5] The agency argues that this protest is untimely because it was filed
   more than 10 days after announcement of the selection, and should not have
   been delayed until after the debriefing (because a debriefing in an FSS
   procurement is not a "required" debriefing). See FAR sect. 8.404(a).
   Sumaria argues that it was misled by the specific invocation of FAR
   sect. 15.506 in the selection notice, that the firm raised its objections
   immediately after the debriefing at which it obtained more specific
   information, and that the circumstances justify considering its protest as
   timely. Under the facts here, we think this protest was timely filed. See
   Raith Eng'g & Mfg. Co., B-298333.3, Jan. 9, 2007, 2007 CPD para. 9 at 3
   (diligent protester may file a timely protest based on information
   obtained at a debriefing, even though that debriefing was not a required
   debriefing).

   [6] Both the initial and supplemental protest also argued that various
   agency actions--principally the decision to re-compete this requirement
   (after determining that discussions in an earlier procurement had been
   inadequate), and the multiple rounds of discussions with DRC--were either
   unjustified, or demonstrated that agency personnel were acting in bad
   faith. Sumaria has failed to provide any factual basis to question the
   propriety of the agency's actions. Nor do we accept that there was an
   absolute limit on the number of rounds of discussions that the agency
   could hold, even where those discussions were of little benefit to
   Sumaria, given its highly favorable evaluation. While Sumaria argues that
   agencies are not required to hold multiple rounds of discussions, it has
   not shown that the agency's actions here were improper.

   [7] Sumaria does not meaningfully dispute the agency's argument that its
   approach was consistent for both offerors. The agency notes that two CPARs
   for Sumaria, which had been considered in the earlier procurement, were
   similarly excluded in this procurement. Since this reevaluation stands on
   its own, we do not consider relevant Sumaria's argument that those CPARs
   "would not have negatively impacted Sumaria's past performance rating" in
   this procurement because Sumaria received a high confidence rating in the
   earlier procurement. Protester's Supp. Comments at 7.

   [8] We do not agree with Sumaria's characterization of the issue as
   involving past performance information "too close at hand" to be ignored
   in the evaluation. See, e.g., International Bus. Servs., Inc.. B-275554,
   Mar. 3, 1997, 97-1 CPD para. 114 at 5. There appears to be no dispute that
   the information was known by the evaluators. However, the reference was
   not within the scope of the past performance review.

   [9] Sumaria argues that the agency's claims--first made in its
   supplemental agency report--that DRC's staffing was based on "in-house
   efficiencies" lack support in the contemporaneous record. While we agree
   that the agency has not cited to the contemporaneous record for these
   claims, Sumaria has failed to validate the premise that it was necessary
   for DRC to provide discrete, identifiable efficiencies in order to perform
   the PWS with fewer staff than Sumaria.