TITLE: B-299605.2, Financial & Realty Services, LLC, August 9, 2007
BNUMBER: B-299605.2
DATE: August 9, 2007
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B-299605.2, Financial & Realty Services, LLC, August 9, 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: Financial & Realty Services, LLC

   File: B-299605.2

   Date: August 9, 2007

   Shelton H. Skolnick, Esq., Skolnick & Leishman, P.C., for the protester.

   Jonathan S. Baker, Esq., Environmental Protection Agency, for the agency.

   Susan K. McAuliffe, Esq., and Christine S. Melody, Esq., Office of the
   General Counsel, GAO, participated in the preparation of the decision.

   DIGEST

   Protest challenging evaluation of proposals and source selection decision
   is denied where record shows the evaluation was reasonable and consistent
   with the solicitation.

   DECISION

   Financial & Realty Services, LLC (FRS) protests the evaluation of its
   proposal and award to Apex Logistics, LLC under request for proposals
   (RFP) No. PR-HQ-07-10196, issued by the Environmental Protection Agency
   for warehouse operations and labor services. FRS contends that its
   proposal should have been rated higher technically and should have been
   selected for award in light of its lower proposed price.

   We deny the protest.

   The RFP, issued on February 1, 2007 as a small business set-aside,
   contemplated the award of an indefinite-delivery/indefinite-quantity
   contract, with fixed-price labor rates, for a base year plus four 1-year
   option periods. RFP paras. B.1, L.2. Award was to be made to the offeror
   that submitted the proposal deemed most advantageous to the government
   considering five equally weighted technical evaluation factors (technical
   experience and approach, management approach, past performance, personnel,
   and corporate experience) and price (which was approximately equal in
   importance to the technical factors combined). Id. para. M.3. Offerors
   were advised that proposals would be evaluated on the completeness and
   quality of the information they provided, and that it was the
   responsibility of each offeror to demonstrate its qualifications in terms
   of experience, capability, and proposed approaches to meet all of the
   requirements of the statement of work (SOW). Id. For instance, offerors
   were instructed that they must demonstrate not only the overall quality of
   their proposed methodologies to perform all of the required tasks, but
   also how their experience matches the RFP's performance requirements. Id.

   The SOW identified numerous warehouse operations requirements (including
   shipping, receiving and storing property, as well as inventory management
   services). Id., attach.1, SOW, at 5-8. Numerous requirements for labor
   support services were also set out in the SOW (including office packing
   and relocating, scheduling of deliveries, collecting recyclables,
   configuring rooms for events, emergency cleaning (including moving
   equipment and collecting trash), shredding and disposal of documents,
   airing and delivery of carpet tiles, assembly of furniture, and installing
   window coverings and bulletin boards). Id. at 1-5.

   The 11 proposals received by the scheduled closing time were evaluated.
   Two proposals were found to be outstanding in terms of technical merit
   (Apex's proposal and another firm's higher-priced proposal). Four of the
   proposals were considered average in terms of technical merit, and four
   proposals (including FRS's proposal, which was rated second to last of the
   11 proposals in terms of technical merit) were considered below average;
   one proposal was considered unsatisfactory.[1] The protester's proposal's
   technical rating of below average was primarily based on its failure to
   adequately demonstrate, as required, its technical experience and proposed
   approach, management approach, proposed personnel, and corporate
   experience.[2]

   Apex's offer (at $12,278,344.40) was the median price proposal received
   (five proposals priced lower and five proposals priced higher than Apex's
   proposal were received); FRS submitted the lowest priced proposal (at
   $10,333,214.92). The agency concluded that between the two highest rated
   proposals (rated outstanding for overall technical merit), Apex's
   lower-priced proposal was the most advantageous. The agency then compared
   Apex's proposal to the proposal ranked next in line technically with a
   rating of average and which proposed a slightly lower price; the agency
   concluded that the Apex proposal remained the most advantageous. Comparing
   the Apex proposal to the remaining lower-rated, lower-priced proposals,
   including FRS's proposal, the agency determined that the benefits of the
   low performance risk presented by the Apex proposal's technical
   superiority warranted payment of the price premium associated with it.
   Given the large disparity between the proposals in terms of technical
   merit and performance risk, the agency considered negligible the cost
   difference between the substantially higher rated Apex proposal and the
   lower-priced, technically inferior proposals, including FRS's
   substantially lower rated proposal. The source selection authority
   determined that the Apex proposal was the most advantageous to the agency,
   and award was made to that firm. This protest followed.

   FRS protests the below average rating assigned to its technical proposal
   and contends that the agency unreasonably determined that the proposal
   failed to demonstrate the firm's experience, capability, and approach to
   meet the RFP's requirements. The protester further contends that, since
   price was approximately equal in importance to technical merit, FRS should
   have received the award because it offered a substantially lower-priced
   proposal.

   In reviewing protests of alleged improper evaluations and source
   selections, our Office examines the record to determine whether the
   agency's judgment was reasonable and in accord with the stated evaluation
   criteria and applicable procurement laws. See Abt Assocs., Inc.,
   B-237060.2, Feb. 26, 1990, 90-1 CPD para. 223 at 4. It is a vendor's
   responsibility to submit an adequately written proposal that establishes
   its capability and the merits of its proposed technical approach in
   accordance with the evaluation terms of the solicitation. See Verizon
   Fed., Inc., B-293527, Mar. 26, 2004, 2004 CPD para. 186 at 4. A
   protester's mere disagreement with the evaluation provides no basis to
   question the reasonableness of the evaluators' judgments. See Citywide
   Managing Servs. of Port Washington, Inc., B-281287.12, B-281287.13, Nov.
   15, 2000, 2001 CPD para. 6 at 10-11. Where, as here, price and technical
   factors are of approximately equal weight, price/technical tradeoffs may
   be made, and we will not disturb awards to offerors with higher technical
   merit and higher prices so long as the result is consistent with the
   evaluation factors and the agency has reasonably determined that the
   technical superiority outweighs the price difference. Structural
   Preservation Sys., Inc., B-285085, July 14, 2000, 2000 CPD para. 131 at 7.

   In response to the protest, the agency provided a detailed record of its
   evaluation and source selection decision. Based on our review of this
   record, and FRS's failure to persuasively rebut the justifications
   provided by the agency for the challenged evaluation findings, we see no
   basis to question the reasonableness of the evaluation and award
   decision.[3]

   Under the technical experience and approach factor, offerors were required
   to demonstrate how their experience matches each of the SOW tasks and
   provide proposed technical approaches to accomplish each task. FRS's
   proposal, however, failed to detail its experience with each SOW
   requirement and failed to specifically match its experience to the SOW
   requirements, as required for the evaluation of proposals. Contrary to the
   RFP's instructions for a demonstration of technical experience, the firm
   submitted a proposal containing general claims of experience with the SOW
   requirements. The firm also failed to provide any details as to how it
   intended to perform the contract to meet each SOW requirement; in this
   regard, rather than provide a detailed explanation of how the firm intends
   to perform the specific tasks, the FRS proposal set forth general plans to
   implement policies and procedures it will establish to perform the work.
   These generalities clearly fail to provide the requisite demonstration of
   technical merit, since they fail to identify how the work will be
   accomplished. [4] While the firm generally states that it will train and
   supervise personnel, check paperwork and product damage, pack in
   accordance with agency requirements, report problems, store items in a
   safe manner, and establish recordkeeping procedures, virtually no support
   was provided by FRS to explain how these measures would be executed, or
   how the actual warehouse and labor support work would be performed.
   Accordingly, there is no basis in the record to suggest that the agency's
   rating of unsatisfactory for the proposal under the technical experience
   and approach factor was unreasonable.[5]

   FRS next argues that, since price was approximately equal in importance to
   the technical factors combined, the agency should have given the
   protester's low price equal weight in the price/technical tradeoff
   analysis conducted to determine which offer was most advantageous to the
   agency. As stated above, the record shows that the agency made a detailed
   comparison between the two highest rated (rated as outstanding) technical
   proposals, and Apex's proposal was considered most advantageous due to it
   lower price. The technical merit of the Apex proposal was then compared to
   that of the next highest rated (rated as average), slightly lower-priced
   proposal, and the agency concluded that the Apex proposal's technical
   superiority outweighed the cost savings associated with the other
   proposal. The source selection official then compared Apex's outstanding
   rating, as well as the firm's higher price, to the lower technical ratings
   received by the lower-priced proposals and concluded that the criticality
   of successful performance of the RFP's requirements here outweighed the
   cost savings associated with the technically inferior proposals.

   Our review of the record provides no basis to question the reasonableness
   of the agency's trade-off analysis, and there is no support for FRS's
   contention that the agency may have considered price to be less than
   approximately equal in importance to the technical factors combined. The
   record shows that the agency gave specific consideration to the low price
   offered by FRS. We believe the agency reasonably concluded, however, that
   the high performance risk associated with the substantially technically
   inferior proposals (including the FRS proposal) outweighed the benefit of
   their lower prices. Based on our review of the record, given the
   substantial disparity in technical merit between the Apex and FRS
   proposals, there is no reason to question the propriety of the tradeoff
   determination that an award on the basis of Apex's low risk proposal was
   reasonably worth the price premium associated with it. While FRS disagrees
   with the evaluation and award decision, its mere disagreement does not
   show that the source selection was not reasonably based or otherwise
   inconsistent with the RFP award language. See Citywide Managing Servs. of
   Port Washington, Inc., supra.

   The protest is denied.

   Gary L. Kepplinger
   General Counsel

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

   [1] The technical evaluators assigned the following adjectival ratings:
   "outstanding" (for exceeding requirements with a very high probability of
   success and a very low level of risk); above average (for exceeding
   requirements with a high probability of success and low level of risk);
   average (for satisfactorily addressing all requirements with a good
   probability of success and average level of risk); below average (for
   failing to adequately address all of the RFP requirements, presenting
   questionable probability of success and above average performance risk);
   and unsatisfactory (for having deficiencies or weaknesses including an
   offeror's failure to address requirements, showing a low probability of
   success and a high risk level).

   [2] FRS's proposal was rated unsatisfactory under the technical experience
   and approach factor, and below average under the management approach,
   personnel, and corporate experience factors. FRS received an above average
   rating under the remaining factor, past performance (reflecting the
   agency's averaging of the three past performance reference surveys
   received for the firm that indicated customer satisfaction ratings of
   outstanding, above average, and average).

   [3] Our review confirms the reasonableness of the agency's determination
   that the protester's proposal failed to provide sufficient support and
   details demonstrating the firm's purported knowledge, capability,
   approach, and experience, and thus did not warrant a higher evaluation
   rating. While we have reviewed all of FRS's contentions, we discuss in
   this decision only a sample of its evaluation challenges, as they each
   involve a similar lack of detail in the proposal to demonstrate the firm's
   qualifications and intended approaches.

   [4] FRS argues that a narrative description of its current warehouse and
   logistics contract submitted for evaluation of its corporate experience
   should be considered under the technical experience and approach, and
   management approach evaluation factors as well. The narrative, however,
   does not support the higher evaluation ratings the firm seeks, since it
   does not match the firm's purported experience to specific SOW
   requirements, as required for evaluation of technical experience and
   approach; it also does not set out the firm's proposed management approach
   for the current work (for instance, concerning the ability to commit
   personnel or stagger labor hours to avoid overtime expenses, as required
   by the RFP). Additionally, with regard to the corporate experience factor,
   although the evaluators found that the narrative provided some corporate
   experience for which the firm was credited, as the agency points out, the
   narrative provides no basis to question the firm's corporate experience
   rating of below average, since it does not show that the firm has
   experience with many of the labor support services required here.

   [5] The protester also suggests that, since its proposal states that the
   firm proposes to use a quality management system, its proposal should be
   rated higher than below average under the management approach factor. Our
   review of the record, however, shows that the firm fails to detail in its
   proposal how its generally described system in fact will be used to manage
   the firm's efforts in performance of the SOW tasks. Absent the requisite
   additional information, we cannot question the reasonableness of the below
   average rating assigned to the firm's proposal in this area. Similarly, we
   note that, since FRS failed to provide the required employee synopses for
   non-key personnel to demonstrate their education and qualifications, there
   is no reason to question the propriety of the below average rating the
   firm's proposal received under the personnel evaluation factor.