TITLE: B-309964; B-309964.2, ITT Industries Space Systems, LLC, November 9, 2007
BNUMBER: B-309964; B-309964.2
DATE: November 9, 2007
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B-309964; B-309964.2, ITT Industries Space Systems, LLC, November 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: ITT Industries Space Systems, LLC
File: B-309964; B-309964.2
Date: November 9, 2007
Kevin P. Connelly, Esq., Joseph J. Dyer, Esq., Grace Bateman, Esq., Jon B.
Crocker, Esq., Heather L. Pitz, Esq., and Amanda B. Weiner, Esq., Seyfarth
Shaw LLP, for the protester.
Scott Arnold, Esq., Bradley Wine, Esq., Joseph Berger, Esq., Austin Fulk,
Esq., and Justin A. Chiarodo, Esq., Dickstein Shapiro LLP, for Ball
Aerospace & Technologies Corp., an intervenor.
Vincent A. Salgado, Esq., James T. Mahoney, Esq., Daniel Hymer, Esq., and
Laura M. Giza, Esq., National Aeronautics and Space Administration, for
the agency.
Edward Goldstein, Esq., and Christine S. Melody, Esq., Office of the
General Counsel, GAO, participated in the preparation of the decision.
DIGEST
1. Protest challenging evaluation of proposals and source selection
decision is denied where record demonstrates that the evaluation was
reasonable and consistent with the solicitation, and protester's arguments
amount to mere disagreement with agency's conclusions.
2. Agency's failure to address Defense Contract Audit Agency qualification
of audit results regarding awardee's cost proposal due to awardee's
noncompliance with cost accounting standards was not prejudicial where
agency demonstrated that awardee's noncompliance would not result in any
increased costs to the government.
DECISION
ITT Industries Space Systems, LLC protests the award of a contract to Ball
Aerospace & Technologies Corp. (BATC) under request for proposals (RFP)
No. NNG07177439R, issued by the National Aeronautics and Space
Administration (NASA) for the operational land imager instrument for the
Landsat Data Continuity Mission. ITT argues that NASA improperly evaluated
its proposal as well as that of the awardee, failed to conduct meaningful
discussions with ITT, and, as a consequence, the award decision was
flawed.
We deny the protest.
BACKGROUND
The Landsat Data Continuity Mission (LDCM) is an Earth-observing satellite
program. Under this program a series of Landsat satellites have been
collecting images of the Earth's surface since 1972 for a variety of uses,
including land use planning, agricultural monitoring, and natural
resources management. On January 9, 2007 NASA issued the subject RFP for
the procurement of the LDCM's next generation Operational Land Imager
(OLI) instrument--"a multispectral, reflective-band, imaging sensor,"
which is intended for flight aboard a separately procured LDCM satellite.
Contracting Officer's (CO) Statement at 3.
The solicitation contemplates the award of a cost-plus-award-fee contract
with a base period of performance of 52 months for the OLI instrument
(including delivery of the OLI instrument within 39 months of contract
award and integration of the instrument in the separately procured
satellite), an additional 5 years of post-orbit sustaining engineering,
plus five 1-year options for additional sustaining engineering. The RFP
provided for award to the offeror submitting the proposal which was
determined to represent the best value to the government. In making the
best value determination, the RFP established a trade-off process in which
NASA would evaluate and consider proposals with respect to three factors:
mission suitability, cost, and past performance. The mission suitability
factor was more important than either the cost or past performance
factors, both of which were of equal importance. Moreover, the RFP
specified that the cost factor was "significantly less important than the
combined importance of the Mission Suitability Factor and the Past
Performance Factor." RFP at 00197.
Section M.4 of the solicitation identified five subfactors within the
mission suitability factor. According to this section of the RFP, each
subfactor was assigned a maximum numerical point value with a combined
maximum value of 1,000 points as follows:
A. Instrument Design Concept 400 points
B. Instrument Testing and Calibration Planning 250 points
C. Management, Systems Engineering, Performance Assurance 250 points
D. Safety and Health 50 points
E. Small Disadvantaged Business Participation Program 50 points
RFP at 00203.
Regarding cost, section M.5 of the solicitation provided that NASA would
evaluate offerors' proposed costs for reasonableness and realism, and that
upward or downward adjustments might be made as a result of the agency's
cost realism assessment, to include adjustments to an offeror's proposed
direct and indirect costs. An offeror's proposed fee would not be
adjusted, however, and all proposed fee amounts would be included in
NASA's assessment of an offeror's most probable cost. The RFP further
provided for adjustments to an offeror's mission suitability score if NASA
was required to adjust an offeror's proposed cost by 21 percent or more
when determining the offeror's most probable cost.
For the purposes of evaluating offerors' past performance, the
solicitation instructed offerors to provide information concerning all
relevant contracts and subcontracts that they and their major
subcontractors were then currently performing or had completed within the
past 5 years. RFP at 00194. The RFP indicated that NASA's past performance
evaluation would be based upon a consideration of an offeror's performance
and the degree of relevance of the past performance as reflected in
information contained in the offeror's proposal, customer questionnaires,
and other references that NASA might contact for additional information.
NASA would assign an offeror a rating of excellent, very good, good, fair,
poor, or neutral based upon an assessment of its performance. According to
the RFP, NASA would consider, among other things, an offeror's performance
record with respect to technical issues, schedule, cost, management, and
mission success. In assessing the relevance of an offeror's performance
history, NASA indicated that it would assess the "degree" to which a prior
contract was similar to the requirements of the solicitation with respect
to size, content, and complexity. RFP at 00205.
On February 23, NASA received timely proposals from two offerors (ITT and
BATC) in response to the solicitation. NASA then constituted a source
evaluation board (SEB), which conducted an initial evaluation of the
offerors' proposals with respect to the three evaluation factors (mission
suitability, past performance, and cost) and found that both offerors'
proposals contained "weaknesses" as well as "significant weaknesses." In
letters dated April 19, NASA sent ITT and BATC written discussion
questions identifying the weaknesses and significant weaknesses identified
by the SEB in its initial evaluation. In addition, the discussion letters
provided that NASA would hold face-to-face meetings with ITT and BATC
regarding the information contained in the written discussion letters and
further indicated that the offerors should be prepared to discuss the
information set forth in those letters. AR, Tab 24, ITT Discussions
Letter, at 04206.
After individually meeting with NASA, ITT and BATC timely submitted their
final proposal revisions. The SEB's evaluation of the ITT and BATC
proposals under the three evaluation factors is summarized as follows:
+------------------------------------------------------------------------+
|Offeror| Mission | Mission |Proposed Cost| Recommended | Past |
| |Suitability|Suitability| Plus Award | Cost Plus |Performance|
| | Points | Rating | Fee | Award Fee[1] | |
|-------+-----------+-----------+-------------+--------------+-----------|
|BATC | 847 | Very Good |$127,873,686 | $142,083,921 | Good |
|-------+-----------+-----------+-------------+--------------+-----------|
|ITT | 660 | Good |$174,012,643 | $167,568,734 | Good |
+------------------------------------------------------------------------+
AR, Tab 45, SEB Final Report, at 07907.
In its evaluation of ITT's proposal under the mission suitability factor,
the SEB determined that ITT's proposal contained 13 strengths and 8
weaknesses, with no significant strengths, significant weaknesses or
deficiencies. BATC's "very good" rating under this factor was based on the
SEB's finding that its proposal contained 2 significant strengths, 13
strengths and 1 weakness, with no significant weaknesses or deficiencies.
AR, Tab 45, SEB Final Report, at 07940, 07925. The detailed breakdown of
the scores under the five mission suitability subfactors was as follows:
+------------------------------------------------------------------------+
| Mission Suitability | Points | BATC | ITT |
| Factor |Available| | |
|-------------------------+---------+------------------+-----------------|
| Subfactor | Pts | Adj |Score|Points|Adj |Score|Points|
|-------------------------+---------+-----+-----+------+----+-----+------|
|Subfactor A -- Instrument| 400 |Excel| 95 | 380 |Good| 65 | 260 |
|Design Concept | | | | | | | |
|-------------------------+---------+-----+-----+------+----+-----+------|
|Subfactor B -- Instrument| 250 |Excel| 97 |242.5 |Good| 70 | 175 |
|Testing and Calibration | | | | | | | |
|Planning | | | | | | | |
|-------------------------+---------+-----+-----+------+----+-----+------|
|Subfactor C -Management, | 250 |Good | 65 |162.5 |Good| 70 | 175 |
|Systems Eng'g, | | | | | | | |
|Performance Assurance | | | | | | | |
|-------------------------+---------+-----+-----+------+----+-----+------|
|Subfactor D -- Safety and| 50 |Good | 60 | 30 |Good| 60 | 30 |
|Health Plan | | | | | | | |
|-------------------------+---------+-----+-----+------+----+-----+------|
|Subfactor E -- Small | 50 |Good | 64 | 32 |Fair| 40 | 20 |
|Disadvantaged Business | | | | | | | |
|(SDB) Participation | | | | | | | |
|Program | | | | | | | |
|-------------------------+---------+-----+-----+------+----+-----+------|
|Cost Realism Adjust | | | | 0 | | | 0 |
|-------------------------+---------+-----+-----+------+----+-----+------|
|Total | 1000 |Very | | 847 |Good| | 660 |
| | |Good | | | | | |
+------------------------------------------------------------------------+
AR, Tab 45, SEB Final Report, at 07924.
After the SEB presented its findings to the source selection authority
(SSA), the SSA concluded that BATC's technically superior proposal with
its lower probable cost was more advantageous to the government than the
proposal submitted by ITT and decided to make award to BATC. This protest
followed.
ITT's protest raises numerous arguments challenging the agency's
evaluation of proposals and the content and scope of its discussions with
ITT. With respect to the cost factor, ITT contends that NASA's cost
realism evaluation was flawed and that NASA's discussions regarding its
costs were misleading and not meaningful. With regard to the past
performance factor, ITT asserts that NASA's evaluation was flawed and
reflected unequal treatment, and that the SSA's consideration of the
offerors' past performance was not based upon a reasonable consideration
of the past performance record for either ITT or BATC. Regarding the
mission suitability factor, ITT raises numerous specific challenges
concerning NASA's evaluation of its proposal, asserts that discussions
regarding its weaknesses in many instances were not meaningful, and that
NASA's evaluation of ITT's proposal in several instances evidences unequal
treatment when compared to its consideration of BATC's proposal. As a
final matter, ITT contends that the above issues resulted in NASA making a
flawed award decision. Although we do not here specifically address all of
ITT's arguments about the evaluation of proposals and other agency
actions, we have fully considered all of them and find that they afford no
basis to sustain the protest of the selection decision here.
DISCUSSION
Cost Evaluation
When an agency evaluates a proposal for the award of a cost-reimbursement
contract, as in this case, an offeror's proposed estimated costs are not
dispositive because, regardless of the costs proposed, the government is
bound to pay the contractor its actual and allowable costs. Federal
Acquisition Regulation (FAR) sections 15.305(a)(1); 15.404-1(d); Tidewater
Constr. Corp., B-278360, Jan. 20, 1998, 98-1 CPD para. 103 at 4.
Consequently, the agency must perform a cost realism analysis to determine
the extent to which an offeror's proposed costs are realistic for the work
to be performed. FAR sect. 15.404-1(d)(1). An agency is not required to
conduct an in-depth cost analysis, see FAR sect. 15.404-1(c), or to verify
each and every item in assessing cost realism; rather, the evaluation
requires the exercise of informed judgment by the contracting agency.
Cascade Gen., Inc., B-283872, Jan. 18, 2000, 2000 CPD para. 14 at 8.
Further, an agency's cost realism analysis need not achieve scientific
certainty; rather, the methodology employed must be reasonably adequate
and provide some measure of confidence that the costs proposed are
reasonable and realistic in view of other cost information reasonably
available to the agency as of the time of its evaluation. See SGT, Inc.,
B-294722.4, July 28, 2005, 2005 CPD para. 151 at 7; Metro Mach. Corp.,
B-295744; B-295744.2, Apr. 21, 2005, 2005 CPD para. 112 at 10-11. Because
the contracting agency is in the best position to make this determination,
we review an agency's judgment in this area only to see that the agency's
cost realism evaluation was reasonably based and not arbitrary. Hanford
Envtl. Health Found., B-292858.2, B-292858.5, Apr. 7, 2004, 2004 CPD para.
164 at 8-9.
In order to facilitate the agency's cost evaluation, offerors were
required to submit proposed cost estimate information (i.e., hours by
labor category, subcontract cost information, and other direct costs) for
many of the work elements (and specific sub-elements) that were, in the
agency's view, "fundamental" to the OLI requirement. These were referred
to as the "Work Breakdown Structure" (WBS). In performing its cost
evaluation, the SEB considered each offeror's proposed technical approach
and proposed cost estimates, which it compared to NASA's own estimates for
each WBS. Based on the SEB's understanding of the requirements and the
offeror's unique technical approach, the SEB calculated "recommended" or
"probable" values for hours and ODCs. Utilizing this information, in
conjunction with labor rate information submitted by the offerors, which
was reviewed by the Defense Contract Audit Agency (DCAA) and adjusted
based on recommendations from DCAA, as well as the offeror's fee, NASA
calculated recommended total costs for BATC and ITT. AR at 7, AR, Tabs 19,
20, 21, 41, and 44. Specifically, NASA made an upward adjustment to BATC's
total proposed estimated cost, increasing it from $127,873,686 to
$142,083,921 and made a downward adjustment to ITT's total proposed
estimated cost, decreasing it from $174,012,643 to $167,568,734.
In challenging the agency's cost evaluation, ITT principally contends that
NASA's conclusions regarding the estimated cost differential between the
two offerors is not supported by the contemporaneous record. ITT asserts
that there was no basis for NASA to conclude that ITT would incur
substantially more labor hours for management since there was nothing to
suggest that ITT's management approach was less efficient than that of
BATC. In this vein, ITT faults NASA for not performing a "cross-check" to
determine whether differences between offerors' hours for WBS cost
elements were the result of differences in their technical approaches or
of inconsistencies in the evaluation of offerors. None of these challenges
provides a basis to sustain ITT's protest.
Notwithstanding the protester's contentions to the contrary, the
contemporaneous record clearly reflects NASA's detailed cost evaluation
and specific identification of the areas where ITT's and BATC's cost
elements differed based on their varying technical approaches. In the
regard, NASA explains that ITT's $25 million higher adjusted cost as
compared to BATC's was a consequence of several factors. AR, Tab 46, SEB
Slide Presentation to SSA, at 08028. Notably, ITT's estimated fee pool was
[DELETED] percent as compared to BATC's fee pool of [DELETED] percent.[2]
Moreover, NASA determined that approximately $[DELETED] million of the
difference was explained by three major factors. First, ITT proposed
[DELETED] as compared to BATC. While this was ultimately judged to be a
strength of ITT's proposal, it was more expensive. Second, ITT's OLI
design was [DELETED] and therefore more expensive than BATC's OLI design.
Third, ITT utilized [DELETED] than BATC proposed to perform the OLI work.
AR at 11-12. By way of example, NASA notes that ITT's management team
included a [DELETED], a position that BATC did not have. ITT also proposed
[DELETED]. BATC, on the other hand, did not [DELETED] overseeing each of
their major technical areas. In addition, BATC proposed to do [DELETED],
resulting in greater staffing inefficiencies due to duplication of
staffing for the subcontractor and prime. Id.
While ITT contends that there is no basis for concluding that its
management approach was "less efficient" and therefore would yield a
substantially higher number of estimated management labor hours, ITT fails
to address the specific examples of the differences in the management
structure between the two proposals identified by NASA. Rather, ITT simply
notes that there was a wide disparity between ITT's higher management
hours and those of BATC, and concludes, based on this fact alone, that
there is no rational basis for such a disparity.[3] The basis for the
disparity, however, is a logical extension of the fact that ITT, in its
initial proposal, set forth a management approach based on substantially
more management hours than even the final upwardly adjusted hours for
BATC.[4] In this regard, ITT does not point to any information in the
offerors' proposals suggesting that the agency's calculation of management
hours for either offeror was erroneous, that BATC's proposal represented
understaffing, or that NASA had failed to properly calculate ITT's or
BATC's management hours. ITT's challenges in this regard do not provide a
basis for sustaining its protest.
ITT further contends that NASA's cost realism evaluation was flawed
because it failed to properly consider Defense Contract Audit Agency
(DCAA) audit results identifying irregularities with BATC's compliance
with cost accounting standards (CAS)--specifically, CAS 420--concerning,
as relevant here, BATC's allocation of its costs for independent research
and development. As a consequence, ITT contends that NASA's "most probable
cost" estimate for BATC was not reasonably supported. Specifically, ITT
highlights the fact that DCAA qualified its audit results for BATC based
on the fact that BATC was "noncompliant" with CAS 420, which had been
reported in prior audits, indicated that the cost impacts had not been
determined, and stated that these issues "may have a significant effect on
the final cost allocations for CAS covered Government contracts." AR, Tab
50, DCAA Audit for BATC, 08221. In addition, DCAA explained that the
Divisional Administrative Contracting Officer (DACO) of the Defense
Contract Management Agency for BATC would separately negotiate the cost
impact of the noncompliance. Id.
The record shows that NASA further questioned DCAA on this issue, asking
whether it could provide some indication of the magnitude of the cost
impact. DCAA responded that it could not provide such an estimate, simply
noting that the matter would be addressed by the DACO. NASA did not pursue
the matter with BATC during discussions and did not make any adjustments
to BATC's costs as result of the DCAA qualification.
In a hearing held by our Office, however, the DACO for BATC, who is
responsible for, among other things, cost allowability issues and
interacting with DCAA regarding its contractor audit reports with respect
to BATC's contracts, provided testimony regarding this issue. The DACO
explained that BATC's noncompliance relates to a 2001 audit finding, which
has not yet been resolved, that any cost impact would be limited to fiscal
year 2000 incurred costs, and that any cost adjustment would be limited to
a decrease in costs to the government--BATC's noncompliance would not
result in increased costs to the government. Hearing Transcript (Hearing
Tr.) at 173. Moreover, the DACO indicated that even if the noncompliance
identified in the 2001 audit were a continuing issue, such that it
implicated BATC's 2007 contracts (something which the DACO indicated has
not been identified by DCAA), such noncompliance by BATC again would not
result in any increased costs to the government, thus negating any concern
that BATC's costs under the OLI contract would increase as a consequence
of the outstanding CAS issue. Id. While ITT contends that the issue was
raised by DCAA and that the DACO cannot speak for DCAA, the record
reflects that DCAA expressly indicated that the matter would be addressed
by the DACO and ITT has not explained why the DACO's testimony should be
regarded as unreliable or otherwise unreasonable. As a consequence, on
this record, ITT's challenge does not provide a basis for our Office to
sustain its protest with regard to this issue.
With respect to the cost evaluation, ITT further contends that NASA misled
ITT during discussions into increasing its costs and argues that its
discussions were not meaningful because NASA failed to inform ITT that its
fee was "too high." ITT's Comments and Supplemental Protest at 33. These
arguments are without merit. Both arguments stem from the erroneous
premise that NASA found ITT's costs to be "unreasonably" high and its
award fee "excessive." ITT's Comments and Supplemental Protest at 31, 34.
While ITT's costs and fee were less competitive than those of BATC, there
is simply nothing in the record to support ITT's assertions that NASA
found them to be unreasonable or excessive based upon its understanding of
ITT's proposal technical approach. An agency is not required to inform an
offeror during discussions that its costs are not as competitive as those
of another offeror. Yang Enters., Inc.; Santa Barbara Applied Research,
Inc., B-294605.4 et al., Apr. 1, 2005, 2005 CPD para. 65 at 10.
Regarding ITT's allegation that it was misled into increasing its costs,
the record reflects that NASA's discussions addressed areas where it had
concluded that ITT's proposal failed to account for costs based upon ITT's
proposed technical approach and NASA's understanding of the requirements.
For example, NASA noted that ITT failed to include labor hours to "support
weekly telecoms," "working groups," and additional "mission-level
reviews," and underestimated travel needs and labor support for various
activities. AR, Tab 24, ITT Discussions Letter, at 04218-19. ITT suggests
it was improper for NASA to lead ITT to further increase its labor hours
and thereby its costs through the discussions process, since its labor
hours and costs were higher than those estimated by NASA and those
proposed by BATC. ITT's argument, however, fails to recognize that ITT's
own changes in its final proposal affirmed that ITT believed NASA's
concerns were justified. If ITT believed that it could perform the
contract at the costs it initially proposed, it had the option to submit
this information to the agency in response to the discussion questions. In
addition, as noted above, NASA's cost realism evaluation was based upon
ITT's proposed technical approach and the discussion questions were
necessarily tailored to that approach. Thus, the fact that ITT's labor
hours and costs were higher than those estimated by NASA or proposed by
BATC is irrelevant to the propriety of NASA's discussion questions to ITT,
which we believe reasonably addressed cost concerns related to ITT's
technical approach. As a consequence, we see nothing objectionable in the
agency's discussions.
Past Performance
In challenging NASA's past performance evaluation, ITT contends that it
was unreasonable for ITT and BATC to have both been rated "good" under the
past performance factor given ITT's superior past performance record as
compared to that of BATC. In this regard, ITT asserts that NASA
misevaluated its own past performance and failed to properly consider
BATC's past performance record, that the evaluation reflected disparate
treatment between ITT and BATC, and that the SSA did not have a reasonable
understanding of the differences between the offerors' past performance
information.
Determining the relative merits of an offeror's past performance
information is primarily a matter within the contracting agency's
discretion and we will not substitute our judgment for reasonably based
past performance ratings. United Paradyne Corp., B-297758, Mar. 10, 2006,
2006 CPD para. 47 at 4. We will examine an agency's evaluation only to
ensure that it was reasonable and consistent with the solicitation's
evaluation criteria and procurement statutes and regulations. Clean
Harbors Envtl. Servs., Inc., B-296176.2, Dec. 9, 2005, 2005 CPD para. 222
at 3. A protester's mere disagreement with the agency's judgment does not
establish that an evaluation was improper. Id.
Here, as a general matter, the past performance record with respect to
both ITT and BATC reflects laudatory comments and ratings, as well as
instances where both offerors experienced serious problems. NASA made a
judgment that each offeror's past performance warranted an overall rating
of "good," and there is nothing in the record to indicate that NASA's
considered judgments were outside the bounds of reasonable decisionmaking.
In this regard, we have specifically reviewed all of the arguments raised
by ITT and find none to be meritorious.
For example, in challenging NASA's evaluation of its own past performance,
ITT asserts that NASA inexplicably excluded one of its past performance
contracts where it had received excellent past performance scores,
specifically its work as a subcontractor for the design of the National
Polar-orbiting Operational Environmental Satellite System
(NPOESS)-Visible/Infrared Imager/Radiometer Suite (VIIRS) Sensor. NASA
explains, however, that ITT's involvement with the NPOESS-VIIRS Sensor
contract was limited to that of a "'potential alternate source'" and
thereby limited to the formulation phase of that contract (i.e.,
preliminary design review). CO Supplemental Statement of Facts at 2. As
such, the SEB concluded that the NPOESS-VIIRS Sensor contract was not
sufficiently similar to the OLI project, which entails the design,
development, fabrication and testing, and integration of the OLI for the
LDCM; the SEB specifically informed the SSA that it did not consider
contracts in the formulation phase, such as the NPOESS-VIIRS Sensor
contract, to be relevant. AR, Tab 46, SEB Slide Presentation to SSA, at
8004. While ITT contends that its work on the NPOESS-VIIRS Sensor contract
which involved a "significant" and "complicated design process," was
"clearly relevant," ITT's Supplemental Comments at 9, its arguments amount
to little more than disagreement with the agency's judgment and do not
provide a basis to sustain its protest.
ITT further contends that by not considering the NPOESS-VIIRS Sensor
contract, NASA's evaluation reflected unequal treatment since it did
consider one of BATC's contracts (its Deep Impact Instrument contract with
the University of Maryland) notwithstanding the fact that NASA had not
received a past performance questionnaire regarding BATC's performance
under that contract. ITT's argument in this regard does not logically flow
from its premise since NASA disregarded ITT's NPOESS-VIIRS Sensor contract
due to relevance concerns, not because it did not obtain a questionnaire
regarding ITT's performance. In any event, the record reflects that while
NASA did not obtain a questionnaire regarding BATC's performance of the
Deep Impact contract, NASA did in fact obtain information concerning
BATC's performance under that contract from the customer and specifically
documented the information it received, see AR at 21 n.5; AR, Tab 34, BATC
Past Performance Information, at 06827-28, thus establishing a basis for
NASA's consideration of BATC's performance on the Deep Impact contract and
its conclusion that BATC's performance on that contract was "very good"
overall. AR, Tab 45, SEB Final Report, at 07966.
In challenging NASA's past performance evaluation, ITT argues that NASA
erroneously considered its performance as a subcontractor to provide the
Cross-Track Infared Sounder (CrIS) Sensor in support of the NPOESS and
that its rating is not supported by the record. NASA rated ITT's past
performance under the CrIS contract as "good" for technical and "fair" for
both schedule and price. ITT argues that its "fair" rating with respect to
schedule was not justified based on the past performance questionnaire
NASA received from the prime contractor regarding ITT's performance.
Conceding the fact that its performance has been affected by what ITT
characterizes as "a unique but significant vibration failure," ITT notes
that the questionnaire reflected ratings of "very good" and "good" with
respect to questions concerning schedule. ITT's Comments and Supplemental
Protest at 11.
NASA considered ITT's performance on the CrIS contract to be "highly
relevant" since "the CrIS contract is most like the OLI contract in that
it involves design, development, fabrication and testing of a complex
earth observing instrument," and therefore "weighed very heavily in the
past performance evaluation for ITT." CO Supplemental Statement of Facts
at 4. In considering ITT's performance of the CrIS contract, the SEB
obtained information beyond the prime contractor questionnaire. As
explained in hearing testimony, the SEB obtained input from the project
manager for the NPOESS Preparatory Project, a NASA employee, who had
direct knowledge of the status of the subsidiary CrIS instrument project.
Hearing Tr. at 16. This individual provided the SEB with a highly critical
assessment of ITT's performance under the CrIS program, indicating that
ITT was the primary cause of the noted vibration failure, which delayed
the scheduled delivery of the CrIS instrument by more than 1 year, and
stated that ITT's performance was "unsatisfactory."[5] Hearing Tr. at 18,
20. Based on this record, we find nothing unreasonable with NASA's past
performance ratings with respect to ITT's performance under the CrIS
contract.
Mission Suitability
With respect to the mission suitability factor, ITT raises numerous
specific challenges concerning NASA's evaluation of its proposal and
asserts that discussions regarding many of its weaknesses were not
meaningful, and that NASA's evaluation of ITT's proposal in several
instances evidences unequal treatment when compared to its consideration
of BATC's proposal.
In reviewing an agency's evaluation, we will not reevaluate technical
proposals, but instead will examine the agency's evaluation to ensure that
it was reasonable and consistent with the solicitation's stated evaluation
criteria. L-3 Communications Westwood Corp., B-295126, Jan. 19, 2005, 2005
CPD para. 30 at 5. In negotiated procurements, whenever discussions are
conducted by an agency, they are required to be meaningful, equitable, and
not misleading. To satisfy the requirement for meaningful discussions, the
agency need only lead an offeror into the areas of its proposal requiring
amplification or revision; all-encompassing discussions are not required,
nor is the agency obligated to "spoon-feed" an offeror as to each and
every item that could be revised to improve its proposal. Metro Mach.
Corp., B-295744, B-295744.2, Apr. 21, 2005, 2005 CPD para. 112 at 19. This
is particularly true where, as here, one aspect of the evaluation is to
test the offeror's technical understanding. See TRI-COR Indus.,
B-259034.2, Mar. 14, 1995, 95-1 CPD para. 143 at 5-6. We have considered
all the issues raised by the protester concerning the mission suitability
factor and find that they are without merit.
ITT argues that several of the strengths it received should have instead
been characterized as "significant" strengths, based upon the relative
definition of the two adjectival ratings and the superlatives used by the
SEB in describing the merits of the strengths contained in ITT's proposal,
and as reflected by the description of the significant strengths ascribed
to BATC's proposal. For example, ITT contends that it should have been
assessed a "significant strength" as opposed to a "strength" under
subfactor A, Instrument Design, of the mission suitability factor, for its
proposed [DELETED] since the SEB found that the ITT had proposed "a very
effective design to mitigate contamination risk." AR, Tab 45, SEB Final
Report, at 07940. According to ITT, a finding the ITT proposed a "very
effective" design properly falls within the definition of a "significant
strength," which requires a finding that the proposal "greatly enhances
the potential for successful performance, or contributes significantly
toward meeting or exceeding the contract requirements," as opposed to a
strength, which merely required a finding the proposal provides "a high
level of confidence of meeting the requirement and to some extent clearly
exceeds what is necessary to meet the requirement." Id. at 07918-19. We
find ITT's entire line of argument in this area to essentially express
ITT's disagreement with the agency's considered technical judgments
regarding the specific elements of the offerors' proposals and we find
nothing to suggest that the agency's judgments were unreasonable or
inconsistent with the terms of the solicitation.
ITT also argues that NASA unreasonably assigned its proposal a "weakness"
for lacking adequate maturation plans for its [DELETED]. As it relates to
this issue, the RFP provided as follows:
Assess the technical maturity of the following instrument subsystems:
the focal plane, focal plane electronics, mechanisms, calibration
devices, structure, optics, and solid state recorder. Assess the
technology readiness of all technologies below Technological Readiness
level 6 (TRL-6) and provide detailed plans and schedules for their
maturation.
RFP at 00180.
In its proposal, ITT maintained that all of its OLI design technologies
met the TRL-6 standard. AR, Tab 9, ITT Initial Proposal, at 01628. The SEB
had concerns as to whether ITT's [DELETED] and in discussions with ITT,
NASA expressly indicated that "the proposed technology readiness levels of
the [DELETED] are not adequately substantiated." AR, Tab 24, ITT
Discussions Letter, at 04215. In its final proposal revision, ITT
attempted to address NASA's concerns in this regard by providing
additional information to confirm that these items were in fact TRL-6
compliant. NASA, however, found the additional information provided by ITT
to be inadequate and therefore assessed ITT with a weakness because,
having failed to establish TRL-6 maturity for these items, ITT did not
provide the detailed plans and schedules for the maturation of these items
as required by the RFP.
ITT, in its comments on the agency report, argues that it had proposed
significant cost and fee margins to accommodate "any efforts" to mature
these items. ITT's Comments and Supplemental Protest at 52. Addressing
this argument, NASA explained that providing cost and fee margins is not
the equivalent of providing maturation plans, and that ITT did not provide
any discussion of the "efforts" that ITT would employ to mature these
items. ITT then chides the agency for failing to recognize that ITT was
not required to provide detailed plans and schedules for maturation of
these items since it had established that the items were TRL-6 compliant.
ITT, however, misses the point. ITT never addresses NASA's specific
explanations of why it did not consider the items to be TRL-6 compliant,
and because NASA found them to be at a level of maturity below TRL-6, ITT
was required under the RFP to provide detailed maturation plans. Based on
this record, there is nothing to suggest that NASA's evaluation of ITT's
proposal in this regard was unreasonable.[6]
In challenging its discussions, ITT maintains that they were inadequate,
and in many instances misleading, with regard to the specific weaknesses
identified by the agency. For example, ITT contends that NASA failed to
conduct adequate discussions with respect to ITT's proposed "calibration
of radiometric sources."[7] As it relates to this issue, the RFP indicated
that NASA would evaluate the procedures by which an offeror would maintain
traceability of their radiometric calibration with regard to spectral
radiance standards maintained by the National Institutes of Standards and
Technology (NIST) for the United States, and how the radiance calibration
transfer to orbit will be verified. Hearing Tr. at 109-110; RFP at 00200.
NASA informed ITT that its [DELETED]. AR, Tab 24, ITT Discussions Letter,
at 04220. The record reflects that ITT revised its proposal in response to
NASA's concerns, however, the SEB found that the additional information
provided by ITT was not sufficient to address its underlying concern and
the weakness therefore remained. In challenging the reasonableness of
NASA's discussions, ITT argues that it was not informed of NASA's true
concerns regarding this weakness, as reflected by the SEB's
characterization of the weakness in its final report. The record shows
that the final report reflected NASA's concerns with issues which were
first introduced in ITT's final proposal revision and therefore could not
have been raised in NASA's previously held discussions with ITT; nor was
NASA required, as ITT suggests, to reopen discussions in order to provide
ITT with an opportunity to address NASA's concerns regarding the newly
introduced information. Ideamatics, Inc., supra.
The protest is denied.
Gary L. Kepplinger
General Counsel
------------------------
[1] The recommended cost reflected NASA's adjustments to the offeror's
proposed cost based upon its cost realism evaluation.
[2] The fee pool values represent NASA's adjusted values for both ITT and
BATC. AR, Tab 46, SEB Slide Presentation to SSA, at 08028.
[3] In its initial proposal, ITT proposed [DELETED] hours with respect to
the "Management" WBS, while BATC proposed [DELETED] hours. NASA estimated
that, based on ITT's approach, that number should be increased by
[DELETED] for a total of [DELETED] hours, to account for items such as
[DELETED] and estimated that the number of hours for BATC should be
increased by [DELETED] for a total of [DELETED] hours. NASA raised these
issues with ITT and BATC during discussions. AR, Tab 24, ITT Discussions
Letter, at 04218-19; AR, Tab 25, BATC Discussions Letter, at 04262-63. In
its final proposal, ITT proposed [DELETED] hours based on the discussion
items. NASA, however, made a downward adjustment of [DELETED] with respect
to ITT's final proposal. AR, Tab 41, Cost Analysis Tables, at 07104-05.
BATC, on the other hand included only [DELETED] hours in its final
proposal, and based on its assessment of BATC's approach, NASA made an
upward adjustment of [DELETED] hours for a total of [DELETED] hours under
the "Management" WBS. AR, Tab 46, SEB Slide Presentation to SSA, at
08026-27.
[4] As previously noted, see fn. 3, ITT initially proposed [DELETED] hours
under the "Management" WBS, while BATC's final upwardly adjusted hours
under this WBS were only [DELETED]. AR, Tab 41, Cost Analysis Tables, at
07104-05.
[5] The project manager's testimony in this regard was consistent with
contemporaneous evaluator notes reflecting that ITT's performance on the
CrIS contract had been rated as "unsatisfactory" due to the noted
vibration failure, which had negatively affected both schedule and cost.
AR, Tab 35, ITT Past Performance Information, at 06912.
[6] While ITT also argues that NASA's discussions regarding this issue
were inadequate, the record clearly reflects that NASA specifically
informed ITT of its concerns with the maturation levels of its [DELETED]
where it indicated that they were "not adequately substantiated." AR, Tab
24, ITT Discussions Letter, at 04215. To the extent ITT chose to establish
that these items were TRL-6 compliant and NASA ultimately concluded that
ITT's efforts in this regard were inadequate, NASA was not obligated to
re-open discussions with ITT to afford ITT yet a further opportunity to
address this issue, or to provide ITT with an opportunity to provide
maturation plans and schedules for these items. Ideamatics, Inc.,
B-297791.2, May 26, 2006, 2006 CPD para. 87 at 3 n.5. ITT further argued
that NASA's discussions and evaluation of BATC's proposal demonstrate
unequal treatment of ITT and BATC. The record, however, reflects that ITT
and BATC proposed different approaches [DELETED]. Based on this record, we
see nothing unequal about the agency's discussions or evaluation.
[7] As NASA explained in hearing testimony, radiometric calibration in the
context of the OLI procurement refers to the process of relating the OLI
instrument output to a physical quantity, specifically spectral radiance.
Radiometric calibration sources are the devices by which that calibration
is determined for the OLI instrument prior to launch. Hearing Tr. at 108.