TITLE: B-310093, Charles Kendall & Partners, Ltd., November 26, 2007
BNUMBER: B-310093
DATE: November 26, 2007
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B-310093, Charles Kendall & Partners, Ltd., November 26, 2007

   Decision

   Matter of: Charles Kendall & Partners, Ltd.

   File: B-310093

   Date: November 26, 2007

   Hugh Mainwaring, Charles Kendall & Partners, Ltd., Inc., for the
   protester.

   Roger D. Waldron, Esq., Mayer Brown LLP, for Polaris Sales, Inc., an
   intervenor.

   Maj. Walter R. Dukes, and Arthur M. Bolely, Esq., Department of the Army,
   for the agency.

   Linda C. Glass, Esq., and Ralph O. White, Esq., Office of the General
   Counsel, GAO, participated in the preparation of the decision.

   DIGEST

   In a negotiated procurement which provided for award on the basis of a
   price/delivery/small business participation tradeoff, protest challenging
   the selection of the high-priced proposal is denied, where, consistent
   with the solicitation's evaluation factors, the source selection authority
   considered the awardee's offer of a shorter delivery schedule, and
   concluded that faster deliveries outweighed the protester's price
   advantage; this kind of conclusion is well within the discretion given
   selection officials to make tradeoff decisions.

   DECISION

   Charles Kendall & Partners, Ltd. (CKP) protests the award of a contract to
   Polaris Sales, Inc. under request for proposals (RFP) NO.
   W56HZV-07-R-G093, issued by the United States Army Tank-Automotive
   Armaments Life Cycle Management Command for all terrain vehicles (ATVs)
   and ATV trailers, along with spare parts and services, for use by security
   forces in Afghanistan and Iraq.

   The protest is denied.

   The RFP provided for the award of a 3-year requirements contract. The RFP
   included estimated quantities for the ATVs and trailers for each of the 3
   years. The RFP provided for a two-phased evaluation process. Offerors were
   informed that, under phase I, the firms' proposals would be evaluated on
   an acceptable/not acceptable basis for compliance with the RFP's
   specifications. An acceptable proposal was defined as one "where there is
   essentially no doubt" that the offered ATVs and trailers would "meet each
   of the specification requirements." RFP para. M.2.1.

   Offerors were informed that those proposals found to be acceptable would
   be evaluated using a tradeoff process to determine which proposal is most
   advantageous under the following phase II evaluation factors: delivery,
   small business participation and price. The delivery factor was more
   important than price, and price was more important than small business
   participation.

   With respect to the delivery factor, the RFP provided that the agency
   would evaluate on the basis of the dates of the offeror's proposed Days
   After Receipt of Order (DARO) for completion of deliveries at FOB Origin
   and to the final FOB Destination point in Umm Qasr, Iraq of the
   government's total estimated initial order of 596 ATVs and 596 ATV
   trailers. The RFP further stated that the delivery evaluation would assess
   the extent to which the deliveries would satisfy the RFP's objective
   delivery schedules for FOB Origin and for FOB Destination, as well as the
   level of risk associated with the proposed delivery schedule. For purposes
   of this RFP, the government's objective delivery dates for the estimated
   initial order quantity of ATVs and ATV trailers, for both FOB Origin and
   FOB Destination, were 210 DARO. Offerors were informed that the basis for
   award would be a price/technical tradeoff taking into consideration the
   "relative advantages, disadvantages, and risks of each proposal." RFP
   para. M.2.2.

   Seven proposals were received, including those from CKP and Polaris, by
   the closing date for receipt of proposals. After discussions, five firms'
   offers, including those of CKP and Polaris, were determined to be
   technically acceptable in the phase I evaluation. After completion of
   evaluation under phase II, the source selection authority (SSA) concluded
   that the award decision came down to a choice between the proposal of CKP,
   which offered the lowest evaluated price, and Polaris, which offered the
   best delivery schedule with a very low risk rating. CKP's and Polaris'
   final revised proposals were evaluated under phase II as follows:

   +------------------------------------------------------------------------+
   |Offeror                  |Delivery Rating/Risk|   Price   |  Sm. Bus.   |
   |                         |                    |           |Participation|
   |(with delivery terms     |                    |           |             |
   |offered in DARO)         |                    |           |             |
   |-------------------------+--------------------+-----------+-------------|
   |CKP                      |       Good/        |$13,352,870|    Good     |
   |                         |                    |           |             |
   |ATV                      |      Low Risk      |           |             |
   |                         |                    |           |             |
   |- 180 days-FOB Origin    |                    |           |             |
   |                         |                    |           |             |
   |- 140 days-FOB           |                    |           |             |
   |Destination              |                    |           |             |
   |                         |                    |           |             |
   |Trailer                  |                    |           |             |
   |                         |                    |           |             |
   |- 80 days-FOB Origin     |                    |           |             |
   |                         |                    |           |             |
   |- 85 days-FOB Destination|                    |           |             |
   |-------------------------+--------------------+-----------+-------------|
   |Polaris                  |     Excellent/     |$18,893,567|    Good     |
   |                         |                    |           |             |
   |ATV                      |   Very Low Risk    |           |             |
   |                         |                    |           |             |
   |- 60 days-FOB Origin     |                    |           |             |
   |                         |                    |           |             |
   |- 60 days-FOB Destination|                    |           |             |
   |                         |                    |           |             |
   |Trailer                  |                    |           |             |
   |                         |                    |           |             |
   |- 60 days-FOB Origin     |                    |           |             |
   |                         |                    |           |             |
   |- 60 days-FOB Destination|                    |           |             |
   +------------------------------------------------------------------------+

   Agency Report (AR), Tab 17, Source Selection Decision, at 3.

   The agency concluded that the Polaris delivery schedule was concise,
   detailed and indicated an excellent understanding and approach. As a
   result, Polaris was rated excellent/very low risk under the delivery
   evaluation factor. AR, Tab 14, Delivery Area Evaluation, at 2. More
   importantly, Polaris had a large existing inventory of ATVs and commitment
   letters from the original manufacturer. The SSA selected Polaris for
   award, despite its $5.5 million price premium, because of the proposal's
   faster delivery schedule. Specifically, the SSA found the Polaris proposal
   to be more advantageous overall because of its delivery advantage. Because
   of the urgent need for the items, the SSA stated that she was willing to
   pay a price premium for substantially quicker delivery time at a lower
   risk. AR, Tab 17, Source Selection Decision, at 5. Award was made to
   Polaris and this protest followed.

   CKP complains that the RFP was ambiguous and misleading in that it failed
   to state that deliveries above and beyond the stated government delivery
   objective would be rewarded under the evaluation. CKP further argues that
   the government's failure to vary its DARO objective mislead offerors about
   the actual criticality of the requirements and that it viewed the
   government's objective delivery date to be an accurate and fair
   representation of what the government believed to be acceptable.

   To the extent that this protest argues about the solicitation delivery
   evaluation factor, many of the arguments it raises are untimely. Our Bid
   Protest Regulations contain strict rules requiring timely submission of
   protests. These rules specifically require that protests based upon
   alleged improprieties in a solicitation which are apparent prior to the
   closing time for receipt of proposals must be filed prior to the closing
   time. 4 C.F.R. sect. 21.2(a)(1) (2007).

   To the extent, however that some of the arguments regarding the agency's
   interpretation of the delivery evaluation factor are timely, we disagree.
   The RFP here specifically informed offerors that award would be made under
   Phase II of the evaluation on a price/technical tradeoff basis,
   considering the evaluated advantages, disadvantages and risks of each
   proposal under the delivery, small business participation, and price
   factors. The RFP also advised that offerors' proposed delivery schedules
   for FOB origin and FOB destination would be considered under the delivery
   evaluation factor. RFP sect. M.2.2. Moreover, the RFP advised that the
   delivery factor was the most important evaluation factor.

   Based on our review of the record--and contrary to the protester's
   contention that had it known the importance of the delivery factor in the
   evaluation of proposals, it would have adjusted its delivery dates
   accordingly--the record shows that the protester proposed delivery dates
   that were significantly below the government's stated objectives. In this
   regard, the protester's proposal, on its face, suggests that the protester
   understood that the agency needed these items sooner than later, and
   understood the importance of an expedited delivery schedule. The record
   shows that CKP simply did not propose a delivery schedule that was as
   favorable as the delivery schedule proposed by Polaris.

   CKP also challenges the SSA's price/technical tradeoff determination that
   Polaris' offer of a shorter delivery schedule was worth the $5.5 million
   price premium associated with Polaris' higher-priced proposal.

   In our view, selection officials have considerable discretion in making
   price/technical decisions. Their judgments in these tradeoffs are by their
   nature subjective; nevertheless, the exercise of these judgments must be
   reasonable and must bear a rational relationship to the announced criteria
   upon which competing offers are to be selected. Award may be made to a
   firm that submitted a higher-rated, higher-price proposal where the
   decision is consistent with the evaluation criteria and the agency
   reasonably determines that the technical superiority of the higher-priced
   offer outweighs the price difference. ACS  State Healthcare, LLC et al.,
   B-292981 et al., Jan. 9, 2004, 2004 CPD para. 57 at 44.

   Here, the SSA recognized CKP's price advantage, but concluded that
   Polaris' shorter delivery schedule was worth the price premium. In making
   this decision, the SSA appropriately recognized the relative importance of
   the solicitation's evaluation factors, in particular that the delivery
   factor was more important than the price factor. AR, Tab 17, Source
   Selection Decision, at 4. The SSA noted that there was an urgent need for
   these items and indicated that she was willing to pay the price premium
   for faster deliveries with lower risk. Although CKP does not believe that
   Polaris' faster delivery schedule was worth an additional $5.5 million,
   CKP's disagreement with the SSA's business judgment does not show that
   that judgment is unreasonable. See ACS  State Healthcare, LLC et al.,
   supra, at 45. Rather, we find that the decision reflects a price/technical
   tradeoff assessment that is within the realm of discretion given selection
   officials on these matters.

   In a supplemental protest filing submitted after receipt of the agency
   report, CKP also complains that the Polaris proposal should have been
   rejected as technically unacceptable under the Phase I evaluation because
   Polaris failed to provide radial tires as required by the solicitation.

   With respect to the specification for wheels and tires, the RFP provided
   the following:

     8.1 The vehicle shall be provided with tubeless on/off road radial tires
     and wheels. The tires shall be dual-sport/purpose and designed for
     requirements stated in paragraph 11.2 of this specification.

     8.2 Run flats are desired.

   RFP, attach. 1.

   While the agency acknowledges that the above-quoted provision is
   ambiguous, it maintains that either a radial or a bias-ply run flat tire
   would have been acceptable. The agency states that it viewed run flat
   tires as superior to radial tires, and recognized that run flat tires are
   more expensive than radials. The agency, and the protester, both represent
   that there are apparently no available ATV tires that can be termed both
   radial and run flats. Finally, the record shows that the protester,
   apparently recognizing the ambiguity, offered both types of tires:

     The Offeror notes that TACOM desire[s] "Run Flat" tyres--reference SOW
     "Attachment 1 Para 8 Wheels and Tyres Pg 2/3."--the offeror offers Good
     Year Run Flat tyres and attached full technical details in the Manual
     Annex to Volume 1. However please note it is NOT possible to have Radial
     Run Flats with ATV technology. Goodyear has verified this. We offer
     TACOM a choice at no extra cost either Run Flat or a Radial Good Year
     equivalent that is not run flat.

   CKP Proposal, at 51.

   In our view, the agency's decision to accept run flat tires has not, in
   any way, prejudiced CKP. Even if we conclude that the awardee's proposal
   of a run flat tire deviated from the specifications and represented a
   relaxation of the specifications, our Office will not sustain a protest
   without evidence of prejudice to the protester; that is, unless the
   protester demonstrates that, but for the agency's actions, it would have
   had a substantial chance of receiving the award. McDonald-Bradley,
   B-270126, Feb. 8, 1996, 96-1 CPD para. 54 at 3; Statistica, Inc. v.
   Christopher, 102 F.3d 1577, 1581 (Fed. Cir. 1996).

   In a situation like here, the question becomes how would the protester
   have altered its proposal to its competitive advantage had it been given
   the opportunity to respond to an altered requirement. See Warren Elect.
   Constr. Corp., B-236173, B-236173.4, B-236173.5, July 16, 1990, 90-2 CPD
   para. 34 at 9. The record shows that CKP understood that the agency
   desired a run flat tire, offered to provide the agency a run flat tire at
   its proposed price, and cannot claim to have been injured by the agency's
   decision to accept a run flat tire, rather than the radial tire that the
   solicitation required. Moreover, there is no debate here that the run flat
   tire offered by both CKP and Polaris--and accepted by the agency--is
   considered the more desirable tire and the more expensive one. Simply put,
   CKP seeks now to use the solicitation's patent ambiguity to bar Polaris
   from award on the basis that Polaris did not think to offer, as an
   alternative, a radial tire that all understood was less desirable. Since
   there is no indication on this record that CKP could have altered its
   approach with respect to the tire requirement, we think CKP has not been
   prejudiced. Id.

   The protest is denied.

   Gary L. Kepplinger
   General Counsel