TITLE: B-310155, SAGE Systems Technologies, LLC, November 29, 2007
BNUMBER: B-310155
DATE: November 29, 2007
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B-310155, SAGE Systems Technologies, LLC, November 29, 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: SAGE Systems Technologies, LLC

   File: B-310155

   Date: November 29, 2007

   William K. Walker, Esq., Walker Reausaw, for the protester.

   Ralph G. Bittelari, Esq., Department of Justice, for the agency.

   Nora K. Adkins, Esq., and James Spangenberg, Esq., Office of the General
   Counsel, GAO, participated in the preparation of the decision.

   DIGEST

   The agency properly accepted the awardee's proposal that employed a
   particular labor category to perform service contract work, where it did
   not violate any solicitation provisions; contention that the use of the
   proposed labor category would violate the Service Contract Act will not be
   considered by GAO because it is a matter for consideration by the
   Department of Labor.

   DECISION

   SAGE Systems Technologies, LLC, protests the award of a contract to
   Drayton, Drayton, and Lamar (DD&L) by the Bureau of Alcohol, Tobacco,
   Firearms and Explosives (ATF), Department of Justice, under request for
   proposals (RFP) No. BATF-0703, for data entry support services.

   We deny the protest.

   The RFP, issued as a competitive section 8(a) set-aside, contemplated the
   award of a contract to support, at three locations, the ATF's Firearms and
   Explosive Services Division's Enforcement Programs and Services database,
   which contains information pertaining to the manufacturing, dealing, and
   importing of ammunition, implements of war, explosives, and firearms. The
   RFP's statement of work identified such typical contract tasks as
   screening forms and documents; entering and retrieving data; processing
   hard and soft mail; monitoring and controlling facsimile communications;
   photocopying; operating and monitoring various office machines; updating
   and printing reports; and coordinating, assembling and mailing packages
   required under the contract. The offerors were informed through the RFP's
   amendments and answers to offeror's questions that the ATF expected to
   maintain the current staffing levels at each location, a total of
   37 employees, although it was "not limiting the solicitation to the
   current staffing situation" and that offerors could "identify [any] labor
   category needed as documented in the wage determination." RFP amend. 6 at
   1; RFP amend 7 at 1.

   The RPF incorporated the contract clause at Federal Acquisition Regulation
   (FAR) sect. 52.222-41, "Service Contract Act [SCA] of 1965, as Amended"
   RFP sect. I.9. The solicitation also incorporated the clause at FAR sect.
   52.222-42, "Statement of Equivalent Rates for Federal Hires" as follows:

     In compliance with the [SCA], and the regulations of the Secretary of
     Labor (29 CFR Part 4), this clause identifies the classes of employees
     expected to be employed under the contract . . .

     This Statement is for Information Only: It is not a Wage Determination.

          Employee Class           Monetary Wage/Fringe Benefit     
     Computer Operator 2                      $17.47                
     Data Entry Operator 1                    $11.02                
     General Clerk 1                          $12.83                
     General Clerk 2                          $14.20                

   RFP sect. I.10. The RFP also included wage determinations applicable to
   the three contract locations that established the minimum applicable SCA
   wages and benefits.

   Proposals were to be evaluated based on four criteria listed in descending
   order of importance: past performance, technical/management approach,
   qualifications of key personnel, and price. Price was to be evaluated for
   reasonableness by comparing the offerors' proposed prices with the
   proposed prices of other offerors competing for the requirement. RFP sect.
   M-3.

   The ATF received 34 proposals in response to the solicitation. Eight
   proposals were included in the competitive range. The ATF determined that
   the awardee's and protester's proposals were the highest rated and were
   technically equal, which made price the deciding factor between these two
   offerors. DD&L's price for the base year and 4 option years was
   $9,032,959, while SAGE's price was $10,871,513. The ATF determined DD&L's
   lower-priced proposal was the best value, and made award to that firm.
   This protest followed.

   SAGE argues that the agency did not perform an adequate "cost realism
   analysis," because DD&L's proposed use of the Data Entry Operator labor
   category to fulfill a majority of the 37 required positions, instead of
   the General Clerk labor category that SAGE proposed, did not meet the
   RFP's labor requirements to perform the tasks as set out in the
   solicitation's statement of work, and that DD&L's proposed labor
   categories violate the SCA. In this regard, SAGE references the SCA
   Directory of Occupations, issued by the Department of Labor, which SAGE
   argues by definition directs the use the General Clerk category at a
   minimum to fulfill the SOW requirements. SAGE's argument here is that by
   not ensuring that DD&L was using the proper labor categories, the ATF
   improperly waived a solicitation requirement resulting in an unfair
   competitive advantage for the awardee.

   We first note that there was no requirement here for a cost or price
   realism analysis, inasmuch as this is a fixed-price contract and the RFP
   did not provide for such an analysis to ascertain whether the offered
   price was unrealistically low. Indtai, Inc., B-298432.3, Jan. 17, 2007,
   2007 CPD para. 13 at 4. Instead, in accordance with the RFP and applicable
   regulations, the ATF compared DD&L's offered prices to those of the other
   offerors, and reasonably concluded, consistent with the RFP, that DD&L's
   total offered price was fair and reasonable, that is, that it was not
   unreasonably high. RFP sect. M.3; FAR sect. 15.404-1(b) (an agency's
   comparison of prices received in response to a solicitation is a fair and
   reasonable price analysis technique).

   With regard to the remainder of the protest, as noted by the ATF, nothing
   in the solicitation required the offerors to use only the General Clerk
   labor category to fulfill the statement of work requirements. To the
   contrary, as the ATF points out, the solicitation identified, albeit for
   informational purposes only, both the Data Entry Operator and General
   Clerk labor categories as ones "expected" to be used under the contract,
   and explicitly allowed offerors to make their own determination as to what
   combination of employee classifications could best perform the required
   services.[1] RFP sect. I.10; RFP amend. 6, at 1. The ATF reviewed and had
   exchanges with DD&L regarding its proposed labor categories, and found
   that they would satisfy the RFP requirements. Contracting Officer's
   Statement at 2. Based on our review of the record, which does not show
   that DD&L violated any solicitation requirement and evidences a reasonable
   evaluation by the agency of this aspect of DD&L's proposal, we find no
   impropriety in the agency's evaluation of DD&L's proposed labor
   categories. See Computer Cite, B-297291, B-297291.2, Dec. 23, 2005,
   2006 CPD para. 31 at 5; Taft Broad. Corp., B-222818, July 29, 1986, 86-2
   CPD para. 125 at 5.

   At the heart of SAGE's protest is its assertion that DD&L's proposed labor
   categories will result in a violation of the SCA. The determination of
   prevailing wages and fringe benefits, and the issuance of appropriate wage
   determinations under the Service Contract Act, 41 U.S.C. sections 351 et
   seq. are matters for the Department of Labor. Concerns with regard to
   establishing proper wage rate determinations or the application of the
   statutory requirements should be raised with the Wage and Hour Division in
   the Department of Labor, the agency that is statutorily charged with the
   implementation of the Act. See 41 U.S.C. sect. 353(a); 40 U.S.C. sect.
   276a; The Forestry Ass'n, Inc., B-236240, Sept. 28, 1989, 89-2 CPD para.
   294.

   Thus, our Office will not consider this protest contention as this is a
   matter for consideration by Department of Labor.

   The protest is denied.

   Gary L. Kepplinger
   General Counsel

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   [1] The ATF points out that SAGE was the only competitive range offeror
   that did not include the Data Entry Operator labor category in its
   proposal.