TITLE: B-311310, Rhonda Podojil--Agency Tender Official, May 9, 2008
BNUMBER: B-311310
DATE: May 9, 2008
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B-311310, Rhonda Podojil--Agency Tender Official, May 9, 2008

   Decision

   Matter of: Rhonda Podojil--Agency Tender Official

   File: B-311310

   Date: May 9, 2008

   LTC Daniel G. Jordan, and Randall J. Vance, Esq., Department of the Army,
   for the protester.
   Thomas J. Madden, Esq., Terry L. Elling, Esq., and Sharon A. Jenks, Esq.,
   Venable LLP, for Sodexho Management, Inc., the intervenor.
   Scott N. Flesch, Esq., Department of the Army, 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

   Protest by agency tender official (ATO) challenging result of competition
   conducted pursuant to OMB Circular A-76 is dismissed as untimely where the
   ATO filed the protest more than 10 days after the ATO knew or should have
   known the basis of protest. While debriefing exception to timeliness rules
   applies to A-76 competitions conducted on the basis of competitive
   proposals, protest nevertheless is untimely because the ATO did not timely
   request a debriefing--a predicate to invoking the exception.

   DECISION

   Rhonda Podojil, the agency tender official (ATO) for the U.S. Army Medical
   Command tender in a public-private competition under Office of Management
   and Budget (OMB) Circular A-76, protests the Army's decision to procure
   nutrition care services at 10 military treatment facilities in the United
   States through a contract awarded to Sodexho Management, Inc. under
   request for proposals (RFP) No. W81K04-07-R-0016, rather than continuing
   to have those services performed in-house by government employees.[1] On
   behalf of the employees, the ATO argues that through discussions, the
   contracting officer led the protester to increase its staffing to a level
   beyond that required by the RFP, which in turn caused the protester to
   increase its price to its competitive prejudice.

   We dismiss the protest as untimely.

   On September 15, 2006, the U.S. Army Medical Command, Center for Health
   Care Contracting, published an announcement on the Federal Business
   Opportunities (FedBizOpps) website, publicizing the Army's intent to
   conduct a standard competition[2] to compare the cost of continued
   in-house performance of the requirements at issue with obtaining those
   services by contract. On June 22, 2007, the agency issued the RFP, which
   provided for a "lowest-priced, technically acceptable" selection process.
   By the RFP closing time, the agency received four private-sector
   proposals, including a proposal from Sodexho, as well as the agency
   tender, which was submitted by the ATO.[3]

   The Army performed an initial evaluation of the agency tender and found
   its proposed approach to be technically unacceptable. Through written
   discussions with the ATO dated October 9, the agency raised its concerns
   regarding the agency tender's proposed approach. After receiving a revised
   technical proposal, the Army reassessed the agency tender's technical
   proposal, again found it to be technically unacceptable, and again raised
   its concerns with the protester in "face-to-face" discussions in early
   December. In response, the protester then submitted a second revised
   technical proposal for the agency tender, which the Army evaluated as
   technically acceptable. In a letter dated January 14, 2008, the agency
   notified the protester that the technical proposal of the agency tender
   had been evaluated as acceptable, but asked the protester to address
   certain errors in the agency tender's pricing proposal, update the pricing
   to reflect newly issued 2008 General Schedule pay information, and submit
   a final revised proposal. Thereafter, the protester submitted a final
   proposal revision for the agency tender in the amount of $70,403,570.
   Consistent with advice from the agency in the January 14 letter, the
   protester did not revise the technical proposal of the agency tender since
   it had been evaluated as acceptable by the agency.

   On February 12, utilizing the OMB A-76 COMPARE software, the Army compared
   the cost of in-house performance (based on the technically acceptable
   agency tender) with the cost of private-sector performance (based on the
   price proposed by Sodexho, which had submitted the lowest-priced
   technically acceptable private- sector proposal). The software adjusts the
   cost of in-house performance and the private-sector price to include, for
   example, the addition of a "conversion differential" to the private-sector
   price, calculated as the lesser of 10 percent of the MEO's
   personnel-related costs or $10 million. OMB Cir. A-76, Attach. B para.
   D.5.a(4)(c). Sodexho's price as adjusted by the COMPARE software was
   determined to be $4,739,463 less than the protester's cost of $70,403,570.
   The ATO was present when the Army conducted this comparison and was
   provided a copy of the cost comparison form indicating that the agency
   tender had lost the competition based on price. The ATO indicates that she
   then "informally" spoke with the contracting officer and his counsel. As a
   consequence of this conversation, she states that she understood that, as
   the ATO, she was entitled to a debriefing within 10 days of the selection
   decision. Later that morning, via a video teleconference, the Army
   announced the results of the cost comparison to the affected in-house
   federal employees. Also that day, the agency published the results of the
   A-76 competition on FedBizOpps. On February 19, 7 days later, the ATO
   wrote to the contracting officer to schedule a debriefing. The Army
   provided the ATO with a debriefing on February 21 and the ATO filed this
   protest on March 3.

   Our Bid Protest Regulations contain strict rules for the timely submission
   of protests. These timeliness rules reflect the dual requirements of
   giving parties a fair opportunity to present their cases and resolving
   protests expeditiously without disrupting or delaying the procurement
   process. Professional Rehab. Consultants, Inc., B-275871, Feb. 28, 1997,
   97-1 CPD para. 94 at 2. Under these rules, a protest such as the ATO's,
   based on other than alleged improprieties in a solicitation, must be filed
   not later than 10 days after the protester knew or should have known of
   the basis for protest, whichever is earlier. 4 C.F.R. sect. 21.2(a)(2)
   (2007). An exception to this general rule is a protest that challenges "a
   procurement conducted on the basis of competitive proposals under which a
   debriefing is requested and, when requested, is required." Id. In such
   cases, with respect to any protest basis which is known or should have
   been known either before or as a result of the debriefing, the protest
   must be filed not later than 10 days after the date on which the
   debriefing is held. The MIL Corp., B-297508, B-297508.2, Jan. 26, 2006,
   2006 CPD para. 34 at 5.

   In addressing the timeliness of the ATO's protest, we first turn to the
   question of when the ATO knew or should have known the basis for protest.
   In this regard, the ATO argues that in evaluating the technical proposal
   of the agency tender, the Army deviated from the RFP's evaluation factors
   and subfactors, which established the requirements of acceptability.
   Specifically, the protester alleges that during discussions, the Army made
   clear that, in order to be found technically acceptable, the agency tender
   was required to increase its staffing to meet performance standards
   exceeding those set forth in the RFP. The ATO generally alleges that the
   increase in costs associated with meeting these higher standards resulted
   in the agency tender having a higher adjusted price than that of Sodexho's
   proposal. Protest at 1, 3.

   Since the allegedly higher standards were conveyed by the Army through
   discussions, the ATO knew or should have known that the Army's imposition
   of allegedly higher standards had a prejudicial effect when she learned
   the results of the cost comparison on February 12, indicating that Sodexho
   had prevailed based on price. The protest, however, was not filed until
   March 3, more than 10 days after February 12. Therefore, in order for the
   ATO's protest to be timely, it must fall within the debriefing exception
   noted above.

   As stated previously, this exception applies only where the debriefing
   provided is in connection with "a procurement conducted on the basis of
   competitive proposals under which a debriefing is requested and, when
   requested, is required." 4 C.F.R. sect. 21.2(a)(2). In addressing this
   question, we note that the term "competitive proposals" is not defined by
   our Bid Protest Regulations, nor by statute or regulation. See Systems
   Plus, Inc. v. United States, 68 Fed. Cl. 206 (2005); The MIL Corp., supra,
   at 6. However, we have previously determined that the use of negotiated
   procedures in accordance with Federal Acquisition Regulation (FAR) Part 15
   and as evidenced by the issuance of an RFP, constitutes a procurement
   conducted on the basis of competitive proposals for purposes of this
   exception to our timeliness rules. The MIL Corp., supra; Professional
   Rehab. Consultants, Inc., supra.

   Here, consistent with the A-76 competition process, the Army expressly
   incorporated and used FAR Part 15 procedures as the framework for the A-76
   competition.[4] In this regard, pursuant to the competition process
   established by the Circular, the Army issued a solicitation seeking
   "proposals" (the RFP), which provided for a lowest-priced, technically
   acceptable source selection in accordance with FAR sect. 15.101-2. The
   Army held discussions with the protester and private-sector offerors in
   accordance with FAR sect. 15.306, which resulted in revisions to the
   agency tender and private-sector proposals consistent with FAR sect.
   15.307, and after announcing the results of the cost comparison,
   consistent with FAR Part 15, the Army provided the protester and Sodexho,
   at their request, with debriefings. As a consequence, we conclude that the
   A-76 competition here was conducted on the basis of "competitive
   proposals."

   The next question is whether the debriefing was a "required" debriefing
   for the purpose of applying our timeliness rules. In this regard, when a
   contract is awarded on the basis of "competitive proposals," 10 U.S.C.
   sect. 2305(b)(5)(A), implemented through FAR sect. 15.506(a)(1), provides
   that "an unsuccessful offeror, upon written request received by the agency
   within 3 days after the date on which the unsuccessful offeror receives
   the notification of the contract award, shall be debriefed and furnished
   the basis for the selection decision and contract award." The agency and
   intervenor argue that the debriefing which the contracting officer
   provided the ATO here was not a "required" debriefing for several reasons.
   Both point to the fact that the Circular does not reference the type of
   required debriefing contemplated by FAR sect. 15.506, but merely requires
   agencies to offer a debriefing "in accordance with FAR sect. 15.503,"
   which pertains solely to award notice requirements for unsuccessful
   offerors. OMB Cir. A-76, Attach. B para. D.6.d; FAR sect. 15.503
   Notifications to Unsuccessful Offerors. The intervenor further argues that
   the ATO's debriefing was not required because such debriefings are limited
   to "offerors," and the ATO is not an "offeror." In support of this
   contention, the intervenor notes that the ATO cannot be an offeror, since
   if the agency tender were to prevail in the competition, it would not
   result in the award of a contract, citing our decision in Dan Duefrene et
   al., B-293590.2 et al., Apr. 19, 2004, 2004 CPD para. 82 at 5. The
   intervenor and the agency further argue that, even if the possibility of a
   required debriefing existed, the debriefing provided to the ATO would not
   qualify, since it was not timely requested.

   In addressing the specific question of whether the debriefing at issue was
   a required debriefing for the purpose of establishing timeliness, we first
   address the general assertion by the agency and the intervenor that
   debriefings are not required in the context of an A-76 competition. We
   reject this contention for the simple reason that the statutory debriefing
   requirements established by 10 U.S.C. sect. 2305(b) and FAR Part 15 hinge
   on whether an agency is making an award on the basis of "competitive
   proposals." Where an agency makes its selection decision under an A-76
   competition on the basis of "competitive proposals," as in this case, we
   think that the statutory and regulatory debriefing scheme is invoked,
   notwithstanding the more limited debriefing guidance set forth in the
   Circular.[5]

   Turning to the question of whether the public-sector competitor in an A-76
   competition can rely on the debriefing exception to our timeliness rules
   for the purpose of establishing the timeliness of its protest at our
   Office despite the fact that it is not technically an "offeror," we note
   that the standing of the public-sector competitor to protest
   public-private competitions conducted pursuant to A-76 has a lengthy
   history. In addressing the various issues in this regard, GAO has
   consistently recognized the importance of establishing, in the conduct of
   A-76 competitions, a level playing field between public and private-sector
   competitors, a principle unanimously agreed to by the
   Congressionally-chartered Commercial Activities Panel. Commercial
   Activities Panel, Final Report: Improving the Sourcing Decisions of the
   Government (Apr. 2002) at 10 (stating "[t]he Panel believes that in order
   to promote a more level playing field on which to conduct public-private
   competitions, the government needs to shift . . . to a FAR-type process
   under which all parties compete under the same set of rules").

   Consistent with this principal, it is our intent to apply our timeliness
   rules to public- and private-sector protesters of A-76 competitions in an
   even-handed manner. As a consequence, where an agency conducts an A-76
   competition on the basis of competitive proposals, as in this case,
   thereby triggering the debriefing requirements established by statute and
   the FAR, we will interpret those provisions as applying equally to
   public-sector competitors for the purpose of invoking the debriefing
   exception to our timeliness rules.

   For the same reason, however, when protesting the results of an A-76
   competition, in order to fall within the debriefing exception to our
   timeliness rules, a public-sector competitor, like its private-sector
   counterpart, will be held to compliance with the rules necessary to
   establish its debriefing as a "required" debriefing. As noted above, a
   debriefing is only required where it is timely requested--within 3 days of
   receiving notice of the award decision. In this case, the ATO's written
   request for the debriefing was made 7 days after receiving notice of the
   award decision. We therefore conclude that, by its terms, the debriefing
   exception does not apply. Absent application of the debriefing exception,
   the ATO was required to file its protest within 10 days of when it knew or
   should have known its basis of protest; because the protest was filed more
   than 10 days later, it is untimely.

   The protest is dismissed.

   Gary L. Kepplinger
   General Counsel

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

   [1] The 10 military treatment facilities are located at Forts Eustis,
   Gordon, Irwin, Jackson, Knox, Leonard Wood, Riley, Sill, and Stewart, and
   the U.S. Military Academy at West Point.

   [2] The Circular establishes the standard competition procedures at
   Attachment B, Section D. Under this process, the agency issues a
   solicitation, obtains offers from private-sector firms and an agency
   tender (which includes a staffing plan--referred to by the Circular as a
   most efficient organization (MEO)), performs a source selection, and then,
   based on the results of the competition, either makes an award to a
   private-sector offeror or enters into a letter of obligation with an
   agency official responsible for performance of the MEO.

   [3] Under the A-76 process, the agency tender does not directly compete
   against Sodexho's proposal until the final cost comparison stage of the
   study process. Nevertheless, the agency tender was required to include a
   technical proposal identifying its approach to accomplishing the agency's
   requirements as established by the RFP, and the Army evaluated the agency
   tender concurrently with the private sector proposals.

   [4] Throughout, the Circular directs agencies to follow the procedures
   established under FAR Part 15. See, e.g., OMB Cir. A-76, Attach. B, paras.
   A.8.e, D.2.c, D.3.a(2), D.4.a(3), D.5.b(1), D.5.b(2), D.5.b(3), D.5.c(2),
   D.5.c(4), D.6.c, D.6.d, and Attach. D, at D-7.

   [5] We question whether the Circular's reference to the award notice
   requirements of FAR sect. 15.503 in connection with debriefings under the
   Circular may in fact have been a drafting error. Preceding its discussion
   of debriefings, the Circular expressly requires agencies to announce the
   results of a competition conducted using competitive proposals through
   FedBizOpps, providing the limited information required under FAR sect.
   15.503(b). It would seem redundant to then have agencies offer debriefings
   to A-76 competitors which provide them only with the same information the
   agency had previously posted on FedBizOpps.