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Introduction
General Counsel, P.C.'s Government Contracts Practice Group is pleased to provide you with the Bid Protest Weekly. Researched, written and distributed by the attorneys of General Counsel, P.C., the Bid Protest Weekly allows the Government Contract community to stay on top of the latest developments involving bid protests by providing weekly summaries of recent bid protest decisions, highlighting key areas of law, agencies, and analyses of the protest process in general.
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1. Re-Engineered Business Solutions, Inc.-- Costs, B-404214.4, July 14, 2011
Link: GAO Opinion
Agency: U.S. Army Corps of Engineers
Disposition: Request denied.
Keywords: Payment of Attorney's Fees
General Counsel P.C. Highlight: When a procuring agency takes corrective action in response to a protest, GAO may recommend reimbursement of protest costs, including reasonable attorneys' fees, if GAO determines that the agency unduly delayed taking corrective action in the face of a clearly meritorious protest
Re-Engineered Business Solutions, Inc. (RBS) requests that a recommendation that the U.S. Army Corps of Engineers reimburse its costs of filing and pursuing its protests of the award of a contract, under a request for proposals (RFP), for the operation, maintenance, and repair of flood control facilities at various locations in Mississippi.
The RFP, issued as a section 8(a) set-aside, provided for the award of a cost‑plus‑fixed-fee contract for the operation, maintenance, and repair of flood control facilities in Mississippi for a base year and four option years. Offerors were informed that award would be made on a best value basis, considering technical, past performance, and cost evaluation factors.
RBS protested to GAO after award was made to another offeror, arguing that the Corps departed from the evaluation scheme required by the RFP, conducted an improper cost/technical trade‑off, conducted a flawed cost realism analysis, and should have selected RBS's higher-priced offer because it received higher ratings under the technical capability and past performance evaluation factors than the awardee. RBS also filed a supplemental protest arguing that the Corps improperly assigned it weaknesses for not providing cost information for small tools and providing an outdated letter of credit. The Corps notified GAO that it would take corrective action by reevaluating proposals and the protest was dismissed. After reevaluating proposals, the Corps again awarded the contract to the original awardee, and RBS again protested the agency's evaluation of its proposal, basically raising the same arguments as it raised in its initial protest. The Corps again notified GAO that it was taking corrective action and the protest was dismissed.
RBS requests that GAO recommend that the agency reimburse its costs of filing and pursuing its protests. GAO states that when a procuring agency takes corrective action in response to a protest, GAO may recommend reimbursement of protest costs, including reasonable attorneys' fees, if, based on the circumstances of the case, it determines that the agency unduly delayed taking corrective action in the face of a clearly meritorious protest, thereby causing the protester to expend unnecessary time and resources to make further use of the protest process in order to obtain relief. Thus, as a prerequisite to recommending the reimbursement of costs where a protest has been settled by corrective action, not only must the protest have been meritorious, but it also must have been clearly meritorious. A protest is clearly meritorious where a reasonable agency inquiry into the protester's allegations would reveal facts showing the absence of a defensible legal position. GAO has recognized, however, that the mere promise of corrective action, without reasonably prompt implementation, has the obvious effect of circumventing the goal of the bid protest system for the economic and expeditious resolution of bid protests. Thus, where an agency fails to implement the promised corrective action, or implements corrective action that fails to address a clearly meritorious issue raised in an initial protest, such that the protester is put to the expense of subsequently protesting the very same procurement deficiency, the agency's action has precluded the timely, economical resolution of the protest.
Here, there is no basis to conclude that the agency has unduly delayed taking corrective action in response to a clearly meritorious protest. In response to the first protest, the agency promptly indicated that it would take corrective action. To the extent that the protester maintains that it is entitled to reimbursement of its costs for filing the second protest because the Corps failed to implement its promised corrective action, the record does not establish that RBS's protests were clearly meritorious. Even where a protester alleges that an agency failed to timely implement promised corrective action, GAO's recommendation that an agency reimburse a protester its protest costs must be based upon a showing that a procurement statute or regulation has been violated. The mere fact that an agency decides to take corrective action does not establish that a statute or regulation clearly has been violated. The Corps took corrective action in response to the protests prior to submitting its reports, and thus GAO has not been provided with a record of the agency's evaluation and selection decision. Further record development would be necessary to determine whether any of RBS's protest grounds had merit. The request for entitlement to protest costs is denied.
2. Ahtna Facility Services, Inc., B-404913; B-404913.2, June 30, 2011
Link: GAO Opinion
Agency: Department of the Army
Disposition: Protest denied.
Keywords: Discussions
General Counsel P.C. Highlight: In order to satisfy its obligation to conduct meaningful discussions, an agency must lead offerors into the areas of their proposals that reflect deficiencies or significant weaknesses
Ahtna Facility Services, Inc. (AFSI) protests the Department of the Army's exclusion of AFSI's proposal from the competitive range under a request for proposals (RFP) to provide healthcare environmental services for the San Antonio Military Medical Center-North (SAMMC-N) and other medical facilities at or around Fort Sam Houston, Texas.
The solicitation contemplated award of an indefinite-delivery, indefinite-quantity (ID/IQ) contract under which fixed-price task orders will be issued to perform various services, including: housekeeping services; collection and distribution of linens; collection, consolidation, packaging, labeling, and preparation of regulated medical waste; collection of general solid waste; collection and transport of recyclable materials; and exterior building services, such as window cleaning and snow removal. The solicitation provided that the agency would use "the Lowest Price, Technically Acceptable (LPTA) source selection technique" and, consistent with this approach, established two evaluation factors: technical acceptability and price.
Proposals were submitted by several offerors, including AFSI. The agency subsequently evaluated AFSI's initial proposal as technically unacceptable, identifying 19 deficiencies, 4 significant weaknesses, and 8 weaknesses. Despite the multiple flaws in AFSI's initial proposal, the agency retained AFSI's proposal in the competitive range and, by letter, opened discussions with AFSI, specifically outlining the various evaluated proposal deficiencies and significant weaknesses. Among other things, the agency's letter expressly advised AFSI that its procedures manual was deficient in that it "did not include the seven (7) types of services [identified in the PWS]," "failed to include performance standards," and "failed to include meaningful and measurable performance metrics." Thereafter, the agency evaluated the revised proposal and concluded that AFSI had resolved some of the multiple proposal flaws, but that many remained. Based on the existence of the ongoing deficiencies in AFSI's revised proposal, the agency determined that the proposal remained technically unacceptable and excluded it from the competitive range.
AFSI first asserts that its proposal "provided all of the information required by the [s]olicitation and the PWS" and that, "[h]ad the agency properly and fairly evaluated AFSI's [revised proposal], the proposal would have been deemed acceptable." GAO states that agencies are required to evaluate offers in accordance with a solicitation's stated requirements and evaluation criteria. Where a dispute exists as to the actual requirements of a solicitation, GAO will first examine the plain language of the solicitation.
Under the heading "Technical Acceptability," the solicitation expressly directed offerors to "[p]rovide a Procedures Manual or equivalent that includes all of the elements in the PWS." Based on the record, GAO finds no merit in AFSI's assertion that the agency's assessment of a deficiency was improper because the solicitation "did not require" AFSI's procedures manual to individually address the procedures to be employed for the seven types of required services. To the contrary, upon review of the solicitation provisions discussed GAO determined that AFSI's obligations were clearly stated. Accordingly, AFSI's assertion that the solicitation "did not require" AFSI to address each required PWS service is without merit.
AFSI asserts that the agency failed to conduct meaningful discussions with AFSI with regard to the solicitation requirements to provide performance standards and metrics. GAO states that when discussions are conducted, they must be meaningful. In order to satisfy its obligation to conduct meaningful discussions, an agency must lead offerors into the areas of their proposals that reflect deficiencies or significant weaknesses; that is, an agency must identify aspects of an offeror's proposal that, unless further addressed, would prevent the offeror from having a reasonable chance for award.
Here, the record shows that the agency's discussions specifically reminded AFSI that its proposal would be evaluated to determine whether the required services "will be consistently performed in a standardized method with established performance standards and performance metrics." Further, the agency told AFSI that its initial proposal "failed to include performance standards aligned with Association for Healthcare Environment (AHE) and in compliance with SAMMC-N Pam[phlet] 40‑2, Infection Control Manual, to meet the PWS requirements." Finally, the agency also specifically advised AFSI that its proposal "failed to include meaningful and measureable performance metrics that meet or exceed the AHE Practice Guidance for Healthcare Environmental Cleaning standards as required in PWS 1.7.2.1." On this record GAO finds no reasonable basis for AFSI to assert that it was confused and/or reasonably believed that its submission of quality control procedures was adequate to meet the solicitation's requirements to submit performance standards and metrics to measure the acceptability of contract performance. AFSI's assertion that it was reasonably misled by the agency's discussions in this regard, or that the discussions were otherwise inadequate, is without merit. The protest is denied.
3. SHG National, LLC, B-404613.3, July 20, 2011
Link: GAO Opinion
Agency: Department of the Army
Disposition: Protest denied.
Keywords: Proposal Evaluation
General Counsel P.C. Highlight: While GAO has recognized that such judgments are often subjective by nature, the exercise of these judgments in the evaluation of proposals must be documented in sufficient detail to show that they are not arbitrary.
SHG National, LLC, (SHG) protests the award of a contract under a request for proposals (RFP) issued by the Department of the Army, for lodging, meals, and transportation services.
The RFP provided for the award of a fixed-price requirements contract. A detailed performance work statement (PWS) was provided, describing the contract requirements. Offerors were informed that the agency estimated that an average of 53, and a maximum of 165, applicants would require daily meals, lodging and transportation services. In this regard, the PWS advised offerors that the actual number of applicants might exceed the agency's estimates and that the contractor was responsible for ensuring that a sufficient number of rooms were available to fulfill the daily requirements of the contract. The RFP provided that award would be made on a best value basis considering the following factors: mission capability, past performance, and price. Offerors were advised that the agency would conduct an on-site evaluation, and that past performance would be separately evaluated and assessed a performance risk rating.
The awardee received a higher rating under the mission capability factor and reflected the SSEB's assessment that the awardee's proposal presented nine strengths, three of which were significant, and one weakness under that factor. Specifically, the SSEB identified three significant strengths with regard to the organization and appearance of the awardee's hotel kitchen, and the hotel's security coverage, as well as five strengths with regard to the hotel's lobby and décor; room furnishings, amenities, and public address system; check-in location; 100 security cameras; and close proximity to the processing station.
SHG complains that its proposal should have been rated excellent under the mission capability factor and contends that the agency used unstated evaluation criteria. The protester argues that its proposal met, or exceeded, the RFP's minimum requirements for the number of hotel rooms, kitchens, security, lobby, and check-in areas. SHG also maintains that the agency evaluated proposals unequally by overvaluing features of the awardee's proposed hotel but undervaluing similar features of SHG's proposed hotel. GAO states that in reviewing protests against allegedly improper evaluations, GAO examines the record to determine whether the agency's judgment was reasonable and in accord with the evaluation factors set forth in the RFP, and whether the agency treated offerors equally in evaluating their respective proposals. While GAO has recognized that such judgments are often subjective by nature, the exercise of these judgments in the evaluation of proposals must be documented in sufficient detail to show that they are not arbitrary. Where a protester challenges the agency's evaluation and source selection, GAO will review the evaluation and award decision to determine if they were reasonable, consistent with the solicitation's evaluation scheme, as well as procurement statutes and regulations, and adequately documented.
GAO finds, based on a review of the record, that the agency's well-documented evaluation of SHG's proposal was reasonable and consistent with the RFP's stated evaluation criteria. In this respect, the RFP identified several elements under the mission capability factor, including hotel sanitation; cleanliness; condition; quality control; maintenance, number of rooms; security features; check-in areas; dining capacity; and distance from the processing station and transportation centers. The record shows that the agency found, and extensively documented, numerous qualitative differences in this regard between the protester's and the awardee's proposed hotels. The record does not support the protester's assertion that the agency evaluated proposal disparately or used undisclosed evaluation criteria.
Insofar as SHG suggests that the agency should not have considered the appearance of the awardee's proposed hotel kitchen, or SHG's atrium style hotel lobby, the RFP clearly advised offerors that the agency would evaluate all aspects of their proposed hotels. Moreover, GAO believes that the agency's consideration of the appearance of the hotel kitchen's or the lobby's design are logically encompassed by, or related to, the consideration of the hotels' condition, sanitation, cleanliness, maintenance, quality control, check-in area, and safety features. The record does not support SHG's assertion that its kitchen should have been evaluated as a significant strength because it allegedly met the RFP's only "measurable" health requirements. In contrast, the awardee's kitchen was found to be "well organized" and "spotless," indicating "a well managed immaculate operation."
The protester also objects to the agency's selection decision, arguing that price was the most important evaluation factor under the RFP, and points out that SHG proposed a lower price than the awardee. The RFP explicitly stated that the two non-price factors (mission capability and past performance), when combined, were significantly more important than price. Although SHG believes that it should have been awarded the contract based on its lower-priced offer, the record shows that the agency performed a reasonable price/technical trade-off. The protest is denied.
4. D'Andre Insurance Services, LLC, B-405046, July 21, 2011
Link: GAO Opinion
Agency: Department of the Interior
Disposition: Protest denied.
Keywords: Bias and Bad Faith in Evaluation
General Counsel P.C. Highlight: Government officials are presumed to act in good faith, and a protester's contention that contracting officials are motivated by bias or bad faith must be supported by convincing proof. GAO will not attribute unfair or prejudicial motives to procurement officials on the basis of inference or supposition.
D'Andre Insurance Services, LLC (DIS) protests the issuance of a purchase order, under a request for quotations (RFQ), issued by the Department of the Interior, for professional services for the Risk Management Agency (RMA), U.S. Department of Agriculture.
The RFQ, issued as a combined synopsis/solicitation under the streamlined commercial item acquisition procedures of Federal Acquisition Regulation (FAR) Parts 12.6 and 13, provides for the issuance of a fixed-price purchase order for the evaluation of, and recommended improvements for, the Nursery Crop Insurance Program, which is administered by RMA, and recommendations for alternative designs for providing insurance for nursery crops. A detailed statement of work (SOW) was provided. Vendors were informed that the purchase order would be issued on a best value basis considering the following factors: technical approach, project management, past performance, and price.
The protester's unacceptable rating under the technical approach factor reflected the evaluators' judgment that DIS failed to demonstrate knowledge of how the nursery crop insurance program currently works and that the protester's quotation contained a deficiency and numerous weaknesses. The agency found that the protester's quotation was deficient with respect to addressing how it would conduct the evaluation of the current program, because DIS's only discussion of developing alternatives was with respect to establishing maximum insurable prices for each insurable nursery plant. Among the weaknesses noted was that DIS's approach reflected excessive effort in some regards; for example, DIS indicated it would conduct a week-long kickoff meeting with RMA, but that this was usually accomplished through a 1-2 hour teleconference. As another example, DIS indicated it would have three individuals prepare and attend each listening session, which the evaluators found excessive. Also, the evaluators expressed concern that DIS proposed conducting a review of underwriting after its review of loss adjustment standards, which the evaluators found was not a logical sequence.
DIS broadly challenges its rating under each of the non-price factors, disagreeing with the agency's technical judgments and asserting that the agency's evaluation of its quotation reflected bias and bad faith. GAO states that in reviewing protests challenging an agency's evaluation of quotations, it will not conduct a new evaluation or substitute its judgment for that of the agency; rather it will examine the record to determine whether the agency's judgment was reasonable and consistent with the solicitation's evaluation criteria, and with procurement statutes and regulations. Government officials are presumed to act in good faith, and a protester's contention that contracting officials are motivated by bias or bad faith must be supported by convincing proof. GAO will not attribute unfair or prejudicial motives to procurement officials on the basis of inference or supposition.
Here, the protester's arguments reflect nothing more than disagreement with the agency's judgment as to the merits of the firm's quotation. As noted above, the agency found that the protester's quotation was deficient with respect to addressing how it would conduct the evaluation of the current program, because DIS only discussed alternatives to establishing maximum insurable prices for each insurable nursery plant. DIS disagrees with the assigned deficiency, arguing that developing alternatives can only be done after performing the program evaluation, and that, in any event, its quotation provided a preliminary discussion of developing alternatives. There is no merit to this argument. Vendors were instructed to discuss their approach to performing the SOW evaluation and recommendation requirements, which included, among other things, providing alternative methods for establishing liability on fluctuating nursery inventory, indemnifying nursery producers, and establishing the maximum insurable price.
Similarly, DIS disagrees with the agency's assignment of weaknesses in the firm's quotation. For example, with respect to the agency concern that DIS had proposed excessive effort to perform this work and failed to demonstrate knowledge of the current program, DIS argues that the "resources needed is a professional determination" and that it has experienced insurance professionals, and not "academics or economists." As noted above, arguments such as these that only disagree with the agency's judgment do not demonstrate that the agency unreasonably evaluated the firm's quotation. GAO finds that the agency reasonably rejected the protester's quotation, given that the record supports the agency's determination that the quotation was deficient and contained a number of weaknesses.
DIS also argues that the awardee's quotation should not have been found technically acceptable, because the awardee is comprised of economists and not insurance professionals and horticulturalists. GAO finds no merit to the protester's contention that the awardee's quotation should have been found technically unacceptable. Here, the RFQ provided for the evaluation of the qualifications of vendors' key personnel. The agency found, and in fact assessed as a strength, the qualifications of the awardee's proposed key personnel, who the evaluators found had both a nursery and crop insurance background. DIS has provided nothing to show that the agency's evaluation judgment was unreasonable. In this regard, although DIS argues that a firm must have actuarial credentials to perform the SOW work, it cites to no specific language in the RFQ or SOW to establish that this is so. The protest is denied.
