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1. Network Innovations, Inc., B-404607; B-404607.2, March 8, 2011
Link: GAO Opinion
Agency: Department of the Army
Disposition: Protest denied.
Keywords: Technical Evaluation; Proposals
General Counsel P.C. Highlight: Because an agency's evaluation is dependent on the information provided in a proposal, it is the offeror's responsibility to submit an adequately written proposal for the agency to evaluate.
Network Innovations, Inc. protests the award of a contract under a request for proposals (RFP), issued by the United States Marine Corps, for wireless internet services.
The RFP provided for the award of a fixed-price contract for wireless internet service. A detailed statement of work (SOW) was provided that described the required services and provided performance-based standards. The contractor would be responsible for the design and installation of a system, and for all labor, supervision, and equipment necessary to satisfy the SOW requirements. Among other things, the contractor was required to furnish satellite and wireless network equipment to accommodate the necessary bandwidth at each service location and to offer a "[h]ighly redundant network design." Offerors were also informed that the contractor must provide a network capacity that would support 6,000 concurrent users at one camp, and 1,500 concurrent users each at two other camps, all at a data transmission level of 10 megabits per second (Mbps) per 512 users. The RFP stated that award would be made on a lowest-price, technically acceptable basis
Network, the incumbent, was found unacceptable under the following four subfactors: final solution design, delivery capability, redundancy, and capacity. Network challenges the agency's evaluation of its proposal under each of the four subfactors.
The solicitation informed offerors that, to satisfy the standard for the capacity subfactor, an offeror must detail how it would provide service to 6,000 concurrent users at one camp, and 1,500 concurrent users each at two other camps, all at a data transmission level of 10 Mbps per 512 users. The solicitation further instructed offerors to describe a feasible and reliable way of providing services to the number of users specified in the SOW (that is, the users at each of the three camps). GAO agreed with the Agency that it is not enough just to promise to meet the specification, as the protester did in its proposal. It had to provide detail as to how it would provide a total bandwidth capacity of 177 Mbps for each of the three camps.
GAO also does not agree with Network that it otherwise adequately demonstrated its ability to satisfy the capacity standard by stating in the past performance section of its proposal that Network, as the incumbent contractor, was currently providing internet service to all three camps. Because an agency's evaluation is dependent on the information provided in a proposal, it is the offeror's responsibility to submit an adequately written proposal for the agency to evaluate. Network failed to do so, and GAO finds that the agency reasonably determined that its proposal was unacceptable under this subfactor. The protest is denied.
2. I.M. Systems Group, B-404583; B-404583.2; B-404583.3, February 25, 2011
Link: GAO Opinion
Agency: Department of Commerce
Disposition: Protest sustained.
Keywords: Price/Cost Evaluation; Price/cost realism
General Counsel P.C. Highlight: In the absence of any analysis of the realism of the awardees' discounted rates, GAO cannot find reasonable the agency's conclusion that the awardees' sample task pricing was realistic and reasonable.
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I.M. Systems Group (IMSG) protests the rejection of its proposal and the award of contracts under a request for proposals (RFP), issued by the National Oceanic Atmospheric Administration (NOAA), Department of Commerce, for scientific and technical support services.
The RFP, issued as a small business set-aside, provided for multiple awards of indefinite-delivery/indefinite-quantity (ID/IQ) contracts for a base year and four option years for a broad range of scientific and technical services supporting NOAA's mission areas. The RFP provided that award would be made on a best value basis, considering price and the following two factors: approach and past performance.
The RFP provided that proposed prices would be evaluated but not scored. The price evaluation will be based on the sum of the fully loaded/burdened labor rates for all labor categories plus the sum of the total prices for the sample tasks. The price evaluation would determine whether the rates and proposed sample task price are realistic, complete, and reasonable. The Government reserved the right to adjust the offeror's evaluated price upward or downward, depending on the price evaluation. The RFP had identified 40 labor categories and offerors were instructed to provide a loaded hourly rate for each category. The offerors' loaded hourly rates were stated to be ceiling rates, from which offerors could elect to propose lower rates on a task-by-task basis. Offerors were required to discuss the basis for their labor rates and identify all load factors.
In addition to providing loaded labor rates, the RFP required offerors to provide a price proposal for four sample tasks. The four sample tasks required offerors to price approximately one quarter of the 40 labor categories identified by the RFP.
Proposals were evaluated by the agency's technical evaluation board (TEB) and price proposals were separately evaluated by the agency's cost evaluation board (CEB). IMSG's proposed prices were based upon the firm's loaded labor rates (the ceiling rates), while the other offerors based their task pricing upon discounts from the proposed ceiling rates. The CET ultimately found that IMSG's proposed price, although reasonable and complete, was not realistic, because the protester's price was a certain percentage lower. The TEB and CET reports were reviewed by the agency's source evaluation board (SEB). The SEB agreed with the CET's price evaluation. With respect to IMSG, the SEB determined that the protester's price was unrealistic and expressed concern about whether IMSG would be able to "retain quality personnel with what appear to be below industry standard labor rates."
IMSG broadly challenges the agency's price evaluation, complaining that NOAA failed to consider the realism of the firms' proposed hourly labor rates. IMSG also complains that NOAA's simple comparison of the awardees' total prices for the sample tasks did not reasonably assess the realism of those firms' loaded hourly rates. IMSG argues that the awardees all proposed unexplained discounts from their proposed ceiling rates and that NOAA did not evaluate the realism of the firms' proposed labor rates as discounted.
GAO states that the Competition in Contracting Act of 1984 (CICA) requires contracting agencies to include cost or price as a factor that must be considered in the evaluation of proposals. An evaluation and source selection that fail to give meaningful consideration to cost or price is inconsistent with CICA and cannot serve as a reasonable basis for award. It is up to the agency to decide upon the appropriate method for evaluation of cost or price in a given procurement, although the agency must use an evaluation method that provides a basis for a reasonable assessment of the cost of performance under the competing proposals.
GAO's review of the record finds that the RFP provided for a realism evaluation of the firms' proposed loaded labor rates and requested cost information that would allow for such an analysis. NOAA did not perform such an analysis of IMSG's price or rates. In determining that IMSG's price was unrealistically low, such that the firm may not be able to retain quality staff, NOAA did not assess whether IMSG's labor rates were too low, but simply assumed that this was the case without analysis. In this regard, the agency did not evaluate the wage rates that IMSG identified for each labor category or consider IMSG's explanation in its price proposal for how it calculated those rates. In the absence of such an analysis, GAO cannot say that the agency's conclusion that IMSG's price was unrealistically low was supported by the record.
GAO also finds that NOAA failed to reasonably assess the realism of the awardees' proposed loaded labor rates. As described above, the RFP established an evaluation scheme under which the agency would consider the sum of the offerors' ceiling rates over the five-year contract period and the sum of their prices for the four sample tasks. Although the RFP also provided for adding these two sums together, as the agency recognized, the sum of the ceiling rates was insignificant in comparison to the sum of the sample task pricing. The record shows that NOAA's judgments concerning the realism and reasonableness of the offerors' proposed prices were determined by the offerors' sample task pricing.
The record shows that NOAA did not assess the realism of the discounted labor rates, although the firms' proposed sample task pricing was based upon those rates. This is particularly troubling where NOAA's judgment concerning the realism and reasonableness of the offerors' proposed prices was based only upon a mechanical comparison of the firms' sample task prices to the IGCE. GAO states that while it is up to the agency to decide upon some appropriate and reasonable method for the evaluation of offerors' proposed prices, an agency may not use an evaluation method that produces a misleading result. The method chosen must also include some reasonable basis for evaluating or comparing the relative costs of proposals, so as to establish whether one offeror's proposal would be more or less costly than another's. In the absence of any analysis of the realism of the awardees' discounted rates, GAO cannot find reasonable the agency's conclusion that the awardees' sample task pricing was realistic and reasonable. The protest is sustained.
GAO recommends that NOAA reevaluate price proposals, conduct discussions, if appropriate, and make a new source selection decision. IMSG should submit its certified claim for costs, detailing the time expended and cost incurred, directly to the contracting agency within 60 days after receipt of this decision.
3. CMI Management, Inc., B-404645, March 2, 2011
Link: GAO Opinion
Agency: Federal Trade Commission
Disposition: Protest denied.
Keywords: technical evaluation; GSA FSS Procurement
General Counsel P.C. Highlight: In a competitive FSS procurement, it is the vendor's burden to submit a quotation that is adequately written and establishes the merits of the quotation.
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CMI Management, Inc. protests the issuance of a task order under a request for quotations (RFQ), issued by the Federal Trade Commission (FTC) for facilities maintenance services.
The RFQ, issued on the General Service Administration's (GSA) e-Buy website, provided for the issuance of a task order for various services for FTC's facilities. Competition was limited to vendors holding Federal Supply Schedule (FSS) contracts under schedule 03FAC. Vendors were informed that quotations would be evaluated under the following three factors, technical, past performance, and price. The RFQ included a detailed statement of work (SOW) requiring the vendor to provide certain key personnel, maintenance and repair of specified equipment, pest control, flag services, and various other duties. Vendors were instructed to submit a technical narrative describing how they would satisfy the SOW and to provide past performance information. Vendors were also informed that the required services must meet certain quality standards and the work performed "shall be of the highest quality and in keeping with the best practices of the industry." The RFQ also advised vendors that "[o]nly the required minimum amount of information is requested. Efforts should be made to keep offers as brief as possible, concentrating on substantive information essential for proper evaluation."
CMI's proposal received poor ratings under the quality control and contingency resources factors. Among other things, the evaluators were concerned that CMI had not specifically addressed the SOW. In this regard, both evaluators noted that CMI did not specifically mention or address quality control. CMI argues that the RFQ did not request a quality control plan or inform vendors that quality control or assurance would be evaluated. CMI also argues that the RFQ directed vendors to keep their quotations as brief as possible, but the agency assigned higher ratings to vendors who submitted detailed technical plans.
GAO states that where, as here, an agency issues an RFQ to FSS contractors under FAR subpart 8.4 and conducts a competition, it will review the record to ensure that the agency's evaluation is reasonable and consistent with the terms of the solicitation. In reviewing a protest challenging an agency's technical evaluation, GAO will not reevaluate the quotations; rather, it will examine the record to determine whether the agency's evaluation conclusions were reasonable and consistent with the terms of the solicitation and applicable procurement laws and regulations.
CMI has not shown that the agency's evaluation of its quotation was unreasonable or inconsistent with the terms of the RFQ. Although CMI complains that the RFQ did not identify quality control as an evaluation factor, GAO finds that the agency's evaluation of the vendors' description of how they would satisfy the SOW's quality standards was reasonably encompassed by the RFQ's technical evaluation factor. The solicitation's SOW provided quality standards that the vendor would be required to satisfy, and the RFQ instructed vendors to describe how they would satisfy all SOW requirements. GAO finds that the solicitation adequately informed vendors that the agency's technical evaluation would assess the vendors' description of how they would perform the SOW requirements, including the quality standards. The record shows that, although CMI's quotation referenced some of the SOW requirements, it failed to address a number of SOW requirements, including the quality standards requirements.
GAO also disagrees with CMI's belief that it was not required to address all of the SOW requirements, because the solicitation asked vendors to be as brief as possible. Although the RFQ asked vendors to submit concise narratives, it also specifically instructed them to describe how they would "completely" satisfy the SOW requirements. In a competitive FSS procurement, it is the vendor's burden to submit a quotation that is adequately written and establishes the merits of the quotation. Additionally, GAO has found that in the context of a FAR subpart 8.4 procurement, an agency's evaluation judgments must be documented in sufficient detail to show that they are reasonable. Here, the contemporaneous record includes evaluator rating sheets, identifying the various vendors' strengths and weaknesses; a detailed price comparison of quotations by contract line item; and the award recommendation. GAO finds that the documentation in the record satisfies the minimum documentation requirements of FAR § 8.405 2(e) and provides sufficient detail to show that the FTC's evaluation and selection judgments are reasonable. The protest is denied.
4. California Industrial Facilities Resources, Inc., d/b/a CAMSS Shelters, B-403397.3, March 21, 2011
Link: GAO Opinion
Agency: Defense Logistics Agency
Disposition: Protest sustained.
Keywords: Brand Name Procurement
General Counsel P.C. Highlight: The FAR permits agencies, in appropriate circumstances, to use "brand name or equal" purchase descriptions, where the purchase description includes a statement of the salient physical, functional or performance characteristics that are necessary to render an "equal" product eligible for award.
California Industrial Facilities Resources, Inc., d/b/a CAMSS Shelters (CAMSS) protests the terms of a request for proposals (RFP), issued by the Defense Logistics Agency (DLA), for tents, shelters and associated accessories.
The RFP was issued as part of the tailored logistics support (TLS) program. The agency intends to award multiple indefinite-delivery/indefinite-quantity (ID/IQ) contracts for the acquisition of commercial tents and shelters, along with associated accessories, for a base year with three one-year option periods. The RFP states that the agency's requirements can be generally categorized into 12 types of shelters. In addition, the RFP provides that the scope of the contract will include accessories for these tents and structures. Finally, the RFP references seven Federal Supply Classes (FSCs) of commercial items that will be included within the scope of the contract, but specifically advises that "the scope of this contract is not limited to these FSCs." In addition to the general description of the agency's requirements, the RFP included two detailed lists of specific items. The first, identified as the core list, includes 249 brand name products identified by manufacturer, manufacturer's part number and national stock number. The second list included 117 additional brand name products, also identified by manufacturer, manufacturer's part number and national stock number; no quantities were identified for these items. However, the RFP cautions that the listed products are merely representative and not inclusive of the agency's overall requirements.
CAMSS asserts that the solicitation fails to include specifications that will permit it to compete for the agency's requirements. According to CAMSS, the agency is required, at a minimum, to list the salient characteristics of the brand name items included in the core list, so that manufacturers of other, comparable, items (such as CAMSS) can compete for the agency's requirements. GAO states that the Competition in Contracting Act (CICA) expressly requires agencies to specify their needs and develop specifications in a manner designed to achieve full and open competition. To that end, solicitations are required to include specifications that permit full and open competition, and may include restrictive provisions or conditions only to the extent necessary to satisfy the needs of the agency. Agencies are further instructed that they may use specifications stated in terms of function (so that a variety of products or services may qualify), performance characteristics or design requirements, depending on the nature of the requirements.
GAO continues to state that these basic requirements are echoed in FAR part 11, under which, to the maximum extent practicable, agencies must articulate their requirements in terms of functions to be performed, performance characteristics required, or essential physical characteristics. While the use of performance specifications is preferred, the FAR also permits agencies in appropriate circumstances to use "brand name or equal" purchase descriptions, where the purchase description includes a statement of the salient physical, functional or performance characteristics that are necessary to render an "equal" product eligible for award. Agencies are precluded from specifying their requirements solely in terms of a particular firm's product unless the particular brand name, product or feature is essential to the government's needs, and market research shows that other companies' similar products lacking the particular feature do not meet the agency's needs, or cannot be modified to meet the agency's needs. Further, when procuring on a brand name only basis, agencies are required to follow documentation and approval procedures for acquiring goods or services using other than full and open competition.
Here, the RFP required prospective offerors for the ID/IQ contract to submit proposals exclusively for the exact brand name items specified in the core list, with no provision for offering alternate, "equal," products. Although the solicitation thus amounts to a brand name only procurement, the agency has not prepared and executed the required justification and approval (J&A) for use of other than full and open competition. The agency's actions therefore are improper. Given the terms of the current solicitation along with DLA's failure to execute the required J&A for use of other than full and open competition, GAO sustains CAMSS's protest.
GAO recommends that the agency prepare an adequately written solicitation that meets the CICA requirement for full and open competition. In the alternative, GAO recommends that the agency prepare and execute an appropriate J&A that sets forth the agency's reasons for conducting its acquisition using other than full and open competition. GAO recommends that the protester be reimbursed the costs of filing and pursuing its protest, including reasonable attorneys' fees.
5. Liberty Terminals LLC, B-403869, December 21, 2010
Link: GAO Opinion
Agency: Department of the Army
Disposition: Protest denied.
Keywords: Proposal Evaluation
General Counsel P.C. Highlight: GAO will question the agency's technical evaluation only where the record shows that the evaluation does not have a reasonable basis or is inconsistent with the RFP. Since an agency's evaluation is dependent on the information furnished in a proposal, it is the offeror's responsibility to submit an adequately written proposal for the agency to evaluate.
Liberty Terminals LLC protests the award of a contract under a request for proposals (RFP), issued by the Department of the Army, Surface Deployment and Distribution Command (SDDC), for stevedoring and related terminal services.
The RFP sought proposals for stevedoring and related terminal services at various ports, under an indefinite-delivery/indefinite-quantity (ID/IQ), fixed-price contract. Award was provided for on a best-value basis considering technical factors and price. The technical factors were equipment, management plan, qualifications of personnel, and past performance. Each factor included subfactors and each subfactor identified a standard of what constitutes an acceptable response. The RFP stated that "award shall be made on the basis of the lowest evaluated price of proposals meeting or exceeding the acceptability standards for non-cost factors." The RFP further stated that "in order to be considered technically acceptable an offeror's technical proposal must pass all standards" and that "[f]ailure on any one factor shall deem the entire proposal as technically unacceptable."
Liberty's technical proposal was rated unacceptable because it received unacceptable ratings for five subfactors. Liberty challenges the evaluation of its proposal under each of the subfactors where its proposal received an unacceptable rating, claiming that there was no reasonable basis for these ratings and that the proposals were unequally evaluated. GAO states that the evaluation of proposals is a matter within the discretion of the procuring agency, since the agency is responsible for defining its needs and deciding on the best methods of accommodating them. GAO will question the agency's technical evaluation only where the record shows that the evaluation does not have a reasonable basis or is inconsistent with the RFP. Since an agency's evaluation is dependent on the information furnished in a proposal, it is the offeror's responsibility to submit an adequately written proposal for the agency to evaluate. An offeror that fails to do so runs the risk that its proposal will be evaluated unfavorably.
Under the first subfactor of the equipment factor, types, mix and quantities of equipment, Liberty's proposal was rated unacceptable. The standard for this subfactor stated that the offeror must possess all equipment required to perform the performance work statement (PWS), and "[a]t a minimum, . . . must have access to [the specifically identified pieces of equipment listed in the RFP for each port]." The agency evaluators found that Liberty's proposal "did not adequately demonstrate that they had made arrangements for the proper types and amounts of equipment at each site for the duration of the performance period as required by the solicitation." Liberty's proposal included a specific list of equipment to be provided under the contract and identified the various equipment that it already had. The proposal also stated that it could move equipment between locations, and that it would lease or purchase equipment that it did not already have to provide the expected level of service to the government. The proposal included various letters of commitment from equipment and other companies to supply various items of equipment. However, Liberty's proposal did not provide for certain equipment required by this subfactor: eight passenger vans and one "MAFI peter with stand." Instead, the SDDC evaluator testified, and the record confirms, that the list of equipment in Liberty's proposal provided for only four passenger vans and did not specifically identify a MAFI peter. In view of the RFP requirement for offerors to provide both service trucks and passenger vans, GAO finds that the agency reasonably read Liberty's proposal as not offering the requisite number of passenger vans, particularly given that the specific equipment list included in Liberty's proposal designated only four "passenger vans."
Liberty's proposal was also found unacceptable under the safety subfactor of the management plan factor. The standard for this subfactor stated, "[d]oes the Offeror's plan include an effective safety program that demonstrates knowledge of all required safety procedures and standards?" The evaluators found that: (1) Liberty's proposal failed to satisfy the standard, since its proposal only "briefly mentions that they have an in-house safety program and a Safety Answer Book but fails to provide specifics on how they intend to assure a safe operating environment while dealing with potentially dangerous . . . cargo"; (2) Liberty provides a picture handbook of their employee forklift safety training handbook but fails to provide any further explanations or plan; and (3) although "[r]eferences to safe operations are scattered throughout Liberty's . . . proposal. . . no specific safety plan for U.S. Government operations is included." Here again, GAO finds no basis to question the reasonableness of the agency's evaluation of the protester's proposal as unacceptable under this subfactor. As explained by the SDDC evaluator, Liberty's proposal only generally discussed safety by referencing the provisions in the RFP related to the requirements and referencing its in-house safety program and Safety Answer Book, but did not describe a safety program in any detail. In sum, the record reasonably supports the agency's conclusion that Liberty's proposal was unacceptable. The protest is denied.
