SUBSCRIBE NOW
1. ITW Military GSE, B-403866.3, December 7, 2010
Link: GAO Opinion
Agency: Department of the Navy
Disposition: Protest denied.
Keywords: Discussions; Trade-off Decision
General Counsel P.C. Highlight: During contract negotiations (discussions) under FAR Part 15, an agency may not mislead an offeror--through the framing of a discussion question or a response to a question--into responding in a manner that does not address the agency's concerns, or misinform the offeror concerning a problem with its proposal or about the government's requirements.
ITW Military GSE protests the award of a contract under a request for proposals (RFP), issued by the Department of the Navy, for shipboard and land based air conditioners.
The RFP provided for the award of a fixed-unit-price, indefinite-delivery/indefinite-quantity (ID/IQ), contract for state-of-the-art mobile, trailer mounted, shipboard, and land based air conditioners. Award was to be made on a best value basis, considering technical, past performance, and price factors.
ITW asserts that it was misled during discussions. Specifically that the Navy improperly advised it during discussions that its prices for two contract line item numbers (CLIN) were "somewhat lower" than the independent government estimate (IGE) and in reliance on this, ITW increased its final price for these two CLINs.
GAO states that when discussions are conducted, they must at a minimum identify deficiencies and significant weaknesses in each competitive-range offeror's proposal. Discussions must be "meaningful," that is, sufficiently detailed so as to lead an offeror into the areas of its proposal requiring amplification or revision. An agency may not mislead an offeror--through the framing of a discussion question or a response to a question--into responding in a manner that does not address the agency's concerns, or misinform the offeror concerning a problem with its proposal or about the government's requirements. In the context of discussions relating to cost or price, agencies may not coerce or mislead an offeror during discussions into raising its prices.
In this case, the Navy identified a number of weaknesses and deficiencies in ITW's initial proposal, which were identified in 25 evaluation notices. Concerns with ITW's proposed prices were communicated to ITW in the letter transmitting the evaluation notices. GAO does not find that the Navy's discussions were misleading. The record shows that the agency accurately conveyed its concerns to ITW in discussions. The agency simply communicated to ITW that its CLIN pricing appeared lower than that of the IGE in two particular regards, and asked ITW to review its pricing. This did not compel ITW to take any particular action.
ITW also argues that since the RFP established that nonprice factors were significantly more important than price, the Navy's determination that the awardee's lower-rated, lower-priced proposal represented the best value was unreasonable.
GAO states that in a best value procurement, it is the function of the SSA to perform a price/technical tradeoff, that is, to determine whether one proposal's technical superiority is worth the higher price. Even where, as here, price is stated to be of less importance than nonprice factors, the SSA may select the lower-rated, lower-priced proposal, where the SSA reasonably concludes that the price premium involved in selecting the higher-rated proposal is not justified. The extent of such tradeoffs is governed only by the test of rationality and consistency with the evaluation criteria. A protester's mere disagreement with the agency's determinations as to the relative merits of competing proposals, or disagreement with its judgment as to which proposal offers the best value to the agency does not establish that the source selection decision was unreasonable.
GAO finds the Navy's source selection decision to be reasonable, consistent with the stated evaluation criteria, and adequately documented. The SSA considered the relative importance of the price and nonprice evaluation factors, the technical advantages possessed by ITW, and the price advantage possessed by the awardee. The SSA concluded the benefits that would be derived from ITW's lower risk proposal were not significant enough to outweigh the associated price premium, and found that the awardee's proposal represented the best value to the government. The protest is denied.
2. World Airways, Inc., B-402674, June 25, 2010
Link: GAO Opinion
Agency: Department of Defense.
Disposition: Protest denied.
Keywords: Past Performance; Technical Evaluation
General Counsel P.C. Highlight: In a negotiated procurement, any proposal that fails to conform to the material terms and conditions of the solicitation may not form the basis for award. The procuring agency has the primary responsibility for evaluating the technical information supplied by an offeror and determining the acceptability of the offeror's proposal; we will not disturb such a determination unless it is shown to be unreasonable.
World Airways, Inc. protests the award of five contracts under a request for proposals (RFP), issued by the United States Transportation Command, Department of Defense, for air cargo transportation services.
The solicitation provided for the award of up to five fixed-price indefinite-delivery indefinite-quantity (ID/IQ) contracts, for a base period of one year with one one-year option. The successful contractors would be required to provide, among other things, all personnel, training, supervision, equipment, diplomatic clearances, and customs clearance procedures necessary to perform international commercial air cargo transportation services within the United States Central Command (CENTCOM) Area of Responsibility (AOR). Award was to be made on a best value basis considering past performance, technical plan, and price.
World Airways first argues that the agency's evaluation of its proposal under the RFP's past performance factor was inconsistent with the terms of the solicitation and unreasonable because the agency, while generally considering and evaluating the offerors' performance within the "last three years," expressly chose to limit its evaluation of past performance to those services provided during a 15-month period.
GAO states that the evaluation of past performance, including the agency's determination of relevance and scope of an offeror's performance history to be considered, is a matter of agency discretion, which GAO will not find improper unless unreasonable or inconsistent with the solicitation's evaluation criteria. GAO does not think that this is inconsistent with the terms of the RFP since the language of the RFP provides that the "recency" aspect of the past performance evaluation was to ensure that the past performance had occurred no more than three years ago.
Additionally, the agency had a reasonable basis for limiting its evaluation to the last 15 months. While an agency is required to evaluate offerors' past performance reasonably and on the same basis, an agency has considerable discretion in determining, for example, what past performance information it will consider. Here, the agency explains that the performance data prior to 2008 was "unreliable" and could not fairly be used to assess any offeror's performance under that program. In sum, the agency's determination to focus on the offerors' performance during the 15-month period discussed above, was reasonably based and consistent with the terms of the solicitation.
GAO also finds reasonable the agency's rating of World Airways' past performance as "little confidence." The rating was primarily based upon World Airways' subcontractor's on-time performance. The agency reasonably found that the past performance questionnaire pertaining to World Airways' principal subcontractor's performance, as well as the on-time performance data available to the agency, raised "substantial doubt" regarding World Airways' successful performance of the effort at the required 85 percent on-time performance standard.
World Airways argues that the agency failed to properly consider the positive ratings or comments provided by its references for other contracts, which ranged from "satisfactory confidence" to "very good confidence," as well as the positive comments regarding the protester's subcontractor's performance. The record reflects, that in evaluating past performance the agency did not look solely at the ratings the offerors (including World Airways and its principal subcontractor) received from their references on each aspect of their past performance and overall. Rather, the record shows that the agency reasonably considered and gave appropriate weight to the completed past performance questionnaires, including any narrative information provided as well as the ratings, and other available information in determining what rating to assign each proposal under the past performance factor.
World Airways also argues that the agency unreasonably assigned a rating of "significant confidence" to FedEx under the past performance factor. The record reflects that FedEx advised the agency that it was suspending its service to Iraq, and that it suspended service because the Iraqi Civil Aviation Authority and Iraqi Airways granted another firm "the exclusive right to control cargo airlift into and out of Iraq." FedEx explained that it initially used this other firm, but that "as a result, the reliability of our service to Iraq has been substantially degraded." The agency states that it was aware of this issue during the evaluation, but that under the CENTCOM Theater Express Tender Program neither the offeror nor any of other the program participants were contractually obligated to submit spot-bids or provide service. Because of this, there was no basis on which to downgrade FedEx under the past performance factor because of the offeror's "discretionary decision to cease commercial service in order to investigate its business approach to a political climate change."
Again, while the protester clearly disagrees, GAO finds reasonable the agency's decision not to downgrade FedEx for its relatively brief cessation of services on certain routes, for which it was not contractually obligated to provide services, and for which it made the judgment that it would not be able to continue to provide such services reliably and at a reasonable price.
World Airways also argues that the agency unreasonably assigned a rating of "high confidence" to another offeror under the past performance factor. The contracting officer explains that both he and the source selection evaluation team were aware of the offeror's conviction and settlements as well as the fact that the Air Force had proposed the offeror for debarment in 2008. GAO cannot find the agency's evaluation here to be unreasonable. As pointed out by the agency, the record reflects that the offeror has performed recent and relevant contracts at a high level, including its performance of the CENTCOM Theater Express Tender Program, which was evaluated by the agency as "exceptional." GAO also finds reasonable the agency's determination that it was not appropriate to downgrade the offeror under the past performance factor given the circumstances here, which include the fact that the incident that resulted in the offeror's conviction, settlement, and proposed debarment occurred nine years earlier.
World Airways argues that the proposals of four of the offerors do not "meet the minimum technical requirements" of the solicitation, because, according to World Airways, only it and another offeror have operated and continue to operate the aircraft that World Airways asserts is required to be used at certain of the 75 mandatory city-pairs set forth in the price schedule. GAO states that in a negotiated procurement, any proposal that fails to conform to the material terms and conditions of the solicitation may not form the basis for award. The procuring agency has the primary responsibility for evaluating the technical information supplied by an offeror and determining the acceptability of the offeror's proposal; GAO will not disturb such a determination unless it is shown to be unreasonable. Based upon a review of the record, the agency reasonably found that the other proposals provided the information requested by the solicitation, and agreed without exception to provide the services required in accordance with the terms of the solicitation. An agency may accept a proposal's representation that indicates compliance with the solicitation requirements where there is no significant countervailing evidence reasonably known to the agency evaluators that should create doubt whether an offeror will or can comply with the requirement. Here, notwithstanding the World Airway's assertions, the record does not indicate that there was any countervailing evidence reasonably known to the agency evaluators that should have created doubt that the other offerors would or could honor their proposals.
World Airways finally argues that the agency's source selection decision was unreasonable. Source selection officials in negotiated procurements have broad discretion in determining the manner and extent to which they will make use of technical and price evaluation results; price/technical trade-offs may be made, and the extent to which one may be sacrificed for the other is governed only by the tests of rationality and consistency with the evaluation criteria. Where a price/technical tradeoff is made, the source selection decision must be documented, and the documentation must include the rationale for any tradeoffs made, including the benefits associated with additional costs. However, there is no need for extensive documentation of every consideration factored into a tradeoff decision, nor is there a requirement to quantify the specific cost or price value difference when selecting a higher-priced, higher-rated proposal for award. The source selection decision here includes a short introduction, and then sections that discuss and provide detailed reasons justifying each of the five awards. In each section, the SSA describes the evaluation results generally, and then specifically compares each awardee's proposal with each of the proposals that were not selected for award, including the proposal of World Airways. GAO states that the source selection decision is adequately documented, consistent with the terms of the solicitation, and reasonably based given the broad discretion afforded source selection officials. The protest is denied.
