Occu-Health, Inc.

B-270228.3 Apr 03, 1996 Jump To VIEW DECISION RELATED PAGES GAO CONTACTS Highlights That evaluation of option quantities was not in its best interests. [1] A best value basis for award was stated. Offerors were informed that the quality factor was more important than the management factor. That both the quality and management factors were significantly more important than price. Discussions were not conducted with EHG. Asserting that DLA improperly conducted discussions with EHG and that the source selection was not reasonably based. This protest was dismissed on October 2 after DLA decided to take corrective action by conducting discussions and requesting BAFOs. [2] On October 5. BAFOs were received from both EHG and Occu-Health by the November 1 closing date. [3] EHG reaffirmed its initial offer of [DELETED] ([DELETED] for the base year and [DELETED] for the option years). View Decision Matter of: Occu-Health, Inc. File: B-270228.3 Date: April 3, 1996 *. Redacted Decision The procuring agency improperly failed to notify offerors that it no longer intended to exercise or evaluate the solicitation's options where it knew this fact prior to the receipt of best and final offers. Attorneys DECISION Occu-Health, Inc. protests the award of a contract to EHG National Health Services, Inc. under request for proposals (RFP) No. S2202A-95-R-0001, issued by the Defense Contract Management Command, Northeast District, Defense Logistics Agency (DLA), for occupational health and industrial hygiene services. We sustain the protest. The RFP, issued April 25, 1995, sought occupational health and industrial hygiene services for the Northeast District's headquarters health clinic in Boston, Massachusetts and 41 field sites. The RFP provided for the award of a fixed-price contract for 1 base year with 4 option years, and included the standard "Evaluation of Options" clause, set forth at Federal Acquisition Regulation (FAR) Sec. 52.217-5, which informed offerors that the government would evaluate offers by adding the price for the base period and options years, unless the government determined, in accordance with FAR Sec. 17.206(b), that evaluation of option quantities was not in its best interests. [1] A best value basis for award was stated, and the following evaluation factors identified: quality, management, and price. Offerors were informed that the quality factor was more important than the management factor, and that both the quality and management factors were significantly more important than price. The RFP incorporated FAR Sec. 52.215-16, Alternate III, which states that the government intends to make award without conducting discussions. DLA received proposals from Occu-Health and EHG, the incumbent contractor, by the closing date for the receipt of proposals. Occu-Health offered the lowest total price (base and option years included) of [DELETED] while EHG offered a total price of [DELETED]. On August 3, DLA made oral inquiries to Occu-Health regarding several aspects of its proposal. Discussions were not conducted with EHG, and best and final offers (BAFO) not requested. The agency determined that EHG's proposal represented the best value to the government and made award to EHG on August 31, with performance to commence on October 1. Occu-Health protested the award to our Office on September 19, asserting that DLA improperly conducted discussions with EHG and that the source selection was not reasonably based. This protest was dismissed on October 2 after DLA decided to take corrective action by conducting discussions and requesting BAFOs. [2] On October 5, DLA initiated negotiations with the offerors. Following discussions, on October 24, DLA requested BAFOs to be submitted by November 1. During this same time frame, a recommendation of the Base Realignment and Closure Commission (BRAC) to close the Defense Contract Management Command's South District and consolidate functions under the Command's West District and Northeast District became final. Specifically, BRAC recommended closing the South District on July 1, 1995; the President approved the BRAC's recommendation and submitted it to Congress on July 15; and the recommendation became final on October 1. On October 27, prior to the receipt of BAFOs under the RFP, the Northeast District determined, in a meeting including the procuring contracting officer, that it would not exercise the options under the contract because "it would be better to prepare a solicitation to provide health services to all of the newly configured District in fiscal year 1997, than to rely on options." BAFOs were received from both EHG and Occu-Health by the November 1 closing date. [3] EHG reaffirmed its initial offer of [DELETED] ([DELETED] for the base year and [DELETED] for the option years), while Occu-Health reduced its price to [DELETED].