New Breed Leasing Corporation

New Breed Leasing Corporation BNUMBER: B-274201; B-274202 DATE: November 26, 1996 TITLE: New Breed Leasing Corporation ********************************************************************** Matter of:New Breed Leasing Corporation File: B-274201; B-274202 Date:November 26, 1996 Matthew A. Simchak, Esq., Philip J. Davis, Esq., and Phillip H. Harrington, Esq., Wiley, Rein & Fielding, for the protester. William E. Franczek, Esq., Vandeventer, Black, Meredith & Martin, an intervenor. Dana N. Smith, Esq., and Anita D. Polen, Esq., Department of the Navy, for the agency. Glenn G. Wolcott, Esq., and Paul Lieberman, Esq., Office of the General Counsel, GAO, participated in the preparation of the decision. DIGEST Protests are sustained where agency's failure to recognize and correct obvious flaws in prior solicitations and contracts constituted lack of advance planning which precluded meaningful competition for requirements and resulted in sole source extensions of concededly flawed contracts with the incumbent contractor. DECISION New Breed Leasing Corporation protests the Department of the Navy's cancellation of solicitation Nos. N00189-94-R-0304 and N00189-94-R-0315 (hereinafter "R-0304" and "R-0315") for material handling and logistics support services at various sites throughout the world,[1] and the sole source extensions of contract Nos. N-00189-94-D-0003 and N-00189-94-D-0006 (hereinafter "D-0003" and "D-0006") for those services. The solicitations were issued as small business set-asides; the incumbent contractor, Management Consulting, Inc. (Mancon) is a large business, not eligible to compete under the canceled solicitations. New Breed maintains there is no rational basis for the cancellation of the solicitations or for the sole source extensions of Mancon's contracts, and that the agency's actions resulted from a lack of advance planning. We sustain the protests on the basis that the agency's actions resulted from a lack of advance planning. BACKGROUND The requirements at issue are sought by the Department of the Navy's Fitting Out and Supply Support Assistance Center (FOSSAC), which provides logistical and material support services to the Department of Defense (DOD) and other federal agencies throughout the world under the Intra-Fleet Supply Support Operations Program (ISSOP).[2] Mancon's contracts were awarded in October 1993, for a base year with 2 option year periods extending through September 30, 1996. On July 5, 1994, FOSSAC submitted requisitions to the Fleet and Industrial Supply Center (FISC), Norfolk Acquisition Group to initiate follow-on procurements for the ISSOP support provided under Mancon's contracts. The requirements for the east coast solicitation (RFP No. R-0304) and west coast solicitation (RFP No. R-0315) were synopsized in the Commerce Business Daily (CBD) on September 5 and 6, 1994, respectively. Acquisition plans were approved approximately 7 months later, on April 25 and June 6, 1995, respectively; the two solicitations were subsequently issued in June of 1995. Each solicitation contained a total of 112 contract line item numbers (CLINs), broken down into 75 firm, fixed-price CLINs, 26 time-and-materials CLINs, and 11 direct reimbursement CLINs. Each CLIN had sub-CLINs for the specific sites to be serviced.[3] For each of the 75 fixed-price CLINs, offerors were required to propose fixed prices, reflecting differing labor rate mixes, for the performance of various tasks.[4] The solicitation provided for award on the basis of the low-priced, technically acceptable offer. Solicitation No. R-0304 was amended three times and solicitation No. R-0315 was amended twice. None of the solicitation amendments significantly altered the description of tasks to be performed and, as amended, solicitation Nos. R-0304 and R-0315 required that proposals be submitted by September 21, and October 5, 1995, respectively. Four offerors, including New Breed, timely submitted proposals for both solicitations which were subsequently evaluated by FISC Norfolk personnel. Technical evaluation of proposals under both solicitations was completed by November 17, 1995; all four proposals were determined to be technically acceptable. Evaluation of cost/price proposals under RFP No. R-0304 was completed in March 1996, and for proposals under RFP No. R-0315, in June 1996. By memoranda dated April 16 and July 10, FISC Norfolk personnel sought authority from Headquarters, Naval Supply Systems Command (NAVSUP), to proceed with the procurement by conducting discussions with all offerors. The memoranda stated that the evaluators had found significant disparities in prices among offerors, noting that the disparities were particularly prevalent among the 75 fixed-price CLINs. On July 30, NAVSUP personnel met with FISC Norfolk personnel to discuss concerns regarding the procurement.