Voith Hydro, Inc., B-277051, August 22, 1997

B-277051 Aug 22, 1997 Jump To VIEW DECISION RELATED PAGES GAO CONTACTS Highlights DIGEST Protest is sustained where. The contracting officer informed Voith that its proposal was in the competitive range and provided the firm with questions and comments concerning the proposal. Including: "Where will the runners be manufactured? This is a deficiency. Will render your proposal unacceptable unless you provide the requested information.". In a February 28 letter Voith stated: Voith Hydro companies have six (6) major hydro-turbine manufacturing facilities throughout the world capable and experienced in manufacturing and supplying runners to the hydropower generation market. That our commitment be that the runners will all be manufactured at a Voith manufacturing facility. View Decision Matter of: Voith Hydro, Inc. File: B-277051 Date: August 22, 1997 * Redacted Decision DIGEST Attorneys DECISION Voith Hydro, Inc. protests the exclusion of its proposal from the competitive range under request for proposals (RFP) No. 1425-96-SP-10- 13640, issued by the Department of the Interior for 18 hydraulic-turbine runners for the Grand Coulee Dam Powerplant. We sustain the protest based on our conclusion that Interior failed to conduct meaningful discussions. As amended, the RFP required that each offeror's technical proposal be submitted as a separate volume of the proposal and include "detailed information of the proposed manufacturing method and facilities to be used during the runner replacement and turbine rehabilitation work. . . ." The technical volume of Voith's initial proposal did not state the manufacturing facility the firm would use. After receipt and evaluation of initial proposals, the agency created a competitive range including Voith's proposal. By letter of February 12, the contracting officer informed Voith that its proposal was in the competitive range and provided the firm with questions and comments concerning the proposal, including: "Where will the runners be manufactured? Please provide information on the manufacturing capabilities of that location. This is a deficiency, and--as such--will render your proposal unacceptable unless you provide the requested information." (Emphasis omitted.) The February 12 letter also scheduled an oral presentation/question and answer session with Voith and asked the firm to respond to the written questions and comments before the meeting. In response to the above question, in a February 28 letter Voith stated: Voith Hydro companies have six (6) major hydro-turbine manufacturing facilities throughout the world capable and experienced in manufacturing and supplying runners to the hydropower generation market. Voith would therefore recommend for a long term project such as Grand Coulee, that our commitment be that the runners will all be manufactured at a Voith manufacturing facility. This would allow best management of schedules and risks. However, if this is not acceptable, Voith will commit, as indicated in the proposal, that nine (9) runners would be manufactured in China, which more specifically would be our SHEC (Shanghai Hydro-Power Equipment Company, Ltd.) facility in Shanghai, China. The remaining nine (9) runners would be manufactured at our Voith Hydro facility in York, Pennsylvania. [Emphasis in original.] Voith then made an oral presentation and participated in a question and answer session. An agency memorandum dated March 5, under the heading "Manufacturing methods and facilities," describes the two options for manufacturing the runners which Voith proposed in its February 28 letter. The memorandum then states "the proposed [SHEC] fabrication facility was the primary weakness in the offeror's proposal." According to the memorandum, this was because SHEC is a start-up facility and will have a long learning curve before a high quality product can be produced consistently. The memorandum also states that due to the critical need for high efficiency and uncompromised reliability from the Grand Coulee runners, the agency cannot afford the risk of an unproven facility with an inexperienced work force. In addition, the memorandum states: The [contracting officer] informed the offeror that the [evaluators] can only evaluate what is proposed and that given several options they will have to assume the least favorable and thus the proposal will be evaluated accordingly. There was an indication that Voith will commit to one of the two options. Regardless of the option selected it appears to the [evaluators] that Voith has committed to a new plant in China and that the runners will be manufactured in this new plant that does not have a proven record. This is a deep concern to the [evaluators] . . . . Nonetheless, the agency left Voith's proposal in the competitive range and requested a best and final offer (BAFO) from Voith along with the other competitive range offerors.