Electronic Design, Inc., B-279662.2; B-279662.3; B-279662.4,

Electronic Design, Inc., B-279662.2; B-279662.3; B-279662.4, BNUMBER: B-279662.2; B-279662.3; B-279662.4 DATE: August 31, 1998 TITLE: Electronic Design, Inc., B-279662.2; B-279662.3; B-279662.4, August 31, 1998 ********************************************************************** DOCUMENT FOR PUBLIC RELEASE The decision issued on the date below was subject to a GAO Protective Order. This redacted version has been approved for public release. Matter of:Electronic Design, Inc. File: B-279662.2; B-279662.3; B-279662.4 Date:August 31, 1998 Brian A. Bannon, Esq., Wayne A. Keup, Esq., Margaret A. Dillenburg, Esq., and Joseph S. Carlin, Esq., Dyer Ellis & Joseph, for the protester. David S. Cohen, Esq., William F. Savarino, Esq., Alex D. Kond�, Esq., Victor G. Klingelhofer, Esq., and Laurel A. Hockey, Esq., Cohen Mohr, for Litton Integrated Systems Corporation, the intervenor. John M. Davis, Esq., Michael Glennon, Esq., and Kelly Swartz, Esq., Department of the Navy, for the agency. Henry J. Gorczycki, Esq., and James A. Spangenberg, Esq., Office of the General Counsel, GAO, participated in the preparation of the decision. DIGEST 1. Agency's source selection decision in which price is considered only as an eligibility factor (i.e., price does or does not fall within agency's budget) is improper because it fails to consider price as a significant evaluation factor, as required by 10 U.S.C. sec. 2305(a)(2)(A) and sec. 2305(a)(3)(A) (1994) and as contemplated by the best value evaluation plan stated in the solicitation. 2. Agency conducted competition on an unequal basis where the awardee's initial proposal was substantially in excess of the page limitation stated in the solicitation, and the agency evaluated that proposal for award without specifically advising and providing the other offerors an opportunity to submit proposals without a page limitation. DECISION Electronic Design, Inc. (EDI) protests an award to Litton Integrated Systems Corporation under request for proposals (RFP) No. N00024-98-R-4013, issued by the Department of the Navy, Naval Sea Systems Command, for integrated ship control system upgrades for CG 47 Ticonderoga class ships.[1] We sustain the protests. The RFP, issued on December 29, 1997, contemplated award of a fixed-price contract for equipment upgrades on 26 ships through fiscal year 2003. Section M of the RFP stated the following evaluation/source selection plan: Attention is directed to Federal Acquisition Regulation (FAR) 52.215-16 which provides that the contract will be awarded to that responsible offeror whose offer, conforming to the solicitation, will be most advantageous to the Government, price and other factors considered. "Other factors" shall include all of those evaluation factors which are described in this Section M. The Government has established the relative importance of the evaluation factors as displayed below in descending order: Technical Portion � Performance � Integration and Testing � Reduce Equipment Support Costs & Overcome Obsolescence � Enhanced Ship Operations Capability � DVD RFP sec. M at 123. Immediately following this statement, section M stated that offers must be for all items and that price must include destination shipping charges, followed by a provision governing the evaluation of previously approved Single Process Initiative processes. Section M then stated that award would be made to the offeror whose: (i) management proposal is acceptable, and (ii) proposed price for all items . . . is, in each separate year, equal to or less than the Navy budget for this effort, and (iii) whose technical proposal is the best of those submitted which meet the criteria of (i) and (ii) above. However, the Government reserves the right to award to a lower priced, lower technical score offeror if that offer represents the best value to the Government. Id. at 123-24. Immediately following was the Navy's budget for this procurement for each year of the contract.[2] Amendment 0002 stated the following question about the source selection plan and the agency's answer: 35. Page 123, . . . the Government reserves the right to award to a lower priced, lesser technically qualified, offeror if it represents the best value to the Government. Is there a minimum technical score or are there any absolute requirements the lower priced offer must meet in order to be considered qualified? Can a lower priced offer be at substantial variance from the RFP in areas such as software language? What is the process the Government will use to evaluate and select a lower priced, lessor technically qualified offer vs.