E.L. Hamm & Associates, Inc., B-280766.5, December 29, 1999

B-280766.5 Dec 29, 1999 Jump To VIEW DECISION RELATED PAGES GAO CONTACTS Highlights Improperly reopened discussions with firm whose proposal had been eliminated from competitive range is denied where the firm's proposal had been recommended for elimination for award. Was not actually eliminated from the competitive range. 2. Challenge to cost realism analysis is denied where. Agency was not required to find awardee's proposed general and administrative rate unduly low where the rate was capped. The rate was not so much lower than the firm's approved provisional rate as to require a finding that it created risk for the agency. We sustained Hamm's earlier protest because we found that the cost realism evaluation was flawed. We concluded that it was unreasonable of the agency to accept Comtek's proposed use of employees in a particular labor category to perform certain tasks. View Decision Matter of: E.L. Hamm & Associates, Inc. File: B-280766.5 Date: December 29, 1999 DIGEST Attorneys DECISION E.L. Hamm & Associates, Inc. protests the proposed award of a cost-plus-award-fee contract to Computer Systems International, Inc. (CSI) by the Department of the Army, under request for proposals (RFP) No. DABT60-98-R-0014, for storage and warehouse services at the Army Training Support Center, Fort Eustis, Virginia. The award followed a reevaluation undertaken by the Army in response to an earlier protest, E.L. Hamm & Assocs., Inc., B-280766.3, Apr. 12, 1999, 99-1 CPD Para. 85, against the award to Communication Technologies, Inc. (Comtek). We sustained Hamm's earlier protest because we found that the cost realism evaluation was flawed. We concluded that it was unreasonable of the agency to accept Comtek's proposed use of employees in a particular labor category to perform certain tasks, and that the evaluation record contained no support for the agency's acceptance of Comtek's proposed overhead rate. Id. at 10. We recommended, among other things, that the Army hold discussions with all competitive range offerors, request and evaluate final revised proposals, and perform a proper cost evaluation, including a cost realism analysis. Id. at 10-11. Hamm alleges various improprieties with respect to the Army's implementation of our recommendation, and contends that the cost realism analysis was again flawed; as a result, the protester alleges, the cost/technical tradeoff was unreasonable. /1/ We deny the protest. BACKGROUND Our prior decision, E.L. Hamm & Assocs., Inc., supra, contains much of the background for this procurement and our rationale for sustaining that protest, which will not be repeated here. However, for purposes of this decision, a brief recapitulation is necessary. Under the RFP, the contract was to be awarded on a best value basis with technical quality more important than cost unless the technical quality of the proposals approached equality, in which case cost would be given greater importance and could control the award decision. RFP Sec. M.3. The agency received 11 proposals and each was evaluated under the stated evaluation factors and subfactors using the [DELETED]. The contracting officer established an initial competitive range comprised of three proposals with an overall rating of [DELETED]. Hamm and CSI, whose proposals received an overall rating of [DELETED], were not included in the initial competitive range. On August 7, 1998, Hamm--the incumbent subcontractor for this requirement--filed a protest with our Office alleging that the Army improperly had excluded its initial proposal from the competitive range (our file number B-280766). After reviewing the protest, the agency decided to take corrective action by reestablishing the competitive range to include those initial proposals rated [DELETED], and Hamm withdrew its protest. Thereafter, on August 18, the contracting officer made a second competitive range determination, increasing the number of offerors from three to six, including Hamm and CSI. Discussions were held and the six competitive range offerors were allowed to submit revised proposals. Comtek's proposal was determined to be the best value to the government and the firm was selected for award. Preaward notification was sent to the five unsuccessful offerors and Hamm filed its second protest, which we sustained on April 12, 1999. E.L. Hamm & Assocs., Inc., supra. In response to our decision, the agency amended the solicitation to revise the labor categories; reopened discussions with the competitive range offerors, including Hamm and CSI; and requested and received final revised proposals. RFP amends. 0003 and 0004. After individually evaluating the offerors' revised proposals under the non-cost evaluation factors and subfactors, the technical evaluation board (TEB) then met to discuss the merits of the revised proposals and reach a consensus in assigning an overall [DELETED] rating for each proposal.