The Jones/Hill Joint Venture, B-286194.4; B-286194.5; B-286194.6, December 5, 2001

The Jones/Hill Joint Venture, B-286194.4; B-286194.5; B-286194.6, December 5, 2001 TITLE: The Jones/Hill Joint Venture, B-286194.4; B-286194.5; B-286194.6, December 5, 2001 BNUMBER: B-286194.4; B-286194.5; B-286194.6 DATE: December 5, 2001 ********************************************************************** Decision Matter of: The Jones/Hill Joint Venture File: B-286194.4; B-286194.5; B-286194.6 Date: December 5, 2001 William A. Roberts III, Esq., Phillip H. Harrington, Esq., William S. Lieth, Esq., and Janet L. Eichers, Esq., Wiley, Rein & Fielding, for the protester. Marvin D. Norman, Esq., Vicki E. O'Keefe, Esq., and Robert E. Little, Jr., Esq., Department of the Navy, for the agency. Louis A. Chiarella, Esq., John L. Formica, Esq., and James A. Spangenberg, Esq., Office of the General Counsel, GAO, participated in the preparation of the decision. DIGEST 1. A conflict of interest existed in an Office of Management and Budget Circular A-76 commercial activities study where a Navy employee and a private-sector consultant wrote and edited the performance work statement and then prepared the management plan for in-house performance. 2. The Navy Independent Review Official's certification (pursuant to Office of Management and Budget Circular A-76) that the government is able to perform the requirements set forth in the performance work statement with the resources provided in the in-house management plan, and that all costs in the in-house cost estimate were fully justified, cannot be found reasonable where it is unsupported by either the contemporaneous documentation or the arguments, explanations, or testimony in the record. 3. Agency's in-house management plan submitted under an Office of Management and Budget Circular A-76 commercial activities study was misevaluated, where the in-house management plan was based on the use of personnel that were not part of the "most efficient organization" to accomplish certain requirements in the performance work statement, and the record does not show that the costs of these personnel were included in the in-house cost estimate. 4. Agency's determination, pursuant to Office of Management and Budget Circular A-76, that the management plan for in-house performance offered a comparable level of performance and performance quality to the selected private-sector proposal, was unreasonable, insofar as it did not account for several strengths identified during the "best value" competition in the selected private-sector proposal. DECISION The Jones/Hill Joint Venture protests the Department of the Navy's determination, pursuant to Office of Management and Budget (OMB) Circular A-76, that it would be more economical to perform base operations and support services in-house at the Naval Air Station, Lemoore (NASL), California, rather than contract for these services with Jones/Hill under request for proposals (RFP) No. N62474-98-R-2069. We sustain the protest. BACKGROUND The Navy issued the RFP on May 5, 1999, as part of a Circular A-76 commercial activities study, to determine whether it would be more economical to perform base operations support and real property maintenance and operations services for the NASL in-house, using government employees, or under contract with a private-sector firm. [1] The solicitation provided that a "best value" offer would be selected in accordance with the terms of the RFP, and compared to the government's in-house management plan in accordance with the terms of Circular A-76 to determine if contractor or in-house performance of the services was more economical. RFP sect. A. The RFP requested fixed-price proposals, and provided for a two-step evaluation of the proposals with past performance, corporate capabilities and past commitment to small business the factors considered in the first step, and management and technical approach and small business commitment the factors considered in the second step. To determine which proposal represented the best value, the combined ratings of the proposals from the two steps were considered approximately equal in importance to price. RFP at M-2. Each offeror's proposal was to include the firm's statement of requirements (SOR), prepared in accordance with a workbook provided by the agency as part of the solicitation package.