Del-Jen, Inc., B-287273.2, January 23, 2002

B-287273.2 Jan 23, 2002 Jump To VIEW DECISION DOWNLOADS RELATED PAGES GAO CONTACTS Highlights A firm protested a Department of the Air Force decision to retain the civil engineering function at Hanscom Air Force Base, Massachusetts, for performance in-house, contending (1) the contract administration costs included in the cost comparison were unreasonable; (2) in-house management plan for a "most efficient organization" included insufficient staffing to perform the performance work statement; and (3) the Air Force improperly failed to ensure that the in-house plan and private sector offer were based on a comparable level and quality of performance. GAO held that (1) the determination of the appropriate contract administration costs was unreasonable, and did not result in a fair competition; (2) the Air Force did not properly account for, and thereby understand, the contract administration efforts, and associated cost, that should be included as costs of in-house performance; (3) the Air Force may have overstated the contract administration effort, and associated costs, that should be included as costs of performance by the private-sector offeror. Accordingly, the protest was sustained, and GAO recommended that (1) the Air Force review the cost comparison; (2) if, as a result of that review, the Air Force concludes that the protester's evaluated price is lower than the cost of in-house performance, the Air Force make award to the protester; and (3) the protester be reimbursed the reasonable costs of filing and pursuing the protest, including reasonable attorneys' fees. View Decision Del-Jen, Inc., B-287273.2, January 23, 2002 DIGEST Attorneys DECISION Del-Jen, Inc. (DJI) protests the decision of the Department of the Air Force to retain the civil engineering function at Hanscom Air Force Base (AFB), Massachusetts, for performance in-house, rather than contract for these services with DJI, under request for proposals (RFP) No. F19650-00-R-0001. The Air Force determined to retain the services in-house based on the results of a cost comparison conducted pursuant to Office of Management and Budget (OMB) Circular A-76, which compared DJI's proposal to perform the work against the government's in-house management plan. /1/ DJI asserts that the contract administration costs included in the cost comparison were unreasonable; the in-house management plan for a "most efficient organization" (MEO) included insufficient staffing to perform the performance work statement (PWS); and the agency improperly failed to ensure that the in-house plan and private-sector offer were based on a comparable level and quality of performance. /2/ We sustain the protest. COST COMPARISON The services solicited, described by the PWS as "typical in the commercial industry," included customer support services, infrastructure maintenance, facility maintenance, physical plant operations, utilities management, civil engineer services, environmental protection services, architectural and engineering services, construction, property management, and financial management. PWS Sec. 1. In the event of contract performance, the RFP provided for award of a cost-plus-award-fee contract, for a base year, with 4 option years. The RFP stated that the private-sector offer to be compared with the MEO would be that which conformed to the RFP and represented the best value to the government. Best value was defined as "the most advantageous offer, cost and other factors considered, providing the best technical quality, business aspects, risks, and costs for a given application, and in consonance with the Government's stated importance of evaluation criteria." RFP Sec. M.1. Private-sector proposals were to be evaluated based on the following factors: (1) mission capability, including business plan demonstrating an ability to meet the mission requirements, manning/staffing, and knowledge and response to unique military requirements; (2) proposal risk; (3) past performance; and (4) cost/price. The mission capability, proposal risk, and past performance factors were of equal importance, and each was more important than cost/price. Technical/past performance proposals were received from [DELETED] offerors, including DJI. After conducting several rounds of discussions, and after the withdrawal of one of the proposals, the Air Force requested complete proposals, including cost proposals, from the remaining [DELETED] offerors. Based on the complete proposals, the agency established a competitive range consisting only of DJI. After further discussions with DJI, the Air Force requested final proposal revisions; based on its revised proposal, DJI's proposal was selected for comparison with the in-house MEO. The ensuing September 2000 cost comparison resulted in a tentative decision that performance by DJI of the civil engineering function would cost less than in-house performance.