Priority One Services, Inc., B-288836; B-288836.2, December 17, 2001

Priority One Services, Inc., B-288836; B-288836.2, December 17, 2001 TITLE: Priority One Services, Inc., B-288836; B-288836.2, December 17, 2001 BNUMBER: B-288836; B-288836.2 DATE: December 17, 2001 ********************************************************************** 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. Decision Matter of: Priority One Services, Inc. File: B-288836; B-288836.2 Date: December 17, 2001 Kevin P. Mullen, Esq., Piper Marbury Rudnick & Wolfe, for the protester. Scott A. Ford, Esq., for SoBran Incorporated, an intervenor. Michael Colvin, Department of Health & Human Services, for the agency. Charles W. Morrow, Esq., and James A. Spangenberg, Esq., Office of the General Counsel, GAO, participated in the preparation of the decision. DIGEST 1. Agency failed to perform a proper cost realism evaluation in awarding a cost reimbursement contract where the agency made no probable cost adjustments even where it identified costs that it believed were unrealistic and did not consider the proposed costs in light of the offeror's proposed technical proposals. 2. Agency's communications after submission of final proposal revisions with one offeror constituted discussions where the agency required the offeror to replace unacceptable personnel, and solicited other proposal revisions from that offeror, which entailed an increase in its proposed costs; thus, the agency was required to conduct discussions with all offerors whose proposals had been determined to be in the competitive range. DECISION Priority One Services, Inc. protests the award of a contract to SoBran Incorporated under request for proposals (RFP) No. NIAID-DIR-01-56, a small business set-aside, issued by the National Institute of Allergy and Infectious Diseases (NIAID), National Institutes of Health, Department of Health & Human Services, for the care, use, and humane treatment of laboratory animals, and technical skills related to the scientific study and manipulation of animals and animal products. Priority One contends, among other things, that NIAID performed an unreasonable cost evaluation and conducted improper discussions with SoBran. We sustain the protest. The solicited services are to be provided under a cost-plus-fixed-fee contract for a base year with four 12-month option periods.[1] Award was to be made to the offeror whose proposal provided the ?best overall value to the Government,? considering the following evaluation factors: past performance (worth 800 points), technical approach and general understanding of requirements (worth 700 points), corporate resources (worth 350 points), small disadvantaged business (SDB) participation (not scored), and cost (not scored). Although past performance was said to be ?of paramount consideration,? cost and SDB participation were ?also important? to the award decision. All evaluation factors other than cost, when combined, were significantly more important than cost. Under the past performance factor, the RFP listed 12 variously weighted subfactors, including whether proposed ?personnel have necessary knowledge, skills and abilities to successfully complete? the contract (worth 100 points) and ?adequate past performance of [s]ubcontractors? (worth 50 points).[2] One of the seven subfactors of the technical approach and general understanding of requirements factor was ?work force recruitment/retention plan? (worth 100 points). Four proposals were received by the closing date. Only Priority One's and SoBran's proposals were included in the competitive range. A four-member technical evaluation panel evaluated and point-scored the technical proposals. The proposals underwent a technical and cost evaluation. Following written discussions, the final revised offers were received and evaluated as follows: Offeror Score Cost SoBran 1,606.25 $33,927,775 Priority One 1,394.25 $36,092,283 Based on this evaluation, the technical evaluators ?acknowledged? that the award should be made to SoBran, but requested ?further clarification/information from SoBran prior to completing the written recommendation for award.? Agency Report, Tab XIII, Source Selection Determination, at 2. After receiving SoBran's response, the agency made award to that firm. This protest followed. Priority One argues that NIAID failed to perform a reasonable cost-realism analysis.