Consolidated Engineering Services, Inc., B-291345; B-291345.2, December 23, 2002

Consolidated Engineering Services, Inc., B-291345; B-291345.2, December 23, 2002 TITLE: Consolidated Engineering Services, Inc., B-291345; B-291345.2, December 23, 2002 BNUMBER: B-291345; B-291345.2 DATE: December 23, 2002 ********************************************************************** Consolidated Engineering Services, Inc., B-291345; B-291345.2, December 23, 2002 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: Consolidated Engineering Services, Inc. File: B-291345; B-291345.2 Date: December 23, 2002 William A. Roberts, III, Esq., Timothy W. Staley, Esq., and Jonathan L. Kang, Esq., Wiley Rein & Fielding, for the protester. John S. Albanese, Esq., and Andrew B. Blumenfeld, Esq., Department of Defense, for the agency. Linda S. Lebowitz, Esq., and Michael R. Golden, Esq., Office of the General Counsel, GAO, participated in the preparation of the decision. DIGEST Protest is sustained where the record fails to reasonably support the agency's decision to eliminate from consideration as technically unacceptable the only proposal received from a commercial offeror in the private-sector portion of the competition conducted pursuant to Office of Management and Budget Circular A-76. DECISION Consolidated Engineering Services, Inc. (CESI) protests the decision of the Department of Defense (DOD) to eliminate from consideration its proposal to operate, maintain, and repair the Pentagon Heating and Refrigeration Plant (H&RP) in Arlington, Virginia. CESI argues that the agency's decision was unreasonable. We sustain the protest. BACKGROUND The Pentagon H&RP requirements at issue here are for steam production, chilled water production, electrical distribution, steam distribution, chilled water distribution, and sewage. Historically, the annual operating cost of the Pentagon H&RP has been approximately $5.4 million. Agency Report (AR), Tab 1, Acquisition Plan, at 1. On May 11, 2001, pursuant to the provisions of Office of Management and Budget (OMB) Circular A-76, the agency issued solicitation No. MDA946-00-R-0034 in order to select a commercial offeror to compete against the government's *most efficient organization* (MEO) under the A-76 cost comparison process.[1] Here, the private‑sector competition was conducted in two phases--phase 1 (request for qualifications) and phase 2 (request for proposals). The cost of the phase 2 private‑sector proposal selected as representing the best value to the government would then be compared to the cost of the government's MEO in accordance with OMB Circular A-76. The agency contemplated the award of a fixed-price with award fee contract to the offeror who successfully competed against the MEO. Phase 1--Request for Qualifications (RFQ) For phase 1, the agency issued an RFQ under which offerors were to provide written submissions and to make oral presentations regarding two technical evaluation factors--past performance and management approach. RFQ S:S: L-3, L-4, at 133-135. With respect to past performance, offerors were required to provide a *Project Master List* of all contracts for operation and maintenance activities, ongoing or completed, within the last 5 years in excess of $1 million. RFQ S: L-4.1.a, at 134. Offerors were also to provide *Relevant Project Summaries,* which were to detail the work performed on five *relevant* contracts selected from the offeror's project master list. As pertinent here, the RFQ defined *relevant* as follows: those operation and maintenance contracts, ongoing or completed, within the last 5 years, with comparable levels of complexity to the operation and maintenance of the Pentagon H&RP. These may include, but are not limited to, experience with: operation and maintenance of central plant facilities, operation and maintenance of large utility distribution systems, coordination with on-going adjacent renovation projects, integrated environmental management as part of operation and maintenance of facilities. RFQ S: L-4.1.b, at 135. For the five relevant contracts selected, offerors were to provide, for example, the following information: the relevance to the Pentagon H&RP contract; major systems operated and maintained, to include boilers (number, make, model number, capacity, and fuel type); chillers (number, make, model number, capacity, and refrigerant type); steam distribution systems (sizes and types); chilled water distribution systems (sizes); electrical distribution systems (sizes); and sewage distribution systems (sizes and types). Id. With respect to management approach, offerors were to describe the management approach they would apply to meet the Pentagon H&RP requirements.