KEI Pearson, Inc., B-294226.3; B-294226.4, January 10, 2005

KEI Pearson, Inc., B-294226.3; B-294226.4, January 10, 2005 TITLE: KEI Pearson, Inc., B-294226.3; B-294226.4, January 10, 2005 BNUMBER: B-294226.3; B-294226.4 DATE: January 10, 2005 ********************************************************************** Decision Matter of: KEI Pearson, Inc. File: B-294226.3; B-294226.4 Date: January 10, 2005 Scott T. Kragie, Esq., Robert E. Gregg, Esq., Karen R. Harbaugh, Esq., and Margaret L. Maciulla, Esq., Squire, Sanders & Dempsey, and William F. Savarino, Esq., and John J. O'Brien, Esq., Cohen Mohr, for the protester. Helaine G. Elderkin, Esq., Carl J. Peckinpaugh, Esq., and Charles S. McNeish, Esq., Computer Sciences Corporation, an intervenor. George U. Lane, Esq., General Services Administration, and Kenneth J. Densmore, Esq., Department of the Navy, for the agencies. Linda S. Lebowitz, Esq., and Michael R. Golden, Esq., Office of the General Counsel, GAO, participated in the preparation of the decision. DIGEST Where the solicitation required that all items or services be on a Federal Supply Schedule (FSS), the contracting agency improperly issued a task order to a vendor whose quotation was based on purchasing software products outside the framework of the FSS. DECISION KEI Pearson, Inc. protests the issuance of a task order to Computer Sciences Corporation (CSC) under request for quotations (RFQ) No. 4TNG17044035, issued by the General Services Administration (GSA) for phase II of the Navy Knowledge Online (NKO) system.(GSA conducted this acquisition on behalf of the Department of the Navy, the user activity.) KEI contends that GSA improperly issued the task order to CSC under that vendor's Federal Supply Schedule (FSS) contract. We sustain the protest. The mission of the NKO system is to provide the entire Navy "enterprise" (800,000 to 1.2 million users, with scalability up to 6 million users), with greater access to training, education, and professional development. RFQ attach. 1, at 1. The NKO system provides users with access to training for technical and professional development, delivering on-demand education and training 24 hours per day, 7 days per week, and anywhere in the world. The NKO system is required to operate using commercial-off-the-shelf products for the majority of applications in a "web-based environment" without "client side application." Id. As explained at the hearing conducted by our Office,[1] a "web-based environment" means that the "end user totally accesses all of these products and services . . . via . . . a common installed browser, whether it's at home or in the office environment or wherever [the user] might be. [The] whole concept was deliver training anytime, anywhere that the person could get Internet access." Tr. at 16. As further explained at the hearing, no "client side application" means that nothing "specific [needs] to be loaded on [a user's] particular computer. . . . Basically[,] if [the user] can log in and get to the Internet[,] [the user] can run th[e] application without anything extra being installed." Id. The RFQ contemplated the issuance of a combination fixed-price, time-and-materials task order (with nine line items) for a 1-year base period and four 1-year option periods to the vendor whose quotation represented the "best value" to the government considering technical evaluation factors and cost/price. The RFQ stated that technical merit would be considered significantly more important than cost/price and that the task order could be issued to other than the vendor submitting the lowest priced, technically acceptable quotation. RFQ attach. 26, at 1-2.[2] In addition, in an undated document containing general questions and clarifications, which was furnished to all vendors prior to the submission of revised quotations, GSA provided the following information: All items or services acquired by the offeror for this delivery order must either be on the GSA schedule, or acquired through a vendor that is on the GSA schedule. In the event that it is necessary to purchase an item through a vendor, the offeror must insure that their cost proposal properly accounts for all ancillary fees (e.g. pass through fees). Additionally, current GSA acquisition policy establishes an absolute ceiling of $25,000.00[3] for the aggregate value of all open market items purchased as part of this delivery order. General Questions and Clarifications, No. 12, at 49-50. As relevant here, KEI (which was teamed with the phase I incumbent contractor) and CSC submitted quotations for phase II.[4] In its revised final cost/price quotation, dated May 28, 2004, CSC provided a chart captioned "Other Direct Procurements by Vendor," in which CSC listed six items/services with corresponding costs and GSA schedule references.