B-296783; B-296783.3, ITT Federal Services International Corporation, October 11, 2005

B-296783; B-296783.3, ITT Federal Services International Corporation, October 11, 2005 TITLE: B-296783; B-296783.3, ITT Federal Services International Corporation, October 11, 2005 BNUMBER: B-296783; B-296783.3 DATE: October 11, 2005 ************************************************************************************** B-296783; B-296783.3, ITT Federal Services International Corporation, October 11, 2005 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: ITT Federal Services International Corporation File: B-296783; B-296783.3 Date: October 11, 2005 Kevin P. Connelly, Esq., Joseph J. Dyer, Esq., Grace Bateman, Esq., Alexander X. Jackins, Esq., Z. Taylor Schultz, Esq., Amanda B. Weiner, Esq., and Jamison L. Weinbaum, Esq., Seyfarth Shaw LLP, for the protester. Karen L. Manos, Esq., John F. Stanton, Esq., and R. William Sigler, Esq., Howrey LLP, for Kellogg, Brown & Root Services, Inc., an intervenor. Nancy J. Williams, Esq., Robert J. McKenney, Esq., Song U. Kim, Esq., and Richard C. Bennett, Esq., U.S. Army Corps of Engineers, for the agency. Scott H. Riback, Esq., and John M. Melody, Esq., Office of the General Counsel, GAO, participated in the preparation of the decision. DIGEST Protest challenging agency's evaluation of proposals is sustained where record shows that (1) agency improperly failed to consider a staffing understatement in awardee's proposal that could have had a material effect on the agency's technical and price/cost evaluation conclusions, and (2) agency's staffing estimates for various program requirements lacked a reasonable basis. DECISION ITT Federal Services International Corporation protests the award of a contract to Kellogg, Brown & Root Services, Inc. (KBR) under request for proposals (RFP) No. DACA78-03-R-0033, issued by the U.S. Army Corps of Engineers to acquire logistics support services throughout the Army's European theater of operations. ITT maintains that the agency misevaluated proposals. We sustain the protest. BACKGROUND The RFP contemplated the award of a combination firm fixed-price (FFP), cost-plus-award-fee (CPAF), indefinite-delivery, indefinite-quantity contract to meet a wide range of logistics support requirements for the Army in its European theater of operations for a base period and 4 option periods. The total period of performance is 58 months, and the maximum dollar value of the contract is approximately $1.2 billion. The RFP was divided among nine contract line items (CLINS) for each performance period. Four of the CLINS were for specific geographic areas to be supported (CLIN 0002 was for Bosnia, CLIN 0003 for Kosovo, CLIN 0004 for Hungary, and CLIN 0005 for Macedonia), and the remaining five CLINS were for theater-wide requirements such as facilities and equipment. Each CLIN was further divided into numerous sub-line items (SCLIN) that were for particular services to be provided. For purposes of preparing price/cost proposals, offerors were to provide lump-sum pricing for the FFP SCLINS; those lump-sum prices were to be based on historical workload and the performance work statement (PWS), both included in the RFP. As for the CPAF SCLINS, offerors were instructed to provide pricing either on the basis of labor hour estimates included in the RFP (although the labor hours were specified, offerors were required to provide their own labor mix) or, where no labor hours were specified, to provide both staffing and cost information.[1] RFP, sect. B. Award was to be made to the firm submitting the proposal deemed to offer the "best overall value" to the government, considering price/cost and two broad non-price/cost considerations--business/management/technical approach and past performance. The RFP advised that the price/cost and business/management/technical approach factors were equal in importance, and that each was significantly more important than past performance, and further, that the past performance and business/management/technical approach factors together were more important than price/cost.