B-297235; B-297235.2, Global, A 1st Flagship Company, December 27, 2005

B-297235; B-297235.2, Global, A 1st Flagship Company, December 27, 2005 TITLE: B-297235; B-297235.2, Global, A 1st Flagship Company, December 27, 2005 BNUMBER: B-297235; B-297235.2 DATE: December 27, 2005 *********************************************************************** B-297235; B-297235.2, Global, A 1st Flagship Company, December 27, 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: Global, A 1^st Flagship Company File: B-297235; B-297235.2 Date: December 27, 2005 William A. Roberts III, Esq., Richard B. O'Keeffe, Jr., Esq., Michael S. Caldwell, Esq., and William J. Grimaldi, Esq., Wiley Rein & Fielding LLP, for the protester. Michael J. Gardner, Esq., Troutman Sanders LLP, for George G. Sharpe, Inc., an intervenor. Robert J. McMullen, Esq., and Lori S. Chofnas, Esq., Department of the Navy, for the agency. Glenn G. Wolcott, Esq., and Michael R. Golden, Esq., Office of the General Counsel, GAO, participated in the preparation of the decision. DIGEST In procurement that placed greater importance on technical factors, agency's establishment of a competitive range of one, which consisted of the awardee's technically unacceptable initial proposal and which excluded protester's "highly acceptable" technical proposal, on the basis that protester's evaluated cost/price was 15 percent higher than the awardee's, was not reasonable where the agency's cost/price evaluation reflected various flaws and erroneous assumptions. DECISION Global, A 1^st Flagship Company protests the Department of the Navy's award of a contract to George G. Sharpe, Inc. under request for proposals (RFP) No. N00140-05-R-0042. The solicitation sought proposals to operate and maintain East Coast inactive ships for the Naval Inactive Ship Management Office (NISMO) in Philadelphia, Pennsylvania. Global maintains that the agency's establishment of a competitive range consisting of only Sharpe's proposal reflected various evaluation errors and lacked a reasonable basis. We sustain the protest. BACKGROUND In May 2005, the agency issued solicitation No. N00140-05-R-0042 seeking proposals to operate and maintain East Coast inactive ships under a cost-reimbursement contract for a base period and four 1-year option periods. The solicitation provided that the successful offeror will furnish direct labor, supervision, administrative support, and (with the exception of government furnished property) all materials necessary to perform the solicitation's requirements. RFP at 16. Global is the incumbent contractor for the protested procurement; Sharpe holds a similar contract for operation and maintenance of inactive ships on the West Coast. The solicitation stated that proposals would be evaluated on the basis of cost/price and the following technical evaluation factors which were listed in descending order of importance: technical and management approach; corporate experience; past performance;[1] personnel resources, and small business participation. RFP at 106. Offerors were advised that technical factors were more important than cost/price. Id. The solicitation further provided that "[i]f [an] offeror's proposal is determined unacceptable in any of the technical evaluation factors and/or subfactors, the proposal may not be considered for award." RFP at 107. With regard to cost/price proposals, the solicitation listed the government's estimated levels of required staffhours, by labor category and contract period;[2] offerors were required to propose labor rates, by contract period, for the various labor categories. With regard to costs for materials, the solicitation contained what the contracting officer described as "plug-in" numbers, Hearing Transcript (Tr.) at 21;[3] that is, numbers that, for purposes of the cost/price evaluation, would be applied to all offerors' proposals.[4] However, the solicitation did not specifically identify the items the government intended to be reflected in the materials "plug-in" numbers.[5] In this regard, the solicitation stated: "the term `material' includes supplies, equipment, hardware, automatic data processing equipment, and software." RFP at 62. However, the solicitation also stated, "The Government shall furnish all [necessary] tools/equipment/vehicles/ property/ADP/other equipment, as specified in Attachments 6, 7, 8 and 9. . . . In the event the material is not available, the Contractor is authorized to procure material which will be reimbursed as an Other Direct Cost (ODC)." RFP at 29.