B-298266, Serco, Inc., August 9, 2006

B-298266 Aug 09, 2006 Jump To VIEW DECISION DOWNLOADS RELATED PAGES GAO CONTACTS Highlights Serco, Inc. protests the award of a contract to AMSEC LLC under request for proposals (RFP) No. N65236-05-R-0501, issued by the Department of the Navy, Space and Naval Warfare Systems Command, for program management, engineering design, industrial work, operational verification and other installation support services necessary to accomplish the Navy's command, control, communications, computer, intelligence, surveillance, and reconnaissance maintenance, modernization, and new system installation for requirements on the West Coast. Serco objects that the Navy failed to consider the potential impact of the Navy's cost adjustments in the technical evaluation of AMSEC's proposal. We sustain the protest. View Decision B-298266, Serco, Inc., August 9, 2006 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: Serco, Inc. File: B-298266 Date: August 9, 2006 Claude P. Goddard, Jr., Esq., Stephen B. Hurlbut, Esq., J. Michael Littlejohn, Esq., and Daniel J. Donohue, Esq., Akerman Senterfitt Wickwire Gavin, for the protester. James J. McCullough, Esq., Deneen J. Melander, Esq., and Steven A. Alerding, Esq., Fried, Frank, Harris, Shriver & Jacobson LLP, for AMSEC LLC, an intervenor. Michael S. Roys, Esq., Space and Naval Warfare Systems Command, Department of the Navy, for the agency. Paul N. Wengert, 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 agency rejected the awardee's rationale for proposed staffing levels under sample tasks, which led the agency, as part of a cost realism analysis, to more than double the hours proposed by the awardee to correspond with the government estimate, but the contemporaneous record did not demonstrate that the agency, in light of its cost realism adjustment, reviewed the awardee's understanding of the contract requirements, as required by the solicitation. DECISION Serco, Inc. protests the award of a contract to AMSEC LLC under request for proposals (RFP) No. N65236-05-R-0501, issued by the Department of the Navy, Space and Naval Warfare Systems Command, for program management, engineering design, industrial work, operational verification and other installation support services necessary to accomplish the Navy's command, control, communications, computer, intelligence, surveillance, and reconnaisance maintenance, modernization, and new system installation for requirements on the West Coast.[1] Serco objects that the Navy failed to consider the potential impact of the Navy's cost adjustments in the technical evaluation of AMSEC's proposal. We sustain the protest. BACKGROUND The RFP contemplated the award of a single indefinite-delivery/indefinite-quantity, cost-plus-incentive-fee and fixed-fee, performance-based contract for all West Coast requirements.[2] The RFP specified that the non-price evaluation factors were significantly more important than price.[3] When issued, the RFP specified two non'price evaluation factors (specifically, professional employee compensation plan and small business subcontracting plan) that would be evaluated on an –acceptable/unacceptable— basis, while the remaining non-price evaluation factors (as relevant here, understanding of work--sample tasks, and management plan) would be assigned points. Offerors also were required to provide responses to three sample tasks,[4] including pricing each task, and offerors were advised that the cost/price evaluation would be based on the total cost proposed for the sample tasks. The RFP specified that award would be made to the offeror whose proposal was determined to provide the –best value— to the government. RFP at 125. Both AMSEC and Resource Consultants, Inc. (RCI)[5] submitted timely proposals to perform the West Coast portion of the RFP. Upon evaluating the proposals, the Navy –determined that it was not possible to perform a proper cost realism evaluation on the offerors['] proposals.— Pre-Negotiation Business Clearance Memorandum at 8. Among the reasons for that conclusion were that some offerors had assumed that other vendors (such as shipyards) would perform some elements of the sample tasks, some offerors' amounts for other direct costs appeared flawed, and –none of the offerors appeared to have enough hours to perform the taskings in comparison with the [independent government estimate (IGE)],— which had not been disclosed to offerors. Id. at 8-9. The Navy then determined that it would disclose the IGE, amend the RFP, hold discussions, and ultimately obtain revised proposals. The Navy issued amendment No. 5 to the RFP on December 14, 2005.