B-299758.2, Business Consulting Associates, LLC, August 1, 2007

B-299758.2 Aug 01, 2007 Jump To VIEW DECISION DOWNLOADS RELATED PAGES GAO CONTACTS Highlights Business Consulting Associates, LLC (BCA), protests the award of a contract issued by the Department of Housing & Urban Development (HUD) to MacArthur & Baker International, Inc. d/b/a/ MBI Consulting (MBI) under request for proposals (RFP) No. R-ATL-01867, which was set aside for firms qualified under the Small Business Administration's (SBA) section 8(a) program, for post-closing portfolio management support services. BCA contends that the agency misevaluated proposals, including the awardee's apparent organizational conflict of interest (OCI). We deny the protest. View Decision B-299758.2, Business Consulting Associates, LLC, August 1, 2007 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: Business Consulting Associates, LLC File: B-299758.2 Date: August 1, 2007 J. Scott Hommer, III, Esq., Peter A. Riesen, Esq., Keir X. Bancroft, Esq., and Patrick R. Quigley, Esq., Venable LLP, for the protester. Philip M. Musolino, Esq., Musolino & Dessel, for MacArthur & Baker International, Inc., d/b/a MBI Consulting, an intervenor. Jud E. McNatt, Esq., Department of Housing & Urban Development, for the agency. Sharon L. Larkin, Esq., and James A. Spangenberg, Esq., Office of the General Counsel, GAO, participated in the preparation of the decision. DIGEST 1. Agency reasonably concluded that the protester's and awardee's proposals were –technically equivalent,— such that price became the discriminator in the award selection. 2. Protest that agency unreasonably accepted the awardee's mitigation plan for a potential –impaired objectivity— organizational conflict of interest (OCI) is denied, where only one of the team members (a subcontractor) had a potential OCI, only a small portion of the work was affected, and the agency reasonably determined that awardee's plan to transfer the affected work to the other team member (the prime contractor awardee), which was fully capable of performing the work independently of the team member with an OCI, was acceptable. DECISION Business Consulting Associates, LLC (BCA), protests the award of a contract issued by the Department of Housing & Urban Development (HUD) to MacArthur & Baker International, Inc. d/b/a/ MBI Consulting (MBI) under request for proposals (RFP) No. R-ATL-01867, which was set aside for firms qualified under the Small Business Administration's (SBA) section 8(a) program, for post-closing portfolio management support services. BCA contends that the agency misevaluated proposals, including the awardee's apparent organizational conflict of interest (OCI). We deny the protest. The RFP sought support for HUD's project managers in analyzing certain unique loans that have been (and will be) created and held by HUD under its –Mark-to-Market— (M2M) Program or its pilot program, the –Portfolio Re-Engineering Demonstration Program.— These typically below-market-interest-rate loans are generally in second lien position and are payable from a percentage of the operating cash flow on these recently underwritten transactions. The purpose of this procurement is to ensure that HUD's field office project managers are provided sufficient information to compare actual property performance to the anticipated performance outlined in the –M2M Restructuring Plan,— which is the contract for debt restructuring that is negotiated between the property owner and HUD. The contractor awarded this contract will, among other things, assist the HUD project managers in drawing accurate conclusions regarding the financial performance of a property and help establish payment amounts due to HUD on the loans. RFP at 11. The RFP contemplated the award of a –Hybrid Contract with Firm-Fixed-Price, Indefinite Quantity/Fixed Unit Rate, Labor Hour and Cost Reimbursement (No Fee) for Travel.— Id. at 4, 85. With the exception of the travel –contract line item numbers— (CLIN), all other CLINs were priced on a fixed-unit-price or fixed-hourly-rate basis, based on estimated quantities set forth in the solicitation. Id. at 5-9. The non-travel CLINs were for asset management and reporting services that included the following activities: post-closing portfolio management services (which included evaluating the financial performance of properties), portfolio database maintenance reporting and development (which included maintaining the government-owned portfolio database), and –intensive servicing— asset management services (which included investigating specific operating contracts and expenses; negotiating with owners, management agents, and tenants; and conducting property site visits). RFP at 15-25. The RFP provided for award on a –best value— basis, considering technical capability and experience, staffing and resources, past performance, and price.