Austal USA, LLC

B-417593 Aug 28, 2019 Jump To VIEW DECISION DOWNLOADS RELATED PAGES GAO CONTACTS Highlights Austal USA, LLC (Austal) of Mobile, Alabama, protests the award of a contract to Huntington Ingalls, Inc. (HII) under request for proposals (RFP) No. N00024-18-R-4313 issued by the Department of the Navy, Naval Sea Systems Command for planning yard support for littoral combat ships. Austal objects to the Navy's evaluation of its own and HII's technical proposals. The protester also challenges the agency's evaluation of the awardee's cost proposal. We deny the protest. View Decision 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:  Austal USA, LLC File:  B-417593 Date:  August 28, 2019 Brian A. Darst, Esq., Odin Feldman Pittleman PC, for the protester. John W. Chierichella, Esq., Keith R. Szeliga, Esq., Katie Calogero, Esq., and Adam A. Bartolanzo, Esq., Sheppard Mullin Richter & Hampton LLP, for Huntington Ingalls, Inc., the intervenor. Rhonda L. Russ, Esq., and Mayank Dixit, Esq., Department of the Navy, for the agency. Kasia Dourney, Esq., and Christina Sklarew, Esq., Office of the General Counsel, GAO, participated in the preparation of the decision. DIGEST 1.  Protest challenging an agency’s assignment of moderate risk to protester’s technical proposal for its intended use of subcontractors is denied where the solicitation provided that reliance on subcontractors would invite higher scrutiny in the evaluation process. 2.  Protest challenging an agency’s evaluation of an awardee’s technical proposal as meriting low risk for its intended use of a wholly-owned subsidiary is denied where the solicitation did not provide that proposals would be downgraded for relying on a corporate affiliate in performing the contract, and the agency’s conclusion was reasonable. DECISION Austal USA, LLC (Austal) of Mobile, Alabama, protests the award of a contract to Huntington Ingalls, Inc. (HII) under request for proposals (RFP) No. N00024-18-R-4313 issued by the Department of the Navy, Naval Sea Systems Command for planning yard support for littoral combat ships.  Austal objects to the Navy’s evaluation of its own and HII’s technical proposals.  The protester also challenges the agency’s evaluation of the awardee’s cost proposal.  We deny the protest. BACKGROUND The solicitation, issued on July 12, 2018,[1] sought proposals for planning yard support services to include engineering, technical, planning, ship configuration, data, and logistics lifetime support efforts required for littoral combat ships (LCS).[2]  AR, Tab 1, RFP at 59.  The RFP, as amended, contemplated the award of a cost-reimbursement contract with a 1-year base period, and five 1-year options.  RFP at 2-43, 169.  The RFP advised that proposals would be evaluated on the basis of cost, and the following five non-cost factors, in descending order of importance:  (1) technical approach; (2) management approach; (3) efficiencies; (4) transition plan; and (5) past performance.[3]  RFP at 240-41.  The first three non-cost factors included multiple equally-weighted subfactors, as follows: Factor I:  Technical Approach Subfactor 1 – Planned Maintenance System (PMS) Planning Subfactor 2 – Chief of Naval Operations (CNO) Availability Planning Subfactor 3 – Capabilities and Facilities Subfactor 4 – Quality Assurance (QA) Processes, Procedures and Management Subfactor 5 – Scheduling and Orchestrating Maintenance and Modernization Factor II:  Management Approach Subfactor 1 – Management Plan Subfactor 2 – Subcontract Management Subfactor 3 – Staffing Personnel Factor III:  Efficiencies Subfactor 1 – Lifecycle Cost Reduction Initiatives Subfactor 2 – Incorporation of Previous Experience/Lessons Identified. RFP at 240.  Regarding the cost factor, the solicitation provided offerors with the level of effort in terms of estimated numbers of labor hours for each year of the contract, and offerors were to propose direct and indirect rates for those hours.  Contracting Officer’s Statement and Memorandum of Law (COS/MOL) at 2.  The solicitation stated that, for purposes of award, all non-cost factors, when combined: are significantly more important than the Total Evaluated Cost (Factor VI).  However, the significance of Total Evaluated Cost as an evaluation factor will increase with the degree of equality in overall merit of competing proposals under the non-cost factors. RFP at 241 (emphasis in original).  The solicitation described the adjectival ratings and definitions to be used in evaluating the proposals, anticipating a combined technical/risk method of assessment of proposals, to include “consideration of risk in conjunction with the strengths, weaknesses, significant weaknesses, uncertainties and deficiencies” identified in the proposals, and the degree of risk of unsuccessful performance.  RFP at 242-43.  The RF...