Link: GAO Opinion
Agency: Department of the Army
Disposition: Protest denied.
Keywords: Technical Evaluation; Price Realism
General Counsel P.C. Highlight: A protester’s mere disagreement with the agency’s judgment in its determination of the relative merit of competing proposals does not establish that the evaluation was unreasonable.
The Department of the Army issued a request for proposals (RFP) to award a fixed-price indefinite-delivery/indefinite-quantity (ID/IQ) contract for a base year and four option years for the mobilization, lease, operation, and demobilization of dining facilities (DFACs) for soldiers and civilian personnel in Kuwait. Najilaa International Catering Services (Najilaa) was not awarded the contract and challenges the agency’s evaluation of proposed staffing levels and associated pricing of the awardee, who was also the incumbent, and claims that the agency failed to conduct meaningful discussions with Najilaa regarding the perceived excessive staffing plan.
The contract was to be awarded based on a “best value” basis that considered mission capability, strategic plans, past performance, and price. Offerors were notified in the RFP’s performance work statement (PWS) that services likely would expand or decrease during performance of the contract and to provide for greater flexibility and to limit risk, the contractor would assume the risk related to the uncertainty of the food service requirements. Also, the PWS provided that the contractor must be capable of operating the DFACs 24-hours, seven days a week, and must provide sufficient workforce to prepare, serve, clean, and maintain the facilities.
Although Najilaa’s proposal received ratings of acceptable overall under the mission capability factor and excellent for the lesser-weighted strategic plans factor, no past performance information had been submitted and so the agency assessed an unknown risk rating for that factor. The agency found Najilaa’s DFAC staffing excessive for the meal service requirements anticipated by the RFP and Najilaa was asked to provide its rationale for the staffing levels. Najilaa responded that it felt the labor quantities to be necessary to meet the PWS requirements, but the agency found this explanation insufficient. Najilaa’s final proposed price was $157 million. The awardee/incumbent’s final proposed price was $60 million.
In reviewing a protest against an agency’s evaluation of proposals, GAO will not reevaluate proposals but instead will examine the record to determine whether the agency’s judgment was reasonable and consistent with the stated evaluation criteria. A protester’s mere disagreement with the agency’s judgment in its determination of the relative merit of competing proposals does not establish that the evaluation was unreasonable. In its review of the record and denial of the protest, GAO found that Najilaa unreasonably interpreted the PWS’s staffing requirements. GAO stated that although the PWS required the contractor to provide staffing at maximum feeling levels when the agency required, this need was anticipated as infrequent and atypical. GAO found that Najilaa was unreasonable in assuming that offerors were required to propose operations at maximum feeding levels for the entire five-year period.
As to Najilaa’s contention that the agency failed to adequately assess the realism of the awardee’s price, the GAO found that, in this case, a fixed-price contract does not require an agency to conduct a price realism evaluation. The RFP did not specifically require a price realism evaluation and did not require offerors to provide cost or pricing data.
Finally, GAO did not resolve the issue of whether the agency failed to conduct meaningful discussion with Najilaa, since the record was clear that Najilaa did not suffer competitive prejudice and Najilaa did not have a substantial chance of receiving the award. GAO stated that Najilaa never explained, specifically, how it would have changed its proposal to decrease staffing levels. GAO denied the protest.