Link: GAO Opinion
Agency: Department of Veterans Affairs
Disposition: Protest denied.
General Counsel P.C. Highlight:
GAO denied the protest of Walsh Investors, LLC, regarding the award of a contract to Fedcar Company Ltd., under a solicitation issued by the Department of Veterans Affairs (VA) for the lease of a healthcare center in Fayetteville, North Carolina.
The VA issued the solicitation for offers seeking offerors to provide a 20-year lease of approximately 250,000 net usable square feet of space at a pre-determined site located in Fayetteville, North Carolina. The successful offeror was to construct a new building on the site that will house a VA healthcare center. The solicitation informed offerors of the agency’s minimum requirements with regard to the development of the building and land, and the services to be provided. The solicitation set forth the following evaluation factors in descending order of importance: (1) price, measured in annual price per net usable square foot, including any option period; (2) technical quality, including the quality of the building and the design concept; (3) the offeror’s qualifications, including past performance; and (4) the adequacy and efficiency of the operations and maintenance plans.
Walsh argued that the agency engaged in misleading discussions, considered unstated evaluation criteria, and made an unreasonable tradeoff decision.
GAO found that the record did not support the protester’s assertion that it was misled or coerced into raising the amount of its building and maintenance reserve. During discussions, the agency informed each offeror of the relationships between the average prices proposed by all offerors and the prices proposed by that offeror. In this regard, the agency informed both Walsh and Fedcar that their building and maintenance reserve was low compared to the average proposed by all offerors. As GAO has long made clear, it stated, it will not sustain a protest where, as here, an agency has treated offerors equally by providing them with the same information during discussions, and where the protester responds by increasing its proposed price primarily for reasons within its business judgment.
GAO noted that while the solicitation did not expressly provide that the agency would take into consideration an offeror’s plan to include adjacent land in the lease, it did provide that the agency was to evaluate the offerors’ development of the site to accommodate the VA’s conceptual building footprint, including the required setbacks, the ingresses and egresses to and from the entrances, traffic patterns to maximize flow of vehicles to and from the main thoroughfare, and how the landscaping design fits the surrounding areas. Therefore, GAO found that the agency’s consideration of the additional acreage was reasonably related to the stated evaluation criteria. Specifically, the agency found that Fedcar’s additional five acres of land adjacent to the proposed site would allow for increased visibility, an additional point of ingress and egress, a site access point at an existing traffic signal, significantly improved on-site traffic circulation, and the possibility of shifting the planned perimeter parking from under the existing power-line easement.
Finally, GAO found that the agency’s tradeoff decision was reasonable. The protester provided no basis for its assumption that the benefits associated with Fedcar’s provision of the additional land–including increased visibility, an additional point of ingress and egress, a site access point at an existing traffic signal, significantly improved on-site traffic circulation, and the possibility of shifting the planned perimeter parking–can be calculated simply by multiplying the number of acres by the most recent numbers from the county tax assessment. In its tradeoff decision, the contracting officer considered that Fedcar’s building design featured many well thought out elements that enhanced the building’s function, a maintenance plan that showed a full understanding of the health care requirements, and the financial ability to perform, noting that Fedcar’s proposal was ranked first under the non-price factors. The contracting officer’s comparison of the strengths and weaknesses associated with Fedcar’s and Walsh’s proposals was reasonable, consistent with the solicitation criteria, and treated the offerors equally. Therefore, GAO found that the agency adequately justified its selection of Fedcar’s higher-rated proposal in accordance with the stated evaluation criteria.