TITLE:  Urban-Meridian Joint Venture, B-287168; B-287168.2, May 7, 2001
BNUMBER:  B-287168; B-287168.2
DATE:  May 7, 2001
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Urban-Meridian Joint Venture, B-287168; B-287168.2, May 7, 2001

Decision

Matter of: Urban-Meridian Joint Venture

File: B-287168; B-287168.2

Date: May 7, 2001

Michael A. Gordon, Esq., Holmes, Schwartz & Gordon, for the protester.

Benjamin N. Thompson, Esq., and Jennifer M. Miller, Esq., Wyrick Robbins
Yates & Ponton, for B&W Contract Services, Inc., an intervenor.

Thomas Y. Hawkins, Esq., GSA-Public Buildings Service, for the agency.

Mary G. Curcio, Esq., and John M. Melody, Esq., Office of the General
Counsel, GAO, participated in the preparation of the decision.

DIGEST

1. In evaluating experience and past performance of joint venture under
Small Business Administration mentor-protégé program, agency properly
considered that small business protégé, which would be performing a majority
of the work under the contract, had no relevant experience.

2. Agency's evaluation of protester's proposal as unacceptable under
staffing and approach factor was unobjectionable where agency reasonably
determined that protester did not propose sufficient staffing, and that the
proposed on-site supervisor did not have all experience required by the
solicitation.

3. In evaluating experience and past performance, agency reasonably credited
awardee, a new business entity, with the experience of employees who worked
on identical contract for predecessor firm.

DECISION

Urban-Meridian Joint Venture protests the award of a contract to B&W
Contract Services, Inc. (BWCS) under request for proposals (RFP) No.
GS-09P-00-KSC, issued by the General Services Administration (GSA) for
operation, maintenance and repair services at the United States Court of
Appeals in San Francisco, California. Urban-Meridian principally challenges
the evaluation of proposals.

We deny the protest.

The solicitation provided for an evaluation based on experience/past
performance, staffing/approach, and price; the non-price factors were more
important than price. Eight offerors responded to the solicitation,
including Urban-Meridian and BWCS. Based on the technical evaluation,
Urban-Meridian's proposal was ranked fourth and BWCS's first.
Urban-Meridian's price was low and BWCS's seventh low. The source selection
authority found that BWCS's significantly superior technical proposal was
worth its additional cost, and that it therefore represented the best value.
Accordingly, award was made to BWCS.

Urban-Meridian challenges the evaluation of its and the awardee's proposals
under both the experience/past performance and staffing/approach factors on
a number of bases. In reviewing a protest against a procuring agency's
proposal evaluation, our role is limited to ensuring that the evaluation was
reasonable and consistent with the terms of the solicitation and applicable
statutes and regulations. National Toxicology Labs., Inc., B-281074.2, Jan.
11, 1999, 99-1 CPD para. 5 at 3. Based on our review of the record, we find that
the evaluation under these factors was reasonable. We discuss
Urban-Meridian's principle arguments below.

EXPERIENCE/PAST PERFORMANCE

Urban-Meridian's Proposal

Urban-Meridian is a joint venture formed under the Small Business
Administration's (SBA) mentor-protégé program. [1] See 13 C.F.R. sect. 124.520
(2000). It is comprised of Urban Systems, Inc., a small disadvantaged
business, and Meridian Management Corporation, a large business. Under the
firms' joint venture agreement, while Meridian, as the mentor firm, would be
involved in performing the contract and would assist Urban, the protégé
firm, in gaining the experience and training necessary to compete for
federal contracts, Urban would be responsible for performing the majority of
the work under the contract, and would be significantly involved in managing
the contract. Mentor Protégé Agreement; Joint Venture Agreement; Protest at
4.

Urban-Meridian's proposal received an experience/past performance rating of
5 (out of 10 available) points. In reaching this rating, GSA considered that
Urban, the entity that would actually be responsible for performing the
day-to-day work at the courthouse, had no directly related experience;
Urban's only experience was performing two parking garage management
contracts. Evaluation Memorandum at 5. GSA also considered Meridian's
experience and past performance. GSA found that Meridian had some, though
not extensive, experience working with all required systems, and some
experience performing at courthouses. Id. GSA also considered the fact that
Meridian's past performance ratings were satisfactory, but not outstanding.
Agency Report (AR) at 7.

Urban-Meridian argues that GSA's downgrading of its proposal based on
Urban's lack of relevant experience effectively improperly nullified Urban's
participation in the mentor-protégé program, and also disregarded its plan
to hire the incumbent employees to perform the contract. According to Urban,
it is likely that the incumbent employees would accept employment with
Urban, and that the day-to-day work thus would continue to be performed by
experienced personnel. Urban asserts that the only other experience that
will be required is corporate management of the incumbent personnel which,
Urban insists, Meridian can supply.

This aspect of the evaluation was reasonable. Where an agency is evaluating
the experience and past performance of a joint venture, there is nothing
improper in its considering the specific experience and past performance of
the entity that would actually perform the work. See Global Eng'g & Constr.
Joint Venture, B-275999.4, B-275999.5, Oct. 6, 1997, 97-2 CPD para. 125 at 8.
The SBA regulations governing the mentor-protégé program do not provide
otherwise, see 13 C.F.R. sect. 124.520, and we find no other basis for
precluding the agency from fully considering the experience and past
performance of both firms in such an arrangement. As for Urban-Meridian's
intention to hire the incumbent employees, the firm's proposal did not
include any information demonstrating that these employees would accept
employment with Urban-Meridian. For example, Urban-Meridian did not submit
letters of interest or intent from the employees, and did not provide an
explanation of how it planned to recruit them; indeed, Urban did not even
indicate that it had contacted the employees. Under these circumstances,
GSA's failure to credit Urban with the experience of these potential
employees was not unreasonable. See generally Comprehensive Health Servs.,
Inc., B-285048.3 et al., Jan. 22, 2001, 2001 CPD para. 9.

BWCS's Proposal

The incumbent contractor for these services is B&W Service Joint Venture, an
entity comprised of Walker Services Corporation and LB&B Associates, Inc.
BWCS was formed by Walker and LB&B to bid on this follow-on contract. In
evaluating BWCS's proposal under the experience/past performance factor, the
agency recognized that the company was new and had no experience in its own
name. However, the agency also recognized that the staff BWCS proposed was
the same staff that is currently performing the contract for the joint
venture, and therefore considered the incumbent staff's experience and past
performance in evaluating BWCS under this factor. Supplemental Agency Report
at 2. Urban-Meridian complains that this was improper because the
solicitation required an evaluation of the offeror, not the offeror's
employees. [2]

A procuring agency properly may evaluate the corporate experience of a new
business entity by considering the experience of a predecessor firm,
including experience gained by employees while working for the predecessor
firm. The key consideration is whether the experience evaluated reasonably
can be considered predictive of the current offeror's performance under the
contract. Oklahoma County Newspapers, Inc., B-270849, B-270849.2, May 6,
1996, 96-1 CPD para. 213 at 4. Here, since the four on-site employees proposed
by BWCS worked for the predecessor firm in the same capacities they will
fill under the new contract, we think it was reasonable for the agency to
consider the employees' experience and past performance predictive of BWCS's
performance if it received award. It follows that the agency reasonably
considered the employees' experience in evaluating BWCS's proposal.

Urban-Meridian asserts that BWCS misrepresented that LB&B would have a role
in the performance of this contract by stating in its proposal that, "Along
with
Mr. Dugan's experience, B&W Contract Services, Inc. and LB&B Associates,
Inc., we bring a wealth of experience to the U.S. Court of Appeals in San
Francisco." BWCS Proposal at ES-1. According to Urban-Meridian, GSA relied
on this representation in assigning BWCS's proposal a score of 10 (out of 10
available) points for experience and past performance.

This argument is without merit. First, Urban-Meridian has taken the sentence
in BWCS's proposal regarding LB&B out of context. The quoted statement is
followed by:

Even though we have addressed LB&B Associates Inc.'s experience, B&W
Contract Services, Inc. is not dependent upon LB&B Associates, Inc. for
experience or references. B&W Contract Services, Inc., along with the
majority shareholder has the necessary experience and financial credentials
to perform continuing, high quality services under the resultant contract.

BWCS Proposal at ES-1. It was sufficiently clear from this statement, we
think, that BWCS was not representing that LB&B would be significantly
involved in performing the contract, and there was no other statement or
indication in BWCS's proposal to the contrary. Further, while one of the
evaluators indicated that he would have liked to see more than one past
performance reference for LB&B, the consensus evaluation report makes no
mention of LB&B. Rather, the discussion of BWCS's experience and past
performance centers solely on its extensive experience--through its
employees, not LB&B--using all critical electronic systems, and operating
and maintaining the mechanical, electrical and plumbing systems, and the
courthouse generally, for the past 5 years as the incumbent contractor.
Evaluation Memorandum at 4. We conclude that the evaluation in this area was
reasonable.

STAFFING/APPROACH

GSA found Urban-Meridian's proposal unacceptable under the staffing/approach
factor and assigned it 3 (of 10 available) points. GSA found that the
proposal was deficient because it did not establish that the on-site
supervisor had all of the experience required by the RFP, the proposed
staffing--three on-site employees, comprised of a desk attendant and two
technicians--was not sufficient to perform the contract, and the proposal to
have the project manager off-site, three time zones away, would result in
inadequate management attention. AR at 8. Regarding its staffing concerns,
GSA noted that Urban-Meridian planned to supplement the three employees with
part-time on-call employees, but found this approach impracticable given
security clearance requirements and the potential that the use of on-call
employees would adversely affect continuity of services. Evaluation
Memorandum at 5.

Urban-Meridian maintains that the significant downgrading of its proposal in
this area was unwarranted. First, it asserts that the on-site supervisor it
proposed in fact has all the experience required by the RFP. In this regard,
the RFP required all personnel working on the contract to have at least 3
years of recent experience in the operation and maintenance of equipment and
systems comparable in complexity to systems covered by the contract. RFP sect.
D.7.1. These systems included a PDSI Maximo Advantage Computerized
Maintenance Management System (CMMS). RFP sect. C.3.8. The agency explains that,
while Urban-Meridian claimed in its proposal that its on-site supervisor had
experience with a different, but comparable, CMMS, it could not evaluate
whether the system in fact was comparable because the proposal did not
identify the system. AR at 8. An offeror runs the risk of having its
proposal downgraded or rejected where, as submitted, it is inadequately
written. McHargue Constr. Co., B-279715, July 16, 1998, 98-2 CPD para. 21 at 6.
Since Urban-Meridian did not identify the allegedly comparable CMMS system,
it was reasonable for GSA to downgrade the proposal for failing to establish
that the proposed site manager possessed all required experience.

Second, Urban-Meridian asserts that GSA misled it into offering the three
employees, including a full-time service desk attendant, that GSA now claims
constituted an inadequate staff (the agency determined that four employees
would be optimal staffing). In this regard, it claims that GSA indicated
during a site visit that the desk service had to be "manned" on a full-time
basis, and implied in a response to an offeror's preproposal question that
two mechanics were the only current on-site employees, when in fact there
were three mechanics on-site in addition to the project manager. According
to Urban-Meridian, based on these statements, it believed it was proposing
the exact number and mix of staff that was currently in place.

This argument is without merit. At no time did the agency direct offerors
how to staff their proposals. Indeed, in response to a question that
specifically asked about the current staffing level, GSA stated: "As
staffing is one of the evaluation factors, we will not disclose the
information. It will be up to the offerors to propose their own staffing
level independently." RFP amend. 2, Question 5. The GSA statements on which
Urban-Meridian claims it relied in no way contradicted this question
response. The agency's reference to full-time service desk staffing merely
reflected a solicitation provision, RFP sect. C.4.4, and amend. 2, Question 13,
which required the contractor to operate a service call desk. In response to
the question regarding the service desk, the agency stated, "However
offerors want to provide this service should include in their technical
proposals under staffing." Id. While this statement could be more clearly
worded, it in no way called for "manning" the service desk on a full time
basis. With respect to the two mechanics, the question asked by a potential
offeror was: "The U.S. Court of Appeals has two mechanics now. Have these
mechanics been told or asked if they would stay under another contractor?"
In response, the agency did not direct offerors regarding staffing, but
stated only that it does not supervise on-site employees. RFP amend. 2,
Question 2. Urban-Meridian interpreted GSA's response as confirming that
there were only two mechanics on site. This interpretation was unreasonable.
The question 2 response did not directly address staffing and, in any case,
the response to question 5 made it clear that it was up to offerors to
determine the appropriate staffing, and that GSA would not provide staffing
information.

Finally, Urban-Meridian maintains that its proposed use of part-time,
on-call employees did not warrant downgrading its proposal. In this regard,
Urban-Meridian claims that, while these employees would have to obtain a
security clearance, this would not interfere with performance, since the
clearance process involves no more than the employee getting fingerprinted
and completing a personal history statement that must be checked by the
local police. Urban-Meridian further notes that its proposal indicated that
part-time personnel would be hired and trained in advance so that they
already would have security clearances when tasked under the contract.

GSA's concerns regarding part-time employees were reasonable. Although
Urban-Meridian attempts to minimize the impact of the security clearance
process on contract performance, it is clear that, even if it is limited to
fingerprinting and personal history checks by the local police, the process
will take some amount of time. We see nothing unreasonable in the agency's
considering the possibility that the clearance process could result in at
least minor delays in bringing in new employees and that, if the delays
occurred on a regular basis--whenever a new part-time employee was brought
in--the delays could disrupt performance, i.e., employees might not be
available when needed. Further, while Urban-Meridian asserts that it intends
to hire and clear the on-call employees in advance, its proposal states only
that "Urban-Meridian routinely recruits a team of part-time maintenance
engineers, electricians, plumbers and building tradesmen in the local area
for assignment to the Project as required in response to work surges and
reimbursable work requirements." Urban-Meridian Proposal sect. 2.1.2. Nothing in
this statement indicates that Urban-Meridian intends to hire and clear
part-time employees in advance.

AWARD DECISION

Urban-Meridian asserts that the scoring difference between its and BWCS's
proposals solely reflects BWCS's incumbency and cannot justify award at a
[DELETED] higher price. The record does not support Urban-Meridian's
assertion. While GSA considered BWCS's experience and performance as the
incumbent contractor, GSA also specifically found that BWCS, unlike
Urban-Meridian, has substantial experience in operating all relevant
electronic systems, substantial experience with facilities management
generally and courthouses specifically, and a sufficient on-site staff that
exceeds the requirements of the solicitation. Award Decision at 2,4,5. These
considerations all fell within the stated evaluation factors, and therefore
were appropriate discriminators between the proposals. We note that the fact
that some of these advantages derive from BWCS's performance as the
incumbent did not preclude the agency from considering them; agencies are
not required to neutralize such advantages of incumbency. Infrared Tech.
Corp., B-282912, Sept. 2, 1999, 99-2 CPD para. 41 at 5. Since, further, the
non-price factors were more important than price, there is no basis to
question the agency's conclusion that BWCS's substantially superior proposal
represented the best value to the government.

The protest is denied.

Anthony H. Gamboa

General Counsel

Notes

1. While the protester refers to a GSA mentor-protégé program, it cites no
regulations establishing or governing the program, and GSA has advised us
that no such program exists. We therefore assume that the protester intended
to refer to the SBA program.

2. Urban-Meridian raises several arguments based on its belief that the
agency violated the source selection plan; for example, it asserts that GSA
should have downgraded BWCS under the experience/past performance factor for
failing to provide the minimum three references called for under the source
selection plan. However, alleged violations of a source selection plan do
not provide a valid basis for protest. See ENMAX Corp., B-281965, May 12,
1999, 99-1 CPD para. 102 at 5.