United States Government Accountability Office 

Washington, DC 20548 

Comptroller General

of the United States

Decision 

Matter of: Granite Construction Company 

 

File: B-400706 

Date: January 14, 2009 

Brian Dowd for the protester. 

James H. Roberts III, Esq., and Carrol H. Kinsey Jr., Esq., Van Scoyoc Kelly PLLC, for 

Baldi Brothers, Inc., the intervenor. 

Bryan C. Naquin, Esq., and Paul Clay, Esq., Department of the Navy, Naval Facilities 

Engineering Command, for the agency. 

Paula A. Williams, Esq., and Ralph O. White, Esq., Office of the General Counsel, 

GAO, participated in the preparation of the decision. 

DIGEST 

Protest challenging evaluation of protester’s technical proposal as unacceptable is 

denied where record demonstrates agency reasonably concluded that protester’s 

offered small business subcontracting plan did not meet the solicitation’s 

subcontracting requirements or provide sufficient rationale supporting its lower 

goals; protester’s arguments amount to mere disagreement with agency’s 

conclusions. 

DECISION 

Granite Construction Company (Granite) of Sacramento, California, protests the 

award of a contract to Baldi Brothers, Inc., of Beaumont, California, under request 

for proposals (RFP) No. N62473-08-R-2206, issued by the Department of the Navy, 

Naval Facilities Engineering Command (NAVFAC) for runway repairs at Travis Air 

Force Base (AFB) in California. The protester argues that the agency improperly 

evaluated its proposal as technically unacceptable.1

 

 

1

 The protester was not represented by counsel and, therefore, did not have access to 

nonpublic information pursuant to the terms of a protective order. Accordingly, our 

discussion in this decision is necessarily general in nature to avoid reference to 

nonpublic information. Our conclusions, however, are based on our review of the 

entire record, including nonpublic information. 
We deny the protest. 

The RFP, issued on an unrestricted basis, sought proposals for a contractor to 

furnish all labor, approved materials, equipment, transportation, supervision, and 

incidental related work to provide runway repairs and the construction of a landing 

zone at Travis AFB. RFP at 45. The RFP contemplated the award of a fixed-price 

construction contract to the offeror submitting the lowest-priced, technically 

acceptable proposal. Proposals were to be evaluated on the basis of five evaluation 

factors: (1) past performance, (2) experience, (3) safety, (4) small business 

utilization, and (5) price. Id. at 80-87. Offerors were advised that an unacceptable 

rating under any non-price factor would render a technical proposal’s overall rating 

unacceptable;2

 only those technical proposals found acceptable would be evaluated 

under the price factor. Id. at 89. 

Of relevance to this protest, is the RFP’s evaluation scheme under the small business 

utilization factor. Under this factor, offerors were to identify the services to be 

subcontracted, and to provide the dollar values and percentage goals (expressed in 

terms of total planned subcontracting dollars) applicable to the contract. Offerors 

also were required to provide supporting rationale for any proposed subcontracting 

goals that were less than the solicitation’s minimum participation goals. RFP at 85. 

Proposals were to be evaluated on the levels of small business participation 

proposed, and on whether those proposed levels met the solicitation’s goals. The 

offeror, whose technically-acceptable proposal was the lowest priced, would “be 

required to submit an approved [plan] prior to award, which reflects the goals as 

stated in [its] proposal.” Id. 

 

2

 The solicitation defined an acceptable rating as: 

The [proposal] has demonstrated a minimally acceptable 

approach that is considered to meet the stated requirements. 

There is little risk that this proposer would fail to meet the 

quantity, quality, and schedule requirements. 

RFP at 89. An unacceptable rating was defined as: 

The proposal fails to meet the stated requirements. The 

submission lacks essential information or is conflicting and 

unproductive. There is no reasonable likelihood of success, 

deficiencies are so major or extensive that a major revision or 

complete rewrite of the proposal would be necessary. 

Id.

Page 2 B-400706 
The goals for participation by small businesses were identified as follows, and were 

calculated as a percentage of all subcontracted dollars: 

All Small Businesses 76.07% 

Woman-Owned Small Business 

(WOSB) 14.37% 

Small Disadvantaged Business 

(SDB) 16.03% 

Hub-Zone Small Businesses 

(HUBZone) 3% 

Veteran-Owned Small Business 

(VOSB) 3% 

Service Disabled Veteran 

Owned Small Business (SDVOSB) 3% 

RFP at 88. Offerors also were required to complete a small business subcontracting 

plan schedule, included in the solicitation as exhibit D, to furnish supporting detail 

regarding their proposed small business participation in subcontracting. Id. at 

97-102. 

Initial proposals were received from six offerors by the specified closing date. The 

agency evaluated these proposals and, as relevant here, Granite’s proposal was rated 

unacceptable because the firm proposed to subcontract 23.43 percent of the total 

work, of which only 2.52 percent would be subcontracted to small business 

concerns. Contracting Officer Statement, at 7. The contracting officer established a 

competitive range comprised of all six proposals and conducted discussions with 

each offeror. In one of the written discussion questions provided to Granite, 

concerning its small business subcontracting plan, the agency notified Granite that 

its proposed subcontracting goals did not meet the minimum small business 

participation goals required by the solicitation. Agency Report (AR) exh. 9, 

Discussion Letter, at 3. 

Following discussions, final proposal revisions (FPR) were requested, received, and 

evaluated. The agency found that Granite’s revised subcontracting plan did not meet 

the total small business subcontracting requirement, noting that the proposed 

percentages, based on the total subcontracted amount, were still “significantly lower 

than those identified in the RFP.” AR exh. 10, Post-Negotiation Business Clearance, 

at 7. The agency further noted that in its FPR, the protester did not provide 

supporting rationale for its proposed total small business percentage and for the 

lower HUBZone, WOSB, SDB, VOSB, and SDVOSB percentages. Id. As a result, 

Granite’s FPR was evaluated as technically unacceptable overall and award was 

made to Baldi as the lowest-priced technically acceptable offeror. AR exh. 10, 

Post-Negotiation Business Clearance, at 13. Following a debriefing, and prior to a 

decision on Granite’s agency-level protest, this protest was filed with our Office. 

Page 3 B-400706 
Granite argues that the agency’s conclusion that its subcontracting plan warranted 

an unacceptable rating was improper. Specifically, while acknowledging that its 

proposed subcontracting goals did not meet the stated solicitation requirements, 

Granite maintains that its proposal adequately explained its efforts to subcontract 

with qualified small business subcontractors.3

 Protester’s Comments at 4-6. 

Our Office reviews challenges to an agency’s evaluation of proposals only to 

determine whether the agency acted reasonably and in accord with the solicitation’s 

evaluation criteria and applicable procurement statutes and regulations. A 

protester’s mere disagreement with the agency’s judgment is not sufficient to 

establish that an agency acted unreasonably. Cherry Road Techs.; Elec. Data Sys.

Corp., B-296915 et al., Oct. 24, 2005, 2005 CPD ¶ 197 at 6. In response to the protest, 

the agency provided the detailed record of its evaluation and selection decision and 

our review confirms that the agency reasonably determined Granite’s proposal to be 

technically unacceptable. 

In a nutshell, the dispute between the protester and the agency arises over the 

method used to calculate an offeror’s compliance with the solicitation’s small 

business subcontracting goals. Simply put, the solicitation established goals for 

various types of small businesses, which were stated in terms of a percentage of total 

subcontracted dollars. In calculating compliance with the stated goals, Granite first 

subtracts the value of its major electrical subcontractor, which is a large business, 

and then calculates its compliance with the solicitation’s goals. In contrast, the 

agency includes the value of this significant subcontract, and calculates the goals 

using the larger total. 

Granite’s approach of deducting the value of the work to be provided by its large 

business electrical subcontractor before calculating its compliance with the RFP 

goals using the much smaller resulting number, means that Granite erred in two 

ways. First, its claimed percentages of the amount of total subcontracted dollars 

going to the various categories of small businesses were significantly overstated 

because they are not based on the total amount of Granite’s subcontracting dollars. 

In addition, because Granite overstated the resulting percentages, it failed to take the 

opportunity to explain why it could not meet the solicitation-required minimums. 

Finally, even if the agency wanted to accept Granite’s representation about why it 

could not meet the solicitation’s overall small business subcontracting goal--i.e., 

 

3

 To the extent Granite protests that the solicitation’s experience requirements 

preclude small businesses from performing both electrical and paving work, its postaward protest is untimely and will not be considered. Protester’s Comments at 2-3. 

Our Bid Protest Regulations require that protests based on alleged improprieties in a 

solicitation which are apparent prior to the time set for receipt of initial proposals, 

must be filed prior to the time set for receipt of initial proposals. 4 C.F.R. 

§ 21.2(a)(1) (2008). 

Page 4 B-400706 
Page 5 B-400706 

76.07 percent of subcontracted dollars--Granite’s FPR says nothing about the other 

applicable small business goals--i.e., the goals applicable to WOSBs, SDBs, HUBZone 

small businesses, VOSBs, or SDVOSBs. In short, Granite’s proposed approach to 

subcontracting does not do either of the two things this solicitation required with 

respect to these other categories of small businesses--i.e., either meet the applicable 

goals, or explain why the goals could not be met. 

To the extent that Granite asserts that its subcontracting plan was a draft plan that 

could have been revised prior to award if the agency was not satisfied, we disagree. 

As quoted previously, the RFP clearly indicates that the agency would evaluate an 

offeror’s small business subcontracting plan as part of the non-price evaluation and 

would then evaluate further only those proposals rated acceptable under each nonprice factor. Consistent with that evaluation scheme, the agency would again review 

and approve the subcontracting plan of the technically acceptable offeror whose 

proposal was deemed the lowest-priced. This approach does not mean the agency 

acted improperly when it decided not to accept a proposal that did not address the 

requirements of the solicitation and give Granite a third opportunity to address the 

situation (since this matter was clearly raised during discussions) after the selection 

decision. 

Under the circumstances here, we think the agency acted reasonably when it 

concluded that Granite had not responded adequately to the small business 

subcontracting requirements set forth in this solicitation. 

The protest is denied. 

Gary L. Kepplinger 

General Counsel