United States General Accounting Office

Washington, DC 20548 

Comptroller General

of the United States

Decision 

Matter of: SDS International, Inc. 

File: B-291183.4; B-291183.5 

Date: April 28, 2003 

Barbara S. Kinosky, Esq., and James S. Phillips, Esq., The Centre Law Group, for the 

protester. 

Michael A. Gordon, Esq., Holmes, Schwartz & Gordon, for CBD Training, Inc., an 

intervenor. 

John D. Inazu, Esq., Robert L. Allen, Esq., and Clarence D. Long, III, Esq., 

Department of the Air Force, for the agency. 

Charles W. Morrow, Esq., and James A. Spangenberg, Esq., Office of the General 

Counsel, GAO, participated in the preparation of the decision. 

DIGEST 

1. Agency reasonably exercised discretion in implementing recommendation made 

in GAO decision, which sustained a protest on the basis that the agency 

misevaluated one of the three evaluation subfactors of the mission capability factor 

included in the solicitation, when it decided to not reopen discussions, to not 

reevaluate past performance (because GAO denied the protest of this evaluation), 

and to evaluate all subfactors of the mission capability factor. 

2. Agency reasonably determined that the strengths in the awardee’s proposal that 

were found to be a significant benefit to the agency were sufficient to offset the price 

advantage of the protester’s proposal, which did not offer comparable strengths. 

DECISION 

SDS International, Inc. protests the award of a contract to CBD Training, Inc. under 

request for proposals (RFP) No. F44650-02-R-0009, issued by the Department of the 

Air Force, Air Combat Command Contracting Squadron, Langley Air Force Base 

Virginia, for aircrew training and courseware development. 

We deny the protests. 

The RFP, a small business set-aside issued on April 3, 2002, is for aircrew training 

and courseware development at the 57th Wing United States Air Force Weapons 

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. 
Page 2 B-291183.4; B-291183.5 

School (USAFWS), Nellis Air Force Base, Nevada, under a fixed-price contract for a 

30-day phase-in period and a base year with 4 option years. 

The RFP provided for award on a “best value” basis considering as evaluation factors 

past performance, mission capability, risk, and price. Past performance and mission 

capability were of equal importance in the evaluation scheme, followed by risk, with 

price being of least importance. Under the mission capability factor, the RFP listed 

three subfactors in descending order of importance: (1) training and workload 

management, (2) courseware development approach and instructional systems 

development management plan, and (3) phase-in. With regard to the first subfactor, 

training and workload management, the RFP stated: 

This subfactor will be evaluated to insure the offeror is employing 

personnel with qualifications commensurate with the requirements of 

the SOW and is managing these personnel effectively. This subfactor 

examines the contractor’s proposed manning levels, personnel 

qualifications, personnel mix, and the duties and responsibilities of the 

site manager. All manning positions must be fully supported by the 

contractor’s workload analysis. 

RFP at 48. 

A number of proposals were submitted. After discussions were conducted and final 

proposal revisions submitted, the source selection evaluation team (SSET) 

determined the proposals of SDS (the incumbent contractor) and CBD were the 

highest rated of those submitted, receiving the following ratings1

: 

Past Performance Mission Capability/Risk 

Subfactor 

No. 1 

Subfactor 

No. 2 

Subfactor 

No. 3 

Price 

Blue Green Blue SDS Very Good/Significant 

Confidence Low Low Low $15,964,852 

Blue Green Green CBD Exceptional/High 

Confidence Low Low Low $17,916,218 

 

1

 The possible past performance ratings were exceptional/high confidence, very 

good/significant confidence, marginal/little confidence, and unsatisfactory/no 

confidence. The possible color ratings for the mission capability factor were 

blue/exceptional, green/acceptable, yellow/marginal, and red/unacceptable. The 

RFP defined blue/exceptional as when the proposal “exceeds specified minimum 

performance or capability requirements in a way beneficial to the Air Force.” The 

possible risk ratings were high, moderate, and low. RFP at 47, 49. 
Page 3 B-291183.4; B-291183.5 

Initial Agency Report, Tab 14, Source Selection Decision, at 2. 

The source selection authority (SSA), after discussions with the SSET Chair, 

contracting officer, and other source selection advisors, decided to increase CBD’s 

rating to blue under the second subfactor of the mission capability factor on the 

basis that CBD’s proposal--[DELETED]--exceeded the stated requirements in a 

beneficial way. The SSA referenced these strengths (and others) in CBD’s proposal 

in justifying selecting CBD’s higher-priced proposal. 

In protesting the award, SDS argued that the source selection was irrational because 

the SSA unjustifiably increased CBD’s rating under the second subfactor of the 

mission capability factor. We sustained the protests in SDS Int’l, Inc., B-291183, 

B-291183.2, Dec. 2, 2002, 2003 CPD ¶ ___, finding: 

[T]he SSA’s discussion of the [DELETED] strength does not comport to 

the contents of CBD’s proposal. This is important here because of the 

three strengths discussed by the SSA to justify raising CBD’s rating to 

blue under this subfactor, the [DELETED] strength was the only one 

that was “viewed to be of significant value.” Thus, CBD’s blue rating 

for this subfactor and the source selection decision identifying this as a 

“visionary approach" in justifying the award are not, on this record, 

reasonably based. 

Id. at 5. On the other hand, we denied SDS’s protest challenging the Air Force’s 

ratings of CBD’s past performance as exceptional and SDS’s as very good. We 

recommended that: 

the Air Force reevaluate the proposals, reopen discussions and obtain 

revised final proposals, if appropriate, and make a new source 

selection. If CBD is not the successful offeror, its contract should be 

terminated and a new award made. 

Id. at 10. 

To implement our recommendation, the Air Force reconvened the SSET and 

replaced two of the four members.2

 Since we did not reject the reasonableness of 

the Air Force’s past performance evaluation, the Air Force chose not to reevaluate 

this aspect of SDS’s and CBD’s proposals. On the other hand, the Air Force decided 

to have the reconstituted SSET reevaluate the prior final proposals of CBD and SDS 

under all of the mission capability subfactors, even though our decision found error 

 

2

 The Air Force attributed the staffing changes to scheduling conflicts encountered 

by the prior members. 
Page 4 B-291183.4; B-291183.5 

only with the agency’s evaluation of CBD’s proposal under the second subfactor. 

Discussions were not reopened, nor were revised proposals solicited or obtained. 

The SSET’s reevaluation resulted in the following ratings under the mission 

capability factor: 

Mission Capability/Risk 

Subfactor No. 1 Subfactor No. 2 Subfactor No. 3 

Green Green Green SDS Low Low Low 

Blue Green Green CBD Low Low Low 

Agency Report, Tab 28, Source Selection Decision, at 13. 

Under the first subfactor, training and workload management, the SSET reduced 

SDS’s proposal’s rating to green from the blue rating it had received under the initial 

evaluation.3

 The SSET found two strengths and no weaknesses in SDS’s proposal 

under this subfactor. One strength was SDS’s [DELETED] that ensured that each 

training division would have [DELETED]. The other strength was SDS’s proposal to 

provide an [DELETED] that went “beyond” the SOW requirements. See Agency 

Report, Tab 26, SSET’s Worksheets. 

In contrast, CBD’s proposal retained its blue rating under this subfactor.4

 The SSET 

found four strengths in CBD’s proposal under this subfactor. One strength was 

CBD’s proposal of an [DELETED]. A second strength was CBD’s proposal to provide 

[DELETED]. The third strength was CBD’s proposal to provide an [DELETED]. 

The final strength was CBD’s proposal of a “[DELETED]. Id.

Under the second subfactor, courseware development approach and instructional 

systems development management plan, SDS’s proposal received a green rating with 

two strengths. One strength was SDS’s [DELETED], which standardized 

[DELETED]. The other strength was SDS’s use of [DELETED]. The SSET also 

assigned CBD’s proposal a green rating under this subfactor with two strengths. 

 

3

 The SSET found that SDS’s staffing plan consisted of [DELETED] base personnel 

with [DELETED] Instructor/Subject Matter Experts (I/SME), and [DELETED] 

personnel, including [DELETED] I/SMEs, after exercise of all contract options. 

Agency Report, Tab 26, SSET’s Worksheets. 

4

 The SSET found that CBD proposed [DELETED] core personnel with [DELETED] 

I/SMEs, with [DELETED] core personnel with [DELETED] I/SMEs after all options 

were exercised. Agency Report, Tab 26, SSET’s Worksheets. 
Page 5 B-291183.4; B-291183.5 

The strengths were CBD’s proposed [DELETED], and CBD’s proposal of a 

[DELETED]. Id.

Under the third subfactor, phase-in, the SSET also reduced SDS’s rating from blue to 

green, although it identified a strength in SDS’s proposal. This strength was SDS’s 

proposal of a [DELETED]. CBD’s proposal also was rated green under this subfactor 

with one strength. This strength related to CBD’s plan to provide a [DELETED] as 

part of its contractor-furnished equipment. Id. 

Based upon a comparative assessment of the proposals, the SSA concluded that 

CBD’s superior past performance and technical features were worth the higher price. 

In particular, the SSA noted that CBD’s proposal to provide [DELETED] [and] [t]his 

added benefit is expected to save over 3,000 Air Force Weapons School Instructor 

hours every year.” Further, the SSA found that CBD’s proposed [DELETED] was an 

“innovative approach,” which will enable CBD’s [DELETED]. The SSA also viewed 

CBD’s plan of using an [DELETED] as an innovative and beneficial approach. 

Agency Report, Tab 29, Source Selection Decision, at 4-5. 

On the other hand, the SSA noted that, even though SDS’s proposal reflected 

strengths involving their [DELETED], the proposal was “without any enhancements 

comparable to those in the CBD proposal.” The SSA found that SDS’s staffing 

approach did “little more than maintain the status quo in terms of the overall training 

approach.” Id. at 5. 

The SSA concluded that the additional costs to obtain the superior training program 

proposed by CBD over the program proposed by SDS were worth the added benefit. 

The SSA also found that [DELETED], and the agency’s confidence in CBD’s ability to 

perform in an exceptional way, made the difference in price “well worth our 

investment.” Id. at 6. The award to CBD was affirmed on January 6, 2003. 

These protests followed. 

SDS contends that the Air Force acted unreasonably by deciding to reevaluate the 

previously submitted proposals of CBD and SDS, as opposed to reopening 

discussions and obtaining revised proposals, and by limiting the reevaluation to only 

the mission capability factor. SDS argues that rather than reevaluating proposals, 

the Air Force merely downgraded its proposal in the areas where it previously had 

obtained blue ratings, and that its proposal should have retained those blue ratings 

since it had strengths that exceeded the minimum requirements. SDS complains that 

in contrast the agency did not fairly or equally rate CBD’s proposal where it retained 

its blue ratings. SDS contends that the Air Force’s actions reflect bias, and unequal 

treatment towards SDS, and maintains the agency only reevaluated those areas 

where SDS’s scores could be lowered. 

In reviewing a protest against an agency’s evaluation of proposals, our Office will not 

reevaluate proposals but instead will examine the record to determine whether the 
Page 6 B-291183.4; B-291183.5 

agency’s judgment was reasonable and consistent with the stated evaluation criteria 

and applicable statutes and regulations. See U.S. Def. Sys., Inc., B-245563, Nov. 3, 

1992, 92-2 CPD ¶ 317 at 4. A protester’s mere disagreement with the agency’s 

judgment in its determination of the relative merits of competing proposals does not 

establish that the evaluation was unreasonable. C. Lawrence Constr. Co., Inc., 

B-287066, Mar. 30, 2001, 2001 CPD ¶ 70 at 4. Based on our review of the record, 

including the written proposals, the pleadings, and hearing testimony, we find no 

basis to overturn the award.5

Here, the SSA, after consulting with the contracting officer and Air Force legal 

counsel, made the decisions to (1) not conduct further discussions and obtain 

revised proposals, (2) not reevaluate past performance, and (3) evaluate all 

subfactors of the mission capability factor. The SSA explained that he chose not to 

conduct discussions because the agency found no weaknesses or deficiencies in the 

proposals, nor did it need to ask any questions about the technical proposals. 

Hearing Transcript (Tr.) at 286-87. With regard to his decision not to reevaluate past 

performance, he relied on the facts that our decision did not take issue with the 

agency’s prior past performance evaluation of the proposals, that the past 

performance records were clear, and that both offerors received very high ratings. 

See Tr. at 242, 299-300, 302-03, 307-09, 312. He also testified that all subfactors, not 

just the second subfactor, of the mission capability factor were reevaluated because 

he sought to have a “fresh” look taken of the proposals in light of our decision, 

particularly since he believed the prior evaluation of the mission capability factor did 

not adequately reflect the agency’s view that CBD’s proposal was in fact superior 

overall to SDS’s (even discounting the flaws in the evaluation found in our prior 

decision), and because he viewed the mission capability factor as an integrated 

whole, such that he did not believe that the second subfactor could alone be the 

subject of a reasonable assessment by an SSET with members not familiar with the 

prior evaluation. See Tr. 249-50, 279-82, 290-93, 350, 362-63. 

The details of implementing our recommendations for corrective action are within 

the sound discretion and judgment of the contracting agency, and we will not 

question an agency’s ultimate manner of compliance, so long as it remedies the 

procurement impropriety that was the basis for the decision’s recommendation. 

ST Aerospace Engines Pte, Ltd., B-275725.3, Oct. 17, 1997, 97-2 CPD ¶ 106 at 5. 

On the record before us, we find no basis to question the agency’s actions. 

 

5

 At the hearing conducted by our Office, the SSA, chairman of the SSET, and one of 

the voting SSET members responsible for reevaluating the proposals provided 

detailed explanations for the scope of the agency’s reevaluation, the reasons for the 

changes in only SDS’s scores from blue to green under the first and third subfactors, 

and the bases for the blue rating for CBD’s proposal under the first subfactor. 
Page 7 B-291183.4; B-291183.5 

While, as the protester suggests, a more comprehensive method of implementing our 

recommendation could have been chosen by the Air Force, including reopening 

discussions and obtaining revised proposals and reevaluating past performance, the 

agency has stated a reasonable basis for not performing these actions. Specifically, 

the record does not show any weaknesses or deficiencies in SDS’s proposal that 

required discussions.6 Moreover, SDS has offered no new evidence, not considered 

in our prior decision, that would indicate that the past performance ratings of SDS 

and CBD were not reasonable. Finally, it was within the discretion of the agency to 

consider the mission capability factor as a whole, since our prior decision did not 

preclude this evaluation and it has offered a reasonable explanation (set forth above) 

as to why it was necessary. 

As noted, SDS contends that the lowering of its ratings under the first and third 

subfactors of the mission capability factor from blue to green was unreasonable and 

reflected bias on the part of the evaluators to improperly justify the agency’s prior 

award decision. 

The agency’s witnesses testified that these changes in the ratings were made based 

on their closer consideration of whether awarded strengths in the proposals were 

beneficial to the Air Force in some material way, and that they determined that some 

strengths under a subfactor that may exceed requirements were not significant 

enough to justify a blue rating. Tr. at 36, 79-80. In performing this evaluation, the 

evaluators referenced the RFP’s definition of blue: “exceeds specified minimum 

performance or capability requirements in a way beneficial to the Air Force.” 

RFP at 47. In deciding whether strengths were sufficiently beneficial to the 

government to support a blue rating under a subfactor, the agency drew a distinction 

between those strengths that were beneficial to the contractor, in that they primarily 

related to the contractor’s reduction of its risk of not successfully performing the 

contract, versus those strengths that provided significant tangible benefits to the 

Air Force beyond the SOW requirements. The evaluators felt that strengths under a 

subfactor primarily for the benefit of the contractor related more to the risk 

evaluation factor and were not sufficient to justify a blue rating for that subfactor, 

whereas strengths under a subfactor with significant tangible benefits to the 

Air Force may warrant a blue rating. See Tr. at 35-37, 61-63, 79-80, 85-86, 163-67, 

172-73. 

For example, the SSET found that the strengths under the first subfactor found for 

the [DELETED] proposed by SDS did not present material significant benefits to the 

 

6

 While SDS references certain comments in the reevaluation documentation that 

SDS was not proposing to furnish a [DELETED] as evidence that discussions were 

required, the record indicates that these comments did not reflect a weakness in 

SDS’s proposal, but were simply a contrast to CBD’s proposal, which received a 

strength for offering these items. 
Page 8 B-291183.4; B-291183.5 

Air Force, but primarily reduced the contractor’s risk, because the [DELETED],7 and 

SDS’s [DELETED]. Tr. at 137-39, 163-67, 172-73. 177-78. Similarly, the strength 

awarded SDS under the third subfactor relating to its “[DELETED]” was considered 

to be a proposal feature that tended more to reduce SDS’s risk of successfully 

performing the contract, such as [DELETED], rather than adding a significant benefit 

to the USAFWS program, and thus the SSET felt that a blue rating was not 

appropriate for this subfactor. Tr. at 37. 61-63, 216-19. 

In contrast, the SSET found that CBD’s proposal warranted a blue rating under the 

first subfactor primarily because CBD proposed to provide [DELETED], which the 

SSET believed would be beneficial to the USAFWS and its students. See Tr. at 22-25, 

37-40. 

SDS maintains that the Air Force unreasonably rated CBD’s proposal blue under the 

first subfactor. For example, SDS argues that, in contrast to SDS’s proposal, CBD’s 

proposal failed to identify personnel by name and qualification, or to provide a 

detailed site organizational chart, but the proposal was based upon hiring the 

incumbent’s workforce. See Agency Report, Tab 17, CBD’s Proposal at II-2-19. 

However, the Air Force’s representatives explained that this lack of specificity was 

not a major concern because CBD proposed to hire SDS’s incumbent personnel, who 

already met the contract’s qualification requirements. The SSA explained that he 

thus viewed the proposals as essentially equal in this respect since they both relied 

upon the same personnel, and that the agency was satisfied with CBD’s statements 

that it would comply with the SOW requirements because CBD received the highest 

rating under past performance, which evidences CBD’s ability to field a qualified 

workforce. See Tr. at 135, 341. We find this explanation to be reasonable under the 

circumstances. 

SDS also argues that the Air Force unreasonably evaluated CBD’s proposal 

[DELETED], contending that no reasonable analysis was made of CBD’s staffing 

levels to ascertain the realism and achievability of these promises. The protester 

complains that very little detail was provided in CBD’s proposal regarding specific 

tasks, and that it is unlikely that CBD can satisfy the minimum SOW requirements 

and also provide [DELETED], given the hours reflected in its staffing model, 

especially since CBD’s staffing allegedly reflects half the hours proposed by SDS for 

similar tasks. 

 

7

 The SSET member testified that the reason that the [DELETED] was not considered 

a greater benefit to the Air Force was because this individual was not dedicated to 

the contract, since his primary duties related to other SDS work, and 

he was available for the USAFWS contract only in the event of shortfalls. 

See Tr. at 137-39. 
Page 9 B-291183.4; B-291183.5 

However, the record evidences that the Air Force specifically considered CBD’s 

staffing in light of its proposal to provide [DELETED]. CBD’s proposal states that 

“[DELETED].” Agency Report, Tab 10, CBD Evaluation Notice Response (CBD-4), 

at 3-4; Tab 17, CBD’s Proposal at II-2-11, II-2-15. 

An SSET member testified that the Air Force, through various calculations, was able 

to determine that CBD’s estimate of staff-hours contained sufficient flexibility to 

cover the hours needed to meet these terms in its proposal. See Tr. at 125-26, 186-97, 

202-09. In this regard, CBD’s proposal was based on the premise that the 

[DELETED], and on [DELETED]. See Agency Report, Tab 17, II-2-13 to II-2-19. 

Thus, the fact that CBD’s proposal reflects fewer I/SME hours than SDS’s for certain 

tasks does not necessarily indicate that CBD cannot meet its proposal promises. 

In this regard, the [DELETED] proposed by CBD will perform [DELETED] that 

would otherwise have to be performed by the [DELETED], as SDS apparently 

contemplated in its approach. 

While the risk of poor performance when a contractor is forced to provide services 

at little or no profit under a fixed-priced contract is a legitimate concern that should 

be considered by the agency, the record here shows that the agency could 

reasonably conclude that the efficiencies inherent in CBD’s approach would allow it 

to satisfy the SOW requirements, the promised [DELETED] support to Air Force 

instructors, and the [DELETED].8 See Burnside-Ott Aviation Training Ctr., Inc: 

Reflectone Training Sys., Inc., B-233113, B-233113.2, Feb. 15, 1989, 89-1 CPD ¶ 158 

at 11. Based on this record, we cannot say the blue rating awarded CBD’s proposal 

under the first subfactor was unreasonable. 

As indicated, SDS largely objects to the evaluation on the grounds that it should have 

received higher color ratings for the strengths proposed in its proposal. However, 

color-coded ratings, adjectival ratings, and point scores are no more than guidelines 

for intelligent decision making to assist source selection officials in evaluating 

proposals; they do not mandate automatic selection of a particular proposal. 

The question ultimately is whether the record supports the agency’s conclusions 

regarding the relative merits of proposals. See Research for Better School, Inc., 

B-270774.3, June 17, 1996, 96-2 CPD ¶ 41 at 8-9. 

Here, the SSA explained that he did not rely solely on the color ratings, but he was 

“far more interested” in the written information underlying the support for the 

ratings, in which the benefits to the Air Force of each proposal were described, 

which the SSA characterized as “word pictures.” See Tr. at 254-55, 270. Here, the 

record indicates that the SSA reasonably found that the number and nature of the 

strengths associated with CBD’s proposal provided it with a clear technical 

 

8

 CBD is clearly obligated to satisfy the promises made in its fixed-price proposal. 

The issue here is whether the agency reasonably evaluated those promises. 
Page 10 B-291183.4; B-291183.5 

advantage over SDS’s proposal. In doing so, the SSA concluded that CBD’s technical 

approach of [DELETED] was an innovative approach, beyond the “status quo” nature 

of SDS’s technical approach, worth the additional cost premium. Based on our 

review, we cannot find the agency’s judgment to be unreasonable. 

While protester argues that the lowering of SDS’s ratings, but not CBD’s, from blue 

to green is indicative of bias on the part of the agency, the agency representatives 

testified that the differences in the color ratings of SDS’s proposal between the two 

evaluations were not of particular concern to the agency because in the second 

evaluation the SSET focused exclusively on evaluating SDS’s and CBD’s proposals, 

unlike the prior evaluation when other offerors were also being considered, and 

because the new SSET team made a “fresh assessment” of the proposals with closer 

attention paid to the definitions in the color-coded ratings. See Tr. at 15, 36, 63, 77, 

163-64, 174-75, 216-17, 219-20, 311. Since we find the agency has reasonably justified 

the award to CBD, there is no basis to challenge the award based on allegations of 

bias. 

The protests are denied. 

Anthony H. Gamboa 

General Counsel