SIZE APPEAL OF: EVOLVER, INC., APPELLANT

*1 On February 18, 2014, the U.S. Small Business Administration (SBA) Office of Government Contracting, Area II (Area Office) issued Size Determination No. 2-2013-147, finding that Evolver, Inc. (Appellant) is not an eligible small business for Department of Homeland Security Solicitation No. HSHQDC-11-R-10001 because it exceeded the applicable size standard.

*1 Appellant contends the size determination is clearly erroneous, and requests that SBA's Office of Hearings and Appeals (OHA) reverse the size determination and find Appellant to be a small business for the instant procurement. For the reasons discussed infra, the appeal is denied, and the size determination is affirmed.

*1 OHA decides size determination appeals under the Small Business Act of 1958, 15 U.S.C. § 631 et seq., and 13 C.F.R. parts 121 and 134. Appellant filed the instant appeal within fifteen days of receiving the size determination, so the appeal is timely. 13 C.F.R. § 134.304(a). Accordingly, this matter is properly before OHA for decision.

*1 On November 1, 2010, the Department of Homeland Security (DHS) issued Solicitation HSHQDC-11-R-10001 (RFP) seeking Information Technology support services for DHS's Enterprise Acquisition Gateway for Leading Edge Solutions II (EAGLE II) program. The solicitation sought an update on the existing EAGLE program. The IT support services to be provided by the contractor are within a broad range of services, solutions, and contract types established by the solicitation. The solicitation was organized into the following distinct Functional Categories (FC): (1) Service Delivery (including Integration, Software Design/Development, Operations & Maintenance); (2) Information Technology Program Support Services; and (3) Independent Verification and Validation. Offerors were responsible for providing proposals that detailed how they would deliver the full range of IT services, technical and management expertise, and solution-related enabling products to meet the requirements of the FCs.

*1 The Contracting Officer (CO) assigned the type of contract as a Multiple Award Indefinite-Delivery, Indefinite-Quantity (IDIQ) contract. The CO anticipates that numerous Task Orders (TO) will be issued throughout the life of the contract, and the Statement of Work (SOW) states that TOs will encompass a wide range of services, comprising professional services, as well as a full-range of electronic and information technology solutions that include hardware, software and enabling products necessary for implementation. (SOW, Section H.) All proposals needed to be submitted in two volumes for evaluation: (i) Technical and Management; and (ii) Pricing. However, evaluations will occur separately and distinctively for each FC, with small business offerors not allowed to submit proposals in more than one FC. (SOW, Section L.) Small Business offerors will be evaluated on the Best Value to the Government. (SOW, Section M.) The non-price factors, when added together, are considered more important than the Price factor.

*2 On February 3, 2011, the CO issued Amendment No. 5 to the solicitation. The Amendment served to notify offerors to changes made to the existing Attachment L-1, Pricing Templates, Materials and Summary Tab. The changes were meant to show the raw evaluation values in the total value column for each year. The Amendment further stated that any “[f]ailure to use the Amendment 000005 version of Attachment L-1, Pricing Templates, will result in non-compliance.” (Amendment No. 5, at 1.)

*2 The RFP contained a small business track that was set-aside for small business concerns, and assigned North American Industry Classification System (NAICS) code 541512, Computer Systems Design Services, with a corresponding $25 million average annual receipts size standard.

*2 On August 28, 2013, the CO notified all unsuccessful offerors that Appellant had been one of successful offerors selected for award. On September 4, 2013, MetroStar Systems, Inc. (MetroStar), an unsuccessful offeror, filed a protest with the CO, claiming that Appellant was not an eligible small business concern because its revenues exceeded the size standard associated with the RFP for small business track offerors.

*2 On February 18, 2014, the Area Office issued its size determination finding Appellant is not a small business concern for the solicitation at issue, and its assigned NAICS code.

*2 The Area Office found that Michael O'Kane holds 100% of Appellant's stock. Mr. O'Kane also acts as Appellant's CEO. The Area Office added that it found no other concerns affiliated with Appellant. Size Determination at 2.

*2 In response to the protest allegations, Appellant stated that it submitted its offer on this procurement on December 29, 2010, thus it should only be required to provide its Federal income tax from 2007, 2008 and 2009. Appellant contended to the Area Office that its proposal was responsive at that time as DHS did not modify the solicitation. Id.

*2 In reviewing the solicitation, the Area Office found that DHS had issued several amendments to the solicitation. After Appellant had submitted its proposal, DHS issued Amendment No. 2, responding to vendor questions, as well as extending the due date for proposals for the small business set-aside portion of the solicitation. Amendment No. 3 provided further responses to vendor questions while Amendment No. 4 corrected and clarified certain solicitation terms. On February 3, 2011, the CO issued Amendment No. 5, requiring offerors to use an amended version of the Pricing Template as part of any offer, stating that “Failure to use the Amendment 000005 version of Attachment L-1, Pricing Templates, will result in non-compliance.” Id.

*3 The Area Office states that at the time the solicitation was issued, 13 C.F.R. § 121.404(a) required offerors to recertify its small business status at time of submittal of a responsive offer that includes price. The Area Office allowed Appellant to provide a response to the implication that its size should be determined based on the date it submitted its offer using the newly required Pricing Template. Appellant responded by stating that its December 29, 2010 offer was not unresponsive based on Amendment No. 5. Appellant added that when submitting the Pricing Template, the information contained therein was the same, without any revisions, as the information provided in its original proposal. Id. at 3.

*3 The Area Office disagreed with Appellant's arguments, and determined that Amendment No. 5 made initial offers nonresponsive unless offerors complied with the requirements of the new Pricing Template. Id. at 5. The Area Office relied on a statement included as part of the Pricing Template that requires an offeror to declare its size and a cost and pricing table. The Area Office determined that Amendment No. 5 effectively made all initial offers nonresponsive. Therefore, the Area Office concluded that the date to determine size is February 23, 2011, the date Appellant submitted its revised offer according to Amendment No. 5. Thus, Appellant's Federal tax returns for 2008, 2009, and 2010 would be required in order to properly calculate Appellant's size. Id.

*3 Appellant failed to provide the Area Office with its 2010 Federal tax returns, acknowledging that any calculation that included its 2010 revenues would make Appellant exceed the size standard associated with this procurement. Consequently, the Area Office determined that Appellant is not a small business concern for the solicitation at issue.

*3 On February 27, 2014, Appellant filed its appeal of the size determination with OHA. Appellant argues the Area Office erred in determining that the date to determine Appellant's size is February 23, 2011.

*3 Appellant argues Amendment No. 5 did not require offerors to recertify their size, and specifically, only “required the resubmission of the pricing template to make changes in the manner the information submitted was assessed and calculated for evaluation purposes.” Appeal at 4. Appellant maintains that the resubmission of its pricing information was the same as its original proposal offer, except that the resubmission conforms to the Pricing Template provided in Amendment No. 5. Appellant further adds that the resubmission did not contain a size recertification as Appellant believed it was not required to do because Amendment No. 5 did not significantly alter the scope of the RFP, nor did DHS specifically required recertification.

*4 Next, Appellant contends that in its second submission, with the new Pricing Template, Appellant submitted the exact same pricing information as its initial offer on December 29, 2010. Appellant argues that because there is no difference between the initial offer and the offer conforming to Amendment No. 5, Appellant's “first submission should be considered responsive in this matter.” Id. at 7. Appellant states that the new Pricing Template was required in order to facilitate DHS's evaluation calculations.

*4 Appellant argues that past OHA decisions have found initial offers unresponsive when a modification to a solicitation is extensive and not a “simple request to provide the same information on an updated template.” Id. at 10. Some of the examples of changes listed by Appellant include changes to a start date, period of performance, price, and estimate for cost of performance. Id at 10-11; citing Size Appeal of Continental Staffing, Inc., SBA No. SIZ-4824 (2006); Size Appeal of TPMC Energy Solutions Environmental Services, LLC, SBA No. SIZ-5109 (2010). Appellant maintains that submitting its initial offer on a reformed template does not rise to the level of a significant change requiring recertification of its small business status or making its initial offer unresponsive. Appellant argues that similar to Size Appeal of Medical and Occupational Services, SBA No. SIZ-4989 (2008), Amendment No. 5 does not alter the solicitation's purpose or scope of work. Appellant concludes that the template requirements resulting from Amendment No. 5 did not extensively and significantly alter the solicitation as to make Appellant's initial offer unresponsive. Id. at 15. Thus, the date to determine Appellant's size should be December 29, 2010.

*4 On March 20, 2014, MetroStar filed its response to the appeal. MetroStar requests that OHA affirm the size determination and deny Appellant's appeal.

*4 MetroStar argues the solicitation's explicit requirement that Amendment No. 5's Pricing Template must be used in order to have a compliant offer made Appellant's initial offer of December 29 unresponsive. (Response, at 3.) MetroStar contends that in this situation, the true issue is whether initial offers were no longer responsive to the solicitation, and not whether the change of Pricing Template's was insignificant enough. Because Appellant's offer was no longer responsive due to changes made to the solicitation, MetroStar asserts that Appellant's February 23, 2011, submission was its proper responsive offer, and as such, the date to determine Appellant's size is February 23. (Id. at 4.) MetroStar reasons that “[h]ad [Appellant] failed to follow the [CO]'s instruction that it use the new Pricing Template L-1, then [[Appellant] would have been nonresponsive to the RFP.” (Id. at 5.) MetroStar concludes that Appellant's new responsive offer included price, and SBA regulations at the time offers were due make clear that Appellant recertified its small business status on February 23, 2011, thus Appellant is not a small business concern for this solicitation.

*5 On March 20, 2014, the SBA offered its response to the appeal. SBA supports the Area Office's size determination and requests that OHA affirm their decision.

*5 SBA asserts that Amendment No. 5 made any previous offers unresponsive. SBA supports this contention by asserting that the CO's email response to an inquiry by the Area Office unmistakably states that all offers not in compliance with the Pricing Template issued in Amendment No. 5 will be considered nonresponsive. (SBA Response, at 6.) SBA adds that Amendment No. 5 unequivocally modified the solicitation in accordance with SBA regulations in place at the time. Because the new Pricing Template required offerors to submit their size status, SBA argues that Appellant's size should be determined from the time it represented its size status, February 23, 2011.

*5 Next, SBA contends the new Pricing Template required offerors to “specify their size status as of the time revised Pricing Templates were completed.” (Id. at 8.) SBA further adds that Amendment No. 5, in no uncertain terms, made any and all previous offers unresponsive, and required that all new offers contain the offerors size status. SBA states that “where a CO wishes to ensure that award will be made to a legitimate small business concern, the CO has the discretion to require recertification as part of an amendment to a solicitation.” (Id. at 9.) SBA concludes that the Area Office properly applied the SBA regulation in place at the time, and that Appellant's responsive offer was submitted on February 23, 2011.

*5 Appellant has the burden of proving, by a preponderance of the evidence, all elements of the appeal. Specifically, Appellant must prove the size determination is based upon a clear error of fact or law. 13 C.F.R. § 134.314. OHA will disturb an area office's size determination only if, after reviewing the record, the administrative judge has a definite and firm conviction that the area office erred in making its key findings of fact or law. Size Appeal of Taylor Consultants, Inc., SBA No. SIZ-4775, at 11 (2006).

*5 At the time the RFP was issued, the size regulations stated that if an agency modifies a solicitation so that initial offers are no longer responsive to the solicitation, then a concern must recertify as a small business when it submits its responsive offer, including price, to the new solicitation. 13 C.F.R. § 121.404(a) (rescinded effective March 4, 2011, 76 Fed. Reg. 5680, 5683 (February 2, 2011)).

*6 Here, the CO issued Amendment No. 5 on February 3, 2011, informing offerors to changes made to the existing Attachment L-1, Pricing Templates, Materials and Summary Tab. The amendment changed the raw evaluation values in the total value column for each year of the existing Pricing Template. The Amendment further stated that any “[f]ailure to use the Amendment 000005 version of Attachment L-1, Pricing Templates, will result in non-compliance.” Appellant argues that Amendment No. 5 did not require offerors to recertify their size status and that it did not alter Appellant's initial proposal. Appellant adds that because the amendment did not extensively and significantly alter the solicitation, the date to determine size should be at the time of its initial proposal, on December 29, 2010. Nonetheless, the issue is whether Amendment No. 5 rendered the initial offers nonresponsive. For the reasons discussed below, I disagree with Appellant and uphold the Area Office's determination.

*6 Although Amendment No. 5 did not contain changes to the SOW which would have rendered initial quotes nonresponsive, Amendment No. 5 undeniably held that any offer submitted by that point will no longer be responsive unless it contained the revised Pricing Template. In the past, OHA has held that changing a solicitation's pricing tables is a minor change that does not change the purpose of the solicitation and the scope of work. Size Appeal of Medical and Occupational Services Alliance, SBA No. SIZ-4989 (2008); Size Appeal of DynaLantic Corporation, SBA No. SIZ-5125 (2010). However, in Medical and Occupational Services Alliance, SBA No. SIZ-4989, cited by Appellant, the amendment at issue did not contain the CO's declaration that any previous initial offer which did not contain the new pricing table would be considered nonresponsive.

*6 Here, Amendment No. 5 stated that “[f]ailure to use the Amendment 000005 version of Attachment L-1, Pricing Template, will result in non-compliance.” Amendment No. 5, at 1. The amendment's wording makes it clear that the solicitation has been modified in a manner that makes any offer submitted prior to February 3, 2011 no longer responsive to the solicitation. The language in the solicitation is categorical and clearly mandates that any proposal not including Amendment No. 5's Pricing Template is not compliant with the solicitation and thus not eligible for award.

*6 A proposal that fails to conform to the material terms and conditions of the solicitation is unacceptable and may not form the basis for award. Business Integra, Inc., B-407273.22, Feb. 27, 2014, 2014 CPD ¶ 114. An offeror bears the burden of submitting an adequately written proposal in the format required by the solicitation, including all information requested or necessary for the proposal's evaluation. Herman Construction Group, Inc., B-408018.2, B-408018.3, May 31, 2013, 2013 CPD ¶ 139. In Business Integra, GAO held that a proposal which failed to include information whose omission the solicitation clearly stated would render a proposal ineligible was in fact ineligible; despite the offeror's argument the information was immaterial. In Herman Construction, GAO held that failure to submit proposals in the required Excel format rendered a proposal nonresponsive. This precedent compels a conclusion that here, Amendment No. 5 established a new mandatory template for the submission of pricing that rendered previous offers nonresponsive.

*7 Accordingly, the provision of 13 C.F.R. § 121.404(a) applied, and Appellant was required to recertify its size with its response to Amendment No. 5. Hence, consistent with § 121.404(a), February 23, 2011, the date when Appellant submitted its revised proposal, remains the correct date for the Area Office to determine Appellant's size. The Area Office thus did not err when using that date to determine Appellant's size. I must therefore affirm the size determination and deny the appeal.

*7 Appellant has not demonstrated that the size determination is clearly erroneous. Accordingly, the appeal is DENIED, and the size determination is AFFIRMED. This is the final decision of the Small Business Administration. See 13 C.F.R. § 134.316(d).