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Case 1:07-cv-00243-LMB

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Anthony Gamboa, Esquire September 25, 2006 Page 7

PROTECTED MATI~mAL TO BE DISCLOSED ONLY IN A'.CCO]~DANCE WITH GOVE I~qME~T.ACCOUNTA BILITY OFFICE PROTE~~O~8

(~) tnse~ proposed unit and e~end~d pric s for each Contract Line Item, including all aption periSds, on pages 2 and 3. The offeror shall include a fully oomp[eted price schedule of the solicitation in this so.ion of their proposal. Any off~ror, which fails to cite a pri{e for each item, or fails to make an ent@. will be rejected as ~on-responsive to this s~licitat~o~. O~ly fi~-fixed price offe~ will be evaluated. Solicitation. at 39 (emphasis added). The Solicitation also provided that "[i]f additional information was required to support price reasonableness, each offeror .may be

requested to provide" additional back up information. /d.
The Selection of NoSIot: On or about September 13, 2006, the Agency advised Rowe that NoSIot had been selected for award, See Letter from Cheong J'. Chon to Mr. Scott Rowe, dated Sept. 13, 2006, attached hereto as Exhibit 3, That letter disclosed that NoSlot's price for the base period and all options was higher thar~ the price offered by Rowe, NeSIot's price was . ld. Rowe offered to perform the work for the base period 63 lower than

and the option years at the firm, fixed price the price offered by NoSlot. Rowe's Proposal and Debriefing:

By letter dated September 14, 2006, Rowe requested a debriefing from the Agency, "The Agency provided a written debriefing on Septe,mber 15, 2006. The written debriefit~g revealed that Rowe was the lowest priced offeror, and it revealed that Rowe had received the highest evaluation ratings available under both the l'eci~nicsl and the

Past Performance evaluation criteria. Yet, Rowe was not selected for award.

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Anthony Garnboa, Esquire . September 25. 2006 page 8

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OnLY [N ACCORD,ONCE W.~TH

, GOVERNNfENT..~CCOUNTABILITY ¯

The written debriefing stated: "The:Government found .that Rowe't, technical and past performance to be "EXCELLENT", See Letter from Cheong J. Chon to Rows Contracting Services, Inc., dated September 15, 2006, attached hereto as Exhibit 4. The Agency noted, however, that in this firm-fixed price contract, "it]he proposed cost [of Rowe's proposal] has weaknesses." Id. (Emphasis added.) The Source Selection Authority ("SSA") identified three specific weaknesses that she allegedly had found with Rowe's cost proposal, (The SSA:noted that she concurred with the Technical Evaluation Panel's ("TEP") evaluation of Rowe's Technical proposal,) Id. The three alleged weaknesses ident~ed 'by the SSA with Rowe's cost proposal
were:

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Anthony Gambca, Esquire September 25, 2006. Page 9

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Id. As required by the SOlicitation, Rowe's Price Proposal was limited to a firm-fixed price offer, wit.h unit price,~ for the specific Contract Line Items and extended prices for those same items--plus a budget submission indicating the various prices included in the offer.

. Id.

RetentionlRecruiting Bonuses from Rowe's Price Proposal Contract Term Base Year (7 Months) Monthly Budget Yearly Budget

(Building 60dO.) .....

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Contract Term
Base Year (7 M~nths) (Expansion Building),

Monthly Budget

Yeady Budget

0

! ~= 'Option Year (Building 6000) Is~ Option Year (Expansion Building)
2nd

Option Year (Building 6000)

2nd Option Year (Expansion Building)
3r~ Option Year (Building 6000) Option Year (Expansion Building) 4'h Option Year (Building 6000) 4~h Option Year (Expansion Building)

See Rowe Budget, submitted with Schedule B Pdce Proposal, attached hereto as Exhibit 5 ("lS, etentionlRecruiting Bonuses" is a line item under the "Other Operating Costs" category on the spreadsheet), Accordingly, Rowe's budget submitted with its Price Proposal indicated that, over and above the direct labor for its employees, Rowe had budgeted an ~

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in the base period, and an

express purpose of paying retention, and recruiting bonuses to its employees. Notably, accordlng to the Price Proposal, Rowe would hav 5t total employees performing work under the resulting contract. Of tha employee 21 would be full time janitors, and

would be part time janitors. Thus, Rowe's budget Indicated, that Rowe had included substantial mo~ies in its firm-fixed price to the ct.3 Notwithstanding Rowe's explained in Rowe's debriefing: the SSA

s Rowe also specifically addressed below,

in its Technical Proposal a~ discussed

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,~ee Ex. 4. at 2 (emphasis added). Contrary to the finding of the SSA, Ro~,e proposed

each out (optlon) year, See' Ex. S.

" This is an incorrect desoripdon of Rowe's firm-fiXed pr~ce offer for the work covered by the contract. As discussed above, the Solicitation sought firm-fixed unit pri~es inclusive of all work and supplies. The Contract Schedule expressly provided; The contractor shall Provide alJ personnel, supervision, eq~l~me~lt and rbaterial, except as specified by the Government, to a6coml~lish Custodial Services at the DefenSe Intelligence Analysis Cer~ter (DIAC) at Bolling'AFB, Washington, DC in accordance with the attached Statement of objectives (sOO), ano technical exhibits, See Ex. 2. Solicitation, Amendment 10 Schedule B, Line I~em 0001; 0002, 0003, 0004 and 0005. Each of those Line Items in turn requested a unit (monthly) price for all of that work for two areas: "'Provide Basic Cleaning Services" for Building 6000 (Line Item 0001AA, 000;~AA. 0003AA, 000~AA, and 0005AA) and "DIAC Expansion" (Line Item 000lAB, 0002AB, 0003AB, 0004AB and 0005AB),

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The SSA continued:

See E×. 4,

Again, it would appear that the SSA mis-read Rewe's proposal. As discussed in more dotal! below, Rowe's Technical Proposal outlined Rowe's specific plan for retention, which among other things included, paying the cleared .employees from the outset of contract perf&rmance approximately were receiving--and specific bonuses for employees. IV, PROTEST GROUNDS A. The evaluation of Rowe's proposal was arbitrary bnd unreasonable. ur more than they currently

As discussed above, the Agency erred in evaluating Rowe's price/cost proposal. Specifically, each of the weakdesses noted by the SS'A in the written debriefing as to Rowe is arbitrary and unreasonable. Where, as here, the Agency's evaluation is
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unreasonable andior arbitrary, GAO will sustain the protest. See The Afore Group, In, c,, B-2777,674, 98-1 CPD ¶ 64 (NOv. 10, 1997) (sustaining protest wh~re agency's price realism evaluation was Unreasonable and inconsistent with the evaluation criteria of the solicitation); see ~[so Rockwell Electronic Commerce Corp., B-2861201, 200! CPD ¶ 65 (Dec. 14, 2000).(stating that "[i]n reviewing a protest, [GAOl will examine the record to ensure that the agency's evaluation was reasonable and consisten't with the stated evaluation criteria.") !. Assessing a weakness for Rowe's labor rates was unreasonable and arbitrary..

The first =weakness" the SSA noted was that. Rawe's "cost proposal indicates that the same labor rates are offered by Rowe for all five years and there is no indication of any increase in the out (option) years." Ex, 4, at I. What the SSA fails to note is that the labor rate proposed by Rowe is sign~can~ly higher than both

the wage determination rate incorporated into the contract and the prevailing rate being paid to the workers currently performing under the predecessor contract, The Solicitation includes Wage Determination No. 94-2103 Rev (33), dated March 10, 2005. See Solicitation. That Wage Determination proscribes an hourly wage for a Janit.or (Occupation Code 11150) of $10.1:2, plus an additional $2.59/hour for

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healtt'i and welfare benefits--or a total of $12.71/hour.s Rowe's budgeted hourly rate of r obviously far exceeds the "rninim6m wage required, l~y the Sol'icitstic;n.' This fa~t, howe.ver, seemir~gly was not considered by the SSA when she determin.ed that Rowe's proposed wages underlying its firm-fixed price offer should !0e assessed as a Weakness. This position is, of course, unreasonable, where, as ,here, tl'ie proposed rate, without increases, already is set at a high enough level to ensure employee retention. In fact, Rowe explaine'd as much in its Technical Proposal,~ writing:

~ The Solicitation also ~rlcorporates by reference FAR .52.222.43, Fair Labor Standards Act and Service Contract Ac~--Prlce AdJus[ment (Multiple Year and Option Contracts). Under that clause, an offeror Ihat was proposing to pay i~s workers at the wage de~ermlnation ~tes wo~ld be precluded ~om including w~g~ increases for out years In its offer. See L&E Assocs., Inc., B,258808.~, 95-1 CPD ~ 2~B (June 22, !995) ~"FAR clause 52.222-43(b) requires ~he contractor.., to warrant 'that the prlce= in this contract do no~ include any allowance for any contingency to ~r increased costs for which adjustment ~ provided under this ctause.'... Thus, estimates of wage in~as~ c~vered by the [Semite Con~ra~ ACt] are ~o be included in the offeror's prices, presumably because any applicable DOL wage Increase will be pa~sed through to lhe government ~en It a~tualty happens~as opposed to when ~he contractor is spe~letlng (in its option-year pdclng) that k migl~t
~ The debriefing.suggests tha~: the SSA lim, ited her review to the Price Proposals, accep~ing Instea~ the technical evaluations from [he "rEP. However, a number of the SSA's obsei'vations credited t;o Rowe's "Gos(' Proposal" in fact are taken from Rowa's Teo~r~l~al Proposal,

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Anthony Gamboa, Esquire September ~'5, 2006 Page 16

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Rowe Technical Proposal for Custodial Services at the DIA at Boiling AFB, dated 13 May 2005 ("Rowe's Technical Proposal"), at Tab 2, Technical Capabilities, A.7 Operational Functions (emphasis added),

Rowe also advised the DIA:

I~owe's Technical Proposal, at Tab 2, A.l.(b) (emphasis added),s And, Rowe Included a "Transition/Retention Plan" as part of its Technical Proposal, That Plan provided in

part:,
Retention

Portions of Rowe's Technical Propo=zl olted hereitl co~lec|ively- are included as Exhibit 6, hereto.

~ Rowe als0 indicated that its employees would be contractually obligated to "continue to work for a, minimum of 30 month~" for Row~ "at the time of SCI A~S" being granted. Id. This was another feature of R0we~s remntl0n ptan,

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Rowe Technical Proposal, Tab 6 (emphasis added). It appears that the SSA failed to consider the complete retention plan that Rowe

was proposing. Theplan included

In light of these facts, the SSA's assessment of a weakness to Rowe

Proposal actually understates the total amount that Rowe had budgeted for Recrul~~ng/Retentlon Bonuses under its Price Proposal. ~ev, discussion above and

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unreasonable and arbitrary.1° See The Arora Group, Ina. B-277674, Nov_ 10, 1997, 981 CPD ¶ 64 (sustaining protest where agency's conclusion that protester's use of '~lat compensation rates posed an unacceptable price realism risk was. neither reasonable nor'consistent with the evaluation criteria"). In Arora, the Navy eliminated the protester from the competition after concluding the protester's fixed price offer lacked price realism because if did not include sala~ escalation. Here. unlike the protester in Arora, Rowe's price proposal was not found to be unrealistic by DIA. Arora, however, still is instructive. In Afore, the protester ,explained that it had addressed employee retention by: a) obtaining long-term employment agreements with its workers; and b) budgeting "into its G&A costs to provide for recruitment of replacemeht employees or bonuses for retention of current ones," GAO ultimately concluded that the Navy's evaluation was unreasonable and inconsistent with the solicitation in fargo part because the agancy's analysis of the protester's proposal was based 0n a miscalculation of tha amount of monies that the protester had budgeted for bonuses for its workers. The agency in Arora ultimately conceded that its evaluators had "misunderstood and mise~aluated" the protester's propesalwanalyzing "a ~um of money amounting to, o~e..ter~th of the actual amount proposed" by the protester for bonuses. Because the evaluators' flawed analysis (based on an incorrect reading of Arora's proposal) provided the basis for the agency's price realism conclusions of Arora's proposal, GAO noted that the agency's
~ Moreover, to the ~×~ent that ~:he Agency,credited N~Slot with a s~ren~{h for offering wa~e i~creas~s in ~he ou~ y~a~s, eve~ i~ those wages did no[ mere or exceed the wages proposed by Rowe, th~ Agency'~ evaluation of Rowe was unreasonable and arbitrary ~or ~his ~ddlflonat reason. Similarly, the evalu~lo~ o~

No$1ot. also would hav~ been flawed.
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"rationale was clearly unreasonable and of little value ir~ supporting the, agency's conclusion." Id. Here, the facts are analogous, As discussed above, DIA ';misunderstood and misevaluated" Rowe's proposal. DIA evaluators incorrectly read Rowe's proposal-ultimately failing to consider the tectal amounts of recruitmen, t/retention monies Rowe budgeted. And, the evaluators failed to properly consider Ultimately, the first weaknes~ the Agency assigned to Rowe's "cost" proposal. (and the two discussed below) all are based on the Agency's analysis that included clearly erroneous information regarding Rowe's proposal, Accordingly, as in Arora, Rowe's protest should be sustained, 2, The $SA's assessment of a weakness for Rowe's failure to include specific bonus amounts for employees also was flawed.

Next, the SSA assessed a weakness to Rowe explaihing:

Ex. 4, at 1. The quoted language that the $$A credits to Rowe's "cost proposal" au--l:ually is taken from Tab 2, TechnicaJ Capabilities §'a,l(b)6,b, of Rowe's Technical. Proposal. That subparagraph reads:

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Subparagraph d, of that particular section of Rowe's Technical Proposal expressly directs DIA to Rowe's "Transition/Contingency/Retention" Plart included at Tab 6 of Rowe's Technical Proposal. That Plan is quoted in the Previous section of this pretest, Andl it expressly provides: ." See Ex. 6, Rowe's "l:echnical Proposal, Tab 6, As noted above, the Plan also expressly provides for:

Id. Arid, the Transitiotl/Contingency/Retention PIan also identified that Rowe had additional monies budgeted specifically for Retention and Recruiting for the base year and all option years of the contract. Accordingly, the SSA factually was wrong. And, assessing a weakness against Rowe for information that expressly was included in the Technical Proposal is unreasonable and arbitrary.

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The SSA unreasonably assessed a weakness for Rowe's alleged failure to mention bonuses far Other employees and for its alleged failure to discuss employee retention. Third, the SSA criticized Rowe's "cost proposal" noting:

EX. 4. As noted (and quoted) above, the SSA simply is wrong.

. According(y, the evaluation of Rowe's proposal was unreasonable and arbitrary for this additional

In its written debriefing, the Agency explains:

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Ex. 4 (emphasis added). The SSA's reliahce on the. Government's past experience with "several" other contractors In the context of Rowe's proposal was unreasonable and

And, it was unreasonable to assign a weakness to Rowe's proposal on this basis. The SSA also unreasonably and arbitrarily determined that Rowe failed to address employee retention in connection with its proposal. As a pr.actical matter, the Price Proposal format did r~ot include a mechanism for such discussion. The

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. B, The evaluation of Rowe's Price Proposal,was inconsistent with the stated evaluation criteria of the Solicitation,

GAO will sustain a protest where the Agerlcy fails to evaluate proposals in accordance with the stated evaluation criteria in the Solicitation. Liberty Power Corp., B-295502, Maroh 14, 2005, 2005 WL 696284 ("lAin agency may not announce one basis for evaluation and award in the RFP and then evaluate proposals and make award on a different basis.") Here, the Agency failed to conduct its re-evaluation in accordance with the stated evaluation criteria. Specifically, the SSA indicated Jd the '
debriefing:

As this is a firm-fixed price contract, the Government places value on the reduction in risk provided by offers who present realistic price proposals that incorporate acceptable employee wage increases. Ex. 4 (emphasis added). The SSA did not indica!e that she found Rowe's price to be unrealist=c. And, the Solicitation was silent regarding any weighted benefit that would be assessed for a compensation plan providing for increases in out years. Under the
1~ To,the extent the Agency found that Rowe could not perform at the price I[ bl~, the Agency is Incorrect. Moreover, any such finding would be an adverse finding of responslblllly for a small business (Rowe) that the Agency would have been required to have referred to the Small Business Administration for a Certificate of Competency.
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Government's logic, an offerdr who, for example; proposed wage ratesof $15/hour during the base perfod, $16/hour during option year 1, $17/hour during option year 2, $18/hour dudng optisn year3, and $19/hour, during option year 4, would be viewed by the Government as providing less risk to the Government than Rowe's proposal for, . That approach is unreasonable and contrary to the stated evaluation criteria'of the Solicitation, C. The price/technical tradeoff was flawed.

As noted above, the Solicitation explained: (b) The Government will perform a trade-off analysis of nonprice factors against price to determine the best value to the Government. Offers that are unrealistically !ow in total price will be considered indicative of a lack of understanding of the complexity and risk in ~neeting contract requirements and will not be considered for award. Solicitation, at 41. The Government awarded Rowe ratings of "Excellent" for both Technical and Past Performanc,~. And, Rowe was the lowest priced offeror. The Government did not find that Re'we h~d submitted an unrealistically low total price. Thus, as the offeror with the highest Technical ratings and the lowest price, Rowe should have been selected for award, This, however, did not odcur. The Government has failed to explain any trade off analysis that it performed that p~'aperly would support its selection of N~Slot, as a Io er rated (or equally rated) higher priced offeror, The failure of the Government to perle m a tradeoff analysis is contrary t~ the Solicitation and grounds for sustaining Rowe's protest. See, e.g., A&D Fire PrOtection, Inc,, B-288852.2', May 2, 2002, 2002 CPD ¶ 74 (sustaining pretest where cost/technical tradeoff favoring higher priced offeror was

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b'ased on agency's erroneous judgment); Preferred Systems Solutions, Inc'., B-292322, Aug. 2S, 2003, 2003 CPD I"[ 166 ("[A] cost/technical t'radeoff requires a comparative assessment of the proposals considering all of the stated selection criteria[.]") D. The selection of NoSIot was improper and contrary to the Solicitation.

As noted, Rowe was the highest ,rated and lowest priced offeror. On information and belief, NoSIot did not offer hourly wages for its employees that matched those offered by Rowe. And, on information and belief, NoSIot was not rated technically . higher than Rowe. Moreover, if NoSIot was rated "Excellent" in Technical or in Past Performance, the Government's evaluation of NoSIot was flawed. Among other things, Rowe specifidally proposed that at the time of contract implementation, Rowe would exceed the Solicitation's minimum requirement of having at least 20% of its employees with security clearances. . Additionally, Rowe ir~dicated on its DD Form 254 (required as part of the Solicitation) that Rowe already held a Top Secret Security Clearance, On information and belief, NoSlot does not hold a Top Secret Security Clear.ance, and NoSIot was unable to propose that it would have 52% (or higher) of its employees already cleared at contract start. In fact, on information an~l belief, NoSlot has yet to even submit an application to obta!n the Top S'ecret security clearance. See documents, attached as Exhibit 7. Thus, on information and belief. NoSIot does not have a history of past performance on contracts where the Top Secret I=acility security clearance was required. Accordingly, the Government evaluation of NoSIot was.

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ir~proper and contrary to the Solicitation to the extent that it rated NoSIot as equal to or better than Rowe in technical or past performance. V. REQUEST FOR A RULING Rowe requests a ruling of the Compt(oller General of the United States on its protest. Vl. FORM OF RELIEF REQUESTED For the reasons discussed above, G~kO sliould sustain Rowe's protest and recommend that the Agency terminate its contract with NoSlot and award the contract to Rowe (or continue in effect the contract pr~eviously awarded to Rowe). Rowe also requests that it be reimbursed its attorneys' fees and costs Incurred in pursuing this protest. VII_ REQUEST FOR DOCUMENTS Rowe requests that GAO require DIA to produce copies ol" the following documents: 1. All documents related to the Agency's corrective action taken in response to Protest of the Ravens Group, B.296741.4. 2, All documents related to the Agency's origillal decision to award to Rowe, including documents evidencing the rationale, 3, AI} documents related to ~.he Agency's subsequ~n~ decision to award to NoSIot, including documents evidencing the rationale. 4. All documents relied upon by the Agency in evaluating Rowe's, NoSIot's and any other offeror's Technical Proposal.

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5. AI} documents relied upon by the Agency in evaluating Rowe's, NoSIot's and any other offeror's Price Proposal. 6. Al! documents, relied upon by the Agency in evaluating NoSIot's past performance. 7. All Agency communications regarding the corrective action and the s~tbsequent source selection. 8, The Source Selection Decision and any documents related to that decision. 9. Any and all reports or evaluations of the Technical Evaluation.Panel. 10. A complete copy of NoSIot's Teqhnical, Past Performance and" Price Proposals evaluated by the Agency. 11. Any guidance or other documents provided to the new Source Selection Authority related to the Agency's proposed corrective action in response to Protest, B- 296741.4, 12. All documents related to the Agency's tradeofi analysismade in support of its award decision. 13, All documents related to whether NoSIot satisfied or could satisfy the requirement of the Solicitation regarding a Top Secret Facility security clearance and personal security clearances for its personnel. Vill', REQUEST FOR HEARING Rowe requests a hearing. Rowe respectfully submits that giver1 the history of this procurement and the changes in the Source Selection Authority, testimon~ will ~aid iO the resolution of this protest.

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Very truly youl:s,

Ke%th B.. Weck~te[n Tamr~y Hopkin~ cc: Cheor~g J. Chert, Contracting Officer K.BW:th

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I, Sco~ Rowe, declare subject to 28 U.S,C. §1741~ that I am President of Rowe C~rrb'actlng Services. Inc. and ~hat I l~ve re~d the foregoing protest and all of the factual sta~rnenL~ therein are true to 1he best~,q~.,f~f knowi~lge.

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EXHIBIT 1

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May16,2006
Contract Appeals Division VIA FACSIMILE

Ms. Mar~ G. Cuttle, Esq. Office of" the General Counsel U.S. Government Accoun~abilily Office 41 G.. Street, NW " Washington, D.C. 20548 Subject: Protest of The Ravens Group. Inc,, De'ar MS. Curcio:
Enclused please find a letter from the Contracting Officer clarh~in~ {~he Agency's corrective action, if you h~Ve ~ny questions regarding this matter, please contact MAJ Peter Tran at (703) 696-2825, facsimile (703) 696-1537, Sincerely,

Major, U,S. Army Trial AItomey Copies Furnished by facsimile:
Protester:

Daryle Jordan. Esq., Patrick Henry LLP Telephone: (703} 256-7754; Facsimile: (703) 256-7883

Kenneth Wecksteln, Esq., Epsmin Becket & GrEen, P,C..
Telephone: (202) 861-0900; Facsimile: (202) 822-4657

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~o~e A~.~om dar.~d April 3. 20~, rh~ fotlo~,in~ it l:~vid~d. A~ rh~ April'3,200~ l~od~ of

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facsi~!e trans~'ttal
April 4, 2006 G'AO Protest of The Ravens Graup, Inc. 08-2967il,3) Tracy Williams, Paralegal Specialist

NUMBER OF PAGES (INCLUDING THIS COVER SHEET): 3,

.... Name
DalTle jordan Kenr~, t.h Weck~in

202-512. G,~d " " u~,,v'~;,~ " ........ ' ......
P~tester ....... Inle~ner

i!

FtrrnlAgency ' 703.25~. 7754 .... 202-B67-09~9 202-512"9749 703-256-7883 202-B22-4657 "' '

Guy r~s

~ C~n~ O~e~ '
MESSA GE

If transmission problems occur, please contact Ms. Tracy, Willi~ims, (703) 696-2850, DSN: 426-2850. Direct all other questions to Meier'Peter Tran, Trial Atlomey at 703~962825 ~r DSN 42~-2825,

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EXHIBIT 2

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1o06 t~ 8I Apt 200~. SF~ REVISED S(~}~DULE PAGE

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