THIS OPINION WAS INITIALLY ISSUED UNDER PROTECTIVE ORDER AND IS BEING RELEASED IN ITS ENTIRETY ON JULY 6, 1994 DENIED: June 29, 1994 GSBCA 12814-P PACIFIC BELL, Protester, v. NATIONAL AERONAUTICS AND SPACE ADMINISTRATION, Respondent, and NORTEL FEDERAL SYSTEMS, INC., Intervenor. Thomas P. Humphrey, Robert M. Halperin, and Stephanie V. Corrao of Crowell & Moring, Washington, DC; and Ronald R. McClain and Christopher L. Rasmussen of Pacific Bell, San Ramon, CA, counsel for Protester. Sumara M. Thompson-King, Office of the General Counsel, National Aeronautics and Space Administration, Washington, DC; and Alexander Barna, Office of the Chief Counsel, Ames Research Center, Moffett Field, CA, counsel for Respondent. Richard J. Webber, Matthew S. Perlman, and John J. O'Brien of Arent Fox Kintner Plotkin & Kahn, Washington, DC, counsel for Intervenor. Before Board Judges NEILL, DEGRAFF, and GOODMAN. GOODMAN, Board Judge. Pacific Bell (Pacific or protester) has protested the decision by the National Aeronautics and Space Administration (NASA or respondent) to modify contract number NAS2-12653 (the contract) between respondent and intervenor Nortel Federal Systems, Inc. (Nortel). Pacific filed its protest on April 18, 1994, on four grounds: (1) NASA had conducted an illegal sole source procurement; (2) NASA failed to publicize its contract actions in the Commerce Business Daily (CBD); (3) NASA violated its delegation of procurement authority (DPA) for the contract; and (4) NASA failed to treat all potential offerors fairly and equally. On April 25, 1994, protester filed a motion for summary relief on the second ground of the original protest complaint. The Board deferred ruling on the motion, as the motion raised issues which required a resolution of the merits. NASA filed a motion to dismiss the protest as untimely on May 4, 1994. On May 13, 1994, the Board denied that motion on the record as it existed at that time. An amended complaint eliminating the third ground of the original complaint and adding two grounds (related to procurement integrity) was filed on May 17, 1994. On May 22, 1994, protester filed another motion for summary relief on the fifth and sixth grounds of the amended protest complaint. On May 23, 1994, intervenor filed a motion to dismiss the sixth ground of the amended protest complaint. A hearing on the merits was held May 23-27, 1994. The parties were allowed to address the motion for summary relief and the motion to dismiss during the hearing and in their posthearing briefs. Respondent renewed its motion to dismiss the protest as untimely based on the completed record. As set forth below, we deny the protest and all pending motions. Findings of Fact The Contract 1. NASA's Ames Research Center (ARC) is located at Moffett Field, California. Also located at Moffett Field is the Moffett Naval Air Station (Moffett NAS). Moffett Field is a single parcel of land surrounded by a perimeter fence. Moffett NAS makes up approximately two-thirds of Moffett Field.[foot #] 1 Transcript at 726-27. ----------- FOOTNOTE BEGINS --------- [foot #] 1 Before 1993, the U.S. Navy provided telephone service to all Moffett NAS buildings and facilities. Protest File, Exhibit 11 at 1. ----------- FOOTNOTE ENDS ----------- 2. Sometime before August 1985, NASA decided to conduct a competitive procurement to upgrade the telecommunications system at ARC. A NASA undated internal memorandum describing the proposed procurement indicated its intent to procure "a system that will effectively address ARC's projected needs for the ten- year life of the system" and one which "include[s] . . . all associated . . . equipment, system expansion . . . through 1996." Protest File, Exhibit 23. 3. NASA requested and received a DPA from the General Services Administration (GSA) for the procurement. The DPA read, in relevant part: We are granting you approval . . . for the acquisition and installation of an integrated voice and data replacement telephone system for Ames Research Center at Moffett Field, California as requested in your letter dated July 11, 1985.[foot #] 2 As the estimated systems (contract) life of the required equipment is 10 years, we are also delegating to you authority to enter into a contract for a period not to exceed 10 years should your evaluation indicate that a multi-year contract is in the best interest of the Government. Our approval is based on the information contained in the aforementioned letter and is contingent upon this office being notified of any changes or discontinuance of service. Protest File, Exhibit 23. 4. A solicitation for the procurement was issued, and Pacific and Northern Telecom, Inc. (NTI) (Nortel's parent company) were among the offerors who submitted proposals in response to the solicitation. 5. A Nortel representative testified that he represented NTI and was present at a site visit conducted at ARC after issuance of the solicitation, and that during the visit, the NASA representatives stressed that NASA was a dynamic organization and that NASA's telecommunications requirements would change over time. Offerors were informed during the tour of the facility that if the Navy activity at Moffett Field were to "gear down," NASA might acquire some of the Navy's facilities, as had happened in the past. There were also vacant areas within the then- existing confines of ARC where offerors were told expansion might take place. Transcript at 703-04. After submission of initial proposals, offerors were required to participate in oral discussions. During the oral discussions with NTI, NASA's ----------- FOOTNOTE BEGINS --------- [foot #] 2 The letter of July 11, 1985, is not included in the record of this protest. ----------- FOOTNOTE ENDS ----------- representatives again emphasized the importance that the capacity of the proposed system be expandable to take on whatever additional service would be required by ARC. Based on NTI's communications with NASA during the site visit and during oral discussions, NTI designed its solution so that it would not present a problem for the extension of services into the areas then occupied by the Navy. Id. at 703-07. 6. An employee from Pacific testified that he was in attendance for only part of the site visit. Protest File, Exhibit 66 at 15. 7. NASA awarded contract number NAS2-12653 in August 1987 for a digital telecommunications system (DTS) for ARC. The contract was awarded to NTI and thereafter novated to NTI's subsidiary, Nortel. The original contract price was $9,040,000. Subsequent modifications before modification 66 (the subject of this protest) increased the total price to $16,096,449.42. Protest File, Exhibits 1, 2 at 6, 3 (novation modification A00001). 8. The contract contained a basic requirement to "[f]urnish, install, and test a Digital Telecommunication System in accordance with the Statement of Work and the Specification." Protest File, Exhibit 1 at B-1. 9. The scope of work stated, in pertinent part: The Contractor shall provide, engineer, install, test, operate and maintain a Digital Telecommunications System in accordance with the following Statement of Work and Specification. Protest File, Exhibit 1 at C-1. 10. The statement of work stated, in pertinent part: 1.0 Introduction This Statement of Work (SOW) defines the tasks to be performed by the Contractor for the installation and maintenance and operations of a digital voice/data switching capability at the National Aeronautics and Space Administration (NASA), Ames Research Center (ARC), located at Moffett Field, California. Protest File, Exhibit 1, DTS Statement of Work at 1. 11. Paragraph 1.2 of the statement of work read, in pertinent part: The tasks in this SOW include the engineering, fabrication, installation, testing, placing in service (cutover), acceptance testing, training, system expansion, and maintenance and operations of a completely operational digital voice/data switching system at ARC, referred to herein as the Digital Telecommunications System (DTS). . . . . The contractor shall install the equipment described in the Specification in all of the approximately 92 buildings, 60 trailers, raceways and other areas that comprise ARC except those in Table C-4 in Appendix C that do not have either voice or data requirements shown. No partial installation is acceptable. The contractor shall accomplish the full job of installing the DTS at ARC. Protest File, Exhibit 1, DTS Statement of Work at 2. 12. The statement of work described the system capacity as follows: 3.3 SYSTEM CAPACITY The Contractor shall deliver a DTS which fully meets the requirements in this SOW and in the Specification, and which is capable of being expanded to the full projected final size. . . . . 3.8 SYSTEM EXPANSION . . . The Contractor shall plan and implement expansions to allow an immediate fallback to the unexpanded configuration should the expansion not operate properly. The Contractor shall ensure that such activities regarding expansion do not adversely affect DTS reliability . . . . The Contractor shall provide the System Expansion Plan as detailed in the Appendices. Protest File, Exhibit 1, DTS Statement of Work at 15, 23. 13. The contractor was required to provide a system expansion plan as follows: B-4.3 System Expansion Plan The Contractor shall provide his plan for expansion of the DTS based on requirements in Table C-3 and in Table C-8 in Appendix C. Procedures for expansion shall include planning details and lead times and descriptions of the engineering required, of the complexity of the change or expansion, of expansion implementation and system testing after the change is made, of the impact on M&O activity, and of the impact to ARC operations. The Contractor shall specifically define facility, utility, personnel, system, or cable plant impact, and any system degradation as a result of future system expansion. Protest File, Exhibit 1, DTS Statement of Work at B-12. 14. DTS Specification 2.0 "System Requirements" included the following provisions: 2.1 General The DTS shall comply with, but not be limited to the following basic requirements: . . . . (j) The DTS shall be of modular design to facilitate the increase or decrease of system size, capacity (throughput) output (trunks and storage capacity), and capability (features/functions). This modularity shall lend itself to expansion, contraction, or relocation according to changing ARC user needs at any location within ARC. (k) The system shall be expandable from its cutover size as required by ARC and as outlined in the DTS Statement of Work (SOW). In addition, the DTS shall have a minimum expandable connection capacity of 15,000 lines, ports, and trunks combined. This capacity is shared between voice and data connections. The expansion can be accomplished by straightforward addition of racks and circuit cards to the original system architecture or by adding new systems (of a similar product line) to the original system. Expansion and upgrades shall be possible without any degradation of performance and with minimal impact to the original system in terms of downtime and operational continuity. It shall be possible to expand the system in increments of 100 lines or less. Protest File, Exhibit 1, DTS Specification at 4. 15. While the DTS to be procured had a minimum expandable connection capacity of 15,000 lines, ports, and trunks combined, the number of lines required by ARC at the time of initial installation was 3,500 to 4,000. Transcript at 724, 731. 16. The pricing for the basic requirement was as contained in Pricing Table A1. Protest File, Exhibit 1 at B-1. 17. The contract had an initial period of performance. The contract provides options for extending the contract for nine additional years during which the contractor is to provide "system maintenance and operation, and expansion items as ordered . . . in accordance with the Statement of Work and the Specification." Protest File, Exhibit 1 at B-2 to B-3. 18. Prices for expansion items and related maintenance and operations for the option years were set out in pricing tables for purchase on an indefinite quantity/indefinite delivery basis. Protest File, Exhibit 1 at B-2 to B-3. 19. The ARC expansion deliverables were listed in Table C-3 of the contract. These quantities were estimates. The person who supplied these estimates testified that the estimates were based upon anticipated growth of ARC within the area under control of NASA in 1987. Transcript at 563. 20. Table C-3 did not describe the hardware or software which might be required in order to provide the additional expansion deliverables. Transcript 684-85, 690-91, 698; Protest File, Exhibit 1 at B-2. 21. It was not possible to predict at the time of the execution of the contract what methods or equipment would be used for providing the additional expansion deliverables. Transcript 687-88, 692-94. It was also not possible to predict, at the time of contract execution, what technologies might become available during the ensuing ten-year period. Id. at 694-95. NTI's proposal indicated, in response to the contract requirement for a system expansion plan, that "when the CO requests an expansion or change, NTI will prepare an Engineering Change Proposal which covers the [requirements of the system expansion plan]." Protest File, Exhibit 25 at D-35. 22. The contract contained no geographic limits or prohibitions as to possible expansion. 23. The contract incorporated by reference the Changes clause in Federal Acquisition Regulation (FAR) 52.243-1 (APR 1984). Protest File, Exhibit 1 at I-2. 24. Before modification 66 was issued, system expansion was accomplished under several modifications in various buildings which either did not exist at the time the contract was awarded or which were formerly occupied by the Navy. Protest File, Exhibit 3 (modifications 29, 40, 52) Approximately 3,000 to 3,500 total additional lines were added to the DTS before modification 66 was executed. Transcript at 731-32. Closure of Moffett Naval Air Station at Moffett Field, California 25. In early 1991, rumors began that Moffett NAS would be closing as part of the nationwide base realignment and closure effort. The decision to close Moffett NAS was made in June 1991. Transcript at 99. During 1991, NASA began investigating becoming the "host agency" for other agencies moving into Moffett NAS. By a Navy/NASA Memorandum of Understanding executed in December 1992, NASA ARC will become the host federal agency and will encompass all of Moffett Field, California. Protest File, Exhibit 11 at 1, Exhibit 12, Agency Procurement Request (APR) at 2; Protest File Exhibit 50. The FRDD for Modification 66 26. A Federal Information Processing (FIP) Resource Decision Document (FRDD) was prepared for the work to be performed under modification 66, which was to extend the ARC DTS to the areas of Moffett NAS into which ARC was expanding. Protest File, Exhibit 7. The person responsible for preparation of the FRDD was the Chief of NASA's Federal Information Processing Management Office. Transcript at 531. The JOFOC for Modification 66 27. A justification for other than full and open competi- tion (JOFOC) was approved by NASA and fully executed by November 9, 1993, for modification 66 to acquire two remote switching centers (RSCs) manufactured by NTI to provide telephone service to the Moffett NAS areas. Protest File, Exhibit 11. 28. The JOFOC was prepared by the Manager of Operations Integration for the Moffett Field Development Project. He testified that the JOFOC was prepared as a result of a determination by the Chief of NASA's FIP Management Office, which was expressed to him in a telephone conversation with the Chief of NASA's FIP Management Office and the Contract Specialist. He could not be specific as to the reason why the JOFOC was thought to be necessary. Q: [Protester's Counsel]: And did [the Chief of NASA's FIP Management Office or the Contract Specialist] tell you why it was necessary? A: There was discussion which I heard that I would be hard-pressed to tell you the intricacies of what it all meant. Well, what it meant was [we needed to] prepare a JOFOC. At least that is what it meant to me. Transcript at 143. 29. The JOFOC relied upon the "unusual and compelling urgency" exception to full and open competition. 10 U.S.C. 2304(c)(2) (1988). The Manager of Operations Integration for the Moffett Field Development Project testified that this exception was used because of the realization by NASA "of all the steps that we needed before we would actually have service to a customer at Moffett Field and [those responsible for acquisition] had miscalculated some of their time frames." Transcript at 149. 30. The JOFOC reads, in relevant part: The expansion of NASA's responsibilities at Moffett Field was inconceivable during the original acquisition of the PBX.[foot #] 3 The closure of Moffett Field was not decided until 1991, three years after the system had become operational. Had the closure been anticipated, inclusion of all of Moffett Field would clearly have been included in the original contract. The decision that NASA take over the base and that we host other agencies was not finalized until December 1992. Protest File, Exhibit 11 at 2. 31. The author of the above statement in the JOFOC had no personal knowledge of, or involvement in, the original acquisition. In addition, he did not consult with anyone who was involved in the acquisition. His statement was based simply on his knowledge that the closure of the Navy base was not decided until 1991. He had no knowledge of whether the possible closure of the NAS had been discussed by NASA with potential offerors before award of the contract. As of the date of the hearing, he had not read the statement of work of the contract. Transcript at 187-88, 200-01. 32. The former Deputy Director at ARC testified in a deposition that "the base closure was not even a gleam in anybody's eye" during the acquisition of the DTS. Protest File, Exhibit 67 at 45. 33. NASA's JOFOC and its APR state that the PBX supplied under the contract could not serve all of Moffett Field. They state that "[t]he original PBX has expansion capability, but because of the electronic distance limitation of the equipment, the PBX is unable to handle the additional requirement without adding the RSCs." Protest File, Exhibits 11 at 2, 12 at 17 (unnumbered). The DPA for Modification 66 34. NASA submitted an APR dated November 18, 1993, to the GSA and received a DPA dated December 16, 1993, for the work to be performed under modification 66. Protest File, Exhibit 18. 35. Conflicting testimony was offered as to the reason why NASA believed a DPA was necessary for modification 66. NASA ----------- FOOTNOTE BEGINS --------- [foot #] 3 PBX is the abbreviation for "private branch exchange," the type of telecommunication switch supplied by NTI for the DTS under the original contract. ----------- FOOTNOTE ENDS ----------- witnesses testified that the DPA was sought on the advice of the Chief of NASA's FIP Management Office. Transcript at 531. Although he had been deposed during discovery, he did not testify at the hearing, nor was his deposition offered into evidence. The current contracting officer testified that, although she had had no direct discussions with the Chief of NASA's FIP Management Office, it was her belief that he thought the DPA was required because of the price of the equipment to be procured pursuant to the modification. Id. at 230-31. ARC's current Chief of the Contract Management Branch for Engineering and Technical Services was the contracting officer for the contract when it was awarded. Id. at 511. She served as ARC's acquisition division's liaison to the office that had the responsibility for the transition of ARC to the remainder of Moffett Field. Id. at 512. She also testified that she had had no direct discussions with the Chief of NASA's FIP Management Office, but she had heard that he was of the opinion that a DPA was required for the purchase of the RSCs to be procured under modification 66. She was not definite as to the reasons why he believed the DPA was required. Id. at 530-31. The Contract Specialist testified that she had a conversation with the Chief of NASA's FIP Management Office, who stated that the work performed under modification 66 "was not under the current authority that would have been FIPS-related." Id. at 260. Modification 66 36. On December 22, 1993, NASA and Nortel entered into modification 66 of the contract to increase the indefinite quantities of the contract and acquire by lease with option to purchase two RSCs manufactured by NTI to provide telephone service to the Moffett NAS areas. The installation of the work under modification 66 was scheduled to be completed on May 27, 1994, with acceptance to occur thereafter. Modification 66 increased the contract price by $1,909,801. Protest File, Exhibit 2. The work performed under modification 66 would increase the DTS's number of total lines by approximately 3,000 to a total of approximately 10,000. Id., Exhibits 15, 21. 37. There is no specific reference to RSCs in the original contract, including the pricing tables. Protest File, Exhibit 1 at A1; Transcript at 517-18. 38. An RSC is a hardware and software configuration that functionally is an integral part of the PBX, but is put in a remote location. It is used either when there is an existing cable plant structure that brings the cable lines to a central point (where the RSC can be installed) or where the distance between the host switch and the point where the telephone service is to go exceeds the loop length that can be driven off the host switch. Use of an RSC requires the same equipment that would otherwise be put on the host PBX in line cabinets and "remotes" it to another location. The user of the system has no knowledge that his line is terminated on the RSC as opposed to being terminated on a line card in the host switch. The features, functions, and capabilities of service off the RSC are identical to those off the host switch. Transcript at 695-96. 39. NASA did not synopsize either its intent to enter into or execute modification 66 in the CBD. 40. The contracting officer at the time of contract award testified that, during the summer of 1993, she concluded that the provision of telephone service to the Navy areas of Moffett Field was within the general scope of the contract. Transcript at 516. In reaching that conclusion at that time, she did not review the contract, the solicitation, or proposals submitted by the offerors. Id. at 525. 41. The current contracting officer stated that she had heard that originally the work to be performed under modification 66 was considered within the scope of the contract, but that determination changed once the Chief of NASA's FIP Management Office prepared the FRDD and determined that a new DPA was necessary. She learned this from the contracting officer at the time of award. She did not form an understanding as to whether the Chief of NASA's FIP Management Office believed the modification was within or outside the scope of the contract. Transcript at 231-32. She believed that the JOFOC would not have been necessary if modification 66 was within the scope of the contract. Id. at 234. 42. Two retired Pacific Bell employees, who had been Pacific's ARC account representatives at the time that the solicitation was issued, both believed that the provision of service to the Navy buildings was within the scope of the contract. Protest File, Exhibits 65 at 36, 66 at 18. Certificate of Procurement Integrity 43. After modification 66 was signed, NASA requested a certificate of procurement integrity. Transcript at 400. 44. The certificate was executed by Nortel and received by NASA after modification 66 had been executed. Protest File, Exhibit 44. Discussion Respondent's Motion to Dismiss NASA filed a motion to dismiss the protest as untimely on May 4, 1994. On May 13, 1994, the Board denied that motion on the record as it existed at that time. Respondent has attempted to demonstrate through documentation and witness testimony at the hearing that protester knew or should have known of the grounds of its protest more than ten working days before it was filed, and has renewed its motion in its posthearing brief. However, respondent has failed to produce substantial evidence to support its motion, and we deny the motion. The Protest Complaint Pacific's protest complaint as amended is composed of five grounds: (1) NASA conducted an illegal sole source procurement; (2) NASA failed to publicize its contract actions in the CBD; (3) NASA failed to treat all potential offerors fairly and equally; (4) modification 66 was illegal due to lack of a certificate of procurement integrity; and 5) modification 66 must be rescinded due to a substantive violation of the Office of Federal Procurement Policy Act (OFPP Act), 41 U.S.C. 423 (1988). For purposes of this opinion, we will designate these grounds as protest grounds 1-5.[foot #] 4 Protest Ground 1 - NASA Conducted an Illegal Sole Source Procurement The central issue in this protest is Pacific's allegation that the work to be performed under modification 66, which extends the ARC DTS to the areas of Moffett Field formerly served by the Navy's telephone system, was beyond the scope of the existing contract and, consequently, an illegal sole source procurement. We must therefore determine if the work to be performed under modification 66 was within the scope of the contract. ----------- FOOTNOTE BEGINS --------- [foot #] 4 The last two grounds were designated the fifth and sixth grounds of the amended complaint, even though the third ground of the original complaint was withdrawn, leaving only five grounds of protest. ----------- FOOTNOTE ENDS ----------- NASA's Actions in Executing Modification 66 do not Prove that the Work Performed Under the Modification was Outside the Scope of the Contract Pacific contends that NASA's actions in requiring a DPA, issuing a JOFOC, and requesting a certificate of procurement integrity are evidence that NASA itself believed the modification to be outside the scope of the contract, as these requirements would not be necessary for a modification within the scope of the contract. Pacific urges the Board to treat respondent's "inside the scope" argument as no more than a post-hoc rationalization by counsel. Protester's Post-Hearing Brief at 20. Pacific therefore believes we should view what it characterizes as NASA's contemporaneous interpretation of the scope of the contract by NASA employees as a "far better interpretive aid than NASA's concocted litigation position." Protester's Post-Hearing Brief at 23. Protester premises this argument on the assumption that these actions by NASA were the result of "contemporaneous interpretations" by NASA officials as to the scope of the contract. The record does not support this assumption. As discussed herein, the critical interpretation is the expectation of the offerors and the procuring agency at the time of contract award. The reasons why NASA obtained a new DPA, issued a JOFOC, and required a certificate of procurement integrity for modification 66 do not appear to be the result of a review of the contract and a determination that the work called for by modification 66 would be outside the scope of the contract. Instead, these actions resulted from a failure to read the contract and interpret it properly. NASA's Request for a DPA for Modification 66 Agencies are required to submit an agency procurement request to the GSA to receive a DPA if the acquisition is not covered by a regulatory or specific DPA. 41 CFR 201-20.305-3 (1993) (Federal Information Resources Management Regulation (FIRMR) 201-20.305-3). Pacific therefore argues, "A DPA was required for Mod 66 because the DPA for the Contract did not cover the Modification -- i.e., the modification was outside of the scope of the contract. Thus, NASA did not have authority to execute Mod 66 without the new DPA. Obviously, NASA could not legally have entered into a contract for items which it had no authority to acquire." Protester's Post-Hearing Brief at 21. NASA's motives in obtaining the DPA for modification 66 are far from clear, even after a full hearing on the merits. Conflicting testimony was offered by NASA employees as to the reason why a decision was made that a DPA was necessary for modification 66. Various individuals testified as to their understanding that the Chief of NASA's FIP Management Office allegedly suggested that a DPA for modification 66 was necessary. Only one of the NASA employees who testified recalled speaking directly to him; the others testified as to their secondhand knowledge of conversations related by others. The Chief of NASA's FIP Management Office was deposed by protester. He was not called as a witness by any party. Finding 35. Except for inconsistent testimony of other NASA employees as to his reasoning, there is no evidence in the record as to why he believed a DPA was necessary for the work to be performed under modification 66. Protester's reliance upon NASA's course of conduct in seeking a DPA does not convince us that the work in question was outside the scope of the original contract. The fact that a DPA was prepared does not establish what the parties intended at the time they entered into the contract, nor is there any evidence in the record that the decision to obtain the DPA was the result of a determination that the work to be performed under modification 66 was outside the scope of the contract. The JOFOC Protester focuses on the JOFOC for several reasons. First, the JOFOC states: The expansion of NASA's responsibilities at Moffett Field was inconceivable during the original acquisition of the PBX. The closure of Moffett Field was not decided until 1991, three years after the system had become operational. Had the closure been anticipated, inclusion of all of Moffett Field would clearly have been included in the original contract. The decision that NASA take over the base and that we host other agencies was not finalized until December 1992. Finding 30. This statement assumes that NASA was required to identify in advance the specific geography of possible future expansion in order for that expansion to be within the scope of the contract. As already discussed, NASA was not required to do so, nor were the offerors required to predict the possible areas of expansion. The contract itself presumed expansion would occur. The author of the JOFOC had no personal knowledge of, or involvement in, the original procurement, nor did he consult with anyone who was involved. As of the date of the hearing, he had not read the statement of work of the contract. The above statement in the JOFOC was based solely on his knowledge that the closure of the NAS was not decided until 1991. He had no knowledge of whether the possible closure of the NAS had been discussed by NASA with potential offerors. Finding 31. We view this statement as nothing more than an assertion that, had NASA known with certainty that expansion was necessary in a specific geographic area at the time proposals were requested for the contract, such information would have been included in the initial contract. The author's statement, therefore, is not a "contemporaneous interpretation" as to whether the work under modification 66 was outside the scope of the contract. Pacific also notes that it was the understanding of the current contracting officer that a JOFOC would not have been necessary if the work to be performed under modification 66 was within the scope of the contract. Finding 41. While this may have been her understanding at the time the JOFOC was issued, the mere issuance of the JOFOC does not mean that the work called for in modification 66 was, in fact, outside the scope of the contract. In contrast, the only person to testify who was involved in the original procurement, the contracting officer when the contract was awarded, stated that during the summer of 1993, she was of the opinion that the work to be performed under modification 66 was within the general scope of the contract. Apparently, this opinion was based upon her original knowledge of the procurement, as she testified that in the summer of 1993, she did not review the contract, the solicitation, or proposals submitted by the offerors. Finding 40. The issuance of the JOFOC and a review of the various opinions of NASA employees do not resolve the fundamental issue - - whether the work called for under modification 66 was within the scope of the contract. Instead, we rely upon our analysis of the original contract and the work to be performed under modification 66.[foot #] 5 The Certificate of Procurement Integrity Pacific alleges that, because Nortel has argued that a certificate of procurement integrity would not be required if modification 66 were within the scope of the contract, NASA's actions in requiring such a certificate is "further evidence" that the work to be performed under the modification was outside the scope of the contract. Protester's Post-hearing Brief at 21. NASA's request for the certificate of procurement integrity is not dispositive of this issue. Again, we rely upon our analysis of the original contract and the work to be performed under the modification, rather than NASA's action in requesting a certificate of procurement integrity. Requesting the certification does not establish the parties' interpretation of the contract. The Work Required by Modification 66 was Within the Contract's Scope ----------- FOOTNOTE BEGINS --------- [foot #] 5 Protester also argues that the JOFOC is a violation of the requirements for full and open competition, as the justification for "unusual and compelling urgency" is not supportable. As we conclude that the modification was within the scope of the contract, no JOFOC was necessary, and we therefore do not address this issue. ----------- FOOTNOTE ENDS ----------- In AT&T Communications, Inc. v. Wiltel, Inc., 1 F.3d 1201 (Fed. Cir. 1993), the Court of Appeals provided us with guidance as to whether a modification departs from the scope of the original contract so as to require competition for its procurement: The Competition in Contracting Act (CICA) requires executive agencies, when procuring property or services, to "obtain full and open competition through the use of competitive procedures." 41 U.S.C. 253(a)(1)(A) (1988). CICA, however, does not prevent modification of a contract by requiring a new bid procedure for every change. Rather only modifications outside the scope of the original competed contract fall under the statutory competition requirement. CICA sets forth no standard for determining when modification of an existing contract requires a new competition or falls within the scope of the original competitive procurement. . . . . In determining whether a modification falls within CICA's competition requirement, this court examines whether the contract as modified materially departs from the scope of the original procurement. See Neil R. Gross & Co., B-237434, 90-1 CPD 212 at 2-3 (Feb. 23, 1990), aff'd on reconsideration, B-237434.2, 90-1 CPD 491 (May 22, 1990) ("[W]e look to whether there is a material difference between the modified contract and the prime contract that was originally competed."); American Air Filter, 57 Comp. Gen. at 286 (The test is "whether a changed contract is materially different from the competed contract."). The analysis thus focuses on the scope of the entire original procurement in comparison to the scope of the contract as modified. Thus a broad original competition may validate a broader range of later modifications without further bid procedures. 1 F.3d at 1204-05. In making its determination as to whether the modification was within the scope of the contract, the Court, in AT&T, focused upon the scope of contract and the offerors' expectations with regard to the type of work that might reasonably be anticipated. This Board has also looked to decisions of the Comptroller General as persuasive authority on this issue. As we stated in MCI Telecommunications Corp. v. General Services Administration, GSBCA 11963-P, 93-1 BCA 25,541, 1992 BPD 287: The standard Changes clause incorporated in [the] contract authorizes the contracting officer to order additional work "within the general scope of [the] contract." In protests challenging a contract modification, this Board, and the Comptroller General, have monitored the integrity of the competitive procurement process by assessing the nature and scope of the original competition. The Comptroller General's often quoted Memorex test -- whether a modification "so substantially changes the purpose or nature of a contract that the contract for which the competition was held and the contract which is to be performed are essentially different" -- is a means to that end. Memorex, 61 Comp. Gen. 42 (1981), 81-2 CPD 334. Id. at 127,220, 1992 BPD 287, at 10-11. In MCI, we applied four factors that we considered relevant when evaluating whether a modification was within the scope of the contract. These factors are the degree of change in the (1) type of work the contractor would need to perform, (2) pricing, (3) schedule for delivery of the service, and (4) whether, during the competition, potential offerors reasonably would have expected the changed work to be within the scope of the contract. We therefore look to the contract, its intended purpose, and whether the modification materially changes that contract. The Scope of the Contract and the Type of Work to be Performed Under Modification 66 Under the original contract, NASA sought to procure "a system that will effectively address ARC's projected needs for the ten-year life of the system" and one which "include[s] . . . all associated . . . equipment, system expansion . . . through 1996." Finding 2. The DPA which was issued for the contract and the contract itself clearly contemplated expansion of the DTS during the ten-year contract period to meet future needs. Findings 3, 11-13. To meet future needs, the offerors were directed to propose a system with "a minimum expandable connection capacity of 15,000 lines, ports, and trunks combined." Finding 14. The number of lines required by ARC at the time of initial installation was 3,500 to 4,000 and this was increased by future modifications, including the approximately 3,000 to 3,500 lines added by modification 66, to approximately 10,000 lines. Findings 15, 24, 36. The contract contained annual options to be exercised for nine years following the first year of contract performance. Finding 17. Even though the original estimates of expansion deliverables were determined based upon contemplated growth in the non-Navy areas, Finding 19, the contract contained no geographic limits or prohibitions as to possible expansion. Finding 22. However, before modification 66 was issued, system expansion was accomplished under several modifications in various buildings which either did not exist at the time the contract was awarded or were formerly occupied by the Navy. Finding 24. It was not possible to predict at the time of the execution of the contract what methods or equipment would be used for providing the additional expansion deliverables. It was also not possible to predict, at the time of contract execution, what technologies might become available during the ensuing ten-year period. Finding 21. However, in submitting their proposals, the offerors were asked to offer a system with the specified minimum expandable connection capacity to accommodate future growth if NASA were to exercise all options to extend the base contract period for nine additional years. The inclusion of the additional 3,000 lines which were added under modification 66 does not exceed the minimum expandable connection capacity of the system to be procured under the contract. Accordingly, Pacific reads the contract too narrowly. It is true that the RSCs supplied under modification 66 were not required when the DTS was installed under the current contract, nor were they listed in the pricing tables. Finding 37. The expansion deliverables listed in the contract did not include the hardware or software which might be included in supplying the deliverables. Finding 20. However, a system capable of providing expanded service, when needed, with a specified minimum expansion capacity, was the purpose of the original contract, and the RSCs fulfill that purpose. The work performed under modification 66 is within the parameters of the expanded capacity of the system. We do not conclude that the work performed under the modification so substantially changes the purpose or nature of the contract that the contract for which the competition was held and the contract as modified are essentially different. Pricing of the Modification Protester argues that modification 66 "had a significant impact on the total contract value. The Contract value was $9,040,000. . . . Mod 66 was valued at $1,909,801. . . . Thus, Mod 66 represented a huge increase in NASA's annual outlays under the Contract and a shift to acquisition of significant amounts of equipment and software rather than just support." Protester's Post-Hearing Brief at 24. Protester compares the modification price to the original contract price and ignores the fact that the exercise of option years and other modifications for additional work increased the price to $16,096,000. The original price was for the DTS with an expansion capability and support of approximately 4,000 lines. Findings 7, 15. The price of the modification, to increase the system by an additional 3,000 lines, does not appear disproportionate. Therefore, the pricing of the modification does not support a determination that the modification is outside the scope of the contract. Delivery of the Work Under the Modification The contract contemplated that the contractor would expand the DTS during the ten-year life of the contract. As stated above, the work to be performed under modification 66 provides additional lines within the minimum number of lines contemplated to be delivered within that time frame. Work under modification 66 is scheduled to be completed during the summer of 1994. Finding 36. The contract had an indefinite delivery schedule. Finding 18. The work to be performed under modification 66 does not materially alter the delivery schedule of the contract. The Expectation of the Offerors at the Time of Contract Award Pacific contends that the work called for under modification 66 is beyond the scope of the contract because the contract does not specifically state that the DTS will be expanded to provide service to the Navy areas of Moffett Field. Also, Pacific argues that when the contract was awarded in 1987, NASA did not know that ARC would expand to encompass all of Moffett Field. Therefore, Pacific argues that the work to be performed pursuant to modification 66 could not have been contemplated by the offerors in their original proposals and therefore is beyond the scope. There is conflicting testimony as to whether NASA envisioned the future takeover of the Navy's areas of Moffett Field at the time it entered into the contract with Nortel in 1987 and informed offerors of this possibility. NASA's JOFOC for modification 66 states that, at the time the contract was entered into, "[t]he expansion of NASA's responsibilities at Moffett Field was inconceivable." Finding 30. However, the employee who prepared the JOFOC was not involved in the original procurement. Finding 31. The former Deputy Director at ARC testified in deposition that "the base closure was not even a gleam in anybody's eye" at that time. Finding 32. In contrast, Nortel presented testimony that NTI's representative had been told by NASA representatives before proposals were submitted and during preaward discussions that NASA might possibly acquire Navy facilities if the Navy were to diminish its presence at Moffett Field. Finding 5. There is testimony in the record from an employee from Pacific who was present for part of the site visit, but his testimony did not mention discussions as to possible expansion. Finding 6. We do not agree with protester that in order to prove the work under modification 66 was within the scope of the contract, respondent must show that at the time of the contract, the offerors contemplated ARC would expand into the Navy areas of Moffett Field during the ten-year contract period. Offerors were not charged with knowing how ARC might grow. While it may not have been possible to predict how ARC might expand over the next ten years, the contract was to provide a DTS with a minimum expansion capacity and provide expansion as needs arose. In performing the work under modification 66, Nortel will not exceed that expansion capacity. The DTS as configured, after the work is performed under modification 66, is within the parameters of the contemplated expansion as set forth in the contract, and therefore, by the very terms of the solicitation and the contract, within the contemplation of the offerors. The Work Performed Under Modification 66 was Within the Scope of the Contract We look to the scope of the original contract and the work performed under modification 66 to determine if the work performed was within the scope. Based upon the foregoing, we hold that the work to be performed under modification 66 was within the scope of the contract. Accordingly, we deny protester's first ground of protest. Protest Ground 2 - NASA Failed to Publicize in the CBD NASA did not synopsize and publicize modification 66 in the CBD as either a proposed contract action or actual contract award. Finding 39. Pacific contends that NASA violated 48 CFR 5.201 (1993) (FAR 5.201), which requires publication of proposed contract actions. Part 5 of the FAR is entitled "Publicizing Contract Actions." FAR 5.001 defines contract action as used in this part of the FAR as "an action resulting in a contract, . . . but not including contract modifications that are within the scope and under the terms of the contract." As we have determined that the work performed under modification 66 was within the scope of the contract, there was no violation of FAR 5.201. Pacific also contends that NASA violated FAR 5.301, which requires a synopsis to be published in the CBD for contract awards resulting from contract actions. Again, since contracting action as defined in FAR 5.001 does not include modifications within the scope of the contract, there was no requirement for a published notice and therefore no violation of FAR 5.301. We deny protester's motion for summary relief on this ground, and deny ground 2 of the protest. Protest Ground 3 - NASA Failed to Treat All Potential Offerors Fairly and Equally In this ground of protest, Pacific alleges that NASA failed to give Pacific timely notification about its plans to acquire the work under modification 66, and otherwise refused to allow Pacific to compete for the work under the modification. As we have held that the work performed under modification 66 is within the scope of the contract, we deny ground 3 of the protest. Protest Grounds 4 and 5 - NASA and Nortel Violated Laws and Regulations Relating to the Certificate of Procurement Integrity Protester alleges that NASA and Nortel also violated express requirements of the OFPP Act, 41 U.S.C. 423, and its implementing regulations. According to protester, NASA violated the OFPP Act by executing modification 66 without having obtained a signed certificate of procurement integrity from Nortel, and Nortel violated the Act because the certificate which it did submit after the modification was executed was not accurate. Thus, protester alleges that modification 66 was illegal due to lack of a certificate of procurement integrity and modification 66 must be rescinded due to a substantive violation of the OFPP Act. NASA did not request or receive a signed certificate of procurement integrity from Nortel until after modification 66 had been executed. Findings 43, 44. However, a certificate of procurement integrity is not required for a contract modification when the changes encompassed by the modification are within the scope of the contract. The FAR provision implementing the OFPP Act contains the conditions under which a certification of procurement integrity is required: For contracts and contract modifications which include options,[foot #] 6 a certificate is required when the aggregate value of the contract or contract modification and all options exceeds $100,000. 48 CFR 3.104-9(b)(3)(ii)(E) (1993) (FAR 3.104-9(b)(3)(ii)(E)). ----------- FOOTNOTE BEGINS --------- [foot #] 6 Modification 66 was a lease with option to purchase. Finding 36. ----------- FOOTNOTE ENDS ----------- The FAR defines modification as follows: (e) Modification means the addition of new work to a contract, or the extension of a contract, which requires a justification and approval (see subpart 6.3). It does not include an option where all the terms of the option, including option prices, are set forth in the contract and all requirements for option exercise have been satisfied, change orders, administrative changes, or any other contract changes that are within the scope of the contract. FAR 3.104-4(e). Therefore, certificates of procurement integrity are only required where a modification is in excess of $100,000 and justification and approval of the modification is necessary pursuant to the provisions of FAR subpart 6.3. FAR 3.104- 9(b)(3)(ii)(E); FAR 3.104-4(e). Subpart 6.3 contains requirements that apply to other than full and open competition. The work performed under modification 66 was within the scope of the contract, and no JOFOC was required. Therefore, there was no requirement that a certificate of procurement integrity be submitted with regard to modification 66. The fourth and fifth protest grounds are premised on alleged violations concerning the submission of a document which was not required in the procurement process, and we therefore deny these grounds. Pacific has filed a motion for summary relief on these grounds, and Nortel has moved to dismiss the fifth protest ground. Protester's motion for summary relief on these grounds, as well as intervenor's motion to dismiss the fifth ground, are also denied. Decision Respondent's motion to dismiss the protest as untimely and protester's motions for summary relief are DENIED. Intervenor's motion to dismiss the fifth ground of protest is DENIED. The protest is DENIED. ________________________ ALLAN H. GOODMAN Board Judge We concur: _____________________ ________________________ EDWIN B. NEILL MARTHA H. DeGRAFF Board Judge Board Judge