Bath Iron Works Corporation, B-290470; B-290470.2, August 19, 2002

DOCUMENT FOR PUBLIC RELEASE The decision issued on the date below was subject to a GAO Protective Order. This redacted version has been approved for public release.

Decision
 
 
Matter of: Bath Iron Works Corporation
 
File: B-290470; B-290470.2
 
Date: August 19, 2002
 
David A. Churchill, Esq., Kevin C. Dwyer, Esq., Cynthia J. Robertson, Esq., Nathan C. Guerrero, Esq., William R. Stoughton, Esq., and Kathy Weinberg, Esq., Jenner & Block, for the protester.
John W. Chierichella, Esq., Anne B. Perry, Esq., Deneen J. Melander, Esq., Richard A. Sauber, Esq., Jonathan S. Aronie, Esq., and Kenneth S. Kramer, Esq., Fried, Frank, Harris, Shriver & Jacobson, for Ingalls Shipbuilding, Inc., an intervenor.
William A. Longwell, Esq., Frank A. Putzu, Esq., Janice M. Passo, Esq., Rhonda K. Russ, Esq., Kelly M. Calahan, Esq., Ann G. Merra, Esq., Craig L. Kemmerer, Esq., and Douglas K. Edgecomb, Esq., Naval Sea Systems Command, Naval Sea Systems Command, for the agency.
David A. Ashen, Esq., and John M. Melody, Esq., Office of the General Counsel, GAO, participated in the preparation of the decision.

DIGEST
 
.
 

DECISION
 
Bath Iron Works Corporation (BIW) protests the Naval Sea Systems Command's (NAVSEA) award of a contract to Ingalls Shipbuilding, Inc., under request for proposals (RFP) No. N00024‑02‑R‑2302, to serve as the design agent for technology development with respect to the DD(X) multi-mission naval surface combatant program. BIW asserts that the competition was not conducted on a common basis and that the evaluation of proposals was unreasonable and otherwise improper.
 
We deny the protest.
 
BACKGROUND
 
The DD(X) naval surface combatant program, Phase III of which is the contemplated DD(X) design agent effort, is a successor to the DD 21 Land Attack Destroyer Program. Prior to cancellation of the DD 21 program on November 30, 2001, NAVSEA had completed phases I (system concept design) and II (initial systems design), under which two teams, including a Gold Team (with Ingalls as the prime contractor and Raytheon Corporation as the system integrator), and a Blue Team, (with BIW as the prime contractor and Lockheed Martin Corporation as the systems integrator), had developed independent designs for the DD 21 destroyer. The DD(X) design agent solicitation, issued on November 30, contemplated a cost‑plus‑award‑fee contract under which the selected DD(X) design agent contractor was required to (1) design, develop and build, and conduct factory tests, land-based tests, and (where specified) at-sea tests of engineering development models (EDMs), and (2) engineer the results of the testing into the DD(X) system design based on the contractor's DD 21 Phase II engineering, and that will meet the operational needs and requirements established in the DD 21 Operational Requirements Document. The solicitation specified a minimum of 11 EDMs: advanced gun system and munitions, integrated power system (IPS), volume search radar (VSR), VSR/SPY-3 multi-function radar (MFR) suite, total ship computing environment, advanced vertical launching system (VLS), integrated deckhouse, autonomic fire suppression system, infrared mock-ups, hull form scale models and integrated undersea warfare system.
 
The solicitation provided for award to be made to the technically acceptable offeror whose proposal represented the “best value.” Proposals were to be evaluated under three non-cost evaluation factors (in descending order of importance): (1) management approach, including (in descending order of importance) subfactors for program management approach, integration of second shipbuilder, combat system solutions, software development management approach, and data and patent rights; (2) technical approach, including equally weighted subfactors for EDMs, parallel design studies, total ship system engineering, total ship computing environment, and specified performance; and (3) past performance. Management and technical approach were to be assigned both adjectival ratings (outstanding, very good, satisfactory, marginal or unsatisfactory) and proposal risk ratings (high, moderate or low), and past performance was to be assigned adjectival ratings (outstanding, good, satisfactory, neutral, marginal or unsatisfactory). The three non‑cost evaluation factors taken together were more important than cost, the fourth evaluation factor. However, offerors were cautioned that, “in order to be considered for award, the Government Evaluated Cost Plus Fee associated with its Cost Proposal must not exceed the total RDT&E [research, development, test and evaluation] budget provided in Exhibit B to Section L of the Solicitation,” which totaled $2.865 billion. RFP § M.2(c)(4).
 
After receiving initial proposals from the Blue and Gold Teams by the February 4, 2002 closing time, NAVSEA commenced discussions with both offerors. Several rounds of oral and written discussions were held, during which offerors were furnished the agency's interim evaluation of proposals, including the evaluated strengths, weaknesses, deficiencies and risks. NAVSEA then requested the submission of final proposal revisions (FPR) by April 2. The results were as follows:
 

	BLUE TEAM		GOLD TEAM
	Adjective	Risk	Adjective	Risk
PROGRAM MANAGEMENT	Very Good	Low	Very Good	Low
Program Management Approach	Outstanding	Low	Outstanding	Low
Integration of Second Shipbuilder	Outstanding	Low	Outstanding	Low
Combat System Solution	Very Good	Low	Very Good	Low
Software Development	Very Good	Moderate	Satisfactory	Moderate
Data/Patent Rights	Satisfactory	Low	Satisfactory	Low
TECHNICAL	Very Good	Moderate	Very Good	Moderate
EDMs	Very Good	Moderate	Outstanding	Moderate
Parallel Design	Very Good	Low	Very Good	Low
Total Ship System Engineering	Outstanding	Low	Outstanding	Low
Total Ship Computing Environment	Outstanding	Moderate	Very Good	Moderate

 

Specified Performance	Very Good	Moderate	Outstanding	Moderate
PAST PERFORMANCE	Good		Good
EVALUATED COST	$[DELETED]Billion		$[DELETED]Billion

 
 
Although both proposals received overall ratings of very good for the program management and technical factors, and ratings of good for the past performance factor, the source selection authority (SSA), concurring with the recommendation of the source selection advisory council (SSAC), concluded that the Gold Team's proposal was “clearly superior” with respect to the EDM and specified performance subfactors. In this regard, the SSA and SSAC determined that the proposed Gold Team DD(X) design was superior to the Blue Team design in several significant areas, and represented “significant advances in technology, warfighting capability and survivability.” SSAC Report at 36; Source Selection Decision (SSD) at 2-3. For example, the Blue Team proposed a VLS offering a high degree of commonality with the Navy's current MK41 Baseline VII Launch Control System and using the traditional VLS configuration of centralized missile magazines, with two unitary, centrally located 64-cell missile magazines, one fore and one aft. In contrast, the Gold Team proposed a new, more innovative approach. Specifically, the Gold Team proposed as its primary approach a peripheral VLS consisting of numerous [DELETED] modules (a total of 128 cells) peripherally located along the hull. Although the Navy recognized that the developmental nature of the Gold Team's peripheral VLS approach necessarily increased program risk, the agency viewed it as an “innovative solution to a significant vulnerability problem in virtually all U.S. Navy surface combatants”; by dispersing the missiles to the periphery of the ship, the peripheral VLS reduced the probability that a single hit would destroy the missile magazine and cause the catastrophic loss of the ship. SSAC Report at 25. According to the agency, “[t]his unprecedented design offers the crew the opportunity to continue to fight through a situation that previously would have destroyed the ship.” Id. In addition, the Gold Team design offered a considerably greater growth capability for larger future missiles than did the Blue Team design, including [DELETED] growth potential with respect to canister length and [DELETED] percent more growth potential with respect to weight.[1]
 
Likewise, the SSA and SSAC determined that the Gold Team proposed a superior radar approach. In this regard, the solicitation required offerors to design, develop, build and test on land a VSR radar, that is, a radar that operates within the L-Band frequency and is designed to scan large areas of aerospace to locate potential threats. However, the L-Band suffers from significant propagation loss at low altitudes, which can lead to a reduced capability to detect low-flying targets. Thus, the solicitation also required that offerors integrate the VSR radar with the SPY-3 MFR radar developed under a contract with the Navy by Raytheon, a member of the Gold Team, and then conduct land and at-sea testing with an integrated radar suite. The SPY-3 MFR is an X-Band radar--operating at a higher frequency and shorter wavelength than the L-Band‑‑which has the potential to pinpoint and track the precise movements of target objects and has better performance against low altitude targets. The Blue Team proposed a radar suite consisting of an L-Band VSR segment and an X-Band SPY-3 MFR segment, each with its own digital processor, and integrated through the suite's command and control sensor manager. In contrast, the Gold Team proposed a “dual band radar” integration approach, under which the VSR and MFR are integrated at the waveform level, with a common scheduler and tracker residing on a common digital processor. The Navy determined that this approach to integrating the two radars was an innovative, superior approach that promised exceptionally close coordination between the radars and resulting significant advances in radar performance, including robust performance in the presence of jamming and electronic countermeasures, superior performance in all natural and man-made environments, improved track accuracy and resolution, and the ability to avoid multiple radar track-to-track correlation problems. In addition, the agency concluded that the greater software and hardware commonality of the Gold Team's approach would result in the need for significantly less software development time and maintenance, and would favorably affect hardware development and long-term operation and support costs. SSAC Report at 16.
 
The SSA and SSAC also found to be a significant advantage the fact that the Gold Team design included a larger aviation landing area (made possible by its peripheral rather than centrally-located, unitary VLS) which accommodated two landing spots rather than the one spot offered by the Blue Team design. The Navy concluded that the availability of two landing spots would result in “dramatically improved aviation flexibility”; that the design would provide the ability to land (and service) helicopters that could not be landed on current cruiser or destroyer platforms, thus significantly increasing joint warfighting capability; and that the dual spot design would facilitate embarkation of next generation unmanned aerial vehicles. SSAC at 26. In addition, the Navy determined that the Gold Team's proposed enclosed stern boat bay for launching and recovering boats was significantly more advantageous than the Blue Team's proposed side-launch boat bay. According to the agency, the stern boat bay would permit rapid, flexible and safe boat handling, especially at higher sea states, while the Blue Team design's over-the-side launches and recoveries would be extremely difficult at high sea states and would present a significant safety concern. SSD at 3; SSAC Report at 27.
 
The Navy recognized that the possibility of using the more advantageous stern boat bay was precluded in the Blue Team's design by the Blue Team's approach to the integrated power system (IPS). SSAC Report at 27. Both teams proposed as their primary IPS solution a permanent magnet motor (PMM), a motor which offers significant potential advantages, but which also is characterized by moderate development risk. However, while the Gold Team proposed a conventional shaft‑driven system with the PMM internal to the hull, and thus available for on‑board repair and replacement of modules, the Blue Team proposed a propulsion system in which the propulsion motors are in two external, steerable pods, mounted below the hull. Although the agency believed that the Blue Team's podded propulsion approach offered significant potential advances in ship maneuverability and ease of maintenance, it noted that this approach had never been developed for a surface combatant, having only been used on commercial cruise ships, and concluded that significant development effort would be necessary in order to militarize the pods and satisfy the Navy's speed, acoustics and shock requirements. Id. at 17.
 
Beyond finding the Gold Team's more conventional propulsion approach as less risky, the agency also found the Gold Team's fallback motor more advantageous. In this regard, given the risks associated with the PMM, the agency viewed a fallback solution to be “critical to the success of the DD(X) program.” SSAC Report at 17. However, the Blue Team's proposed fallback motor, also incorporated in a podded design, was capable of only [DELETED] knots, short of the 30-knot speed requirement; would not satisfy the Navy's [DELETED] requirements; and presented a moderate development risk. In contrast, the Gold Team's fallback motor met the Navy's [DELETED] requirements, and was considered to be low risk as a result of its technological maturity. In addition, the Navy questioned whether the Blue Team's podded propulsion system, unlike the Gold Team's approach, was [DELETED]. In summary, the agency found that, overall, the Gold Team's IPS solution was more advantageous than the Blue Team's podded IPS approach. Id. at 18.
 
The SSA also concurred in the SSAC's finding that the Gold Team's EDM testing program was more robust than the Blue Team's, and thus will more effectively mitigate the risks associated with development of the EDM systems. SSD at 4; SSAC Report at 37.
 
The SSA, concurring with the recommendation of the SSAC, concluded that the Gold Team proposal's superiority with respect to the EDM and specified performance subfactors, which reflected the additional, advanced warfighter capability and the greater flexibility to meet future needs of the Gold Team's approach, outweighed both the Blue Team proposal's advantage with respect to software management and total ship computing environment, and the Blue Team's less than one-percent advantage in evaluated cost, such that the Gold Team proposal represented the best value. Upon learning of the resulting award to Ingalls, and after being debriefed, BIW filed this protest.
 
BIW challenges the evaluation and award decision on several grounds. Based on our review of the record, including testimony taken at a 3-day hearing our Office conducted in this matter, we find no basis to question the award to Ingalls. We discuss the most significant arguments below.
 
DD 963-CLASS DESTROYER
 
BIW asserts that the Navy failed to conduct the competition on a common basis when it denied the Blue Team the use of a decommissioned DD 963-Class destroyer for at-sea testing while at the same time accepting for purposes of the evaluation the Gold Team's proposed use of a decommissioned DD 963-Class destroyer.
 
In this regard, the solicitation required at-sea testing of three of the EDMs, including the IPS, integrated undersea warfare system, and VSR/SPY-3 MFR radar suite EDMs. RFP § C, at 8, 21, 23. Offerors were required to “identify where the EDM testing will be conducted and discuss the readiness of the site to support the required tests.” RFP § L, at 21. The RFP placed the responsibility for arranging the tests with the contractor, stating that “[t]he Contractor shall make all necessary arrangements for scheduling and funding test ranges, test articles, test equipment, environmental planning and all other resources associated with testing, including LFT&E [Live Fire Test and Evaluation], DT [Development Testing] and OT [Operational Testing] events.” RFP § C, at 10.
 
Question No. 1.79, concerning the draft RFP, asked as follows with respect to the IPS EDM: “Does the Government intend to provide the platform for at-sea testing . . . ?” The agency responded:
 
The government does not intend to provide the platform for at-sea testing. The contractor should use the platform that offers the best opportunity to achieve the tests' objectives, minimize program cost, and maintain the schedule. (See response to question 1.78.)
Draft Questions and Answers, Nov. 14, 2001. Although this answer appeared to preclude use of a government-owned at-sea test platform, the parties indicated a different interpretation of the applicable solicitation provisions. The contracting officer testified at the hearing (July 10-12, 2002) that the agency intended, not to preclude use of a government-owned platform, but only to advise offerors that the DD(X) Program Office would not furnish test resources as government furnished property under the FAR. Hearing Transcript (Tr.), July 11, at 150‑63. The Gold and Blue teams, by their actions, likewise indicated that they did not view the solicitation as a bar to the use of government-owned at-sea test platforms since, as discussed below, they both requested and/or assumed the use of government-owned at-sea test platforms.[2]
 
As for which at-sea test platform to use, the answer to Question No. 1.78 to the draft RFP suggested the relevant selection criteria. The question asked whether “tests performed on a vessel which is significantly different from the proposed DD 21 hull form, e.g. a barge, [would] be considered acceptable for demonstrating operational and dynamic performance.” Draft Questions and Answers, Nov. 14, 2001. The agency answered as follows:
 
Yes, a vessel that is significantly different from the proposed DD 21 hullform is acceptable for demonstrating operational and dynamic performance. All tests should be accomplished at the facility, vessel or location that offers the best opportunity to achieve the tests' objectives, minimize program cost, and maintain the schedule.
Question 1.78.
 
The Blue Team had prepared a study, seeking to establish that it could increase the sustained speed of its then [DELETED]-knot podded design to meet the agency's 30-knot requirement. This 30 Knot Study, the results of which were briefed to the Navy DD(X) Program Office in November 2001 and formally presented on January 31, 2002, found that use of a DD 963 Spruance Class destroyer was the favored solution for the IPS at-sea test platform. 30 Knot Sustained Speed Design Excursion: Technical Feasibility Study, Jan. 31, 2002, at 62; Tr., July 12, at 329-35. Upon inquiring generally about obtaining the use of Navy ships, and being directed by the DD(X) Program Office's IPS point of contact to the Office of the Chief of Naval Operations (CNO) N43, the Navy office that ultimately determines the disposition of decommissioned ships, BIW's lead naval architect for the DD(X) was then referred to the NAVSEA Inactive Ship Program Office, to identify a specific decommissioned ship. BIW's lead naval architect was informed that six DD 963s were scheduled to be decommissioned every year from fiscal years 2003 through 2006. He understood that once a specific ship was identified, the DD(X) Program Office would need to ask CNO 43 (or other higher authority) for official designation of the ship for testing purposes. NAVSEA Comments, July 19, 2002, at 31; BIW Comments, July 19, 2002, at 37-38; Tr., July 12, at 325‑28; AR Tab 555.
 
On January 3, 2002, the Blue Team contacted the team's designated Industry Liaison Point of Contact (ILPOC), a Navy employee, at the Naval Surface Warfare Center, Carderock Division (NSWCCD), to ascertain the availability of and costs of using a decommissioned DD 963. The ILPOC in turn contacted a supervisor at the Inactive Ship Program Office, and then, on January 8, the Blue Team e‑mailed a written request for the information to the supervisor. AR Tab 449. The Inactive Ship Program Office supervisor responded in a January 11 e-mail, advising that “[w]e expect to have a DD 963 Class ship . . . so schedule at this point in time indicates that schedule is not an issue for us,” and that the rough order of magnitude cost to inactivate a DD 963 and tow it to BIW would be $1.25 million. Id. The Blue Team then requested additional information, asking the ILPOC to obtain it “as soon as possible.” AR Tab 449, BIW e‑Mail to ILPOC, Jan. 12, 2002, 9:45 a.m. On January 15, the ILPOC pressed the commander of the Inactive Ship Program Office for an immediate, firm commitment to furnish the ship and a determination of the exact cost involved. Tr., July 10, at 28‑30, 43-45; Declaration of Commander of Inactive Ship Program Office. Shortly thereafter, on January 16, the Inactive Ship Program Office supervisor stated in an e‑mail to the ILPOC that
The NAVSEA position is that we will not entertain a leasing or other agreement at this time to lease, loan, grant, sell, etc. a DD 963 Class ship in furtherance of the BLUE Team effort to quantify cost for purposes of the BLUE Team proposal. There are significant legal issues involved as well as precedent concerns.
AR Tab 449; Declaration of Commander of Inactive Ship Program Office. Although the Commander of the Inactive Ship Program Office did not “approve the email word for word before it went out,” he directed that it be sent, provided “general direction” as to what he wanted it to say, and “directed the thrust and tenor” of it. Tr., July 10, at 54-55, 90-91.
The ILPOC's supervisor at NSWCCD, unsure whether the DD(X) Program Office was aware of the Blue Team request, then asked the ILPOC to inquire of the Blue Team whether it wanted him to pursue the matter with the DD(X) Program Office. On January 17, the ILPOC's supervisor was advised by the Blue Team's Technical Director that “he had other options to pursue concerning his at sea demonstrating, that he didn't want me to go forward and contact [the DD(X) Program Office].” Tr., July 10, at 124-27; Declaration of ILPOC Supervisor at 2. Pursuant to the terms of the private party agreement under which the ILPOC was acting, which precluded disclosing information outside the government industry team without permission, the ILPOC's supervisor did not contact the DD(X) Program Office. Tr., July 10, at 121-24, 127.
On February 4, 2002, the Blue Team submitted its initial proposal, which stated that its IPS at-sea EDM was
based on a modified commercial vessel with the addition of turbine and diesel generation sets and a motor drive capable of driving a single stern-mounted full-scale DD(X) pod and EDM propeller to 66% of full load. This is the optimal configuration for reducing risk associated with 4-quadrant electrical and mechanical dynamic performance, as well as structural loading of a full scale pod. These were determined to be higher risks than those associated with stopping, turning, and other maneuvering properties.
Initial Technical Proposal at B-12. In its basis of estimate (BOE) for procuring and converting an unidentified commercial ship to be the IPS EDM at-sea test vehicle, included in its cost proposal, the Blue Team noted that it had considered as its alternative (beyond the commercial ship and a 1/3 scale geometrically-similar demonstrator) the use of a DD 963 scheduled for decommissioning. The Blue Team explained that “[t]he DD 963 makes a viable and attractive full-scale demonstrator, however, questions surrounding the availability of that platform caused its elimination from this estimate.” Initial BOE, E5.1.2.5.BIW, at 7. In addition to the IPS at-sea test platform, the Blue Team proposed to conduct at-sea testing of its radar suite using the MV Belard, a commercial roll-on/roll-off vessel, and testing of its integrated undersea warfare system EDM using a “Gray Ship (DD 963 Class),” that is, an in-service DD 963 destroyer. Initial Technical Proposal at B-17, 30.
On March 21, the Gold Team held a press conference during which, according to an account in the March 25 issue of Inside the Navy, it announced that it “plans to use a Spruance-class DD 963 hull for at-sea demonstration purposes.” AR Tab 464. The article quoted a vice president of Northrop Grumman Corporation, the parent company of Ingalls, as explaining that “the company, rather than the Navy, came up with the idea of using the Spruance hull”; according to the vice president, “we said, 'Well, you could take a barge or you could take some old ship and put a propulsion plant in, but it wouldn't give you the same type of hydrodynamic analysis that you need for a warship.'” Id.
Although the Blue Team did not raise the question of its use of a decommissioned DD 963 as an at-sea IPS test platform at the subsequent March 26 oral discussions with the Navy, on April 1, just prior to the April 2 closing date for receipt of FPRs, BIW's lead naval architect for the DD(X) sent a copy of the article by e-mail to the ILPOC. When the ILPOC then asked the lead naval architect whether the Blue Team wanted her and her supervisor to inquire at NAVSEA as to the use of a DD 963, the lead naval architect responded by e-mail early on the morning of April 2: “Please do not do anything. I have provided this article for your information only.” AR 449.[3]
In its FPR, the Blue Team described its IPS at-sea test platform as “a modified commercial heavy lift ship with ample capacity to accommodate the IPS propulsion pod, test equipment and facilities for test engineers and observers.” Blue Team FPR at B-18. The Blue Team noted, however, that
[a]lthough our leading option from a technical perspective is the use of a decommissioned DD963 Class Ship, the Blue Team has not proposed this approach because we were unable to obtain any form of business arrangement or cost estimate from the NAVSEA Inactive Ship Program Office. We were informed that the Program Office would not entertain a leasing or other agreement. They stated in part, 'There are significant legal issues involved as well as precedent concerns.'
Id. at B-27. In contrast, although the Gold Team had not requested permission from the Inactive Ship Program Office or CNO 43 to use a decommissioned DD 963, it proposed in its FPR, as it had in its initial proposal, to use a to-be-decommissioned DD 963 Class ship, the USS Radford, as an at‑sea test platform for its IPS and radar EDMs (among others).
In response to the reference in the Blue Team's FPR to a decommissioned DD 963, the Source Selection Evaluation Board (SSEB) and SSAC considered during the final evaluation whether the Blue Team's use of a decommissioned DD 963 would have affected the evaluation. The SSEB informed the SSAC that use of a decommissioned DD 963 did not result in a strength for the Gold Team in the evaluation and that, had the Blue Team used a decommissioned DD 963 instead of a commercial vessel, its evaluation would not have changed. Tr., July 10, at 211-14. The SSAC agreed that, from a technical perspective, the selection of a test platform did not affect the evaluation, Tr., July 11, at 212, and specifically noted in its report that “the identity of the at-sea test platform had no effect on its best value analysis of the offerors' IPS EDM.” SSAC Report at 18 n.12.
BIW maintains that the Navy acted improperly in denying it use of a decommissioned DD 963 for at-sea testing while at the same time accepting for purposes of the evaluation the Gold Team's proposed use of a decommissioned DD 963 Class destroyer. According to the protester, denial of the use of a decommissioned DD 963 precluded it from offering a more advantageous approach.
In reviewing an agency's evaluation of proposals and source selection decision, our review is confined to a determination of whether the agency acted reasonably and consistent with the stated evaluation factors and applicable procurement statutes and regulations. United Defense LP, B-286925.3, et al., Apr. 9, 2001, 2001 CPD ¶ 75 at 10-11; Main Bldg. Maintenance, Inc., B- 260945.4, Sept. 29, 1995, 95-2 CPD ¶ 214 at 4. In this regard, it is a fundamental principle of government procurement that competition must be conducted on an equal basis, that is, offerors must be treated equally and be provided with a common basis for the preparation of their proposals. MSI, a Div. of the Bionetics Corp., B-243974, et al., Sept. 17, 1991, 91-2 CPD ¶ 254; cf. Lance Ordnance, Inc., Jan. 26, 1999, B-281342, 99-1 CPD ¶ 23 at 3-5 (awardee's lease of government-owned facilities did not confer unfair advantage).
 
Based on our review of the record, we find that the denial of the use of a decommissioned DD 963 class destroyer did not result in competitive prejudice to the Blue Team. As discussed below, the Blue Team failed to pursue the Inactive Ship Program Office's denial of a ship, thus supporting the conclusion that use of a decommissioned DD 963 was not viewed by the Blue Team as a significant consideration. Further, the Navy reasonably determined that there would have been no material technical benefit to the Blue Team from proposing a decommissioned DD 963 instead of the large commercial ship it proposed as its IPS EDM at‑sea test platform. Finally, it does not appear from the record that the Blue Team's failure to propose a decommissioned DD 963 as an at-sea test platform materially affected the evaluation.[4]
 
Denial of Use
The Navy asserts that it did not deny the Blue Team use of a decommissioned DD 963. Rather, according to the agency, the January 16 e-mail from the Inactive Ship Program Office supervisor to the ILPOC, cited by the protester as a denial, was intended not as a final denial, but simply to inform BIW that under the severe time constraints imposed by the company, the Navy was unable to provide the requested detailed information and firm commitment “at this time.” Tr., July 10, at 54-56, 97,104, 106; Declaration of Commander of Inactive Ship Program Office. Again, the e-mail stated that,
The NAVSEA position is that we will not entertain a leasing or other agreement at this time to lease, loan, grant, sell, etc. a DD 963 Class ship in furtherance of the BLUE Team effort to quantify cost for purposes of the BLUE Team proposal. There are significant legal issues involved as well as precedent concerns.
AR Tab 449. According to the agency, in the context of BIW's pressure for a quick response, BIW should have recognized from the use of the phrase “at this time” that this was not intended as a final denial.
The Navy's position is not persuasive. Although the Inactive Ship Program Office may have intended the January 16 e-mail to be other than a final denial, we think the Blue Team reasonably interpreted it as such, given the reference to the “NAVSEA position,” the seeming exclusion of any type of agreement under which the ship could be furnished, and the reference to the “significant legal issues involved as well as precedent concerns.” Tr., July 11, at 362-66; July 12, at 209-10, 359. Indeed, the record indicates that involved Navy personnel likewise viewed it as a denial. In this regard, we note that the ILPOC's summary of events, prepared on April 30, after award, at the request of the Blue Team, includes the notation that on January 16, the Inactive Ship Program Office supervisor had left her a voice message “indicating that he had been given the 'official word' that he could no longer work on this.” AR Tab 449. Further, the ILPOC herself had informed her supervisor, according to the testimony of her supervisor, that she viewed the e-mail as a final denial. Tr., July 10, at 139-40.
Prejudice
Competitive prejudice is a prerequisite to sustaining a protest. Where the record does not demonstrate that, but for the agency's actions, the protester would have had a reasonable chance of receiving the award, our Office will not sustain a protest, even if a deficiency in the procurement is found. McDonald‑Bradley, B-270126, Feb. 8, 1996, 96-1 CPD ¶ 54 at 3; see Statistica, Inc. v. Christopher, 102 F.3d 1577, 1581 (Fed. Cir. 1996). Based on our review of the record, we find that the denial of the Blue Team's request to use a decommissioned DD 963 destroyer as an at-sea test platform did not result in competitive prejudice to the protester so as to warrant sustaining its protest in this regard.
1. Failure to Appeal Denial
The Navy asserts that the Blue Team's internal proposal preparation documentation shows that the Blue Team estimated that proposing a full power at-sea IPS EDM would have resulted in exceeding the budget allocation for the IPS EDM by as much as $[DELETED] million. NAVSEA Comments, July 19, 2002, at 60-62.[5] According to the agency, when this consideration is taken into account in conjunction with the Blue Team's failure to pursue the January 16 e‑mail denial with either the DD(X) Program Office or with Navy authorities with the authority to grant or deny a request to use a decommissioned ship, the inescapable conclusion is that the Blue Team ultimately did not prefer to use a decommissioned DD 963 class destroyer as an at‑sea test platform.
We agree with the Navy that the Blue Team's failure to pursue other avenues beyond the NAVSEA Inactive Ship Program Office to obtain a decommissioned DD 963 suggests that the Blue Team did not view the use of a DD 963 as important to its proposed effort. In this regard, the contemporaneous record indicates that BIW's lead naval architect for the DD(X), based on his inquiries as to the procedure for obtaining a decommissioned Navy ship, understood that while the Blue Team initially was to work with the Inactive Ship Program Office to identify a specific decommissioned ship, once a specific ship was identified, the DD(X) Program Office would need to ask CNO N43 (or other higher authority) for official designation of the ship for testing purposes. Tr., July 12, at 325‑28; AR Tab 555. (In fact, CNO N43 is the higher-level Navy office that ultimately determines the disposition of decommissioned ships. NAVSEA Comments, July 19, 2002, at 31 n.17.) Likewise, the Commander of the Inactive Ship Program Office testified that on January 15 he advised the ILPOC, who was pursuing the availability of a decommissioned DD 963 on behalf of the Blue Team, that he lacked the authority to grant the Blue Team's request. Tr., July 10, at 43-44. Thus, the Blue Team was on notice that approval of its request for use of a decommissioned DD 963 would likely require the DD(X) Program Office to request approval of an ultimate decision authority at a higher level than the Inactive Ship Program Office. Furthermore, this process was consistent with the procedures established during the preceding DD 21 program. As noted by the agency, the DD 21 Shipbuilder Alliance Competition Plan, dated June 11, 1999, provided a procedure by which the teams could obtain the assistance of the DD(X) program office in securing government resources:
Competing Teams may also request [the DD(X) Program Office] support to obtain access to Government information, and facilities in cases where Government sponsorship is necessary and in other circumstances where the teams have been unable to gain such access. Competing Teams will contact [the DD(X) Program Office] and request support to facilitate access in these cases.
DD 21 Shipbuilder Alliance Competition Plan at 24; AR 74. The Blue Team never sought this support from the DD(X) Program Office.
BIW maintains that the Blue Team was precluded from contacting the DD(X) Program Office by the cover letter to the RFP, which provided that:

Potential offerors are reminded that all communications regarding this RFP are to be directed to the Contracting Officer. . . . [T]he final cut‑off date for submittal of all questions is 19 December 2001. All questions shall be submitted in writing . . . .
Questions submitted will be provided to all prospective offerors.
RFP Cover Letter. We do not agree. This language only addresses “communications regarding this RFP”; it does not preclude the teams from seeking assistance in obtaining access to government resources.
 
We conclude that, notwithstanding the preference expressed in the Blue Team's 30 Knot Study, and the apparent intent expressed in Blue Team's internal proposal preparation documents to propose a decommissioned DD 963 class destroyer, the Blue Team's failure to pursue the Inactive Ship Program Office's denial with either the activity ultimately responsible for granting or denying a request for use of a decommissioned ship, or the activity conducting the DD(X) procurement, strongly supports the conclusion that use of a decommissioned DD 963 class destroyer as an at-sea test platform was not a significant consideration in its proposal. Further, this conclusion is consistent with the position taken by the Navy, both during the procurement and in response to the protest, that the denial of a decommissioned DD 963 and the selection of a test platform did not affect the evaluation.
2. Technical Benefit
The Navy also maintains that the Blue Team would not have technically benefited from proposing a decommissioned DD 963 destroyer instead of the large commercial ship it proposed as its IPS EDM at-sea test platform. As acknowledged by the Blue Team program manager, the Blue Team's 30 Knot Study evaluated a single-pod large commercial ship as equivalent to a single-pod DD 963 as a test platform for reducing risk with respect to structural, mechanical and electrical dynamics, rating both platforms as “good” in this regard. Tr., July 12, at 16‑17. Only with respect to reducing hydrodynamics and maneuvering risk did the 30 Knot Study evaluate the DD 963 as a better choice than a large commercial ship, rating the DD 963 as a fair test platform and the commercial ship as poor. 30 Knot Study at 65.
However, under the RFP, hydrodynamics and maneuvering risk were primarily addressed under the hull form EDM, for which modeling, not at-sea testing, was specified. In this regard, the RFP provided that
Hull Form Scale Model. The Contractor shall design, develop, build, and use physical numeric models to demonstrate hydrodynamic performance of the proposed design. . . . Numeric models combined with empirical relationships from physical models shall illustrate [Operational Requirements Document] compliance in the following areas:
Seakeeping
Intact Stability, Static and Dynamic
Damage Stability, Static and Dynamic
Maneuvering
Propulsion and Resistance
Propulsor Efficiency
Propulsor Acoustics, Steady and Transient conditions
Free Surface Flow
 
RFP § C, at 7. In contrast, under the IPS EDM, for which the solicitation required at‑sea testing, the RFP provided that: “At-sea testing shall address system characteristics and performance that cannot be tested in a land-based facility. These tests shall include operational, environmental, and dynamic performance tests.” RFP, § C, at 21. As explained in the testimony of the SSEB Chairman and the Navy's DD(X) program manager, the focus of the IPS EDM at-sea testing was to be on reducing risk with respect to structural, mechanical and electrical dynamics. Tr., July 11, at 118-20, 130; July 12, at 270‑71. This focus was recognized by the Blue Team's program manager, Tr., July 12, at 58, and acknowledged in the Blue Team's FPR, as follows:
 
This [IPS EDM] is the optimal configuration for reducing risk associated with 4‑quadrant electrical and mechanical dynamic performance, as well as structural loading of a full-scale pod. These were determined to be higher risks than those associated with stopping, turning, and other maneuvering properties.
Blue Team FPR Technical Proposal at B-27 to B-28. Thus, the IPS EDM at-sea testing was focused on the areas for which, according to the 30 Knot Study, a large commercial ship would be as effective as a DD 963 in reducing risk.
 
BIW appears to argue that using a DD 963 for at-sea testing would be advantageous because hydrodynamic risks are more important for the Blue Team's proposed podded propulsion approach than they are for ships with a conventional shaft‑driven system. This litigation position appears inconsistent with the focus of the IPS EDM at-sea testing on reducing risk with respect to structural, mechanical and electrical dynamics (rather than with respect to hydrodynamics and maneuvering), a focus acknowledged both in the Blue Team's FPR and by its program manager.
 
In any case, it is not clear that using a DD 963 with one pod rather than a large commercial ship would have resulted in significant additional risk reduction. While the parties agree that a DD 963 is hydrodynamically closer to a DD(X) than is a commercial ship, and thus should offer some testing advantage, they disagree as to the extent of any additional risk reduction that use of a DD 963 would provide. In the final analysis, however, the Navy convincingly explains, and the RFP requirement for using modeling rather than at‑sea testing for the hull form EDM appears to confirm, that testing for seakeeping, stability, maneuvering, propulsion, resistance, and acoustics is best performed with a model in a controlled laboratory setting where precise measurements can be taken, rather than in uncontrolled and difficult‑to‑measure conditions at sea. Tr., July 12, at 261-65. Further, we find persuasive the testimony from the Navy's DD(X) program manager (a naval architect) that, given the significant apparent differences between a DD 963 hull with a single, center-line pod and the Blue Team's proposed DD(X) tumblehome hull with two offset pods, any resulting test data would be of limited value such that no significant, additional overall risk reduction could be expected from use of a DD 963. Tr., July 11, at 125-31; Agency Comments, July 26, 2002, at 16‑19. In these circumstances, there is no basis for finding that the agency's technical judgment was unreasonable.

3. Evaluation Impact
 
The Navy asserts that the Blue Team's failure to propose a decommissioned DD 963 did not materially affect the relative standing of the competing proposals. Again, the SSAC and SSEB specifically addressed this question in their contemporaneous evaluation of FPRs, finding, according to the SSAC, that “the identity of the at-sea test platform had no effect on its best value analysis of the offerors' IPS EDM.” SSAC Report at 18 n.12.
 
We find the Navy's position to be reasonable. First, the record does not show that the Gold Team's evaluation was materially aided by its proposal of a decommissioned DD 963. The SSAC merely noted that at the conclusion of the Gold Team's at-sea testing of its radar suite, the suite would remain on the test vessel and thus would continue to be available for testing of future radar modifications. SSAC Report at 16. However, this consideration appears to have related only to whether the demonstrator vessel was owned or merely leased, rather than to the fact that it was a decommissioned DD 963.
 
Nor does it appear that the Blue Team was materially, significantly disadvantaged in the evaluation by its failure to propose a DD 963. The Blue Team already had received five minor strengths, with no weaknesses, for its proposed testing of the hull form EDM (under which hydrodynamics and maneuvering risk were to be addressed). SSEB Report at 79-81. While there remained a low risk for dynamic stability risk reduction activities under the hull form EDM, the SSEB explained that risk as being based on the severe consequences of a capsize, a weakness the protester has not shown would be eliminated by use of a single pod DD 963 hull as the at-sea demonstrator. Although the Blue Team's FPR was assessed a low overall risk (rather than a finding of no risk) under the EDM subfactor for at‑sea testing, this was based on its failure to furnish adequate details regarding the testing, and does not appear to be related to the choice of test platform. SSEB Report at 74.
 
The Blue Team also was rated, as was the Gold Team, low risk‑‑rather than no risk‑‑under the IPS EDM for meeting shock requirements, on the basis that a final demonstration of compliance in this regard would not occur until completion of “full-scale shock testing of propulsion pods and other significant equipment” in Phase IV (the next development phase after the phase to be awarded here). Blue Team's FPR Technical Proposal at B-7; SSEB Report at 97. In this regard, BIW's lead naval architect for the DD(X) testified that
 
If we had additional funding we might have gone with an additional, you know, say, 1/3 scale demonstrator. . . . [w]e might have even looked at shock testing. We knew that shock was certainly a consideration. It was always expressed to us as an area where there was concern, because there haven't been any podded propulsors on a naval ship before . . . . If we had additional budget that might have been one of the things we considered testing.
Tr., July 12, at 319-20. The lead naval architect further testified that:
 
And if we had been able to propose the 963, when we had gotten to a shock test, whether it had been in Phase III or Phase IV, depending on when funding was available‑‑there are several options for shock testing. One of the options would have been to do it on the 963, and one of the concerns that had been raised was the interaction between the pod and the hull. While that would not have been an exact replica obviously of the DD(X) hull form, the destroyer type of hull form would have been much more representative for a shock test than the commercial ship would have been.
And the 963 is a shock qualified ship, so it would have been a reasonable platform to attempt to do a shock test on. We might have chosen to take the pod to some other facility and do a shock test at Aberdeen or some specialized facility.
Tr., July 12, at 354-55.
 
It is apparent from this testimony that the Blue Team was aware of the Navy's concern regarding the shock requirements, and that budget considerations, not the unavailability of a DD 963, led it not to propose shock testing. The Blue Team's budget concerns in this regard are especially significant given the testimony of the Blue Team's proposal manager, discussed below, which indicates that only a significant (and unlikely) increase in budget would have significantly altered the Blue Team's approach. In any case, the lead naval architect conceded on cross‑examination that the Blue Team had not conducted an analysis to determine whether the decommissioned DD 963 they were considering, which was to be significantly modified by replacement of part of the stern, would still be shock qualified after the modification. Tr., at July 12, at 369-70.[6]
 
As previously discussed, in explaining its determination that the Gold Team's overall IPS approach was more advantageous than the Blue Team's, the SSAC noted, not only the superiority of the Gold Team's approach to the critically-important fallback motor requirement, but also the fact that significant development effort would be necessary in order to militarize the pods and satisfy the Navy's speed, acoustics and shock requirements. SSAC Report at 16-17. Further, as noted above, one of the five moderate and low risks (for a success-oriented schedule, diesel acoustics, motor drive development, pod acoustics, and shock) assessed by the SSEB against the Blue Team IPS was a low risk based on the delay until Phase IV of a final demonstration of compliance with the shock requirements. While it is possible, therefore, that the protester's proposal of shock testing of a decommissioned DD 963 during Phase III would have led to elimination or mitigation of the assessed shock risk, given the agency's remaining concerns with the Blue Team's IPS, there is no basis for concluding that this would have materially altered the evaluation so as to overturn the Gold Team's superiority in this area and result in a determination of Blue Team superiority here. Given the further uncertainty as to whether the Blue Team in fact would or could have proposed shock testing for a modified decommissioned DD 963, there is no basis for finding competitive prejudice in this regard.
 
4. Conclusion
 
In summary, we find that the Blue Team's failure to pursue the Inactive Ship Program Office's denial of the use of a decommissioned DD 963 as an at-sea test platform matter with either the activity ultimately responsible for granting or denying a request for use of a decommissioned ship, or the DD(X) program office, especially in light of the opportunities available to raise the matter with the DD(X) Program Office, strongly supports the conclusion that use of a decommissioned DD 963 class destroyer as an at-sea test platform was not viewed by the Blue Team as a significant consideration. Further, this is consistent with the Navy's reasonable determination that there would have been no material technical benefit to the Blue Team to proposing a decommissioned DD 963 destroyer instead of the large commercial ship it proposed as its IPS EDM at‑sea test platform. Since the record does not otherwise indicate that the Blue Team's failure to propose a decommissioned DD 963 as an at-sea test platform materially affected the evaluation, we conclude that the Blue Team was not competitively prejudiced by the agency's alleged unequal treatment in this regard.
 
COST
 
BIW asserts that the Navy underestimated the likely cost of performance by the Gold Team such that, instead of being approximately $500,000 below the RDT&E cap of $2.865 billion as evaluated, the likely cost of performance would exceed the cap. The protester concludes from this that the Gold Team's proposal should have been rejected as unacceptable.
 
We disagree. Although it does not appear to have been the agency's intent to waive the cap, the record indicates that the agency in fact has additional money available in the program budget to fund higher contract costs. (The solicitation cap was based on an agency estimate of the cost of the required work). Tr., July 11, at 124‑25; Agency Comments, July 26, 2002, at 1-3. In such circumstances, we will not sustain a protest even if the agency in effect has waived the funding requirements, where there is no basis for finding competitive prejudice to the protester as a result of the alleged waiver. United Defense LP, supra, 2001 CPD ¶ 75 at 27.
 
We find no prejudice here. Specifically, based on our review of the alleged deficiencies in the agency's cost evaluation, we conclude that the protester has not shown that it would have increased its proposed effort so as to materially improve its competitive position had it known that additional funding in the amount of any likely overrun would be available. For example, BIW asserts that Ingalls understated its [DELETED] costs by more than $[DELETED] million.[7] In this regard, Ingalls' approved Cost Accounting Standards Disclosure Statement (CAS Statement) provides for a [DELETED] with respect to [DELETED]. Here, Ingalls [DELETED]. BIW asserts that there was an inadequate basis for the application of [DELETED].
 
We find no basis to conclude that the Navy's determination to accept Ingalls' [DELETED] here was unreasonable. As noted above, Ingalls' [DELETED] was consistent with its CAS Statement. Further, although, as noted by the Defense Contract Audit Agency (DCAA), the Gold Team's FPR did not include supporting documentation for [DELETED], DCAA Memorandum, [DELETED] DD(X) RFP, Feb. 17, 2002; FPR Cost Proposal, Book 1, at 2-11 to 2-12, further inquiry to DCAA by NAVSEA revealed that Ingalls' proposed [DELETED] had been approved in [DELETED] procurement. Indeed, a DCAA procurement liaison auditor assigned to NAVSEA, who was a cost evaluator for this procurement, was informed by the cognizant DCAA auditor that DCAA [DELETED]. (Ingalls reports [DELETED]. Declaration of Vice President/Controller for Northrop Grumman Ship Systems, July 18, 2002) Further, the cognizant DCAA auditor advised NAVSEA that he believed the Ingalls [DELETED]would be approved. Likewise, the record indicates that during the prior DD 21 source selection, where Ingalls had proposed the same [DELETED], the DCAA procurement liaison auditor was advised by the Navy's administering contracting officer for Ingalls at Supervisor of Shipbuilding, Conversion and Repair in Pascagoula, Mississippi, that based on the information he had, and after checking with DCAA, he would approve the [DELETED]. Declaration of DCAA Procurement Liaison Auditor Assigned to NAVSEA.[8]
 
Although BIW questions other aspects of the agency's cost evaluation, it has failed to demonstrate that any cost understatement was significant in the context of this procurement. In this regard, we note that in her testimony, the Blue Team's program manager was unable to identify any specific additional effort she would have proposed had the solicitation cap been increased by $10 or $50 million. (Only when asked about a possible $100 million increase in the cap did the program manager suggest specific additional specific program effort she might have proposed.) Tr., July 12, at 147-50. We conclude that there is no basis to question this aspect of the evaluation.
 
RADAR FIREWALL
 
As noted above, the Gold Team proposed a “dual band radar” integration approach under which the VSR and the SPY-3 MFR radar--which had been developed by Raytheon, a member of the Gold Team, and which offerors were required to use‑‑are integrated at the waveform level, with a common scheduler and tracker residing on a common digital processor. In contrast, the Blue Team proposed a radar suite in which the VSR segment and an SPY-3 MFR segment were not so closely integrated, with each having its own digital processor. BIW asserts that acceptance of the Gold Team's closely integrated radar approach is inconsistent with a firewall that was established to govern access to Raytheon radar information, and thus gave the Gold Team an improper advantage.
 
As background, in preparing to enter the engineering and manufacturing development (EMD) phase of the MFR program, which was to involve a downselect from the three MFR teams then undertaking risk reduction activities, the Navy determined that it was necessary to require the successful MFR contractor to establish a firewall. The Navy believed that, in the absence of such a firewall, the MFR contractor might enter into an exclusive arrangement with one of the two DD 21 teams and refuse to share any information with the competing DD 21 team, thereby requiring the Navy to support a second MFR development effort. AR at 33‑34; Declaration of Former MFR Program Manager for DD 21 Program. Accordingly, the MFR EMD solicitation issued in February 1999 required offerors to propose processes and procedures that would provide the DD 21 Blue and Gold teams with fair and equal access to MFR documentation. RFP N39997-99-R-3754. Under the resulting Article 19 negotiated with Raytheon, the successful MFR contractor, Raytheon agreed to
 
establish firewall relationships with the DD 21 Blue and Gold Competing Teams which will facilitate equitably providing information about the MFR E&MD prototype, assisting in Blue and Gold excursion studies for DD 21, and protecting Blue and Gold competition sensitive information. The Contractor is to establish fair and equitable agreements, with each competing team, that protect the integrity of the DD 21 Competition.
Raytheon Article 19, Agreement No. N3997-99-9-3754. The implementing Data Protection Agreements between Raytheon and each team set forth processes and procedures as to how the teams would receive equal access to MFR prototype data. However, each agreement also provided for the conducting of excursion studies, defined as “studies that are not required by the 'MFR Agreement' and are funded by separate instrument by the 'Blue Team' or 'Gold Team,' and address the integration of the MFR into DD 21.” Raytheon-Lockheed Martin Data Protection Agreement, Dec. 9, 1999; Raytheon‑Ingalls Data Protection Agreement, Oct. 15, 1999. On March 28, 2000, the Navy clarified the firewall requirements, advising BIW and Raytheon that the government would review material submitted through the firewall to ensure that “no SPY-3 EDM data, which should be available to both Competing Teams, is released solely to one Competing Team.” NAVSEA Letter to Raytheon and BIW, Mar. 28, 2000; NAVSEA Letter to Raytheon and BIW, Apr. 21, 2000.
 
The Navy asserts that the government has been scrupulous in ensuring that MFR data is provided equally to both the Blue and Gold teams. Further, based on its review of the information furnished regarding the Gold Team's proposed radar approach for the DD(X), the Navy has determined that no firewalled MFR radar information was included in the Gold Team's technical proposal, which included only a 5-page top-level discussion of its radar approach. Raytheon personnel behind the firewall did submit directly to the Navy (not through the Gold Team) cost information supporting the Gold Team's proposed radar approach. In addition, agency technical evaluators, in order to assess the feasibility, reasonableness and degree of technical risk associated with the Gold Team's proposed approach, used their knowledge of information behind the firewall. BIW has not refuted the agency's findings in this regard. Rather, the protester essentially argues that, by taking into account firewalled information in its evaluation of the Gold Team's radar approach, the Navy accorded the Gold Team an unfair competitive advantage.
 
We find nothing improper in the Navy's acceptance of the Gold Team's proposed radar approach. Both the firewall Data Protection Agreements, with their reference to undertaking excursion studies addressing the integration of the MFR into the DD 21, and the solicitation for the DD(X), the successor to the DD 21, contemplated that the MFR would be integrated into the Navy's new naval surface combatant. The protester has pointed to no firewall provision that precluded a closer integration of the VSR and the MFR radars than it chose to offer. Indeed, the record indicates that BIW's team member, Lockheed, had engaged in discussions with Raytheon concerning the possibility of a “Dual Band (X/L) Radar,” that is, a dual band MFR/VSR radar, for the DD 21, Raytheon June 8, 2000 Counteroffer to Lockheed's June 2, 2000 Counteroffer, and that the discussions between these companies included consideration of an integrated MFR/VSR radar suite in which there would be a common signal processor and data processor. Although BIW denies that the contemplated radar suite Lockheed discussed with Raytheon was integrated at the waveform level, as was the Gold Team's proposed radar suite, the record indicates that the contemplated radar suite at least was significantly more integrated than that proposed by the Blue Team, where each radar had its own digital processor. We view this as persuasive evidence that the Blue Team itself saw no bar in the firewall to a more integrated radar approach. Declaration of Deputy Director of Theatre Air Defense, Raytheon Electronic Systems; Declaration of Vice President, Future Surface Combatant (DD(X)), Raytheon Electronic Systems; Navy Comments, July 26, 2002, at 32-35; Navy Comments, July 31, 2002, at 1-3.
 
Since it appears that a close integration of the two radars was within the contemplation of the parties, we believe that it should have been evident that the Navy would review all MFR information, including information behind the firewall, in order to evaluate the feasibility, reasonableness and degree of technical risk associated with the proposed overall, integrated radar suite. Indeed, the Navy reports that neither the Gold Team's radar approach, nor the Blue Team's less closely integrated radar approach, could be validated or reasonably assessed unless the government took into consideration prior MFR development, and that the agency did in fact use firewalled MFR information to assess the feasibility and degree of technical risk associated with the Blue Team's radar approach. AR at 52. In any case, we have consistently held that, in evaluating proposals, contracting agencies may consider any evidence, even if that evidence is entirely outside the proposal (and, indeed, even if it contradicts statements in the proposal), so long as the use of the extrinsic evidence is consistent with established procurement practice. See, e.g., Alcan Envtl., Inc., B-275859.2, Apr. 11, 1997, 97-1 CPD ¶ 139 at 4 n.3; Vortec Corp. B‑257568 et al., Oct. 18, 1994, 94-2 CPD ¶ 145 at 5; AAA Eng'g & Drafting, Inc., B‑250323, Jan. 26, 1993, 93-1 CPD ¶ 287 at 6; Western Med. Personnel, Inc., B-227991, Sept. 28, 1987, 87-2 CPD ¶ 310 at 3. Here, the firewall did not apply to government personnel and, other than arguing that consideration of firewalled information was per se improper, BIW has not demonstrated that the evaluators acted unreasonably or in any way inconsistent with the RFP evaluation criteria in considering the outside knowledge that they had concerning the offerors and their proposed approaches.
 
Nor do we find any impropriety in the agency's consideration of the cost information regarding the Gold Team approach that was furnished by Raytheon personnel behind the firewall directly to the Navy. Given our determination that the agency evaluators reasonably considered technical information from behind the firewall, there is no basis for concluding that consideration of firewalled cost information was improper. In any case, it should have been even clearer to the offerors that such cost information would be considered in the evaluation, since the DD(X) solicitation required offerors to furnish very detailed cost information; the RFP provided that the bases of estimates in the cost proposal “shall be provided with sufficient detail to allow for a complete understanding of how the proposed hours and costs were derived.” RFP § L, at 27-31. Accordingly, there is no basis for questioning the agency's handling of firewalled information.
 
PERIPHERAL VLS
 
As noted above, one of the evaluated significant advantages offered by the Gold Team's proposed design was the use of a dispersed, peripheral, rather than a unitary, centrally located VLS configuration. BIW asserts that the source selection decision failed to account for the development risk associated with the Gold Team's approach by not considering that there was a [DELETED] likelihood that the development of the peripheral VLS would be abandoned and that the Gold Team instead would rely on its fallback unitary VLS.
 
BIW bases its argument essentially upon a Gold Team notation on a timeline chart listing 13 major development and risk reduction efforts, the first four of which had been completed under the DD 21 program. Each effort is given a risk rating at completion. For example, [DELETED]. BIW notes that, at the completion of quasi‑static pressure (QSP) small scale testing and analysis in September 2001, the last step listed on the timeline prior to commencement of a full‑scale QSP test scheduled for June 30, 2002, the timeline assigned an overall risk [DELETED].[9] Since the Gold Team proposal indicates that the full‑scale QSP test would enable an early go/no-go decision with respect to the peripheral VLS, BIW argues that the probability of a no‑go decision was [DELETED]. FPR Technical Proposal at 2.1-1, 2.1‑29 to 2.1-30; FPR Cost Proposal, 14J000-IE1, § 10; DD 21 Program Risk Management Plan, Feb. 11, 2000.
 
BIW's argument is unpersuasive. As an initial matter, we note that the Navy maintains that the Gold Team's risk factor and its components should be viewed, not as an absolute measure of technical risk, but as a relative measure of risk associated with various technical events, for use in directing resources to where they are most needed. This is consistent, reports the Navy, with the guidance in the Defense Systems Management College‑‑Risk Management Guide for DOD Acquisition, February 2001, which notes that[DELETED].
 
In any case, the Gold Team's guide to risk management explains that [DELETED]. DD 21 Program Risk Management Plan at 4-3. According to the Navy, however, the Gold Team has undertaken significant risk reduction and mitigation efforts under the DD 21 program and under the DD(X) program (using proposal preparation funding from the agency), so that there in fact is not a [DELETED] probability that the QSP test will result in a failure. Tr., July 10, at 239‑48; Tr., July 11, at 256-63. Indeed, the Gold Team's proposal described risk reduction activities in this regard, and stated with respect to the full-scale QSP test that
 
[o]ur confidence is extremely high as we employed conservative estimates for the design QSP load as well as an underestimate of the QSP rise time (resulting in a design load more severe than reality). Our calibration test demonstrated the test loads will be lower than estimated and the rise times will be slower than estimated resulting in a more benign loading environment than used . . . for design.
Response to Question G-0006 at 43; Response to Question G-0005 at 30‑31. Furthermore, the record indicates that even a failure in the full-scale QSP test would not necessarily result in a no-go decision with respect to the peripheral VLS. Rather, hearing testimony indicated that, in the event of a failure, the Navy, which retained the authority to direct continued development, and the contractor would need to examine the nature and the cause of failure so as to ascertain whether to continue development. Tr., July 10, at 244‑45; Tr., July 11, at 314-17.
 
In summary, the Gold Team expected to successfully complete Phase III development of its proposed peripheral VLS, Response to Question G-0006 at 39, and while the Navy recognized the developmental risk associated with the peripheral VLS, nevertheless, based on its familiarity with the Gold Team's prior and proposed risk reduction efforts, it viewed the overall development risk as low/manageable/ satisfactory. Tr., July 10, at 248, 256; Tr., July 11, at 252-54; SSA at 3. Since the protester has made no convincing showing that the overall risk in fact was significant, such that there was a likelihood that the Gold Team would be unable to complete Phase III development of the peripheral VLS, we find no basis to question the evaluation in this regard.
 
CONCLUSION
 
Based on our review of the record, and after considering all of the protester's various challenges to the award, including those not discussed above, we find no basis to question the Navy's determination that the Gold Team proposal's superiority with respect to the EDM and specified performance subfactors, which reflected the additional, advanced warfighter capability and the greater flexibility of the Gold Team's approach, outweighed both the Blue Team proposal's advantage with respect to software management and total ship computing environment, and cost, such that the Gold Team proposal represented the best value.
 
The protest is denied.
 
Anthony H. Gamboa
General Counsel