Link: GAO Decision
Protestor: Phacil, Inc.
Agency: Department of Agriculture
Disposition: Protest Denied.
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GAO Digest:
Protest challenging an agency’s evaluation of quotations and selection decision is denied where the record shows that the agency’s evaluation and issuance of a task order was reasonable and consistent with the terms of the solicitation.
General Counsel PC Highlight:
Phacil, Inc. protested the issuance to Vistronix, Inc. of a task order for information technology (IT) support services for the agency’s Natural Resources Conservation Service (NRCS). The RFQ divided the services into five functional areas: software/database development, integration, and maintenance (Area 1); application and production support testing; product application and database operations support; help desk support; and cloud hosting. Vendors were requested to provide fixed-price labor hours for Area 1, and fixed prices without labor hours for the remaining four areas. Vistronix proposed significantly fewer annual labor hours for Area 1 than the government estimate, for which the agency requested clarification regarding Vistronix’s methodology to calculate these hours. Vistronix provided a short explanation of the methodology it used and indicated that its low estimate reflected its subject matter expertise and economies of scale.
The GAO found no basis to question the agency’s price realism analysis, finding reasonable the agency’s conclusion from Vistronix’s quotation and clarification response that the firm’s price reflected a realistic approach to performing the work. The GAO found no evidence that one of the agency evaluators, a former employee of Vistronix, had a personal conflict of interest, pointing out that he had only been employed by Vistronix for 6 months and had been at the agency for more than a year before the RFQ was issued. Finally, the GAO declined to consider Phacil’s argument that there was a latent ambiguity in the RFQ regarding “new” tasks that led Phacil to submit a higher price than it otherwise would have. The GAO pointed out that Phacil did not indicate how its price would change if that protest ground were sustained.
If the government provides estimates of the labor hours it anticipates will be required to fulfill the requirement, vendors are not bound to submit quotations containing the same or similar amounts of labor hours. However, if a vendor quotes significantly higher or lower labor hours, it should clearly detail how it plans to fulfill the needs of the agency with such different amounts. In this case, although the offeror provided very little justification for its greatly reduced labor hours, the GAO found that the agency had provided sufficient documentation to make a reasonable analysis. There are many cases that have been decided contrary to this decision, and offerors are not advised to venture so far from the government estimate. To do so may result in the assignment of risks or weaknesses to the quotation, and the agency is not obligated to conduct discussions or seek clarifications.