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PJ Helicopters, Inc., B-402524.2, May 20, 2010

  • By GCPC GovCon Legal Team
  • July 22, 2010
  • Price Reasonableness

Link: GAO Opinion

Agency: Department of Agriculture, U.S. Forest Service

Disposition: Protest denied.

Keywords: Price Reasonableness

General Counsel P.C. Highlight:
PJ Helicopters, Inc. protests the determination by the U.S. Forest Service, National Interagency Fire Center, to exclude its proposal from the competitive range under a request for proposals (RFP) for exclusive-use helicopter fire suppression services at various base locations. The solicitation, issued September 25, 2009, contemplated the award of one or more fixed-price contracts, with economic price adjustments, for a base year, with three 1-year options. Award was to be made to the offeror(s) whose proposal(s) were evaluated as the “best value” to the government considering price and several non-price evaluation factors.

PJ asserts that the agency improperly determined that its price was unreasonable, noting that the agency actually found higher prices for the same services be reasonable under previous solicitations at the same bases.

GAO noted that in evaluating price reasonableness, agencies may use a variety of techniques, including comparison of the proposed prices received in response to the solicitation, comparison of the proposed prices to prices previously paid for the item being acquired, comparison of the prices proposed with published commercial price lists and comparison of the prices received with an independent government estimate. The GAO determined that the price reasonableness determination here was unobjectionable. It noted that the agency used one of the acceptable evaluation methods specifically identified in the FAR–comparison of prices received–as the basis for its analysis. Moreover, the agency was aware of its previous determinations and concluded that the previous determinations involved different time and supply constraints. GAO also noted that each federal procurement is judged on its own merits and not in comparison to some previous procurement. GAO denied the protest.

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