Link: GAO Opinion
Agency: U.S. Army Corps of Engineers
Disposition: Request denied.
Keywords: Payment of Attorney’s Fees
General Counsel P.C. Highlight: When a procuring agency takes corrective action in response to a protest, GAO may recommend reimbursement of protest costs, including reasonable attorneys’ fees, if GAO determines that the agency unduly delayed taking corrective action in the face of a clearly meritorious protest
Re-Engineered Business Solutions, Inc. (RBS) requests that a recommendation that the U.S. Army Corps of Engineers reimburse its costs of filing and pursuing its protests of the award of a contract, under a request for proposals (RFP), for the operation, maintenance, and repair of flood control facilities at various locations in Mississippi.
The RFP, issued as a section 8(a) set-aside, provided for the award of a cost?plus?fixed-fee contract for the operation, maintenance, and repair of flood control facilities in Mississippi for a base year and four option years. Offerors were informed that award would be made on a best value basis, considering technical, past performance, and cost evaluation factors.
RBS protested to GAO after award was made to another offeror, arguing that the Corps departed from the evaluation scheme required by the RFP, conducted an improper cost/technical trade?off, conducted a flawed cost realism analysis, and should have selected RBS’s higher-priced offer because it received higher ratings under the technical capability and past performance evaluation factors than the awardee. RBS also filed a supplemental protest arguing that the Corps improperly assigned it weaknesses for not providing cost information for small tools and providing an outdated letter of credit. The Corps notified GAO that it would take corrective action by reevaluating proposals and the protest was dismissed. After reevaluating proposals, the Corps again awarded the contract to the original awardee, and RBS again protested the agency’s evaluation of its proposal, basically raising the same arguments as it raised in its initial protest. The Corps again notified GAO that it was taking corrective action and the protest was dismissed.
RBS requests that GAO recommend that the agency reimburse its costs of filing and pursuing its protests. GAO states that when a procuring agency takes corrective action in response to a protest, GAO may recommend reimbursement of protest costs, including reasonable attorneys’ fees, if, based on the circumstances of the case, it determines that the agency unduly delayed taking corrective action in the face of a clearly meritorious protest, thereby causing the protester to expend unnecessary time and resources to make further use of the protest process in order to obtain relief. Thus, as a prerequisite to recommending the reimbursement of costs where a protest has been settled by corrective action, not only must the protest have been meritorious, but it also must have been clearly meritorious. A protest is clearly meritorious where a reasonable agency inquiry into the protester’s allegations would reveal facts showing the absence of a defensible legal position. GAO has recognized, however, that the mere promise of corrective action, without reasonably prompt implementation, has the obvious effect of circumventing the goal of the bid protest system for the economic and expeditious resolution of bid protests. Thus, where an agency fails to implement the promised corrective action, or implements corrective action that fails to address a clearly meritorious issue raised in an initial protest, such that the protester is put to the expense of subsequently protesting the very same procurement deficiency, the agency’s action has precluded the timely, economical resolution of the protest.
Here, there is no basis to conclude that the agency has unduly delayed taking corrective action in response to a clearly meritorious protest. In response to the first protest, the agency promptly indicated that it would take corrective action. To the extent that the protester maintains that it is entitled to reimbursement of its costs for filing the second protest because the Corps failed to implement its promised corrective action, the record does not establish that RBS’s protests were clearly meritorious. Even where a protester alleges that an agency failed to timely implement promised corrective action, GAO’s recommendation that an agency reimburse a protester its protest costs must be based upon a showing that a procurement statute or regulation has been violated. The mere fact that an agency decides to take corrective action does not establish that a statute or regulation clearly has been violated. The Corps took corrective action in response to the protests prior to submitting its reports, and thus GAO has not been provided with a record of the agency’s evaluation and selection decision. Further record development would be necessary to determine whether any of RBS’s protest grounds had merit. The request for entitlement to protest costs is denied.