Link: GAO Opinion
Agency: Department of Agriculture
Disposition: Protest denied.
Keywords: Price reasonableness; price realism
General Counsel P.C. Highlight: GAO will not re-evaluate proposals in considering a bid protest, but will only consider whether the Agency’s evaluation was reasonable.
In October of 2009, the Department of Agriculture issued a request for proposals (RFP) for contractors to provide maintenance and support services on Hewlett Packard equipment at certain locations. The RFP was issued as a total set-aside for service-disabled, veteran-owned small businesses and would use Federal Acquisition Regulation Part 12 for commercial items in its evaluation, based equally on past performance, price, and technical/management approach.
SDV Solutions, Inc., the incumbent, was one of three bidders that submitted proposals, with the eventual contract being awarded to Kelco Computing Solutions. SDV protested the award to Kelco by alleging that the USDA improperly evaluated Kelco’s past performance and by challenging the USDA’s evaluation of Kelco’s unusually low price.
When a protest alleges inequities related to an agency’s evaluation of past performance, GAO examines the record to ensure that the evaluation was reasonable and consistent with the solicitation’s criteria, rather than substituting its own judgment in the evaluation process. Here, SDV claims that Kelco should have been rated lower on past performance because it did not have relevant experience as a prime contractor performing government contracts. However, the solicitation did not require relevant experience as a prime contractor, rather that the offerors had focused on prior government customers for similar services. Based on this analysis, GAO held that the USDA’s evaluation was consistent with the solicitation.
SDV also claimed that Kelco’s price was unreasonably low and that SDV provided a more realistic price based on its incumbent experience. However, GAO said this argument reflects a misunderstanding of the solicitation. The RFP only required a price reasonableness analysis and not a price realism analysis, where a reasonableness analysis only looks to see whether the offered price is too high. Also, based on confirmations that Kelco made to the contracting officer during a series of verifications, it was determined that Kelco had properly addressed the issue of pricing for the option years as included in the solicitation. As such, SDV’s protest was denied.