BNUMBER: B-261707
DATE: September 12, 1995
TITLE: Vito J. Gautieri
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Matter of: Vito J. Gautieri
File: B-261707
Date: September 12, 1995
Robert J. MacPherson, Esq., Postner & Rubin, for the protester.
Scarlett D. Orenstein, Esq., General Services Administration, for the
agency.
Mary G. Curcio, Esq., and John M. Melody, Esq., Office of the General
Counsel, GAO, participated in the preparation of the decision.
DIGEST
Rejection of protester's offer of building in flood plain was proper
where solicitation stated (as provided in applicable administrative
order, implementing Executive Order No. 11988), that flood plain
property would be leased only if it was the only practicable
alternative, and agency reasonably determined that awardee's non-flood
plain property was a practicable alternative to leasing protester's
flood plain property.
DECISION
Vito J. Gautieri protests the award of a contract to Batavia Big N
Plaza Associates under solicitation for offers (SFO) No. MNY-94393,
issued by the General Services Administration (GSA) to lease office
space in Batavia, New York. Gautieri asserts that the award to
Batavia at a rent higher than that proposed by Gautieri, on the basis
that Gautieri's offered building is in a flood plain, was improper.
We deny the protest in part and dismiss it in part.
The SFO provided that offers would be evaluated under several factors,
price being less important than the other three factors combined. The
solicitation also provided that the contract would not be awarded for
a property located in a flood plain unless that was the only
practicable alternative. In this regard, Executive Order No. 11988,
42 Fed. Reg. 26,951 (1977) (implemented by GSA Administrative Order
ADM 1095.2, July 23, 1979), precludes federal agencies from providing
direct or indirect support of flood plain development when there is a
practicable alternative. The purpose of the order is to minimize the
impact of floods on human safety and health and the wetlands. A
practicable alternative to acquiring leased space in a flood plain is
defined under paragraph 10 of ADM 1095.2 as one which:
(a) meets justified program requirements;
(b) is within the legal authority of GSA or client agency;
(c) meets technological standards;
(d) is demonstrated as being cost effective; and
(e) does not result in unreasonable adverse
environmental impacts.
Seven offers, including the protester's, were received. GSA
determined that five of the offered properties were acceptable and
were not located in a flood plain. Since Gautieri's property was in a
flood plain, GSA rejected it, and subsequently awarded the lease to
Batavia for an annual rent of $91,733, compared to Gautieri's offered
price (for the space GSA was currently leasing) of $50,467.50.
Gautieri protests that, because the rent on Batavia's property is
higher than Gautieri's, leasing Batavia's property is not cost
effective, and thus is not a practicable alternative to leasing
Gautieri's property within the meaning of ADM 1095.2. Gautieri
concludes that, under these circumstances, GSA was required to lease
Gautieri's lower-priced flood plain property.
The protest is without merit. While Gautieri's offered flood plain
property was less expensive than Batavia's, there is nothing in the
orders which dictates that this consideration be determinative of cost
effectiveness; indeed, neither order defines the term "cost effective"
at all. Thus, the determination of cost effectiveness has been left
largely to GSA's discretion, although ADM 1095.2 does provide some
guidance--it specifically warns against defeating the purpose of the
orders by restrictively applying the elements of the practicable
alternative definition (such as cost effectiveness) to avoid leasing
non-flood plain property.
GSA was well aware of Gautieri's lower-offered price, but considered
two measures of the value of Batavia's property as nevertheless
showing that Batavia's property was a cost effective non-flood plain
alternative--Batavia's was the lowest-cost, highest technically rated
non-flood plain property, and an independent appraisal concluded that
Batavia's offered price was below the fair market value for the lease.
Both of these considerations clearly bear on the relative value of the
offered property and, thus, the cost effectiveness of the non-flood
plain alternative. There thus simply is no basis for questioning the
reasonableness of GSA's determination to make award to Batavia.
Gautieri also protests that by awarding the lease without considering
alternative sites, such as Gautieri's, which would result in
substantial savings to the government, the agency essentially
disregarded the requirement that price be considered in the award
decision. As noted above, however, GSA did take price into
consideration; Batavia's was the lowest priced among the five
acceptable offers. There is no requirement that award be made to the
low-priced offeror in a negotiated procurement. Ameriko Maintenance
Co., B-250786, Feb. 16, 1993, 93-1 CPD 145.
Gautieri argues that its building is only marginally in a flood plain
and that its proposal therefore should not have been rejected. Under
our Bid Protest Regulations, protests based on other than solicitation
improprieties must be filed within 10 working days after the protester
knows or should know the basis of protest. 4 C.F.R. 21.2(a)(2)
(1995). GSA informed Gautieri in February 1995, 2 months after offers
were submitted, that Gautieri would not be considered for award
because it offered space in a flood plain. Any challenge to this
determination had to be filed no later than 10 working days
thereafter. Since Gautieri did not raise this issue until it filed
its protest on June 14, it is untimely and will not be considered.
Gautieri maintains that GSA should have entered into a succeeding
lease with Gautieri, instead of awarding a new lease, because this
would have been a more cost effective means of meeting the
requirement. This argument ignores the fact that Gautieri's property
was in a flood plain, contrary to executive policy, as discussed
above. In any case, the argument is untimely. Since it was clear
when the SFO was issued that GSA intended to award a new lease, not
extend Gautieri's, any protest on this ground had to be filed no later
than the closing date; Gautieri did not protest until after award. 4
C.F.R. 21.2(a)(1).
The protest is denied in part and dismissed in part.
\s\ Ronald Berger
for Robert P. Murphy
General Counsel