BNUMBER:  B-262029
DATE:  November 6, 1995
TITLE:  Ameriko, Inc.

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  Matter of:Ameriko, Inc.

File:     B-262029

Date:     November 6, 1995

Christopher Solop, Esq., Ott & Purdy, for the protester.
William A. Roberts III, Esq., Lee P. Curtis, Esq., and Brian A. Darst, 
Esq., Howrey & Simon, for Del-Jen, Inc., an interested party. 
Eric W. Hanger, Esq., and Diane D. Hayden, Esq., Department of the 
Navy,  for the agency.
Katherine I. Riback, Esq., and Paul Lieberman, Esq., Office of the 
General Counsel, GAO, participated in the preparation of the decision.

DIGEST

Allegation that agency improperly caused protester to increase its 
price in its best and final offer is denied where record shows only 
that protester was invited to "provide a breakdown" of the prices in 
question; protester's determination to increase its prices  in 
response reflects its own business judgment.  

DECISION

Ameriko, Inc. protests the award of a contract to Del-Jen, Inc. under 
request for proposals (RFP) No. N44255-95-R-6046, issued by the 
Department of the Navy for base operating services for the Naval 
Station Everett Family Support Complex, Marysville, Washington.  The 
protester contends that the Navy misled it during discussions into 
increasing its offered prices.  

We deny the protest.  

The RFP, issued on February 2, 1995, contemplated the award of a 
contract which consisted primarily of fixed-price line items, and also 
included a number of relatively small indefinite quantity line items, 
for a base year with 2 option years to provide base operating 
services, such as building and grounds maintenance, pest control and 
custodial services.  The RFP advised that award would be made to the 
responsible offeror whose offer was most advantageous to the 
government and that technical merit and price were of equal 
importance.  The RFP provided that technical proposals were to be 
evaluated under the subfactors of (1) experience and past performance; 
(2) proposed staffing; (3) resources; and (4) quality control, with 
the first subfactor equal to the total of all other subfactors, and 
the remaining subfactors of equal importance.

On February 23, proposed offerors were taken on a site visit; however 
the participants were confined to a bus because the Family Support 
Complex was still under construction.  Five offerors submitted initial 
proposals by the March 17, closing date.  Ameriko's proposal received 
an acceptable technical rating, and its total price of $2,641,143 was 
second low.  Del-Jen's proposal received a highly acceptable technical 
rating, and its price of $3,624,016 was the highest received.  The 
government estimate was $3,157,998.81.  After evaluation, three 
proposals, including Ameriko's and Del-Jen's, were included in the 
competitive range.  

The agency concluded that discussions were necessary because the 
prices offered could not be determined reasonable or realistic on the 
basis of the available information.  The agency first conducted 
written discussions with each offeror whose proposal was in the 
competitive range.  Among other things, the agency informed Ameriko 
during discussions that its firm, fixed price (FFP) component of 
$825,756 for the base year was too low, and asked for a breakdown of 
the major elements of its price.  The agency also informed Ameriko 
that it considered its indefinite quantity (IQ) component price of 
$54,625 to be unrealistically high and asked for a similar breakdown.  
The agency was concerned that Ameriko's proposal was unbalanced 
between the FFP and IQ components.  The agency advised Del-Jen that it 
viewed its  FFP of $1,181,037 and its IQ price of $35,530 for the base 
year to be high, and asked for a breakdown of these prices.  In order 
to provide an opportunity to more carefully examine the entire 
facility,  each competitive range offeror was given a personal site 
visit of the entire, virtually completed, facility.   
  
Revised proposals were received by May 12.  The technical ratings and 
the total revised prices for the three competitive range offerors were 
as follows: 

                Technical RatingTechnical Rank      Price (3 years)

Del-Jen         highly acceptable              1    $3,225,483.00

Offeror A       highly acceptable              2    $3,039,304.23

Ameriko         highly acceptable              3$2,819,463.65
The revised government estimate was $3,145,609.50.  In its revised 
proposal Ameriko lowered its IQ price to $43,548.96, and raised its 
FFP for the base year to $889,661.88.  Following evaluation of the 
revised proposals, the agency determined that further discussions were 
not necessary. 

BAFOs were received by June 26.  The technical ratings and BAFO prices 
for the three competitive range offerors were as follows: 

                Technical RatingTechnical Rank      Price (3 years)

Del-Jen         highly acceptable       1        $2,627,457.00

Offeror A       highly acceptable       2        $3,038,040.00

Ameriko         highly acceptable       3        $2,798,236.50
The agency determined that Del-Jen's proposal offered the best value 
to the government and made award to that company on July 16.

Ameriko protests that it was improperly misled by the agency during 
discussions into substantially increasing the FFP portion of its 
price, which resulted in a substantial increase in its BAFO price.  

Agencies are required to conduct meaningful discussions with all 
offerors whose proposals are in the competitive range; the requirement 
is satisfied by advising them of weaknesses, uncertainties, excesses, 
or deficiencies in their proposals which require amplification or 
correction and by affording them the opportunity to submit revised 
proposals.  Federal Acquisition Regulation (FAR)  15.610(c)(2) and 
(5); Crestmont Cleaning Serv. & Supply Co., Inc.; Scott & Sons 
Maintenance, Inc.; Son's Quality Food Co., B-254486 et. al., Dec. 22, 
1993, 93-2 CPD  336. 

The protester's initial price for the FFP work was approximately 18 
percent below the agency's FFP estimate.  The Navy's written 
discussions statement was "[t]he Government considers your price for 
item 0001 (the price for the FFP work for the base year) to be too 
low.  Please provide a breakdown of the major elements of your prices 
using the attached format."  We see nothing misleading or coercive 
about this statement, and the record provides nothing which suggests 
that during oral discussions, Ameriko was otherwise instructed or 
coerced into raising its price.  Rather, in response to written and 
oral discussions, Ameriko responded that it had made a "lengthy and 
detailed examination of all elements of our price for CLIN 0001, and 
have raised our price accordingly"; this statement suggests that 
Ameriko's price increase was based on judgments it made in response to 
its own review.  
See Eagle Technology, Inc., B-236255, Nov. 16, 1989, 89-2 CPD  468.  
In this regard,  the agency has submitted a declaration from the 
contracting officer, who personally conducted Ameriko's second site 
visit, in which he related statements made by an Ameriko 
representative that its price would increase based on information 
gained as a result of the second site visit.  This statement belies 
the assertion that Ameriko was coerced into raising its prices, and 
indicates that the change reflects business judgment based on a better 
appreciation of the nature and scope of the required work.   

Ameriko also objects that the agency abandoned its initial price 
analysis method, upon which the discussion questions were based, in 
its subsequent price analyses.  Specifically, the agency based its 
discussion questions on a comparison of Ameriko's prices and the other 
prices received and the government estimate, but in subsequent price 
analyses compared Ameriko's revised prices to the other prices 
received and only used the FFP portion of the government estimate for 
comparative purposes.    

However, rather than being prejudiced by the agency's failure to use 
the IQ portion of the government estimate after the initial 
evaluation, if anything, Ameriko benefited from the discussion 
question concerning its IQ prices.  Ameriko was informed by the agency 
during discussions that it considered its IQ prices too high, and 
Ameriko lowered its IQ prices.  As a result, Ameriko's IQ price 
compared more favorably to other offerors' IQ prices then it otherwise 
would have.  Under the circumstances, the agency's alleged error was 
not prejudicial to Ameriko.  Prejudice is an essential element of 
every viable protest.  See Lithos Restoration, Ltd., 71 Comp. Gen. 367 
(1992), 92-1 CPD  379.[1]

The protest is denied.

Comptroller General 
of the United States

1. Ameriko also argues that the agency's release during the protest 
process of Ameriko's protest, which was marked with the legend, 
"PROTECTED MATERIALS NOT TO BE DISCLOSED," to Del-Jen, violated the 
procurement integrity provisions of the Office of Federal Procurement 
Policy (OFPP) Act, 41 U.S.C.  423, and its implementing regulations, 
FAR  3.104.  Clearly this release of information had no impact on the 
propriety of the award, and in any event,  the inadvertently released 
material consisted only of bottom line prices, which should not have 
been considered confidential in any event.