TITLE: B-310814, Accumark, Inc., February 13, 2008
BNUMBER: B-310814
DATE: February 13, 2008
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B-310814, Accumark, Inc., February 13, 2008
DOCUMENT FOR PUBLIC RELEASE
The decision issued on the date below was subject to a GAO Protective
Order. This redacted version has been approved for public release.
Decision
Matter of: Accumark, Inc.
File: B-310814
Date: February 13, 2008
Thomas O. Mason, Esq., and Francis E. Purcell, Jr., Esq., Williams Mullen,
for the protester.
John Pope Midyette for InfraMap Corporation, an intervenor.
Dave Nimmich, Esq., Naval Facilities Engineering Command, for the agency.
Scott H. Riback, Esq., and John M. Melody, Esq., Office of the General
Counsel, GAO, participated in the preparation of the decision.
DIGEST
1. Protest that agency unreasonably found that awardee's prices were
realistic under a fixed-price contract is denied where record shows agency
based its determination on a comparison of all offerors' prices to one
another and to the government estimate, and all prices received were
within a narrow range.
2. Protest that agency should have rejected awardee's proposal for
offering unbalanced prices is denied where awardee's price was low overall
and, to extent that its prices for one element of contract were high in
comparison to other offerors' prices and government estimate, record shows
estimated quantity for that element was reasonably accurate; thus, based
on the record, there is little risk that award will not result in lowest
cost to government.
DECISION
Accumark, Inc. protests the award of a contract to InfraMap Corporation
under request for proposals (RFP) No. N40085-05-R-2545, issued by the
Department of the Navy to acquire utility and underground facilities
locating and marking services at various Naval facilities in the Hampton
Roads, Virginia area. Accumark asserts that the agency misevaluated the
awardee's price proposal.
We deny the protest.
The RFP contemplated the award of a fixed-price,
indefinite-delivery/indefinite-quantity (ID/IQ) contract for a base
period, with 4 option years and 5 award option years. Award was to be made
on a "best value" basis, considering price and three non-price evaluation
factors--technical approach/management, corporate experience and past
performance. RFP sect. M.2. The technical factors, combined, were equal in
weight to price. The agency was to consider the reasonableness, realism
and completeness of the proposed prices; proposals that offered
unreasonable, unrealistic, or unbalanced prices could be downgraded or
considered unacceptable. Id. In this regard, realism was defined as
follows: "Prices are compatible with the scope of solicitation performance
requirements and proposed technical approach." Id.
The agency received three proposals and included all in the competitive
range. Following discussions with the offerors, the agency made award to
Accumark. InfraMap challenged the award in an agency-level protest,
alleging that the Navy improperly had failed to solicit final proposal
revisions (FPR) at the conclusion of discussions. The agency determined
that InfraMap was correct, and thereafter advised all three offerors that
they would be permitted to submit FPRs. In soliciting FPRs, the agency
disclosed all offerors' total prices in order to ameliorate any
competitive harm to Accumark due to the release of its price in connection
with the announcement of the award. Agency Report (AR), exhs. 17, 18.
InfraMap and Accumark (and the third offeror) submitted revised proposals;
Accumark made limited changes to its technical proposal and also slightly
revised its proposed prices, while InfraMap revised only its price. After
evaluating the proposals, the agency rated the proposals as follows:
+------------------------------------------------------------------------+
|Offeror |Tech./Mgmt. | Corp. Exp. | Past Perf. | Overall | Price |
| | | | |Tech. Rating| |
|--------+------------+------------+------------+------------+-----------|
|Accumark| Very Good |Satisfactory|Satisfactory|Satisfactory|$15,088,000|
|--------+------------+------------+------------+------------+-----------|
|InfraMap|Exceptional | Very Good | Very Good | Very Good |$13,607,638|
|--------+------------+------------+------------+------------+-----------|
|Offeror |Satisfactory| Marginal | Neutral | Marginal |$14,494,800|
| A | | | | | |
+------------------------------------------------------------------------+
AR, exhs. 21, 27. On the basis of these evaluation results, the agency
made award to InfraMap, concluding that, because the firm had submitted
the best technical proposal at the lowest price, it offered the best value
to the government. AR, exh. 22. After being advised of the award decision,
Accumark filed this protest.
Accumark asserts that the agency unreasonably determined that InfraMap's
proposed prices were realistic.[1] InfraMap reduced its price in its FPR
and the protester maintains that this was a dramatic price reduction that
should have led the agency to conclude that there would be an adverse
impact on InfraMap's technical capability to perform the contract.[2]
In the context of a solicitation that provides for award of a fixed-price
contract, an agency may, in its discretion, provide for considering the
realism of offered prices for purposes of assessing whether a price is so
low as to evince a lack of technical understanding on the part of the
offeror. Consolidated Servs., Inc., B-276111.4, Dec. 29, 1997, 98-1 CPD
para. 14 at 4. In such a context, an agency's simple comparison of the
prices received with one another, as well as with a government estimate,
can serve as an adequate basis to establish the realism of the proposed
prices where, as here, there was adequate competition, and the proposed
prices fall within a narrow range. Id. at 5.
The realism determination here was unobjectionable. The record shows that
InfraMap's initial price--$[deleted]--was found by the agency to be
unreasonably high, AR, exh. 27, at 5, and the agency so advised InfraMap
during discussions. AR, exh. 8, at 1. InfraMap reduced its price in its
FPR, and the agency compared this reduced price to the other prices
received to determine whether it was realistic. The agency found that
InfraMap's price compared favorably to the other prices.[3] It thus
concluded that, since there was adequate price competition, InfraMap's
proposed price was realistic, reasonable and complete. AR, exh. 22, at 3,
5-8. The agency's methodology was consistent with the applicable standard,
and its conclusion was reasonable in light of the fixed-price nature of
the requirement, the comparability of the prices received and the adequacy
of the competition. Under these circumstances, the protester's general
assertion that InfraMap may not have understood the requirement is not
sufficient to bring the agency's determination into question. In this
regard, the agency rated InfraMap's proposal superior to the others
received, and Accumark has raised no substantive challenge to the agency's
evaluation conclusions. See Consolidated Servs., Inc., supra.
Accumark asserts that the award to InfraMap was improper because its
proposed prices were unbalanced. In this connection, offerors were
required to submit prices for six exhibit line items (ELINS) for each of
the contract's performance periods. RFP sect. B.17; sect. J, exhs. A-K.
Each of the ELINS represented a different aspect of the required work.
Accumark maintains that InfraMap's prices for the first five ELINS are
understated, and that its price for the sixth is overstated. According to
the protester, there was no historical information available for the sixth
ELIN, and the agency thus did not have a reasonable basis for its quantity
estimate under that ELIN; as a result, there is a risk that InfraMap's low
total price will not result in the lowest actual cost to the government.
As an initial matter, we note that, to the extent that the protester is
challenging the accuracy of the agency's estimated quantity for the sixth
ELIN, its protest is untimely. Our Bid Protest Regulations require that
protests concerning alleged improprieties apparent on the face of a
solicitation be filed prior to the deadline for submitting proposals. 4
C.F.R. sect. 21.2(a)(1) (2007). Here, the RFP included the agency's
estimated quantities for all of the ELINS, and if Accumark thought that
the estimated quantities were inaccurate, it was required to protest the
matter prior to the deadline for submitting proposals.
In any case, this argument is without merit. Under Federal Acquisition
Regulation (FAR) sect. 15.404-1(g), unbalancing exists where, despite a
proposal's low overall price, individual line item prices are either
understated or overstated. In such circumstances, agencies are required to
consider whether award to a firm whose prices are unbalanced may pose a
risk that the government will pay unreasonably high prices for contract
performance. Id. In the context of an ID/IQ contract, a key consideration
is the accuracy of the government's quantity estimates; if the estimates
are reasonably accurate, then evidence of mathematical unbalancing
generally does not present a risk that the government will pay
unreasonably high prices for contract performance. Neals Janitorial Serv.,
B-279633, June 3, 1998, 98-1 CPD para. 156.
The sixth ELIN is for global positioning system (GPS) mapping services,
and the RFP specified an estimated 800 units for these services. The
individual responsible for preparing the estimate states that, while no
historical data existed for this aspect of the contract, he based his
estimate on the potential number of parcels for which the agency might
require that GPS survey work be performed. Specifically, he states:
For the line item involving GPS mapping, this service had not been part
of the previous contract, so I did not have historical data from that
contract to assist me in creating the estimated quantity. Instead, I had
been informed that the primary Navy customer for these services would be
a communications command that was planning to earmark funds to map
portions of its underground communications lines that had not previously
been mapped using GIS [geographic information system] technology. My
estimated quantity of 800 such units was based upon the number of
parcels required to complete that effort.
AR, exh. 26. The agency further explains that the GPS mapping line item
reflects an estimate of the level of effort required if the Navy
telecommunications command orders mapping for the entirety of its unmapped
network in the Hampton Roads area, and that it therefore would be
virtually impossible to overrun the estimated quantity.
The protester challenges the estimate on two bases. First, it asserts that
the estimate is based on the needs of the primary user of the GPS mapping
requirement, but does not account for other possible users of the service.
However, Accumark has produced absolutely no information or evidence to
show that other commands within the Navy may require GPS mapping services,
and nothing in the record suggests that the agency contemplates allowing
other commands to use the contract for these purposes. Accumark's mere
speculation regarding other possible ordering activities is insufficient
to reasonably draw into question the accuracy of the estimate. Second, the
protester maintains that, because the number of underground lines to be
mapped varies from one parcel to another, the actual cost of mapping any
given parcel could vary depending on the amount of time necessary to map a
given parcel. However, the RFP called for a lump-sum price per mapping
survey. Thus, the number of lines to be mapped and the amount of time
involved would have no effect on the estimated quantity or the cost to the
government. We conclude that Accumark has failed to show that the estimate
is inaccurate and there is no basis in the record to otherwise find that
there is any risk that the agency will pay unreasonably high prices for
the GPS survey requirement.
The protest is denied.
Gary L. Kepplinger
General Counsel
------------------------
[1] In its initial protest, Accumark also asserted that the agency
improperly had accepted an alternate price proposal from InfraMap that was
noncompliant with the terms of the solicitation, and also engaged in
unequal discussions. The agency responded to these assertions in its
report, and in its comments, Accumark makes no mention of these
assertions. We deem these allegations to be abandoned. Israel Aircraft
Indus., Ltd.--TAMAM Div., B-297691, Mar. 13, 2006, 2006 CPD para. 62 at
6-7.
[2] Accumark also argues that the agency failed to consider the
reasonableness of InfraMap's price. However, price reasonableness concerns
whether a price is too high, not whether it is too low. Medical Matrix,
LP, B-299526, B-299526.2, June 12, 2007, 2007 CPD para. 123 at 9 n.6.
Since Accumark claims that the awardee's price is too low, there is no
basis to find that price unreasonable.
[3] The record shows that the agency also used the government
estimate--$18,394,585.90-- as a reference point in its price evaluation,
AR, exh. 27.