GAO: “Best Value” Tradeoff Must Consider Benefits Of Lower-Cost Proposal

In a best value tradeoff evaluation, a procuring agency must consider the benefits of a lower-cost proposal, even if that proposal’s cost is not as close to the agency’s internal cost estimate as a higher-priced proposal.

As demonstrated by a recent GAO bid protest decision, it is improper in a tradeoff analysis for an agency to refuse to consider the relative benefits of paying a lower cost for a lower-rated proposal.

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A GAO Reminder: Know Your Protest Filing Deadline

One of the first questions a contractor must ask itself before filing a bid protest with the GAO is whether its protest would be timely filed. But as a recent GAO decision highlighted, the answer to that question might not be so clear.

Contrary to a common misconception, a protest is not always timely if filed within 10 days of a debriefing. As one prospective protester learned, if the debriefing is not “required” under applicable law, a GAO protest filed within 10 days of a debriefing might be untimely.

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GAO: No Review Of Unsolicited Proposal Protest

The GAO generally will not review an agency’s decision not to accept a company’s unsolicited proposal to the federal government.

As demonstrated in a recent bid protest decision, because one of the GAO’s functions is to promote full and open competition, the GAO ordinarily will not consider a protest contending that an agency should have made a sole source award based on an unsolicited proposal.

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GAO: Initial Proposal “Nullified” By Solicitation Amendment

When an initial proposal is nullified by a subsequent solicitation amendment, an offeror must timely resubmit its proposal–or be eliminated from the competition.

As one offeror recently learned, an agency can nullify initial proposals with a solicitation amendment that substantially changes the solicitaton’s terms.  When that happens, an offeror can no longer rely on its initial proposal.

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GAO: Agency Need Not Raise Offeror’s High Price In Discussions

When an agency decides to hold discussions with offerors, must it discuss with an offeror the price proposed for the contract? Not unless that offeror’s proposed price is so high as to be unreasonable.

As the GAO held in a recent bid protest decision, unless an offeror’s price is so high as to make its proposal unacceptable, the offeror is not entitled to be informed during discussions that its price is too high–even if the price is significantly higher than competitors.

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Reverse Auctions: Last-Second Bid Was “Late”

In a reverse auction, a bid filed literally at the last second was excluded as late, perhaps because the reverse auction system did not process the bid until a few seconds after the deadline.

As a recent GAO protest demonstrates, reverse auctions–by their very nature–encourage last-second bids, but it is the prospective contractor that may pay the price if the reverse auction system does not immediately process a bid.

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Subcontractor Price Proposals: A Cautionary Tale

Subcontractors sometimes prefer to submit their cost or price proposals directly to the government, instead of submitting their cost or pricing information through the prime contractor.  In cases where a procuring agency allows it, such independent submissions can ease a subcontractor’s concerns about disclosing sensitive information to the prime contractor.

But when a subcontractor circumvents the prime contractor and independently submits its pricing, the prime contractor is unable to review the subcontractor’s proposal to ensure that it complies with the terms of the solicitation.  As demonstrated in a recent GAO bid protest decision, if the subcontractor’s proposal is non-compliant, the entire team may pay the price.

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