Price Realism and Fixed-Price Contracts: The Solicitation Controls

If price realism is evaluated by a procuring agency under a solicitation for a fixed-price contract, the solicitation must inform offerors that price realism will be considered, says the GAO in a recent bid protest decision.

In GAO Protest of Emergint Technologies, Inc., B-407006 (Oct. 18, 2012), the GAO sustained a bid protest because the procuring agency in question failed to inform offerors that price realism would be evaluated–and seemed to fundamentally misunderstand the concept of a price realism evaluation.

Continue reading

How Low Can You Go? GAO Denies Price Realism Protest

When is a competitor’s low price simply too low to be realistic?  Maybe never, at least when it comes to challenging the low price in a GAO bid protest.

As seen in a recent GAO bid protest decision, when a fixed-price solicitation does not call for a price realism analysis, the procuring agency is not required to conduct one–and a competitor will not succeed in challenging the award on the basis of a supposedly unrealistically low price.

Continue reading