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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Agency Pays 72.6% Price Premium; GAO Upholds Award

I often caution would-be bid protesters that when it comes to “best value” procurements, the GAO gives agencies wide discretion to pay a price premium for a proposal evaluated as superior.

Case in point: a recent bid protest decision in which the GAO upheld the procuring agency’s decision to pay a whopping 72.6% price premium.

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