[Protest of Navy Contract Award for Computer Services]

Two firms protested a Navy contract award for computer services, contending that the Navy improperly: (1) evaluated technical proposals; and (2) conducted the cost realism analysis. GAO held that the Navy: (1) improperly evaluated technical proposals; (2) failed to properly document its award decision; and (3) improperly adjusted the protester's cost proposal upward. Accordingly, the protests were sustained, and GAO recommended that the Navy: (1) reevaluate all proposals consistent with the solicitation's evaluation criteria, and reasonably document support for the evaluation and source selection; (2) correct the error in its cost realism analysis of the protester's proposal, and, if necessary, reevaluate the proposals for cost realism; (3) terminate the awardee's contract and make award to another bidder, if otherwise appropriate; and (4) reimburse the protesters for their protest costs.