Protest of Potential Contract Award Alleging Improper Proposal Evaluation

B-205533: Jul 8, 1982

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A firm protested the award of any contract under an invitation for bids (IFB) issued by the Defense Logistics Agency (DLA). Bids under the IFB were to be based on the bidders' own technical proposals submitted as step one of a two-step procurement. The protester challenged the potential award to the apparent low bidder contending that DLA failed to evaluate certain maintenance aspects of the technical proposals and improperly waived certain technical requirements for the potential awardee without advising the other offerors that its minimum needs had changed. Three firms submitted proposals under the solicitation prior to the closing date. At some point during the evaluation, it was decided that the systems offered should be equipped with special tools for manual operation. The bidders were advised of the added requirement and afforded the opportunity to clarify any apparent deficiencies in their proposals. The protester agreed to the added requirement; however, the low bidder informed DLA that it would not comply with the special tools requirement stating that it did not have any such tools available. Instead, the firm offered what it considered a more feasible alternative. The project engineer concluded that all proposals, as clarified, were technically acceptable, and the two-step IFB was issued to the three offerors. The protester discovered that DLA had accepted the low bidder's offer without the special tools requirement and protested to GAO arguing that, since DLA had waived several requirements, including the one for special tools, it did not treat all bidders equally and, as a result, the procurement was defective. GAO stated that if a technical proposal represents a basic change in the Government's essential requirements, it can be accepted only if the agency informs the other offerors of the change and affords them the opportunity to submit revised proposals based on the changed requirements. This reflects the fundamental procurement principle that all offerors must be treated fairly and equally so as to promote full and free competition. In this case, GAO concluded that DLA failed to treat all bidders fairly and equally. Accordingly, the protest was sustained, and GAO recommended that DLA resolicit bids based on its current minimum needs.