[Protest of Cancellation of Navy IFB]

A firm protested the cancellation of a Navy solicitation for an electro-hydraulic winch. The protester asserted that the procuring agency acted in an arbitrary and capricious manner by finding it nonresponsible and canceling the solicitation. The protester also requested an award of bid preparation costs. During a preaward survey, the protester and the Navy differed concerning the winch's operation and configuration, and the contracting officer determined that the protester was nonresponsible. The question of responsibility was referred to the Small Business Administration which subsequently issued the firm a Certificate of Competency. In the interim, the Navy decided to build the equipment in-house and canceled the solicitation. GAO accepted the Navy's assertion that it could produce the winch in-house faster and more economically, and GAO stated that, despite the protester's allegation, this decision was not reached to thwart the competitive process. Since cancellation was justified as being in the best interests of the Government, GAO did not consider the propriety of the nonresponsibility determination. Accordingly, the protest was denied. GAO also denied the claim for bid preparation costs because the Navy did not act arbitrarily in cancelling the solicitation.