[Protest of DFSC Termination of Contract]

B-214225: Sep 10, 1984

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A firm protested the termination of a contract awarded by the Defense Fuel Supply Center for the supply of aviation fuel. The contracting officer decided to terminate the contract on the ground that the EPA reference prices selected by the offerers made it impossible for contracting officials to determine which proposal offered the lowest ultimate cost to the government. The language of the request for proposals (RFP) required award on the basis of the most favorable cost to the government, from a conforming responsible offerer. Furthermore, in such procurements, the government must assure itself that the probable lowest ultimate cost will be obtained prior to award. Offerers must be treated equally, and the RFP must be drafted in such a manner that offers can be prepared and evaluated on a common basis. GAO found that the application of these principles to this procurement supported the agency's determination that the award to the protester was improper. The proposals submitted by the two offerers did not reference the same market. Therefore, GAO could not conclude that the contracting officials acted unreasonably in determining that there was no reasonable assurance that award to the protester would result in the lowest ultimate cost to the government. Furthermore, GAO did not believe that the other offerer's proposal had to be rejected for the reasons presented by the protester. Since an agency decision to terminate a contract is largely a matter of discretion, GAO would not question the decision. The untimeliness of a protest by the other offerer did not render improper an agency determination to undertake corrective action. Accordingly, the protest was denied.