[Request for Reconsideration of Decision Concerning AID Procurement]

B-218622.2,B-218622.3: Sep 25, 1985

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The Agency for International Development (AID) and a firm requested reconsideration of a decision which sustained a protest against 13 AID indefinite quantity contract awards for technical services. GAO had held that the AID cost evaluation approach was faulty because AID: (1) did not evaluate offerers' direct costs to the prejudice of firms who offered low direct costs but higher indirect costs; and (2) did not evaluate all of the protester's indirect costs and assumed that the indirect costs would be the highest possible. In addition, GAO questioned the authority under which AID conducted the procurement as a minority business set-aside. In its request for reconsideration, AID contended that: (1) it could not evaluate offerers' direct costs because the costs could not be predicted until AID field offices issued delivery orders pursuant to the contracts; (2) while it could evaluate direct costs based on hypothetical work plans, as GAO suggested, it would be unreasonable to do so because the hypothetical plans would bear no relation to realistic situations and would be unfair to some firms; (3) it had to evaluate the protester's indirect costs based on the worst assumptions because the protester's bid did not bind it to supply a specific mix of labor skills; and (4) it was required by law to spend at least 10 percent of its appropriation on minority business activities. GAO held that: (1) AID failed to rebut the GAO finding that it violated the principle that costs should be given due consideration before contract awards are made; (2) since AID acknowledged the feasibility of hypothetical work plans, it should use them in future procurements; (3) the original decision merely required AID to give some consideration to labor costs; and (4) since it could not conclude that AID was without authority to conduct its own minority business set-aside program, the original decision was accordingly modified. The other requester, a partner in a joint venture with the original protester, contended that GAO should have recommended a contract award to the protester's joint venture because AID had previously failed to adequately debrief the requester concerning a similar procurement. GAO held that the requester was not prejudiced by the AID actions because proposals were evaluated differently under the two solicitations. Accordingly, the original decision was affirmed, except as modified.