[Protest of Navy Determination Pursuant to OMB Circular A-76]

B-221352: May 6, 1986

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A firm protested a Navy determination that the Marine Corps could provide base operating support services at a lower cost than it, contending that the Navy: (1) improperly omitted six staff positions from its cost comparison; (2) should have included material costs for the first and fifth contract years in its in-house estimate; (3) improperly added the cost of eight contract administrators to the protester's proposal; and (4) omitted certain partial man-years from its in-house estimate while adding similar charges to the cost of contracting out. GAO noted that, although the determination as to whether work should be performed by government personnel or by a contractor is not generally within its bid protest functions, it will review a protest alleging arbitrary rejection of a bid where an agency used the procurement system to aid in its determination. GAO found that: (1) the Navy's determination of its required staffing level was a management decision and not for review since the protester did not show it to be unreasonable; (2) the cost of government-furnished material is a common cost and not to be considered in a cost comparison; (3) the protester's mere disagreement with the Navy's determination of the number of administrators that it required was not a basis for protest; and (4) the alleged errors in omitting man-years from the in-house estimate did not affect the evaluation. Accordingly, the protest was denied.

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