[Recommendation for Termination of Protested Contract]

B-208189.2: Mar 17, 1983

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In a prior decision, GAO sustained a protest which complained that an agency had improperly canceled a solicitation for the reconstruction of an abandoned mine site. The agency had believed that the solicitation misled bidders as to its evaluation methods. However, GAO found that an award under the canceled solicitation would have served the Government's needs and would not have prejudiced any bidder. During the development of the protest, the agency had awarded the contract. Therefore, GAO asked the agency to issue a stop work order and to determine whether the low bidder under the canceled solicitation would be willing and able to complete the project at its original bid price if termination and reinstatement were recommended. If the low bidder was interested, GAO asked the agency to determine the termination cost and make recommendations regarding termination. Although the firm was willing to perform the contract in accord with its original bid, the agency recommended strongly against termination citing environmental considerations. In determining whether to recommend termination of a contract, GAO considers a number of factors in addition to cost including: the good faith of the parties, the extent to which the contract has been performed, the urgency of the contract, and the potential impact of termination on the agency's mission. On the basis of the record, GAO found that the termination appeared neither impracticable nor contrary to the best interests of the Government. The agency did not demonstrate that termination would exacerbate environmental problems and GAO found its termination cost estimate to be exaggerated. Therefore, GAO concluded that the contract should be terminated for the convenience of the Government, the improperly canceled solicitation should be reinstated, and award should be made to the low responsive and responsible bidder.