[Request for Reconsideration and Claim for Proposal Preparation Costs]

The Internal Revenue Service (IRS) requested reconsideration of a sustained protest against its elimination of the protester from the competitive range. In addition, the protester claimed reimbursement for its proposal preparation costs. GAO held that: (1) IRS improperly determined from benchmark results that the protester's rate of access did not meet the solicitation's requirement; (2) since the first and second benchmarks were conducted differently, IRS could not compare the results of the two benchmarks to support its conclusion that the protester improperly fine-tuned its equipment for the second benchmark; (3) IRS did not take into account that other factors could have caused discrepancies between the two benchmarks; (4) discrepancies between the two benchmarks should have prompted further investigation and evaluation of the protester's technical capability; and (5) the protester was entitled to recover its proposal preparation costs, since IRS acted arbitrarily in evaluating its proposal and it had a substantial chance of receiving the award. Accordingly, the original decision was affirmed and the claim was allowed.