[Protest of Economic Price Adjustment Clause Provisions in GSA Solicitation]

A firm protested the standard for contract price adjustment contained in the economic price adjustment clause of an invitation for bids (IFB) issued by the General Services Administration for Federal Supply Schedule requirements for plastic bags. The protester contended that: (1) the Department of Labor's producer price index (PPI) in the price adjustment clause did not accurately reflect actual market prices, so prospective bidders were unable to assess the consequences of their bids; and (2) the solicitation's price adjustment clause contained ambiguities and was one sided in favor of the Government. The contracting agency itself made allegations about the timeliness of the protester's rebuttal comments. GAO determined that: (1) the price adjustment clause in the protested solicitation reflected the necessary objective standard because it was tied to the PPI; (2) it was the bidder's responsibility to project costs and to cover uncompensated cost increases; (3) the protester failed to provide sufficient evidence to establish that the PPI did not represent the actual market price for the material used in manufacturing the contract items; (4) the economic price adjustment clause was not ambiguous since it contained sufficient detail to give bidders an understanding of the clause's operation; and (5) the price adjustment clause was not one sided since it was within the contracting agency's right to impose the maximum risks on the contractor and not on itself. Finally, GAO found that the contracting agency's allegations had no basis. Accordingly, the protest was found to be without merit.