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A firm protested the Army Corps of Engineers' rejection of its low bid and subsequent contract award for ship removal and disposal, contending that the Corps unreasonably determined that the value of its assets was insufficient to cover its bid bond. GAO held that the Corps: (1) reasonably rejected the protester's bid, since the protester's required bid bond offered insufficient security; and (2) properly relied on the tax assessment value of the surety's real estate holding, since the appraisal the protester submitted with its bid bond was not current. Accordingly, the protest was denied.

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B-244452, Sep 23, 1991

DIGEST: Cancellation of request for quotations for commissary deli service and resolicitation of the requirement were not improper where shortly after award agency determined that proposals were improperly evaluated because the solicitation failed to list the evaluation criteria and was unclear as to what items had to be priced.


Tony Ingoglia Salami and Cheese, Inc.:

Tony Ingoglia Salami and Cheese, Inc. protests the Air Force's proposed termination of its contract and cancellation of request for quotations (RFQ) No. F45603-91-T-1018 for bakery, delicatessen, and pizza cart services at the commissary at McChord Air Force Base, Washington, and the resolicitation of the same requirement under an RFQ with weighted evaluation criteria.

We deny the protest.

The original RFQ was issued to six vendors on November 27, 1990, with a December 27 closing date for receipt of quotations. The RFQ was a pre- priced, self-funded contract for the food services. The solicitation contemplated that the awardee would furnish fresh bakery, deli, and pizza products and would charge those authorized commissary patrons for their orders at rates contained in the agreement. The agreement is for a 5-year period. The RFQ required vendors to provide a list of 30 of their most popular samples (for a total of 60 in the bakery and deli categories) and to provide pricing on attachments 1 and 2, which consisted of 55 bakery items and 52 deli items. Prices for pizza were not requested. The RFQ did not contain any evaluation, selection, or award criteria.

Quotations were received from five vendors. Three of the vendors submitted pricing for only 60 items, 30 bakery and 30 deli. The Air Force evaluators did not request additional pricing from the vendors. Rather, the evaluators extracted prices for like items from each quotation. The evaluators compared the vendors' prices for 24 bakery items and 25 deli items. There were 31 bakery items and 27 deli items that were never evaluated, and prices for pizza were not compared. Although not stated in the RFQ, the evaluators also evaluated the following: quality of product versus price; number of items to be reduced in price per month; and minimum savings guaranteed to patrons.

The Air Force selected Tony to provide the bakery, delicatessen, and pizza cart services based on the following:

"(a) Lowest price for total of 49 deli items.

(b) Provides quality products.

(c)Provides 12 items offered to patrons in the form of volunteer price reductions (VPR's) on a monthly basis.

(d) Guaranteed they will maintain a minimum of 30% savings to patrons."

On February 1, 1991, two contracts were awarded to Tony, one for the deli and pizza cart service and the other for the bakery service.

As the result of a congressional inquiry, the Air Force conducted a review of the original solicitation and the evaluation procedures. The Air Force concluded that the selection procedures were flawed and that the RFQ was ambiguous because it was not clear whether vendors were to quote on 55 bakery items and 52 deli items or 30 of the more popular items from each list. The Air Force also determined that the selection was improper because the award criteria were not stated in the RFQ and that the price evaluation was not based on the complete requirement. In order to ensure complete fairness to all interested vendors and to ensure that all were given equal opportunity to compete, the Air Force determined that the requirement should be resolicited. The Air Force decided to continue the current contract until a source is selected using the revised procedures. Tony was notified of the proposed cancellation and resolicitation by letter dated April 18, 1991. This protest followed.

The new solicitation was issued May 30. The solicitation outlined the weighted criteria elements of quality, availability and selection of products, vendors' past and current experience in managing delis/bakeries, vendors' plan for service to commissary patrons, and price differential.

Tony contends in its protest that the cancellation was improper and, if there existed any flaws in the solicitation, it did not adversely affect any of the offerors since all were treated in the same manner.

In negotiated procurements, the contracting agency need only establish a reasonable basis to support a decision to cancel a solicitation. Rodgers- Cauthen, Barton-Cureton, Inc., B-220329, Jan. 6, 1986, 86-1 CPD Para. 11. It is fundamental that offerors must be advised of the basis upon which their proposals will be evaluated. The Faxon Co., 67 Comp.Gen. 39 1987), 87-2 CPD Para. 425. We have recognized that a solicitation that does not set forth a common basis for evaluating offers, which ensures that all firms are on notice of the factors for award and can compete on an equal basis, is materially deficient. See The Faxon Co., supra.

Here, because the solicitation was not clear as to what items were to be priced, it resulted in offerors submitting prices on different items and not on the total requirement. While Tony submitted the low quote based on the evaluation of selected items, the record is unclear as to whether or not Tony would be low if the agency had evaluated the total requirement. Furthermore, there was nothing in the solicitation to advise offerors of how the award would be made since the award criteria and methodology were not stated in the solicitation. Offerors may have submitted entirely different offers if they had been advised to submit prices for all the items actually evaluated and if they had been aware that other non-price factors would play a significant role in the award selection.

The protest is denied.