Cartridge Technology Network, Inc.

B-271197 Jun 03, 1996 Jump To VIEW DECISION RELATED PAGES GAO CONTACTS Highlights Awardee's offer is not unbalanced where awardee's last 2 option year prices were lower than protester's and lower than awardee's prices for the base year and first two option years. There is no evidence of overstated prices in awardee's offer in the earlier contract years. CTN argues that ALI's proposal contained unbalanced prices and should have been rejected. Past performance was evaluated using an Automated Best Value Model (ABVM) score (ranging from 0 points for poor performance to 100 points for excellent performance). Price (for the base and option years) was to be evaluated for reasonableness. ALI's BAFO was assigned an ABVM score of 99.3 points. While CTN's was 89.7 points. The offerors' prices were as follows: ALI CTN Base price $57.90 $53.90 Option period 1 48.90 48.90 Option period 2 40.90 43.00 Option period 3 29.30 43.00 Option period 4 26.20 43.50 TOTAL $5. View Decision Matter of: Cartridge Technology Network, Inc. File: B-271197 Date: June 3, 1996 Awardee's offer is not unbalanced where awardee's last 2 option year prices were lower than protester's and lower than awardee's prices for the base year and first two option years, but there is no evidence of overstated prices in awardee's offer in the earlier contract years. Attorneys DECISION Cartridge Technology Network, Inc. (CTN) protests the award of a contract to American Laser, Inc. (ALI) under Defense General Supply Center (DGSC) request for proposals (RFP) No. SPO450-95-R-3056, for laser printer toner cartridges to be used by the Defense Supply Center in Richmond, Virginia (DSCR). CTN argues that ALI's proposal contained unbalanced prices and should have been rejected. We deny the protest. The RFP contemplated the award of a fixed-price requirements contract on a best value basis, for a base year with four 1-year options, for an annual estimated 25,000 cartridges. The solicitation set forth two equally weighted factors, price and past performance. Past performance was evaluated using an Automated Best Value Model (ABVM) score (ranging from 0 points for poor performance to 100 points for excellent performance), which indicated the offeror's performance on DSCR contracts for the type of supplies required here, performed over a 12-month period beginning 14 months prior to generation of the offeror's ABVM score. Price (for the base and option years) was to be evaluated for reasonableness. DSCR received 13 offers. Following discussions, the agency requested and received best and final offers (BAFO). ALI's BAFO was assigned an ABVM score of 99.3 points, while CTN's was 89.7 points. The offerors' prices were as follows: ALI CTN Base price $57.90 $53.90 Option period 1 48.90 48.90 Option period 2 40.90 43.00 Option period 3 29.30 43.00 Option period 4 26.20 43.50 TOTAL $5,080,000 $5,795,000 The contracting officer made award to ALI based on its highest past performance score and lowest price. CTN argues that ALI's BAFO was unbalanced, and could not be accepted for award, because its base year and first 2 option year prices were substantially higher than the prices for the last 2 option years. CTN maintains that ALI's BAFO will not result in the lowest price to the government, "since demand for the toner cartridge models procured under [this] RFP is likely to diminish over a five year period," as Hewlett-Packard introduced a new "next generation" series of laser printers which utilize different toner cartridges from those required here. Before an offer can be rejected as unbalanced, it must be found to be both mathematically and materially unbalanced. An offer is impermissibly mathematically unbalanced where it contains nominal prices for some items and overstated prices for others. SIMSHIP Corp., B-253655.2, Dec. 2, 1993, 93-2 CPD para. 293. A mathematically unbalanced offer is considered materially unbalanced, and cannot be accepted, where there is a reasonable doubt that acceptance of the offer will result in the lowest overall cost to the government, or where it is so grossly unbalanced that its acceptance would be tantamount to allowing an advance payment, even if the offer represents the lowest cost to the government. Star Brite Constr. Co., Inc., B-244122, Aug. 20, 1991, 91-2 CPD para. 173. It does not appear that ALI's BAFO was mathematically unbalanced. A mathematically unbalanced offer must contain both nominal prices and overstated prices. Although ALI's last 2 option year prices were lower than CTN's and lower than ALI's own prices for the base year and first 2 option years, there is no evidence of overstated prices in the earlier contract years--ALI's base and first 2 option year prices ($57.90, $48.90, and $40.90, respectively) were very similar to CTN's ($53.90, $48.90, and $43.00, respectively).