Freedom Graphic Systems, Inc., B-277305, September 22, 1997

B-277305 Sep 22, 1997 Jump To VIEW DECISION RELATED PAGES GAO CONTACTS Highlights DIGEST Allegation that termination of contract and resolicitation is improper because agency should have modified protester's contract and considered protester's claim for a substantial concomitant price increase does not provide a valid basis for protest. Award was made to Freedom on the basis of its low bid of $852. Freedom's representative was advised by the agency that the specifications were incorrect because the product needed by the user required the computerized imaging of both sides of the form. Which the agency concluded was not sufficient to justify Freedom's additional charge. Which was denied on June 17. The four bids that were received in response to the resolicitation were opened. View Decision Matter of: Freedom Graphic Systems, Inc. File: B-277305 Date: September 22, 1997 DIGEST Attorneys DECISION Freedom Graphic Systems, Inc. protests the termination for convenience of a contract issued to it by the Government Printing Office (GPO) under Jacket 425-791, and the resolicitation of a requirement for the production of four versions of a variably imaged self-mailer for the Social Security Administration. Freedom requests that the agency withdraw the termination for convenience, cancel the subsequent resolicitation and award, and reinstate Freedom's original contract with a change order for certain additional required work. We dismiss the protest. The agency received four bids at the original bid opening on May 19, 1997. Award was made to Freedom on the basis of its low bid of $852,862.50. At a post-award conference, Freedom's representative was advised by the agency that the specifications were incorrect because the product needed by the user required the computerized imaging of both sides of the form, rather than the one side specified in the IFB. Freedom subsequently stated that it intended to charge for this modification to the specifications and, on June 2, Freedom quoted an additional price of approximately $151,052.80, with no supporting justification. To date, Freedom has submitted only an internal price list, which the agency concluded was not sufficient to justify Freedom's additional charge. Because Freedom did not adequately justify its proposed $151,052.80 charge to meet the revised specifications, the contracting officer decided not to modify the contract. Instead, the contracting officer decided to terminate for convenience and resolicit bids using the new specifications. The agency's Contract Review Board unanimously concurred with the contracting officer's decision. The day after the termination for convenience, the customer agency, the Social Security Administration, notified the GPO of 10 other changes to the specifications in addition to the change involving two-sided imaging. GPO subsequently issued a new solicitation with specifications reflecting the two-sided imaging requirement as well as the other changes. On June 9, Freedom filed an agency-level protest against the termination for convenience and the resolicitation, which was denied on June 17. On that same date, the four bids that were received in response to the resolicitation were opened. Webcraft Technology, Inc. was awarded the contract on the basis of its low bid of $966,737.57. Freedom's bid of $974,557.50 was second low. This protest to GAO followed. An agency's decision to terminate a contract for the convenience of the government is usually a matter of contract administration that is not subject to review by our Office under our bid protest procedures, unless the decision results from the agency's finding that the initial contract award was improper, in which case we will review the protest to examine the propriety of the award procedures that underlie the termination action. Special Waste, Inc., 67 Comp.Gen. 429, 431 (1988), 88-1 CPD Para. 520 at 3. Termination of a contract and resolicitation is proper when, subsequent to award, the contracting agency discovers that the solicitation did not properly describe the government's needs, id., or that the solicitation contains inadequate specifications which misled competitors and deprived the government of the full benefits of competition. See Flow Tech., Inc., 67 Comp.Gen. 161, 162 (1987), 87-2 CPD Para. 633 at 3. Here, the crux of the protester's argument is that our Office should review a contract administration matter and require the agency to issue a contract change order for which Freedom seeks a substantial price adjustment, rather than terminate Freedom's contract. While the protester argues that our Office should consider the matter because it involves a termination based on a material solicitation defect, the protester's arguments are contradicted by its actions.