Todd Pacific Shipyards Corporation, B-281383, February 1,

B-281383 Feb 01, 1999 Jump To VIEW DECISION RELATED PAGES GAO CONTACTS Highlights DIGEST Solicitation for ship repair is improper where the record evidences that the stated foreseeable costs to be added to each bidder's bid price to determine the low bidder are grossly understated. Are to be added for evaluation purposes to the bid prices to determine the lowest bidder. Among the foreseeable costs called out in the solicitation is "[t]he cutter's fuel. Arguing that the $172.30 per nautical mile is outdated. Maintenance and personnel costs that will be necessary to move the Polar Star to and from the contractor's place of performance are much higher. Such that the IFB contains no reasonable method for determining which bid provides the lowest overall cost to the government. /1/ The agency states that the current rate of $172.30 per nautical mile for transiting cutters of the Polar Star's class to and from prospective shipyards was established in 1991 based on 1989 and 1990 data. View Decision Matter of: Todd Pacific Shipyards Corporation File: B-281383 Date: February 1, 1999 DIGEST Attorneys DECISION Todd Pacific Shipyards Corporation protests invitation for bids (IFB) No. DTCG85-98-B-625M51, issued by the Department of Transportation, U.S. Coast Guard (USCG), for furnishing the necessary labor, materials, and facilities to dry-dock and repair the USCG Cutter Polar Star (an icebreaker). We sustain the protest. The IFB, issued on September 21, 1998, provides for award on the basis of price and price-related factors. The IFB lists a variety of costs that the government expects to incur in moving the ship to and from the contractor's shipyard; these anticipated costs, which according to the distance between the bidder's shipyard and the ship's location, are to be added for evaluation purposes to the bid prices to determine the lowest bidder. IFB Sec. M.3. Among the foreseeable costs called out in the solicitation is "[t]he cutter's fuel, maintenance and personnel cost for one (1) round trip from the cutter's home moorage at . . . Seattle, [Washington] to contractor's place of performance at $172.30 per nautical mile." IFB Sec. M.3.A. Todd protested to our Office before the November 17 bid opening, arguing that the $172.30 per nautical mile is outdated, and that the actual fuel, maintenance and personnel costs that will be necessary to move the Polar Star to and from the contractor's place of performance are much higher, such that the IFB contains no reasonable method for determining which bid provides the lowest overall cost to the government. /1/ The agency states that the current rate of $172.30 per nautical mile for transiting cutters of the Polar Star's class to and from prospective shipyards was established in 1991 based on 1989 and 1990 data. Jan. 14, 1997 Notes from Vessels Conference at 1. The agency states that they are currently in the process of updating these rates, but that revising the rates is a "complex and far reaching process." Agency Memorandum of Law at 4. Regarding the present solicitation, the agency contends that the IFB clearly and concisely stated the foreseeable cost formula to be used in the evaluation of the low bidder, and that all bidders were able to prepare their bids on an equal and well informed basis. Agency Memorandum of Law at 2. Under Federal Acquisition Regulation Sec. 14.201-8, the evaluation of price-related factors, including foreseeable costs "to the Government resulting from such factors as differences in inspection, locations of supplies, and transportation," is a proper basis for award in a sealed bidding procurement. Cascade Gen., Inc., B-272271, Aug. 1, 1996, 96-2 CPD Para. 52 at 2. "While a nonlocal facility is assessed a higher transportation charge, the charge simply reflects an actual cost to the government, which is entitled to consider this cost in evaluating bids." Marlen C. Robb & Son, Boatyard & Marina, Inc., B-256516, June 28, 1994, 94-1 CPD Para. 392 at 3. However, when a solicitation lacks accurate foreseeable costs, the agency cannot determine whether award to one firm versus another will result in a lower cost to the government. See Hoechst Marion Roussel, Inc., B-279073, May 4, 1998, 98-1 CPD Para. 127 at 3 (protest sustained where solicitation for drugs did not state accurate dosage estimates); Beldon Roofing & Remodeling Co., B-277651, Nov. 7, 1997, 97-2 CPD Para. 131 at 7 (protest sustained where solicitation for roofing work lacked accurate quantity estimates). We agree with the protester that the 1989 and 1990 rates that the agency used in the solicitation are outdated; however, this fact alone is not determinative. See Southgate Servs., B-246758, Mar. 20, 1992, 92-1 CPD Para. 300 at 5-7 (protest denied where solicitation included older estimates because more recent estimates were unreliable).