Metcalf Construction Company, Inc., B-289100, January 14, 2002

B-289100 Jan 14, 2002 Jump To VIEW DECISION DOWNLOADS RELATED PAGES GAO CONTACTS Highlights A firm protested a Department of the Navy contract award for military family housing design and construction, contending the Navy improperly excluded its proposal from consideration for award. GAO found that the Navy (1) did not act improperly in excluding the protester's proposal, and (2) was not required to reopen discussions to permit the protester to cure the defect in pricing introduced in its final proposal revision. Accordingly, the protest was denied. View Decision Metcalf Construction Company, Inc., B-289100, January 14, 2002 DIGEST Attorneys DECISION Metcalf Construction Company, Inc., a small business concern located in an historically underutilized business (HUB) zone, protests the rejection of its proposal and the award of a contract to Lend Lease Actus under request for proposals (RFP) No. N62742-00-R-1345, issued by the Department of the Navy for the design and construction of military family housing at the Marine Corps Base in Kaneohe Bay, Hawaii. Metcalf contends that the agency improperly excluded its proposal from consideration for award because its price for one of the RFP's line items was over the budget ceiling specified in the solicitation for that item. We deny the protest. The RFP, which contemplated the award of a fixed-price contract, provided for award to the responsible offeror whose proposal was determined to be most advantageous to the government. The solicitation stated that in the evaluation of proposals, technical factors (which consisted of past performance, qualifications and experience, small business utilization, technical approach, and management plans) would be approximately equal in weight to price. The solicitation schedule contained three line items relating to three different projects for the design and construction of family housing on the Marine Corps Base. Item 0001, which was to be awarded during fiscal year (FY) 2001, called for the construction of 30 units pursuant to Project H-570; Option 0001, to be exercised during FY 2002, called for the construction of 158 units pursuant to Project H-571; and Option 0002, to be exercised during FY 2003, called for the construction of 24 units pursuant to Projects H-571 and H-563. The solicitation, as amended, contained the following paragraph relating to price limitations on the various items: 1A.7 INFORMATION CONCERNING COST LIMITATIONS: The budget ceiling for the award of this contract is as follows: Base Item: $7,300,000 for Project H-570 (30 units) Option 0001: $35,780,000 for Project H-571 (158 units) Option 0002: $5,400,000 for Projects H-571 and H-563 (24 units) Proposals in excess of this amount will not be considered. Offerors should prepare their proposals so as to permit award at a price within the cost limitation. RFP, as amended by Amendment No. 0007. /1/ The solicitation also contained the following paragraph concerning the evaluation of prices: 1B.8 PRICE EVALUATION. Price proposals will be evaluated in accordance with FAR 52.217-5, Evaluation of Options. For award purposes, the price for pre-priced Options 0001 and 0002 will be added to the Item 0001 price. Upon addition of Item 0001, Option 0001 and Option 0002 prices, prices will be evaluated in accordance with FAR 52.219-4, Notice of Price Evaluation Preference for HUBZone Small Business concerns. /2/ RFP, Amendment 0004. After initial proposals had been received, the above section was amended to substitute the word "evaluation" for the word "award" in line 2. RFP, Amendment No. 0008. Three offerors submitted proposals prior to the May 24 closing date. The agency conducted discussions with, and requested a revised proposal from, each of the three. The technical evaluation board assigned each of the final proposals a technical rating of acceptable. Each of the final proposals complied with each of the line item budget ceilings specified in section 1A.7. The day after receipt of final proposal revisions (FPR), the agency amended the RFP to incorporate an updated Davis-Bacon Act wage determination and requested a second round of FPRs. Prices received were as follows: . Budget Lend Lease Offeror A Metcalf . Ceiling Actus .Base $7,300,000 $7,300,000 [Deleted] [Deleted] .1st Option $35,780,000 $34,283,457 [Deleted] [Deleted] .2nd Option $5,400,000 $5,400,000 [Deleted] [Deleted] .Total $48,480,000 $46,983,457 [Deleted] [Deleted] .HUBZone $51,681,802.70 [Deleted] .Preference .Adjusted .Total /3/ Agency report at 8. Because Metcalf's final revised price for Option 0002 exceeded the budget ceiling set forth in the RFP, Metcalf's proposal was eliminated from further consideration. The agency subsequently determined that the technical proposals of Lend Lease Actus and Offeror A were essentially equal and selected the former for award based on its lower price.