Islandwide Landscaping, Inc., B-293018, December 24, 2003

B-293018 Dec 24, 2003 Jump To VIEW DECISION DOWNLOADS RELATED PAGES GAO CONTACTS Highlights Islandwide Landscaping, Inc. (ILI) protests the Department of the Army's award of a contract to Paradise Landscape Maintenance, Inc. under request for proposals (RFP) No. DAPC5002R0037, for tree maintenance and removal services at Aliamanu Military Reservation, Hawaii. ILI contends that the Army improperly evaluated its offered price. We deny the protest. View Decision B-293018, Islandwide Landscaping, Inc., December 24, 2003 DOCUMENT FOR PUBLIC RELEASE The decision issued on the date below was subject to a GAO Protective Order. This redacted version has been approved for public release. Decision Matter of: Islandwide Landscaping, Inc. File: B-293018 Date: December 24, 2003 Timothy H. Power, Esq., for the protester. Maj. Gregg A. Engler, Department of the Army, for the agency. Peter Verchinski, Esq., and John M. Melody, Esq., Office of the General Counsel, GAO, participated in the preparation of the decision. DIGEST Protest that agency improperly determined that protesters proposed fixed price was unrealistically low is denied where solicitation called for price realism analysis and protesters price was substantially lower than other offerors prices; based on comparison with these prices, it was reasonable for agency to conclude that protesters proposal posed a significant risk of nonperformance. DECISION Islandwide Landscaping, Inc. (ILI) protests the Department of the Armys award of a contract to Paradise Landscape Maintenance, Inc. under request for proposals (RFP) No. DAPC50'02'R'0037, for tree maintenance and removal services at Aliamanu Military Reservation, Hawaii. ILI contends that the Army improperly evaluated its offered price. We deny the protest. The RFP, as amended, contemplated the award of a fixed-price, indefinite-delivery/indefinite-quantity contract for a 1-year base period, and an option to extend services for up to 12 months, for various tree-related services, including tree trimming, tree maintenance, tree survey, tree tagging, root removal, stump removal, and debris removal. The RFP informed offerors that the evaluation would be based on three factors: technical capability, performance risk (comprised of past performance and work experience), and price. Technical capability and performance risk combined were approximately equal in weight to price. The RFP stated that price would be analyzed to determine the extent to which it was reasonable, realistic, and consistent with the proposal, and that unrealistically high or low prices may be grounds for eliminating a proposal. RFP at 59. Award was to be made to the offeror whose proposal was found to be most advantageous to the government, price and other factors considered. Five proposals were received, including ILIs and Paradises. ILIs initial price was significantly lower than the four others prices--it was less than 50 percent of the closest competitors price--but the agency nonetheless included ILIs proposal in the competitive range along with those of Paradise and two other offerors. The agency conducted discussions, and invited offerors to submit revised proposals. Although the agency brought its concern regarding ILIs low price to the firms attention, ILI did not submit a revised proposal. The agency conducted a second round of discussions, and again brought its concern regarding ILIs low price to ILIs attention. This time, the protester responded by raising its price, although it remained substantially lower than all other prices submitted; the price proposed by Paradise was the second lowest. In a price/technical tradeoff comparing ILIs and Paradises proposals, the agency decided, in light of Paradises technical superiority and ILIs unrealistic pricing, which the agency believed posed a risk of nonperformance, to make award to Paradise, notwithstanding ILIs lower price. ILI filed a protest challenging the agencys technical and price evaluations. We summarily dismissed the protest ground relating to the technical evaluation because it failed to state a sufficient basis for protest. We therefore address here only the protesters assertion that the agency improperly determined that its proposal was unrealistically priced. ILI states that it is performing similar work at the prices it lists in its offer, and that its pricing therefore was realistic. Where, as here, an RFP contemplates the award of a fixed-price contract, an agency may provide for the use of a price realism analysis for the limited purpose of measuring an offerors understanding of the requirements or to assess the risk inherent in an offerors proposal. PHP Healthcare Corp., B-251933, May 13, 1993, 93'1 CPD 381 at 5. The nature and extent of an agencys price realism analysis are matters within the agencys discretion. Star Mountain, Inc., B'285883, Oct. 25, 2000, 2000 CPD 189 at 6.