PCA Aerospace, Inc., B-293042.3, February 17, 2004

B-293042.3 Feb 17, 2004 Jump To VIEW DECISION RELATED PAGES GAO CONTACTS Highlights Is denied where widely disparate pricing among offerors reasonably led agency to conclude that instructions regarding pricing may have confused offerors. The Air Force's action was in response to two protests challenging the award on a number of grounds. Which led the agency to conclude that its instructions regarding pricing may have caused confusion among offerors. PCA asserts that the Air Force lacks a reasonable basis for the corrective action because the instructions provided by the agency were clear. Were approximately equal in weight to price. The agency issued amendment No. 0001 to explain how offerors were to price the CAP line item. The amendment provided that the estimated total cost for the CAP line item for the base and all options years was "to be determined by the government.". View Decision PCA Aerospace, Inc., B-293042.3, February 17, 2004 * REDACTED DECISION DIGEST Attorneys DECISION PCA Aerospace, Inc. protests the decision by the Department of the Air Force to terminate its contract awarded under solicitation No. F09603-03-R-22453, reopen discussions to clarify pricing, and conduct a new evaluation and new source selection decision based on the new offers. The Air Force's action was in response to two protests challenging the award on a number of grounds, which led the agency to conclude that its instructions regarding pricing may have caused confusion among offerors. PCA asserts that the Air Force lacks a reasonable basis for the corrective action because the instructions provided by the agency were clear. We deny the protest. The RFP, posted on the Federal Business Opportunities (FedBizOpps) website on August 5, 2003 as a small-business set-aside for the acquisition of up to 1,900 titanium pylon ribs for F-15 aircraft, contemplated the award of a fixed-price requirements contract for a base year, with five 1-year options. The RFP provided for award on the basis of price, first article evaluation, and other non-price factors, in descending order of importance. RFP at 43. All evaluation factors other than price, when combined, were approximately equal in weight to price. In order to mitigate the risk associated with the purchase of titanium, a material with widely-fluctuating prices, the RFP included a Contractor Acquired Property (CAP) line item, which would allow for reimbursement of the contractor's actual incurred titanium costs under each order. Agency Report (AR), Tab 2, Contracting Officer's Statement (COS), at 1. On August 20, the agency issued amendment No. 0001 to explain how offerors were to price the CAP line item. The amendment provided that the estimated total cost for the CAP line item for the base and all options years was "to be determined by the government." RFP, amend. 1, at 2. On August 22, to further clarify pricing for this line item, the agency posted a memo to offerors at the FedBizOpps website, advising offerors that [b]ecause of volatility of titanium prices, the Government will assume the risk of the potential for price increases by reimbursing this cost (with allowable and allocable G&A [general and administrative] expenses). For this reason, your submitted unit prices SHOULD NOT include these costs. At the time individual orders are issued, that line item will contain funds estimated to be sufficient to cover these costs. AR, Tab 4B, FedBizOpps Memo to Offerors, at 1. The agency received [DELETED] proposals by the extended September 12 closing date. The offers ranged in price from [DELETED] to [DELETED]. The agency established a competitive range of [DELETED] offers by eliminating offers priced above [DELETED]. AR, Tab 2, COS, at 1. Because of the wide price disparity even among the competitive range offers, the agency opened discussions by letters to the offerors dated September 15. AR, Tab 2, COS, at 2. Each letter began with an identical paragraph advising offerors of the disparity in the prices received, and that the agency considered this disparity to be "constructive notice of the possibility of a mistake." AR, Tab 6, Air Force Letter Opening Discussions, at 1. Therefore, all offerors were urged to critically and carefully examine the constitution of your proposal, the elements from which you derived your unit prices . . . and the mathematical calculations contained therein to ensure that your offer is based upon the Government's requirements as stated in the solicitation and Amendments 0001 and 0002 thereto as well as the additional information notices subsequently added to the www.fedbizopps.gov website. In accordance with those postings please ensure that your submitted unit prices DO NOT include the cost of titanium forgings and associated allowable and allocable G&A for that material. Id. at 3.