4H Construction Corporation

B-413558.4 Feb 08, 2017 Jump To VIEW DECISION DOWNLOADS RELATED PAGES GAO CONTACTS Highlights 4H Construction Corporation, of Cleveland, Mississippi, protests the actions of the Department of the Army, Corps of Engineers, in connection with solicitation No. W9127S-16-B-0001, issued to acquire dredging services. 4H argues that the agency unreasonably has determined to convert the acquisition from a sealed bid procurement to a negotiated procurement based on a finding that the prices received in response to the invitation for bids (IFB) were unreasonably high. We dismiss the protest. We dismiss the protest. View Decision Decision Matter of:  4H Construction Corporation File:  B-413558.4 Date:  February 8, 2017 S. Leo Arnold, Esq., Ashley, Ashley & Arnold, for the protester. James W. Cullum, Esq., Department of the Army, Corps of Engineers, for the agency. Scott H. Riback, Esq., and Tania Calhoun, Esq., Office of the General Counsel, GAO, participated in the preparation of the decision. DIGEST Protest challenging propriety of government estimate is dismissed for failure to diligently pursue the information necessary to raise the allegation where record shows that protester was afforded an opportunity to exchange its bid estimate information with the agency’s government estimate information but the protester declined to make the exchange. DECISION 4H Construction Corporation, of Cleveland, Mississippi, protests the actions of the Department of the Army, Corps of Engineers, in connection with solicitation No. W9127S-16-B-0001, issued to acquire dredging services.  4H argues that the agency unreasonably has determined to convert the acquisition from a sealed bid procurement to a negotiated procurement based on a finding that the prices received in response to the invitation for bids (IFB) were unreasonably high. We dismiss the protest. The agency issued an IFB to obtain dredging services for a base year and two 1‑year options.  In response to the IFB, the agency received three timely bids by the July 28, 2016, bid opening date, including the bid of the protester, which was the low bid received.  Agency Report (AR) exh. 11, Bid Abstract.  After reviewing the bids, the agency determined that all three were unreasonably high priced, and that it could not make award on the basis of the bids submitted.  In this connection, the record shows that the agency made its determination regarding the unreasonableness of the prices by comparing them to a government estimate prepared by the agency.  The record shows that the government estimate for the work was $13,927,205.  AR, exh. 22, Independent Government Estimate at 3.  In comparison, 4H’s bid was $18,332,000, and the other two bids were for $19,279,250 and $21,564,150 respectively.  AR, exh. 11, Bid Abstract.  Because all three bids exceeded the government estimate by more than 25 percent, the agency concluded that they were unreasonably high and that award could not be made to any of the bidders.[1] On August 8, 4H submitted a letter to the agency protesting the agency’s conclusion that all three bids submitted were unreasonably high.  AR, exh. 9.  4H’s letter generally challenged the realism of the government estimate, but did not identify any particular basis for its assertion that the estimate was unrealistically low.[2]  Rather, its assertion in its entirety provided only as follows:  “On behalf of 4H, I hereby protest the government estimate as unreasonably low.  4H’s bid price would be well within 125 percent of the government estimate if the estimate contained reasonable costs for performance.”  AR, exh. 9, 4H Agency Level Protest, at 1.  In response to the protester’s August 8 letter, the agency wrote to 4H on August 15.  AR, exh. 15.  By that letter, the agency requested that 4H provide the agency with the complete details of its bid estimate in accordance with the requirements of the U.S. Army Corps of Engineers Acquisition Instructions (UAI).  The specific provision of the UAI pertinent to the protest is § 33.103-101, which provides as follows: If, after bid opening, an apparent low bidder protests the reasonableness of the Government estimate, the contracting officer shall provide the details of the Government estimate to the protester upon receipt of complete details of the protester’s estimate.  The details of the Government and protester’s estimates are not to be disclosed to third parties. In response to the agency’s request, 4H specifically declined to provide its bid estimate documents.  4H’s counsel stated as follows: My understanding of UAI [§ ]33.103-101 is that the protestor must provide the details of its bid estimate in order to obtain a copy of the details of the independent government estimate (“IGE”).  4H has not requested a copy of the details of the IGE at this time, so I do not believe it is necessary or required that 4H provide you with the details of its bid estimate. AR, exh. 16, 4H Letter, Aug.