Perimeter Security Partners, LLC

B-417591 Aug 19, 2019 Jump To VIEW DECISION DOWNLOADS RELATED PAGES GAO CONTACTS Highlights Perimeter Security Partners, LLC (PSP), a small business, of Brentwood, Tennessee, protests the cancellation of invitation for bids (IFB) No. W912DR-18-B-0005, issued by the Department of the Army, Corps of Engineers (Corps), for the construction of an access control point in Fort Meade, Maryland. PSP contends the Corps improperly concluded the bid prices received were unreasonable, cancelled the IFB, and converted the procurement to a negotiated procurement pursuant to Federal Acquisition Regulation (FAR) § 14.404-1(e)(1). We deny the protest. View Decision DOCUMENT FOR PUBLIC RELEASE The decision issued on the date below was subject to a GAO Protective Order. This version has been approved for public release. Decision Matter of:  Perimeter Security Partners, LLC File:  B-417591 Date:  August 19, 2019 David A. Rose, Esq., Rose Consulting, LLC, for the protester. Maureen A. McAndrew, Esq., and Raymond Schlee, Esq., Department of the Army, for the agency. Christopher Alwood, Esq., Evan D. Wesser, Esq., and Edward Goldstein, Esq., Office of the General Counsel, GAO, participated in the preparation of the decision. DIGEST Protest challenging the cancellation of an invitation for bids after bid opening and conversion to a negotiated procurement is denied where the agency reasonably found that the sealed bid prices were unreasonable where the low bid exceeded the government’s independent estimate by 23.5 percent. DECISION Perimeter Security Partners, LLC (PSP), a small business, of Brentwood, Tennessee, protests the cancellation of invitation for bids (IFB) No. W912DR-18-B-0005, issued by the Department of the Army, Corps of Engineers (Corps), for the construction of an access control point in Fort Meade, Maryland.  PSP contends the Corps improperly concluded the bid prices received were unreasonable, cancelled the IFB, and converted the procurement to a negotiated procurement pursuant to Federal Acquisition Regulation (FAR) § 14.404-1(e)(1). We deny the protest. BACKGROUND The Corps issued the IFB on June 15, 2018, pursuant to the two step sealed bidding procedures of FAR part 14, as a small business set-aside that contemplated the award of a fixed-price contract for construction of the Reece road access control point in Fort Meade, Maryland.  The deadline for submission of bids for step one was July 24.  Agency Report (AR), Tab 3, IFB amend. 2, at 1-2.  The agency received five timely step-one bids, and the contracting officer subsequently determined that three bidders would advance to step two.  AR, Tab 4, Down Select Memorandum, at 3.  The deadline for submission of bids for step two was March 20, 2019 at 2:00 p.m.  AR, Tab 7, IFB amend. 5, at 1. The agency received three timely step-two bids, including from PSP.  Combined Contracting Officer’s Statement/Agency Memorandum of Law (COS/MOL) at 1.  The bids, and the agency’s independent government estimate (IGE), were as follows: Bidders Total Bid Perimeter Security Partners $26,505,208 Akima Construction Services $26,508,587 AMG JV $26,520,611 IGE $21,460,936   AR, Tab 11, Bid Abstract. On April 23, the contracting officer concluded that all of the bids were unreasonably high because they exceeded the IGE by between 23.5 and 23.58 percent.  AR, Tab 13, Memorandum for Record, at 2.  The contracting officer also decided that it was in the best interest of the government to cancel the IFB and complete the procurement through negotiation in accordance with FAR § 14.404-1(e)(1).  Id.  The Corps sent a letter to PSP dated May 10, which advised that all three bids had been determined to be unreasonable since they exceeded the IGE by “25.0% or more.”  AR, Tab 14, Letter Cancelling Invitation for Bids, at 1.  The letter also informed PSP that the Corps was cancelling the IFB and would attempt to complete the procurement through negotiation.  Id.  PSP submitted this protest to our Office on May 20.  DISCUSSION PSP argues that the contracting officer improperly concluded that the bid prices received were unreasonable, and therefore lacked a compelling reason to cancel the IFB as required by FAR § 14.404-1(a)(1).  Protest at 6.  For the reasons that follow, we find no basis on which to sustain the protest.[1] Once bids have been opened, award must be made to the responsible bidder who submitted the lowest responsive bid, unless there is a compelling reason to reject all bids and cancel the IFB.  FAR § 14.404-1(a)(1).  One such compelling reason an IFB may be canceled after bid opening is when the prices of all otherwise acceptable bids are unreasonable.