Carl R. Jones Excavating & Hauling, LLC (W912EQ21B0001)

B-419717.4 Jul 29, 2021 Jump To FULL REPORT VIEW DECISION RELATED PAGES GAO CONTACTS Highlights Carl R. Jones Excavating & Hauling, LLC (CRJ), of Fredericktown, Missouri, protests the cancellation of invitation for bids (IFB) No. W912EQ21B0001, issued by the Department of the Army, Corps of Engineers (Corps), for construction services. The protester alleges the Corps improperly canceled the IFB after sealed-bid opening. 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 redacted version has been approved for public release. Decision Matter of:  Carl R. Jones Excavating & Hauling, LLC File:  B-419717.4 Date:  July 29, 2021 Boris A. Kaupp, Esq., McCarthy, Leonard & Kaemmerer, L.C., for the protester. Thomas J. Warren, Esq., and Edward J. McNaughton, Esq., Department of the Army, for the agency. Young H. Cho, Esq., and Peter H. Tran, Esq., Office of the General Counsel, GAO, participated in the preparation of the decision. DIGEST Protest challenging agency’s cancellation of invitation for bids (IFB) after bid opening is denied where the agency has a compelling reason to cancel the IFB because the solicitation did not accurately state the agency’s actual needs and would have restricted competition. DECISION Carl R. Jones Excavating & Hauling, LLC (CRJ), of Fredericktown, Missouri, protests the cancellation of invitation for bids (IFB) No. W912EQ21B0001, issued by the Department of the Army, Corps of Engineers (Corps), for construction services.  The protester alleges the Corps improperly canceled the IFB after sealed-bid opening. We deny the protest. BACKGROUND The IFB, issued on November 3, 2020 under Federal Acquisition Regulation (FAR) part 14 and set aside for small businesses, contemplated the award of a single, fixed-price contract with a performance period of 665 days after the notice to proceed, for a project referred to as the Below Kennett Seepage Remediation Project.[1]  Protest at 2, Agency Report (AR), Tab 4, IFB at 1.[2]  The Corps received and opened 11 sealed bids on January 8, 2021.  COS at 1. CRJ submitted the second lowest-price bid.  Id.  Upon review of the three lowest bids, the contracting officer had concerns that the discrepancy in prices between the independent government estimate (IGE) and these bids could have indicated a lack of understanding of the requirements, representing an unreasonable risk to the government.[3]  Id. at 2.  The contracting officer analyzed the bid prices and concluded that the low bid prices of the lowest priced-bidder (Young’s General Contracting, Inc. (YGCI)) and CRJ were not “fair and reasonable."[4]  Id.  The contracting officer found these bidders were ineligible for award and disqualified them, without referring them to the Small Business Administration (SBA).  Id.  The agency found the third lowest-bidder’s price--which was 20.37% below the IGE--to be “fair and reasonable.”  Id.  As a result, the Corps made award to Medvolt Construction Services on March 23.  Id. YGCI and CRJ, separately, filed protests with our Office challenging the award to Medvolt; the protests were docketed as B-419717 and B-419717.2, respectively.  Among the allegations asserted by the protesters were:  (1) the Corps performed an impermissible price realism analysis; and (2) that finding a bidder’s price was too low relates to the issue of responsibility, and the contracting officer was, therefore, required to refer the disqualified small businesses to the SBA for a final determination.  On April 9, the agency advised that it would take corrective action by terminating the award, canceling the IFB, and resoliciting.  See generally AR, Tab 12, Agency Notice of Corrective Action. The agency’s notice of corrective action detailed its rationale for canceling the solicitation.  The Corps explained that, in reviewing the protest allegations, it discovered a patent ambiguity in the solicitation that resulted in an IFB that did not reflect the agency’s actual needs.  Id. at 1.  Specifically, while the solicitation stated that it was set aside for small businesses, the IFB also:  (1) advised bidders to review FAR clause 52.219-27, Notice of Service-Disabled Veteran-Owned Small Business Set-Aside (SDVOSB); and (2) included FAR clause 52.219-3, Notice of Historically Underutilized Business Zone (HUBZone) Set-Aside or Sole Source Award.  Id. at 1-2.  The agency represented that it was not the Corps’s intent to limit competition only to small businesses that qualified as both SDVOSB and HUBZone small business concerns.  Id.