MGM Computer Systems, Inc. (36C26124Q0444)

B-422741 Oct 16, 2024 Jump To VIEW DECISION DOWNLOADS RELATED PAGES GAO CONTACTS Highlights MGM Computer Systems, Inc., a service-disabled veteran-owned small business (SDVOSB) located in Galloway, New Jersey, protests the cancellation of request for quotations (RFQ) No. 36C26124Q0444, issued by the Department of Veterans Affairs (VA) for a patient elopement wander management system at the VA Central California Healthcare System in Fresno, California. The protester contends the agency lacked a reasonable basis to cancel the solicitation. We deny the protest. View Decision Decision Matter of: MGM Computer Systems, Inc. File: B-422741 Date: October 16, 2024 Michael Maurer for the protester. Natica Chapman Neely, Esq., Department of Veterans Affairs, for the agency. Kasia Dourney, Esq., and Alexander O. Levine, Esq., Office of the General Counsel, GAO, participated in the preparation of the decision. DIGEST Cancellation of request for quotations was reasonable where the only quotation being considered was substantially higher-priced than the agency’s available funding. DECISION MGM Computer Systems, Inc., a service-disabled veteran-owned small business (SDVOSB) located in Galloway, New Jersey, protests the cancellation of request for quotations (RFQ) No. 36C26124Q0444, issued by the Department of Veterans Affairs (VA) for a patient elopement wander management system at the VA Central California Healthcare System in Fresno, California. The protester contends the agency lacked a reasonable basis to cancel the solicitation. We deny the protest. BACKGROUND On March 6, 2024, the VA published the RFQ on the System for Award Management website as a set-aside for SDVOSBs, under the commercial item acquisition and simplified acquisition procedures of Federal Acquisition Regulation (FAR) parts 12 and 13. Agency Report (AR), Exh. 2, RFQ at 1, 44. The solicitation contemplated the award of a fixed-price contract for the WanderGuard BLUE patient elopement wander management system or an equivalent system. Id. at 1. The solicitation provided that award would be made to the responsible vendor whose quotation, conforming to the RFQ, would be the most advantageous to the government, considering the following factors: (1) price; (2) capability of proposed system (if other than the brand name system); and (3) an authorized distributor letter issued by the original equipment manufacturer (OEM) within the past year.[1] Id. at 39, 44-45. The RFQ instructed that quotations would be evaluated using a “comparative evaluation” process pursuant to FAR section 13.106-2(b)(3), to determine which quotation provided the best value to the government. Id. at 44. The solicitation advised that before conducting the comparative evaluation, the agency would first screen quotations for completeness and conformance with the RFQ requirements; only complete and conforming quotations were to be evaluated by the VA. Id. As relevant to this protest, the funding available for this procurement was $110,000. AR, Exh. 6, Funding Document at 3. The agency’s independent government cost estimate (IGCE) also amounted to $110,000. Contracting Officer’s Statement (COS) ¶ 7. The VA received two quotations in response to the solicitation, including one from MGM. Id. ¶ 4. During the initial evaluation of quotations, the agency rejected the one quotation received from a firm other than MGM because the agency found it to be incomplete. Id. ¶ 5. MGM’s quotation included an authorized distributor letter from CenTrak, the OEM for MGM’s quoted system, which was dated October 16, 2019. Id. ¶ 6; AR, Exh. 3, MGM’s Quotation at 25. Although MGM’s distribution letter did not comply with the RFQ’s instructions--per the terms of the solicitation it had to be issued within one year and MGM’s letter was more than four years old--the VA did not note the problem during the compliance check and proceeded with evaluating MGM’s quotation.[2] COS ¶ 12. After completing its evaluation, the agency concluded that MGM’s quotation met “all specifications,” however, the agency had concerns about the reasonableness of MGM’s price. AR, Exh. 4, Technical Evaluation at 1. Specifically, the contracting officer contacted MGM via email, stating that: VA is having a difficult time determining your quot[ation] to be priced fair and reasonable. The quot[ation] is priced significantly higher than our [IGCE] and your [contract line item number] pricing exceeds appropriated funding that the VA has allocated for this action. AR, Exh. 5, Email Exchanges Between MGM and Agency at 10. The contracting officer then asked if the protester could provide “any discounts” to its price of $272,174. Id.; see also AR, Exh. 3, MGM’s Quotation at 17. In response, MGM submitted a revised quotation and reduced its price to $248,174. AR, Exh.