Criterion Corporation

The procurement

Base operations support services at Homestead Air Reserve Base, Florida, under an IDIQ contract with fixed-price, time-and-material, and cost-reimbursable orders. Step one screened prices for completeness, fairness, reasonableness, balance and, if necessary, realism. Step two looked at technical acceptability starting with the lowest price, then selected the best combination of price and past performance.

The protest

Criterion argued that the Air Force unreasonably excluded its proposal as unrealistically low. The agency compared Criterion's staffing count and price to the second-low offeror's, but never examined Criterion's own labor mix or how it planned to use its workforce to do the work.

The agency’s answer

The Air Force said it did examine Criterion's technical approach. Criterion proposed more full-time equivalents than the next-lowest offeror at a much lower price, with labor rates only marginally lower on average. The price analyst concluded it was unrealistic to think Criterion could propose more FTEs for much less and still accomplish the scope of work.

What decided it

The realism analysis had to account for the offeror's own labor mix and staffing approach, not just its FTE count and price.

GAO found that the record did not show the Air Force considered Criterion's labor mix, labor utilization strategy, or whether its FTEs and labor categories could realistically support each performance work area at its unit prices. Without that, the comparison to the second-low offeror was not apples-to-apples. GAO recommended a new price realism evaluation that considers whether Criterion's price shows a misunderstanding of the requirements or inordinate performance risk, plus reimbursement of Criterion's protest costs.