A contracting agency need only establish a reasonable basis to support a decision to cancel an RFQ; in this regard, so long as there is a reasonable basis for doing so, an agency may cancel a RFQ no matter when the information precipitating the cancellation first arises, even if it is not until quotations have been submitted and evaluated. Quality Tech., Inc., B-292883.2, Jan. 21, 2004, 2004 CPD para. 29 at 2-3; DataTrak Consulting, Inc., B-292502 et al., Sept. 26, 2003, 2003 CPD para. 169 at 5. DISA maintains that it canceled the RFQ to co-sponsor the conference with AFCEA because it was in the best interest of the government to continue its relationship with AFCEA. DISA explains that the purpose of the conference is to promote a technical exchange between government and industry, to inform the government of industry initiatives and their possible relevance to the DISA mission, and to discuss with industry the agency’s plans and concerns regarding its existing programs. DISA contends that its relationship with AFCEA is beneficial because the functions of the AFCEA organization are directly related to DISA’s mission and because the large AFCEA membership includes both corporations and individuals that have an interest in the agency’s mission. DISA also states that AFCEA can bring a level of technical expertise to the planning of the conference that a support contractor cannot provide. Under the RFQ, a vendor would help select a conference site and hotel, and would provide conference management support necessary to implement the conference. In contrast, the Memorandum of Agreement (MOA) between DISA and AFCEA anticipates that AFCEA will be involved in substantive aspects of the conferences, to include development of the conference program, as well as matters of scope, theme, agenda and speakers. As a result, DISA argues that co-sponsorship of the conference with AFCEA enhances the quality of the conference for both government and non-government attendees. Finally, the agency maintains that the JER provides the agency with authority to enter into co-sponsorship arrangements for conferences with recognized scientific, technical, educational or professional organizations. We have reviewed the record here and we see no basis to question the agency’s decision that its conference needs would be better satisfied by continuing its co-sponsor relationship with AFCEA. Moreover, we note that the JER anticipates this kind of relationship and recognizes that such co-sponsors can add to the substance of the event and also provide substantial logistical support. JER, DOD 5500.7-R, sect. 3-206. (National Conference Services, Inc. and Direct Marketing Productions, Inc. d/b/a Technology Forums, Inc., B-311137, April 25, 2008) (pdf)

In a negotiated procurement, an agency has broad authority to decide whether to cancel a solicitation, and to do so need only establish a reasonable basis. The Borenstein Group, Inc., B-309751, Sept. 26, 2007, 2007 CPD para. 174 at 3. We have found a reasonable basis for the cancellation of an RFP exists where an agency discovers an existing contract for its requirement that would be more advantageous to the government than continuing with the procurement. See Astronautics Corp. of Am., B-222414.2, B-222415.2, Aug. 5, 1986, 86-2 CPD para. 147 at 2-3. So long as there is a reasonable basis, an agency may cancel a solicitation no matter when the information precipitating the cancellation first arises, even if it is not until proposals have been submitted and evaluated. Daston Corp., B-292583, B-292583.2, Oct. 20, 2003, 2003 CPD para. 193 at 3.  Mr. Scott contends that the I-BIZ executive agent services are outside the scope of the BBA-SME contract. Specifically, the protester contends that the BBA-SME contract provides for only “expert and advisory services, with no responsibility for nothing, not for Executive Agents, who are responsible for program success.” Protester’s Supplemental Comments at 9.  We disagree with Mr. Scott that the executive agent services solicited by the RFP are not within the scope of the BBE-SME contract. As noted above, the RFP sought a bilingual individual with a secret security clearance and experience to provide expert advice, assistance and guidance with respect to establishing I-BIZ initiatives. In addition, the RFP described the executive agent’s services as including “recommend[ing] policy and at the direction of [Multi-National Forces - Iraq], initiate Iraqi First and I-BIZ requirements to address theater wide economic issues.” RFP, SOW, para. 4.1. Similarly, the BBA-SME contract sought bilingual, experienced subject matter experts, most of which were required to have a secret or interim secret clearance to “assess, advice, and assist commanders in developing and implementing action plans for specific tasks.” BBA‑SME Contract, SOW, at 2. The contracts identified the areas in which possible tasks could be performed as including economic development and commerce; business development/contracting; and urban planning/infrastructure engineering. Id. at 9-11. We find from our review that the fairly broad scope of the BBA-SME contract statement of work includes the advice and assistance services sought by the RFP here.  We also find reasonable the agency’s conclusion that it would be more advantageous to obtain the executive agent services under the existing BBA-SME contract rather than continuing with its procurement under this RFP. As noted above, the agency found that the protester’s and the other offeror’s proposals were deficient, and in particular that Mr. Scott’s proposal did not demonstrate that he would satisfy the RFP’s experience, Arabic language, and security clearance requirements. See Contracting Officer’s Statement at 2. Although Mr. Scott disagrees with the agency’s evaluation, he does not establish that the agency’s concerns with his and the other offeror’s proposals did not provide the agency with a reasonable basis to conclude it would be more advantageous to use its existing contract to satisfy these requirements. In addition, the agency concluded that obtaining these services from the BBA-SME contract, rather than under the RFP, could result in cost savings and would relieve the agency of having to administer two contracts.  (Brian X. Scott, B-310970; B-310970.2, March 26, 2008) (pdf)

After Para Scientific challenged issuance of the order under that solicitation, the contracting officer reviewed the entire contract file and determined that there were significant problems with the solicitation that warranted cancellation. AR at 7. The contracting officer determined that the agency had (1) neglected to develop a sole source justification memorandum, (2) included technical evaluation criteria in the solicitation but had intended an award based solely on price, (3) included language in the solicitation that could suggest that “or equal” products would be considered even though the solicitation was issued as brand-name only, and (4) failed to permit a split-award where two disparate items were being solicited. Id. In light of these issues and Para Scientific’s offer of “or equal” products, the contracting officer decided to cancel the solicitation, perform additional market research, and if a brand name or equal solicitation were warranted, issue a new solicitation including salient characteristics and all appropriate contract clauses. Id. at 8. After conducting this comprehensive review of solicitation No. N00259-07-T-0361, the contracting officer realized that the same serious concerns existed with regard to solicitation No. N00258-08-T-0005. SAR at 6. The contracting officer therefore cancelled solicitation No. N00258-08-T-0005 based on the same rationale: that it was prudent to investigate whether the specifications could be less restrictive, and if a brand name or equal solicitation were warranted, issue a new solicitation including salient characteristics and all appropriate contract clauses. Id. at 6-7. Para Scientific asserts that the reasonable course of action for the agency was not to cancel the solicitations, but rather to issue orders to Para Scientific on the basis of its lowest priced quotations of technically equal alternative products. Para Scientific argues that it is being “shunned for being creative” in offering more economical “or equal” products where other firms merely offered the brand-name products. Protest, Nov. 9, 2007, at 2. In response, the agency asserts that it could not have properly issued orders to Para Scientific under the solicitations as written, and argues that its decision to cancel the solicitations was reasonable in view of the contracting officer’s determination that each solicitation materially overstated the agency’s requirements and that the agency could obtain enhanced competition by relaxing the requirements. We agree.

A contracting agency need only establish a reasonable basis to support a decision to cancel an RFQ, Surgi-Textile, B-289370, Feb. 7, 2002, 2002 CPD para. 38 at 2, and may cancel no matter when the information precipitating the cancellation first arises, even if it is not until offers (or, as here, quotations) have been submitted and evaluated. A-Tek, Inc., B-286967, Mar. 22, 2001, 2001 CPD para. 57 at 2-3. A reasonable basis to cancel exists when a new solicitation presents the potential for increased competition or cost savings. Robertson Leasing Corp., B-275152, Jan. 27, 1997, 97-1 CPD para. 49 at 3. Therefore, cancellation of a solicitation is proper where the solicitation materially overstates the agency’s requirements and the agency desires to obtain enhanced competition by relaxing the requirements. Id. Here, Para Scientific’s own argument that its alternative products were technically equal to the agency’s requirements supports the reasonableness of the agency’s decision to cancel the solicitations, given that the solicitations were written as brand-name only requirements. Because the record reflects that the solicitations’ brand-name only requirements may have been overly restrictive, and because the agency identified multiple other flaws in the two solicitations, we find that the agency’s decision to cancel the solicitations was proper. (Para Scientific Company, B-310742.2; B-310903, February 14, 2008) (pdf)

SuperTec protests, among other things, that the agency’s cancellation of RFQ No. 2007Q-025 was merely a pretext to avoid conducting a competitive procurement and resolving a potential bid protest. Because we find, based on the specific facts presented, that the cancellation was improper, we sustain the protest on this basis. We recognize that contracting agencies generally enjoy broad discretion in determining whether to cancel a solicitation, and need only have a reasonable basis for doing so. See, e.g., Surgi-Textile, B-289370, Feb. 7, 2002, 2002 CPD para. 38 at 2; Encore Management, Inc., B-278903.2, Feb. 12, 1999, 99-1 CPD para. 33. In this regard, a contracting agency’s determination that the integrity of a procurement has been compromised may form a reasonable basis for cancellation. See Federal Acquisition Regulation (FAR) sect. 3.104-7. Nonetheless, where a protester has alleged that an agency’s rationale for cancellation is but a pretext, that is, the agency’s actual motivation is to avoid awarding a contract on a competitive basis or to avoid resolving a protest, we will closely examine the reasonableness of the agency’s actions in canceling the acquisition. Gonzales-McCaulley Inv. Group, Inc., B‑299936.2, Nov. 5, 2007, 2007 CPD para. 192 at 5; SMF Sys. Tech. Corp., B-292419.3, Nov. 26, 2003, 2003 CPD para. 203 at 4-6; Miller, Davis, Marter & Oper, P.C., B-242933, B‑242933.2, Aug. 8, 1991, 91-2 CPD para. 176 at 4. Further, in considering a protest raising that concern, we view an agency’s discretion, though broad, as not unfettered. In that regard, the overarching guidance of the FAR has direct relevance:

Government business shall be conducted in a manner above reproach and, except as authorized by statute or regulation, with complete impartiality and with preferential treatment for none. Transactions relating to the expenditure of public funds require the highest degree of public trust and an impeccable standard of conduct. The general rule is to avoid strictly any conflict of interest or even the appearance of a conflict of interest in Government-contractor relationships.
FAR sect. 3.101-1.

Based on the record here, we conclude that the agency did not have a reasonable basis for canceling the RFQ. Specifically, as explained above, the COTR disclosed information to ManTech that she believed may have provided ManTech with an “unfair advantage.” Thereafter, the agency cancelled the procurement citing concerns about “the integrity of the pending procurement,” “potential organizational conflicts of interest,” and “a possible bid protest”--but then awarded a sole-source contract for the canceled requirements to a contracting team that included ManTech. Further, the sole-source award was based on a ManTech-developed proposal that was substantially similar to the earlier ManTech proposal for which the COTR suggested ManTech had obtained an “unfair advantage.” Nothing in the record indicates that the agency gave any consideration to whether its contract award to the TMR/ManTech team complied with statutory or regulatory requirements regarding procurement integrity or OCIs.[16] See, e.g., 41 U.S.C. sect. 423 (2000); Federal Acquisition Regulation (FAR) sect. 3.104; FAR Subpart 9.5. More importantly, in light of the integrity concerns expressed by the agency itself, the cancellation and subsequent sole-source award to the TMR/ManTech team did nothing to address, much less remedy, those concerns. In fact, the events, viewed as a whole, support the protester’s allegation that the solicitation was cancelled to, in effect, avoid further review of the issues raised. On this record, the agency did not have a reasonable basis for canceling the solicitation.

The protest is sustained.

RECOMMENDATION

We recommend that the agency rescind the cancellation notice regarding RFQ No. 2007Q-025, and document its consideration of the procurement integrity and/or OCI issues presented by the COTR’s disclosure of information, as contemplated by the procurement integrity provisions of the Office of Federal Procurement Policy Act, 41 U.S.C. sect. 423, and FAR sect. 3.104, and the OCI requirements of FAR Subpart 9.5. In this regard, the agency’s actions should include, but not necessarily be limited to, determining what information was disclosed and to whom, whether ManTech or any other offeror should be disqualified from the competition, and/or whether a level playing field can be established by disclosing the information provided to ManTech to all offerors. Following that consideration, the agency should conduct a competitive procurement for the requirements under the original RFQ, if otherwise appropriate. We also recommend that SuperTec be reimbursed its costs of filing and pursuing its protest, including reasonable attorneys’ fees. SuperTec should submit its certified claim for costs, detailing the time expended and costs incurred, directly to the agency within 60 days of receipt of this decision. 4 C.F.R. sect. 21.8(f)(1) (2007). (Superlative Technologies, Inc., B-310489; B-310489.2, January 4, 2008) (pdf)

Shortly after receiving GMIG’s comments, HHS requested dismissal of the protest based on a discovery that the acquisition had been conducted under a delegation of GETA authority that was not effective as to HHS-U. As previously stated, on April 14, 2003, the Deputy Assistant Secretary for Program Support in charge of PSC delegated to the Director of the Human Resources Service the authority to approve and acquire training through HHS-U under the GETA acquisition authority. AR, Sept. 10, 2007, Tab 3, Memorandum, Deputy Assistant Secretary for Program Support. However, by notice of November 23, 2001, PSC had ceased to be an OPDIV. 66 Fed. Reg. 58,740 (Nov. 23, 2001). Therefore, according to HHS, because the authority to redelegate GETA acquisition authority was based on PSC’s status as an OPDIV, the Deputy Assistant Secretary for Program Support did not, in 2003, have the authority to redelegate the approval or acquisition of training under GETA to the Director of the Human Resources Service. Thus, the agency asserted that HHS-U lacked the authority to conduct this acquisition. Because of this, it rescinded the selections and cancelled this solicitation. On August 7, our Office dismissed GMIG’s protest as academic due to the solicitation’s cancellation.  On August 8, GMIG protested that the GETA authority was operational at the time of GMIG’s selection and, alternatively, that the agency’s decision to cancel the solicitation was solely for the purpose of having its protest dismissed. In response, the agency argued that its decision to cancel was reasonable because the acquisition was unauthorized as it was conducted under an invalid delegation of acquisition authority and that the reason for cancellation was not pretextual. A contracting agency need only establish a reasonable basis to support a decision to cancel a request for quotations. SMF Sys. Tech. Corp., B-292419.3, Nov. 26, 2003, 2003 CPD para. 203 at 4. So long as there is a reasonable basis for doing so, an agency may cancel a solicitation, no matter when the information precipitating the cancellation first arises, even if it is not until quotations have been submitted and evaluated. Id. As here, however, where a protester has alleged that the agency’s rationale for cancellation is but a pretext to avoid awarding a “contract” on a competitive basis or to avoid the resolution of a protest, we will closely examine the reasonableness of the agency’s actions in canceling the solicitation. Id.; Griffin Servs., Inc., B-237268.2 et al., June 14, 1990, 90-1 CPD para. 558 at 3, aff’d, General Servs. Admin.--Recon., B-237268.3 et al., Nov. 7, 1990, 90-2 CPD para. 369. In cases where we conclude that the agency’s rationale for cancellation is merely a pretext, we will recommend appropriate corrective action. See Griffin Servs., Inc., supra, at 3-4; Miller, Davis, Marter & Opper, P.C., B-242933, B-242933.2, Aug. 8, 1991, 91‑2 CPD para. 176 at 4. Here, it appears from the record that HHS is correct in its assertion that the GETA acquisition authority had not been validly delegated to HHS-U. We believe that this lack of authority would ordinarily provide a reasonable basis to cancel a solicitation. However, based on our review of HHS’s actions here, we conclude that the cancellation of this solicitation was pretextual. The record shows that this was the only acquisition, out of the hundreds that had been conducted by HHS-U without properly delegated authority, that was cancelled when HHS became aware of the lack of authority, even though a number of the other HHS‑U acquisitions were ongoing. See AR, Oct. 12, 2007, Declaration of HHS Director, Division of Acquisition Policy, at 5. We recognize that HHS asserted in its response to our Office’s inquiry that it “expect[ed] and intend[ed] that HHS-U would cancel all outstanding requests for quotations for training services,” but that it apparently had not “adequately communicated [this] expectation” to HHS-U. Id. However, whether expected or not, this did not occur. Thus, we find on this record that HHS’s cancellation appears to be, as the protester contends, essentially a pretext to avoid further scrutiny and review of its protest. (Gonzales-McCaulley Investment Group, Inc., B-299936.2, November 5, 2007) (pdf)

In a negotiated procurement, an agency has broad authority to decide whether to cancel a solicitation, and to do so need only establish a reasonable basis. VSE Corp., B-290452.2, Apr. 11, 2005, 2005 CPD para. 111 at 6. A reasonable basis for the cancellation of an RFP exists when an agency discovers an existing contract for its requirement that would be more advantageous to the government than continuing with the procurement. See Astronautics Corp. of Am., B-222414.2, B-222415.2, Aug. 5, 1986, 86-2 CPD para. 147 at 2-3. In this case, OCAR discovered that an existing contract encompassed its requirements, determined that the existing contract was more advantageous than continuing with the planned negotiated procurement, and on that basis cancelled the RFP. We conclude that OCAR’s decision had a reasonable basis. Although it is unfortunate that an apparent lack of coordination at OCAR prevented this RFP from being cancelled earlier, an agency properly may cancel a solicitation no matter when the information precipitating the cancellation first surfaces or should have been known, even if the cancellation occurs after proposals have been submitted. Daston Corp., B-292583, B-292583.2, Oct. 20, 2003, 2003 CPD para. 193 at 3. (The Borenstein Group, Inc., B-309751, September 26, 2007) (pdf)

The Bureau of the Public Debt awards and administers contracts on behalf of Treasury’s FedSource branch offices, which operate as part of the agency’s franchise fund. The franchise fund primarily provides contracting services (including administrative and financial services) to federal agencies on a reimbursable basis. The RFP, issued on May 30, 2006, contemplated multiple awards of indefinite‑delivery/indefinite-quantity contracts for a base period, with 5 option periods, for support services to be provided under FedSource’s Administrative/ Clerical and Light Industrial business line. Work under the RFP was to be obtained through task orders that would specify the task, location, service to be provided, period of performance, and performance measures. RFP at 2. Cancellation is appropriate where an agency conducts a reassessment that suggests the solicitation may not reflect its needs, such that the agency is uncertain whether the requirement will exist in the future. Peterson-Nunez Joint Venture, B‑258788, Feb. 13, 1995, 95-1 CPD para. 73 at 4-5. This is the case here. BPD’s review brought into question whether it would continue to support FedSource; since this uncertainty could be resolved in favor of discontinuing the relationship--in which case the services covered by the RFP would no longer be required--it provided a reasonable basis for the agency to cancel the solicitation. While, as the protester argues, the services that would be provided under this contract will still be needed by customer agencies in the future, it is BPD’s need for these services to support the FedSource program--not the government’s needs as a whole--that is controlling for purposes of determining whether the cancellation was permissible. Again, since, based on BPD’s review, it was questionable whether the agency would continue to need the services under the RFP, the agency had a sufficient basis to cancel the solicitation. Id.; Dr. Robert J. Telepak, B‑247681, June 29, 1992, 92-2 CPD para. 4 at 4. (Global Solutions Network, Inc., B-299424, April 20, 2007) (pdf)

In a negotiated procurement, where one or more of the offerors’ prices have been revealed, an agency may properly cancel a solicitation where the record contains plausible evidence or reflects a reasonable possibility that a decision not to cancel would be prejudicial to the government or the integrity of the procurement system. Noelke GmbH, B-278324.2, Feb. 9, 1998, 98-1 CPD para. 46 at 3-4. Here, we conclude that the agency’s decision to cancel the solicitation was proper. First, the record shows that the agency’s needs had changed because it could no longer make good use of the phase-in and readiness provisions so late in the hurricane season and that any amendment to the solicitation to delete these requirements would have been so substantial that offerors could not have reasonably anticipated the changes. An agency has a reasonable basis to cancel a solicitation where, as here, it determines that a solicitation does not accurately reflect its needs. Logistics Solutions Group, Inc., B-294604.7, B-294604.8, July 28, 2005, 2005 CPD para. 141 at 3. Second, the agency states that, by waiting to reissue the solicitation to coincide with the start of the 2007 hurricane season, it could avoid paying start-up costs for base camps that would have seen limited use in the 2006 hurricane season. Cost savings through a restructuring of the agency’s requirements also constitute a reasonable basis to cancel a negotiated procurement, even after the agency has entered into negotiations with the potential awardee. Capitol Gateway Assocs. Ltd. P’ship, B-255587, Jan. 24, 1994, 94-1 CPD para. 37 at 2-3. Third, the agency asserts that its plan to eliminate the requirement that the offerors be prepared to operate five base camps simultaneously will increase competition by fostering the involvement of smaller firms capable of performing contracts of a more limited scope. The ability to enhance competition is a reasonable basis to justify the cancellation of the solicitation. Id. at 3. In fact, as the agency notes, when “an amendment proposed for issuance after offers have been received is so substantial as to exceed what prospective offerors reasonably could have anticipated,” and competition would be enhanced if the contacting officer canceled the solicitation and issued a new one, the agency is required to cancel the solicitation. Federal Acquisition Regulation sect. 15.206(e). In summary, the record supports the agency’s assertions that its decision to cancel rather than amend the solicitation will assist the agency in controlling costs and fostering competition through a solicitation that more accurately reflects the agency’s needs; each of these reasons supports a finding that the agency’s cancellation decision was proper. (SEI Group, Inc., B-299108, February 6, 2007) (pdf)

A contracting agency need only establish a reasonable basis to support a decision to cancel an RFP. In this regard, so long as there is a reasonable basis for doing so, an agency may cancel a solicitation no matter when the information precipitating the cancellation first arises, even if it is not until proposals have been submitted and evaluated. Glen/Mar Constr., Inc., B-298355, Aug. 3, 2006, 2006 CPD para. 117 at 2. Here, given that, as explained below, the agency was required to purchase the indicator control subassemblies from FPI, the agency acted reasonably in canceling the RFP. Agencies are required to purchase supplies manufactured by FPI where, after conducting market research, the agency determines that supplies produced by FPI are comparable to those of the private sector in terms of price, quality, and time of delivery. FAR sect. 8.602(a)(1), (3). While the record reflects that the agency did not consider FPI as a source for the indicator control subassemblies prior to issuance of the RFP, and thus did not conduct market research in advance of the RFP, upon realizing that FPI was a potential source for the indicator control subassemblies, the contracting officer properly took steps required by the FAR to determine whether FPI’s item was comparable to that of the private sector in terms of price, quality, and time of delivery. Upon concluding that they were comparable, the contracting officer was required to purchase the subassemblies from FPI and cancel the RFP. To the extent the protester argues that the RFP should have been issued as a HUBZone set-aside, the argument is without merit. FAR sect. 8.602(a)(3) specifically provides that where an FPI item is determined to be comparable, the agency “shall . . . purchase the item from FPI.” An agency may only acquire an item produced by FPI using “competitive procedures,” including the HUBZone set-aside procedures set forth under FAR Subpart 19.13, where the agency determines that the FPI item is not comparable in one or more of the areas of price, quality, and time of delivery. FAR sect. 8.602(a)(4); FAR sect. 19.1304(a)(1) (stating that the HUBZone provisions do not apply to requirements that can be satisfied through award to FPI). Since the contracting officer’s market research indicated that FPI’s subassemblies were comparable in all respects, setting aside the requirement for HUBZone small business concerns was not an option for procuring the items.  (Management Solutions, L.C. d/b/a EssTech Engineering, B-298883; B-298883.2, December 13, 2006) (pdf)

Starlight Corporation, Inc. protests that the Department of the Air Force improperly canceled request for proposals (RFP) No. FA4479-05-R-0001, for aircraft services at McChord Air Force Base, Washington. The agency now concedes that the solicitation could be read as requiring this experience, even though it did not intend this to be the case. The agency states that so long as the offeror demonstrated in its proposal that it had the capability of performing these services it should be considered technically acceptable. In this regard, the agency expresses concern that given the emphasis on experience in the solicitation, offerors without experience may have been discouraged from submitting proposals, even though they may have otherwise been able to submit technically acceptable proposals. As indicated by the above discussion, our review of the record confirms the agency’s conclusion that the solicitation was either ambiguous with regard to whether experience was required, or overstated the agency’s minimum needs by requiring experience, when, in fact, what the agency intended to require was for the offeror to demonstrate in its proposal that it had the capability of performing these services in order to be found acceptable.[4] While the protester states that there is no evidence that competition was inhibited by the potential requirement that certain experience was required given the large number of proposals submitted, the record evidences that Empire may have prepared its proposal with the belief that the competition was with offerors who had this experience, and we, therefore, find the competition may have been prejudiced by this ambiguity. (Starlight Corporation, Inc., B-297904.2, April 14, 2006) (pdf)

Regarding the firm’s challenge to the agency’s cancellation of the procurement, in a negotiated procurement, such as here, a contracting agency need only establish a reasonable basis to support a decision to cancel an RFP. PBSI Corp., B-227897, Oct. 5, 1987, 87-2 CPD para. 333 at 2. It is well established that an agency’s lack of funding for the procurement provides a reasonable basis for its cancellation, as agencies cannot award contracts which exceed available funds. Quality Support, Inc., B-296716, Sept. 13, 2005, 2005 CPD para. 172 at 2. Here, the agency explains that the protester’s proposed price substantially exceeds the agency’s funding for the project.[2] Accordingly, the cancellation clearly was reasonable, since an award was not possible within available agency funds. See First Enter., B-292967, Jan. 7, 2004, 2004 CPD para. 11 at 3. (Ystueta Inc., B-296628.4, February 27, 2006) (pdf)

A contracting agency need only establish a reasonable basis to support a decision to cancel a request for quotations. Quality Tech., Inc., B-292883.2, Jan. 21, 2004, 2004 CPD para. 29 at 2. An agency’s lack of funding for a procurement provides a reasonable basis for cancellation, as agencies may not award contracts that exceed available funds. Quality Support, Inc., B-296716, Sept. 13, 2005, 2005 CPD para. 172 at 2. Here, the agency states that funds for the procurement at issue have been withdrawn and the solicitation has been cancelled, and has submitted documents showing that the funds are no longer available. Under these circumstances, we have no basis to object to the cancellation. IVI contends that the lack of funding is a pretext and in fact the agency cancelled the solicitation in order to avoid addressing the issues in IVI’s initial protest. In this regard, we recognize that the notice posted on the FedBizOpps website announcing the cancellation states that the solicitation was cancelled “due to protest.” Even assuming, however, that the agency’s decision to withdraw funding and cancel the solicitation was triggered by the initial protest, we fail to see any basis to conclude that the cancellation was improper. The management of an agency’s funds generally depends on the agency’s judgment concerning which projects should receive funding and a contracting agency has the right to cancel a solicitation when, as a result of its allocation determinations, funds are no longer available. First Enters., B-292967, Jan. 7, 2004, 2004 CPD para. 11 at 3. In the absence of a showing of bad faith on an agency’s part in connection with a funding decision (which is neither alleged nor otherwise evident here), there is no basis to require an agency to go forward with a procurement which it has decided not to fund, even if the decision to cancel was prompted by a protest concerning the solicitation. See James M. Carroll—Recon., B-221502.3, Mar. 24, 1986, 86-1 CPD para. 290 at 3. Regarding the protester’s argument that funding for the requirement was withdrawn after--and thus could not have resulted in--cancellation of the solicitation, the order in which the two events occurred is irrelevant given that we will not recommend that an agency proceed with an acquisition for which no funding is available. See Greenway Enters., Inc., B-238943.2, May 4, 1990, 90-1 CPD para. 454 at 2. (Information Ventures, Inc., B-297815.2, February 13, 2006) (pdf)

As noted, a reasonable basis to cancel exists where a solicitation does not accurately reflect the agency’s requirements. The fact that NASA found that the RFP may not accurately reflect its requirements, and that it needed to fully consider and resolve questions regarding its LN2 requirements that were not considered at the time the RFP was issued, constituted a reasonable basis to cancel the RFP. While the protesters attack NASA’s motives as merely capitulating to political pressure on behalf of a particular constituent, we find nothing questionable about NASA responding appropriately to the concerns expressed by representatives of Congress, which has oversight authority. Based on our review of the record, NASA has established that it has legitimate reasons for reviewing its requirements before proceeding with this procurement and thus a reasonable basis to cancel the RFP while it does so. See Global Solutions Network, Inc., B-290107, June 11, 2002, 2002 CPD para. 98 at 3-5. Nevertheless, Kenco and Air Products question the timing of the agency’s decision to cancel, given that it was made after each had expended considerable resources to address the RFP, and because no mention was made to the offerors of the SCAP prior to the cancellation, and because all the agency’s prior studies concluded that building a LN2 plant was in the government’s best interest. The protesters argue that they should at least be entitled to recover their proposal preparation costs, given the agency’s actions. However, as long as an agency has a reasonable basis to cancel, it may properly cancel a solicitation no matter when the information precipitating the cancellation first surfaces or should have been known. See The Potomack Partnership, B-252860, Aug. 3, 1993, 93-2 CPD para. 75 at 4 (cancellation after receipt but without evaluating proposals); see also Global Solutions Network, Inc., supra (cancellation prior to receipt of proposals). Given that NASA promptly canceled the RFP when it learned that there were reasons for questioning its requirements, we have no reason to question the agency’s actions here. (Kenco Associates, Inc.; Air Product and Chemicals, Inc., B-297503; B-297503.2, January 25, 2006) (pdf)

While the agency has asserted several reasons for canceling the RFQ, it is well established that an agency’s lack of funding for a procurement provides a reasonable basis for cancellation, as agencies cannot award contracts which exceed available funds. First Enter., B-221502.3, Mar. 24, 1986, 86-1 CPD para. 290 at 3. While the VA concedes that the procurement was flawed and that there was a misunderstanding between the contracting officer and the program office as to this procurement, as discussed above, the record shows that there are no funds available for this requirement. Moreover, the contracting officer reports that, based on his discussions with the program office, it is not clear that the VA had any definite requirements for conferences at the time it issued the RFQ. The contracting officer states that he has again discussed this matter with the program office and the program office has confirmed that, in addition to a lack of funding, there is no current requirement for the conference planning and support services solicited under the RFQ. Supplemental Agency Report at 6. While we do not condone the program office’s apparently erroneous decision to prepare a procurement request that led to the issuance of this RFQ, nonetheless, the record does support the contracting officer’s decision to cancel the RFQ. (Quality Support, Inc., B-296716, September 13, 2005) (pdf)

The Air Force indicates here, however, that an MOA, which is an internal Air Force document, would not necessarily state every requirement stated in the RFP’s statement of work. In this regard, the Air Force advises that the Bandit Dining Facility where the 28th SVS Squadron serves the meals is a hardened facility, and that the Squadron is required to observe the Air Force’s own training and quality assurance requirements that are consistent with the RFP’s Statement of Work requirements. As noted above, the estimate for the hardened facility is expressly included in the government estimate. Moreover, Cattlemen’s has not rebutted the agency’s explanation or shown that any incremental quality assurance and training costs are not included in the government estimate. In addition, the Air Force indicates that the requirement that a private-sector contractor provide its own hardened facility, including electrical capacity, was necessary because the Bandit Dining Facility is a military facility currently in use for other operations, such that a contractor cannot use them to satisfy these RFP requirements, and because the safety factors related to wind velocity exceeding 60 miles per hour, with gusts between 80 and 90 miles per hour, in South Dakota require a hardened facility. Supplemental Agency Report at 1‑2. Thus, the protester’s reference to the omitted requirements in the MOA does not demonstrate that the government estimate was other than realistic and fair, or that the comparison of the estimate with the protester’s proposal was unequal or improper. In addition, we note that Cattlemen’s has not questioned any of the specific elements in the government estimate as understated, and on this record we have no basis to find that the estimate was other than realistic and fair. Under the circumstances, we believe the agency reasonably determined that the protester’s proposed price, as compared to the government estimate, was excessive, and that the agency therefore had a reasonable basis to cancel the RFP in order to obtain the services in-house.  (Cattlemen's Meat Company, B-296616, August 30, 2005) (pdf)

A contracting agency need only establish a reasonable basis to support a decision to cancel an RFQ; in this regard, so long as there is a reasonable basis for doing so, an agency may cancel a solicitation no matter when the information precipitating the cancellation first arises, even if it is not until quotations have been submitted and evaluated. Quality Tech., Inc., B-292883.2, Jan. 21, 2004, 2004 CPD para. 29 at 2-3; DataTrak Consulting, Inc., B-292502 et al., Sept. 26, 2003, 2003 CPD para. 169 at 5. It is well-established that lack of funding for a procurement provides a reasonable basis for cancellation, as agencies cannot award contracts which exceed available funds. First Enter., B-292967, Jan. 7, 2004, 2004 CPD para. 11 at 3-4; James M. Carroll--Recon., B‑221502.3, Mar. 24, 1986, 86-1 CPD para. 290 at 3. Further, an agency may properly cancel a solicitation due to funding limitations regardless of any challenge to the validity of the agency’s underlying cost estimate which, as in this case, served as the basis for the funding amount; as stated above, agencies simply cannot create obligations that exceed available funds. See National Projects, Inc., B‑283887, Jan. 19, 2000, 2000 CPD para. 16 at 4. Accordingly, given that all the quotations received here exceeded available funding for the work, we see no basis to question the propriety of the agency’s decision to cancel the RFQ. (Firetech Automatic Sprinkler, B-295882, May 4, 2005) (pdf)

Here, the record contains no evidence, or even argument, that the government or the integrity of the procurement system would be prejudiced if the RFP were not cancelled and award were made thereunder. VA’s only asserted basis for cancellation is that the RFP did not contain evaluation factors. However, where, as here, a negotiated procurement does not provide technical evaluation factors, award is to be made to the responsible offeror with the lowest-priced, technically acceptable offer. See Omatech Serv. Ltd., B-254998, B-254998.2, Dec. 17, 1993, 93‑2 CPD para. 329 at 3. Thus, the competition for award under the RFP was solely based on price. The agency does not assert that it will change any of its requirements but will issue an IFB, under which the sole basis for award is price, for the same requirements. Thus, since the basis for award under the RFP and IFB would be the same, the agency lacks a reasonable basis to cancel the RFP. Moreover, not only is neither the government nor the integrity of the competitive procurement system prejudiced by not cancelling the RFP here, but Rand & Jones, whose low competitive price for this same requirement has been been publicly disclosed, would be prejudiced if this requirement were recompeted on the basis of price. (Rand & Jones Enterprises Company, Inc., B-296483, August 4, 2005) (pdf)

Since it is apparent from the record that the agency's requirements have changed substantially from those solicited, we find the Army's decision to cancel and resolicit was reasonable. The protester's mere disagreement with the agency's otherwise reasonable bases for cancellation provides no basis to question the propriety of that cancellation. Nor is there any evidence in the record supporting the protester's contention that the proffered rationale for cancellation is merely a pretext by the agency to manipulate the procurement process because, as part of the October 21, 2004 corrective action, the agency had agreed to reevaluate proposals. Government officials are presumed to act in good faith and, where a protester contends that contracting officials are motivated by bad faith, it must provide convincing proof, since our Office will not attribute unfair or prejudicial motives to procurement officials on the basis of inference and suppositions. American Artisan Prods., Inc., B-292559, B-292559.2, Oct. 7, 2003, 2003 CPD paragraph 176 at 9; Chenega Mgmt., LLC, B-290598, Aug. 8, 2002, 2002 CPD paragraph 143 at 4. Here, other than innuendo, Logistics has provided no support for its bad faith allegation. In any event, an agency may cancel a solicitation no matter when the information precipitating the cancellation first arises. DataTrak Consulting, Inc. , B-292502 et al. , supra , at 5. To the extent Logistics argues that the Army should have amended rather than cancel the original solicitation, this argument is without merit. See Protester's Comments at 4-5. Federal Acquisition Regulation Section 15.206(e) requires the contracting officer to cancel the original solicitation and issue a new one, if an amendment would be so substantial as to exceed what prospective offerors reasonably could have anticipated. On the basis of the record before us, we think the changes in the agency's current minimum needs fall within this provision. See VSE Corp. , B-290452.2, Apr. 11, 2005, 2005 CPD paragraph 111. (Logistics Solutions Group, Inc., B-294604.7, B-294604.8, July 28, 2005) (pdf)

Here, we find that the record demonstrates that the agency reasonably decided to cancel this RFP. The reduced scope of work associated with severing certain requirements to avoid possibly improper bundling and the removal of the requirement to provide a storage facility, due to the GOCO, meant that the current RFP did not reflect the agency's requirements. In addition, because of the time which has elapsed from the initial issuance of the solicitation in March 2000 until the cancellation in December 2004, and the numerous changes made to the RFP during that period, we find that the agency's assumption that additional firms may well be interested in participating in a competition based on a solicitation reflecting the agency's current requirement, with the result that competition may be increased, is reasonable. Where, as here, a solicitation no longer accurately reflects an agency's requirements, and resolicitation could result in increased competition, the cancellation of the solicitation is appropriate. See Global Solutions Network, Inc. , supra . As detailed above, the CBP found that cancellation of the RFP was more feasible than issuing another amendment because it was still trying to resolve its responsibilities, as well as to determine the best method for procuring the requirement, given its reorganization and its failure to resolve with the TEOAF how this evolving requirement should be procured. Although VSE suggests otherwise, the numerous prior amendments to the RFP do not preclude the CBP from canceling the RFP. The only pertinent inquiry here is whether there existed a reasonable basis to cancel, since an agency may cancel at any time when such a basis is present. Since the record here reflects that there was a reasonable basis to cancel the RFP, we do not find that the agency abused its discretion, even though it may have taken a different course by further amending the RFP. See PBSI Corp., B-227897, Oct. 5, 1987, 87-2 CPD 333 at 2. In this regard, the CBP advises that it initially believed the changes could be addressed via amendments . . . since CBP and the offerors had already put so much effort into the solicitation but instead of continuing to try to force the agency's developing needs into the old solicitation with the full knowledge that scope-changing modifications and/or a termination for convenience are inevitable, the agency decided to cancel and re-evaluate the work. See Agency Report at 24-25. In any case, Federal Acquisition Regulation (FAR) 15.206(e) specifically advises that if, in the judgment of the contracting officer, based on market research or otherwise, an amendment proposed for issuance after offers have been received is so substantial as to exceed what prospective offerors reasonably could have anticipated, so that additional sources likely would have submitted offers had the substance of the amendment been known to them, the contracting officer shall cancel the original solicitation and issue a new one, regardless of the stage of the acquisition. Consistent with this regulation, and in light of the many significant amendments since initial proposals were obtained, the agency's decision to cancel and resolicit was the appropriate course to take. (VSE Corporation, B-290452.2, April 11, 2005) (pdf)

Here, we find that the cancellation of the RFQ was entirely appropriate. It is undisputed that the drawings upon which Supreme would rely in producing the light plates is at a lower revision level--level "AK"--than the level currently specified for this item. Although Supreme argues that the difference in revision level does not affect "fit, form or function," DCSR states that it does not know the impact, if any, of the difference in revision levels. In this regard, there is no information in the record regarding the difference between the two revision levels. Also, the RFQ failed to include the required DLA clause that instructs vendors offering alternate products to provide information and/or data to show that its product is interchangeable with the exact item specified in the solicitation. Under these circumstances, we find the agency reasonably cancelled the solicitation. Cancellation of the solicitation provides Supreme with an opportunity to determine whether it can offer the exact part sought by the agency--that is, a part manufactured to revision level "AL"--or to qualify an alternate part. (Supreme Edgelight Devices, Inc., B-295574, March 4, 2005) (pdf)

Here, we see no basis for GSA's decision to cancel the SFO. The agency has been unable to articulate how the alleged difference between the "price" and "percentage" methodologies supports its position that Greenlee may not have submitted the lowest price under this SFO. The two analyses GSA has provided in the record were both so flawed as to provide no support for the agency's position. First, GSA apparently relied on an analysis applying the offerors' base year discounts to a single8.63 item under partition work. That analysis was not representative of the work to be performed because it was based only on base year discounts and ignored the asbestos work required under the SFO. GSA's second analysis relied on a split between the partition and asbestos work that was grossly inconsistent with the split specified in the SFO. Even if we assume that there is a difference between a price-based methodology and a percentage-based one under the SFO, the agency has not furnished a reasonable price analysis to support the conclusion that the protester was not the lowest-priced offeror under either of those methodologies. Since the agency justified cancellation only on a claim that the two methodologies generated different results, and that claim was unsupported, the agency has failed to provide any basis for the cancellation. (Greenlee Construction, Inc., B-294338, October 26, 2004) (pdf)

Under FAR 15.206(e), where a contracting officer determines that an amendment to a solicitation requirement after offers have been received is so substantial as to exceed what prospective offerors reasonably could have anticipated, so that additional sources likely would have submitted offers had the substance of the amendment been known to them, the solicitation must be canceled and all interested firms given an opportunity to respond to the changed requirement. See The New Jersey & H St. Ltd. P'ship , B-288026, B288026.2, July 17, 2001, 2001 CPD 125 at 3-4. Our review of the record confirms that the challenged amendment falls outside of this provision as it is neither substantial nor beyond that which prospective offerors reasonably could have anticipated. (Government Contract Services Company, B-294367, October 25, 2004) (pdf)

To the extent that the protester is arguing that cancellation of the RFP is improper because the agency still intends to procure new equipment fielding services, its argument ignores the essence of the agency's justification for cancellation, which is that, in light of recent developments, including the shift to modularity, the agency's needs will not be met by contracting for new equipment fielding services separately from force modernization planning, unit set fielding, and configuration management services. In other words, the agency's justification for cancellation is not that new equipment fielding services are no longer required; it is that it has determined that its needs require the award of a single contract for a range of services rather than separate contracts for each type of service. According to the agency:

Fieldings, reconfiguration, [and] modernization will occur at many points in the [expeditionary] cycle and will not be the linear process as currently designed. That is why the separate functions of fielding, planning, management, configuration management, force modernization, and unit set fielding must be integrated under a single organization that provides unified command and control of the contractor assets and maximizes [the agency's] flexibility in shifting expertise across this spectrum of requirements. The synchronization of these efforts with installation, infrastructure, training, logistics, personnel and other key enablers will also be essential -- and is much broader than the vertical stove-pipe fielding only solution offers.

Contracting Officer's Statement, Sept. 14, 2004, at 2. Where, as we believe is the case here, an agency reasonably determines that an RFP does not accurately describe its needs, cancellation of the solicitation is appropriate. Source AV, Inc. , B-241155, Jan. 25, 1991, 91-1 CPD 75 at 3. (ELEIT Technology, Inc., B-294193.2, September 30, 2004) (pdf)

Here, we find that the Coast Guard had a reasonable basis to cancel the solicitation. As explained by the agency, and apparently conceded by the protesters, while the Coast Guard sought the submission by offerors of 12 different training meal menus, each consisting of breakfast, lunch and dinner, the solicitation did not clearly provide for this. Accordingly, the solicitation was flawed in this regard. Additionally, although the Coast Guard sought proposals that included detailed nutritional information for the food items comprising the menus in order for the agency to ensure that the nutritional needs of Coast Guard personnel would be met by the selected offeror, the agency reasonably concluded based upon its review of the RFP, and in light of the proposals received, that the RFP failed to adequately convey this to the offerors. We note that the agency's conclusion in this regard is consistent with the position of Watson and Rice in their initial protests to our Office, where they argued that the agency, in downgrading proposals that did not include specific nutritional information, was improperly imposing a requirement that was not set forth in the solicitation. Rice Protest, B-293861, at 4; Rice Protest, B-293861.3, at 3; Watson Protest, B293861.2, at 11. In sum, the solicitation failed to adequately set forth the agency's needs with regard to training meal menus and nutritional information regarding the menu items proposed, and the agency's cancellation of the solicitation is thus unobjectionable. In reaching this conclusion, we have considered Watson's argument that the cancellation of the solicitation was only a pretext, that is, that the agency's motivation in fact was to avoid awarding a contract on a competitive basis. Watson Comments at 4-5. We have closely examined the reasonableness of the agency's actions and, as set forth above, find the cancellation to be reasonable in light of the provisions of the solicitation that were, as conceded by Watson, ambiguous or requiring clarification. Id. at 10-14; see SMF Sys. Techs. Corp. , B292419.3, Nov. 26, 2003, 2003 CPD 203 at 4. For example, in arguing that the agency's evaluation of its proposal under the food/menus/table service evaluation subfactor was unreasonable, the protester comments that [o]nce again, the Agency is penalizing Watson for its own inability to clearly draft a Solicitation which elicits the same response from all offerors. Watson Comments at 13-14. Further, the fact that the Coast Guard discovered the above-noted deficiencies in the RFP after the SBA found Wolf ineligible for award, and did not assert that these deficiencies justified the cancellation of the solicitation until it filed its agency report in response to the protests, does not preclude cancellation of the RFP. An agency may properly cancel a solicitation regardless of when the information precipitating the cancellation arises. Admiral Towing and Barge Co. , B-245600; B-245602, Jan. 16, 1992, 92-1 CPD 83 at 6; see Rice Servs., Ltd. , supra , at 8 (the tardiness of the agency's determination that a solicitation should be cancelled does not alter the overriding principle that an agency should not proceed with a procurement when it reasonably believes that the resulting contract will fail to meet the agency's requirements). (Rice Services, Inc.; Watson Services, Inc., B-293861; B-293861.2; B-293861.3; B-293861.4, June 15, 2004) (pdf)

Asserting contract avoidance, promissory estoppel, and quantum meruit , the protester essentially argues that the agency's decision to cancel the RFQ was arbitrary and capricious. [2] A contracting agency need only establish a reasonable basis to support a decision to cancel an RFQ. DataTrak Consulting, Inc. , B-292502 et al. , Sept. 26, 2003, 2003 CPD 169 at 5. So long as there is a reasonable basis, an agency may cancel a solicitation no matter when the information precipitating the cancellation first arises, even if it is not until offers (or, as here, quotations) have been submitted and evaluated. Id. In this case, the USTDA indicates that it canceled the RFQ because it decided to perform the analysis, grant, and audit services in-house and, as a result, there was no longer a need for a contractor to perform the services. Our review of the record provides no basis for us to question the reasonableness of the agency's decision in this regard. Id. (denying protest of solicitation cancellation where the agency indicated that the services were no longer needed because they would be performed in-house). (SKJ & Associates, Inc., B-294219, August 13, 2004) (pdf)

The agency, however, indicates that the FedSource-Denver solicitation will not meet its needs because the aggregate dollar ceiling of250 million is not sufficient to satisfy the requirements for all nine FedSource offices for a base year, which the agency estimates to be approximately $300 million annually for both fiscal years 2004 and 2005, or for the 5-year period from fiscal year 2005 through 2009, which the agency estimates as more than $2 billion. Global argues that the government's estimate for fiscal year 2004 is overstated and maintains that the agency could use the subject solicitation to meet its requirements for a base-year period by issuing task orders for the entire $250 million in that year. [5] Other than the protester's speculation, however, there simply is nothing in the record that casts material doubt on the agency's estimates of its requirements. Moreover, even assuming that the current solicitation was capable of meeting the agency's requirements for a base year, the agency has indicated that it requires a support service contract capable of servicing the nine FedSource offices on a consolidated basis for the next 5 years, with a dollar ceiling in excess of2 billion, and that the agency expects to issue such a solicitation within the next few months. [6] The protester does not argue or suggest that the subject solicitation is capable of meeting such a requirement. Since the agency's consolidated needs for a base year plus option years clearly exceed the scope of the current solicitation, the agency reasonably canceled the RFP in favor of a solicitation that is consistent with the agency's contract consolidation effort and with the magnitude of the combined requirement. See id. ; USA Elecs. , B-283269.2, Oct. 5, 1999, 99-2 CPD 67 (holding that agency reasonably canceled solicitation where the agency's requirements had increased). (Global Solutions Network, Inc., B-294054; B-294054.2, August 10, 2004) (pdf)

As previously noted, the contracting officer cites two bases for his decision to cancel: (1) his recognition that the RFP did not furnish sufficient guidance as to required staffing levels, leading many offerors to propose staffing numbers (for individual categories of support and/or for overall performance) that the evaluators judged inadequate, resulting in downgrading of the proposals’ ratings under the technical approach subfactor; and (2) notification from the user activity of a significant reduction in its staffing requirement. With regard to the first basis, we agree with the protester that the agency’s argument that the solicitation failed to furnish sufficient guidance to offerors by failing to state the minimum acceptable staffing level for each category of support is undercut by the fact that the RFP, as re-issued, also fails to include these numbers; while the draft version of the revised SOW, dated March 23, 2004, included “minimum coverage” staffing numbers, the final version included in the re-issued RFP does not. The record nonetheless demonstrates that there were ambiguities regarding required staffing coverage in the cancelled solicitation that had an impact on the evaluation of proposals and thus provide a reasonable basis for cancellation. In this regard, the existence of an ambiguity affecting the competition under an RFP furnishes a reasonable basis for cancellation of the solicitation. A-Tek, Inc., B-286967, Mar. 22, 2001, 2001 CPD ¶ 57 at 2-4. Notification from the user activity as to a significant reduction in its staffing requirement furnished a second reasonable basis for cancellation. Cancellation of a solicitation is appropriate where an agency finds that its needs are no longer accurately reflected by an RFP, such as when there is a significant reduction in the anticipated workload. PAI Corp. et al., B-244287.5 et al., Nov. 29, 1991, 91-2 CPD ¶ 508 at 4; Dynalectron Corp., B-216201, May 10, 1985, 85-1 CPD ¶ 525 at 4. In sum, the revised RFP reflects a change in required hours of coverage for these 10 categories from between 1,048 and 1,248 hours per week in the canceled RFP, to 840 hours per week in the revised SOW; this reduction in hours (between 208 and 408 hours per week) translates to a reduction of between 5 and 10 employees (out of a total in all 14 categories of at most 39 employees). In our view, a reduction of that magnitude cannot be characterized as minimal. (Superlative Technologies, Inc., B-293709.2, June 18, 2004) (pdf)

Cancellation is proper where award under the solicitation would not meet the government’s actual needs, and the agency properly may cancel a solicitation no matter when the information precipitating the cancellation first surfaces or should have been known, even if the cancellation occurs after proposals have been submitted. See Encore Mgmt., Inc., B‑278903.2, Feb. 12, 1999, at 3. (Daston Corporation, B-292583; B-292583.2, October 20, 2003) (pdf)

The record reflects that the agency canceled the initial RFQ and made the decision to resolicit its requirements under a revised solicitation after the project manager’s review of the acquisition and her conclusion that the Ft. Berthold Service Unit/Minnetohe IHS clinic’s needs had changed. Specifically, the agency reports that its primary reason for canceling and resoliciting this requirement was the agency’s determination that the requirement for electronic claim filing using a clearinghouse for billing third parties was no longer needed because these services would be performed in-house. Agency Dismissal Request at 2. In response, DataTrak asserts that the agency “did not have a justifiable change in its needs that would support this action.” Supplemental Protest (B-292503.2) at 14. Rather, the protester alleges, the revised RFQ is for the same effort and scope of work as the initial RFQ and DataTrak insists that the agency simply issued the revised RFQ to change the evaluation criteria and thus avoid making award to DataTrak whose quotation in response to the initial RFQ was fully responsive. Id. at 14-16; Protester’s Comments at 9-13.  Our review of the record provides no basis for us to question the reasonableness of the agency’s cancellation of the initial RFQ.  (DataTrak Consulting, Inc., B-292502; B-292502.2; B-292503; B-292503.2, September 26, 2003)  (pdf)

As noted, the agency initially canceled the RFP after concluding that SKSS's price was unreasonable, and that there thus were no acceptable HUBZone offers. The contracting officer's conclusion was based in significant part on a comparison of SKSS's price with the agency's estimate--SKSS's price exceeded the estimate by 8.2 percent. The protester asserts that such a small percentage does not support a finding of price unreasonableness. We are inclined to agree with the protester, since the agency has not provided an explanation as to why this arguably modest price difference was significant enough to render SKSS's price unreasonable. However, the validity of the price reasonableness determination is not dispositive in this case, and we thus need not address it, since the record supports the agency's conclusion--reached during its consideration of the agency-level protest--that SKSS's proposal was technically unacceptable. In this regard, a contracting agency's initial reliance on an improper reason for canceling a solicitation is not significant if the record establishes that another proper basis for the cancellation exists. Peterson-Nunez Joint Venture, B‑258788, Feb. 13, 1995, 95-1 CPD ¶ 73 at 5; SEI Info. Tech.--Recon. B‑219668.2, Apr. 23, 1986, 86-1 CPD ¶ 393 at 3. An agency properly may cancel a solicitation no matter when the information supporting the cancellation first surfaces or should have been known. Pike Creek Computer Co., Inc., B‑290329, June 21, 2002, 2002 CPD ¶ 106 at 2.  (Sunshine Kids Service Supply Company, B-292141, June 2, 2003)  (pdf)

We believe that determinations of this kind must be left in the first instance to the sound judgment and discretion of responsible agency officials, subject to objection upon review only if clearly shown to be without a reasonable basis. See Federal Leasing, Inc.; DPF, Inc., B-182534, Apr. 18, 1975, 75-1 CPD ¶ 236 at 7-8. After a review of the record in the present case, we cannot conclude that the Army lacked a reasonable basis to cancel the solicitation at the time it did so.  In reaching this conclusion, we take note of the evidence in the record that the PWS workload has changed over the lengthy period of time since the study commenced; of the recent restructuring and reorganization of the way the Army manages installation support operations and the inevitable but uncertain impact this will have on the garrison's organization and its components, including the three components at issue in the solicitation; and of the garrison's concerns about funding. In an appropriate case, each of these factors may be sufficient to justify the cancellation of a solicitation. Printz Reinigung GmbH, B-241510, Feb. 8, 1991, 91-1 CPD ¶ 143 (cancellation of solicitation justified because of agency concerns about inaccuracy of the RFP's stated workload due to recent organizational changes and potential for cost savings through consolidation); Source AV, Inc., supra (cancellation of A-76 solicitation was reasonable where agency based its decision on uncertainty regarding budgetary constraints and likelihood that a reduction in the workload would materialize after a planned agency reorganization); Mercury Consolidated, Inc., B-218182, June 17, 1985, 85-1 CPD ¶ 687 (cancellation of A-76 solicitation justified based on substantial changes in the government's needs and the long period of time between the original solicitation and necessary revisions). While we find that the Army failed to provide sufficient support to justify the cancellation of the solicitation on any one of these factors alone, in our view, when the implications of these factors are combined with the uncertainty raised by the pending exemption requests and their potential impact on the scope of this procurement, we cannot conclude that the cancellation decision was clearly unreasonable.  (Satellite Services, Inc., B-288848.3, April 28, 2003)  (pdf)

In the final analysis, the process for selecting topics involves consideration by numerous DOD component activities, and the protester has not identified any basis for our Office to conclude that DOD, as the acquiring activity, improperly or inaccurately determined that its actual needs did not include the subject topic.  While it is unfortunate that this deliberative process took the amount of time ultimately required, this delay does not provide a basis for finding the cancellation improper.  See PAI Corp., et al., B-244287 et al., Nov. 29, 1991, 91-2 CPD ¶ 508 at 4-5 (cancellation proper no matter when the information precipitating the cancellation is known or should have been known, even if solicitation is not canceled until after proposals are submitted and protesters have incurred costs in pursuing the award).  (Pike Creek Computer Company, Inc., B-290329, June 21, 2002  (pdf)  (STTR Program))

Where an agency determines that a solicitation does not accurately reflect its needs, cancellation is appropriate. Digicon Corp., B-256620, July 7, 1994, 94-2 CPD ¶ 12 at 2.  Further, in a negotiated procurement, an agency has broad authority to decide whether cancellation is appropriate, and this authority extends to the cancellation of solicitations used to conduct A-76 cost comparisons. Lackland 21st Century Servs. Consol., B-285938.7, B-285938.8, Dec. 4, 2001, 2002 CPD ¶ 197 at 5. Finally, provided an agency has a reasonable basis for doing so, it may cancel a solicitation regardless of when the information precipitating the cancellation first surfaces. Id.  (Rice Services, Ltd., B-284997.5, March 12, 2002)

Where cancellation of a solicitation is justified, the fact that a particular offeror otherwise would have been in line for award does not provide a basis for precluding the agency from canceling. See Tender Loving Care Ambulance & Ambulette Co., Inc., B-276571.2, July 17, 1997, 97-2 CPD para. 25 (only small business remaining in competition is not entitled to award under small business set-aside where procuring agency had a reasonable basis to cancel request for proposals); HBD Indus., Inc., supra (sole remaining acceptable offeror is not entitled to award where agency has a legitimate basis to cancel procurement).  We have found that a reasonable basis to cancel an RFP exists where changes to the solicitation are expected to result in increased competition or lower prices. Robertson Leasing Corp., B-275152, Jan. 27, 1997, 97-1 CPD para. 49 at 3. We have also specifically found that a required change in a construction schedule meets the stricter compelling reason standard necessary to support cancellation of an invitation for bids, where that change likely will result in changed prices. Cedar Valley Corp., B-225475, B-225723, Feb. 24, 1987, 87-1 CPD para. 211 at 3. Goode does not argue that the construction schedule does not need to be changed, or that the proposed change will not result in lower contractor costs, more competition, and a potentially lower cost to the government.  (Goode Construction, Inc.--Protest and Costs, B-288655.4; B-288655.5; B-288655.6, January 28, 2002)

In a negotiated procurement, an agency has broad authority to decide whether to cancel a solicitation; there need be only a reasonable basis for the cancellation. Safety Storage, Inc., B-280851.2, May 13, 1999, 99-1 CPD para. 93 at 2. This broad grant of authority extends to the cancellation of solicitations used to conduct A-76 cost comparisons. Source AV, Inc., B-241155, Jan. 25, 1991, 91-1 CPD para. 75 at 3; Cantu Servs., Inc., B-219998.8, B-233697, Mar. 27, 1989, 89-1 CPD para. 306 at 2. So long as an agency has a reasonable basis for doing so, it may cancel a solicitation regardless of when the information precipitating the cancellation first surfaces or should have been known, even if the solicitation is not canceled until after proposals have been submitted and evaluated, Peterson-Nunez Joint Venture, B-258788, Feb. 13, 1995, 95-1 CPD para. 73 at 4; Nomura Enter. Inc., B-251889.2, May 6, 1993, 93-1 CPD para. 490 at 3-4; after contract award, see Atlantic Scientific & Tech. Corp., B-276334.2, Oct. 27, 1997, 97-2 CPD para. 116 at 5; or, as here, after the announcement of a different course of action in response to a GAO protest. Id. at 1-2.  (Lackland 21st Century Services Consolidated, B-285938.7; B-285938.8, December 4, 2001)

Cancellation of request for quotations (RFQ) for 1 year of janitorial and grounds maintenance services, with 4 option years, on the basis that the services had to be procured pursuant to the Javits-Wagner-O'Day (JWOD) Act, was improper where only services for 240 days or fewer had to be acquired under the statute. Related RFQ to cover a shorter term properly was canceled, however, since a reasonable basis existed for cancellation.  (Aleman & Associates, Inc., B-287275.2; B-287356.2, July 2, 2001)

More importantly, the record reflects that the solicitation was either ambiguous with regard to the time allowed for installation of the UPS system, or overstated the agency's minimum needs by continuing to mandate a 45-day installation period, and that the agency may obtain enhanced competition by amending the solicitation to clearly reflect its needs in this regard. Accordingly, we find that the agency's decision to cancel the solicitation to revise the source selection criteria and specifications to better reflect the agency's actual requirements, and seek enhanced competition, was reasonable.  (A-Tek, Inc., B-286967, March 22, 2001)

A contracting agency need only establish a reasonable basis to support a decision to cancel an RFQ. Shasta Transfer & Storage, B-261172, July 28, 1995, 95-2 CPD para. 48 at 2; Tony Ingoglia Salami and Cheese, Inc., B-244452, Sept. 23, 1991, 91-2 CPD para. 268 at 3. A reasonable basis to cancel exists when there is a material increase in the quantity needed to satisfy the agency?s requirements, Switlik Parachute Co., Inc., B-275539, Mar. 3, 1997, 97-1 CPD para. 113 at 3, or when a new solicitation presents the potential for cost savings. Eastman Kodak Co., B-271009, May 8, 1996, 96-1 CPD para. 215 at 4, recon. denied, B-271009.2, Oct. 7, 1996, 96-2 CPD para. 136.  (USA Electronics, B-283269.2, October 5, 1999)

The record shows, and D&K does not rebut, that it was noncompliant with regard to the bulk storage, countertops and also failed to fully explain its position concerning the double-walled storage tank. The record shows that these matters were the subject of both oral and written discussions, and that the protester?s final revised proposal remained noncompliant. In these circumstances where the agency conducted several rounds of oral and written discussions, and the protester?s proposal still remained noncompliant with the RFP SOW, we see no basis to object to the contracting officer?s decision to cancel. See Concepts Bldg. Sys., Inc., B-281995, May 13, 1999, 99-1 CPD para. 95.2.  (D&K Construction Company, Inc., B-281244.3, October 1, 1999)