United States Government Accountability Office

Washington, DC 20548

Comptroller General

of the United States

Decision

Matter of: International Transport Company

File: B-406924.2; B-406924.3

Date: December 20, 2012

Philip J. Davis, Esq., Wiley Rein LLP, for the protester.

Matteo Zappile, Franzosini Sud SRL., for the intervenor.

Keith M. Dunn, Esq., Department of the Navy, for the agency.

Frank Maguire, Esq., and David A. Ashen, Esq., Office of the General Counsel, 

GAO, participated in the preparation of the decision.

DIGEST

1. Awardee’s proposal was properly found technically acceptable where a site 

inspection by contracting personnel indicated that the awardee met the solicitation 

requirement for a minimum dedicated storage. 

2. Protest against evaluation of awardee’s past performance is denied where the 

evaluators reasonably determined that the awardee’s submitted contracts were 

relevant, despite being significantly smaller in magnitude than the solicited 

requirement, because they involved essentially the same services as the solicited

requirement.

DECISION

International Transport Company (ITC) protests the Department of the Navy’s award 

of a contract to Franzosini Sud SRL (Franzosini), under request for proposals (RFP) 

No. N68171-12-R-0003, for packing, moving and shipping services for Department 

of Defense personnel in the Naples, Italy area. The protester asserts that 

Franzosini’s proposal was unacceptable and otherwise improperly evaluated with 

regard to price realism and past performance. 

We deny the protest.

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.
Page 2 B-406924.2, B-406924.3 

BACKGROUND

The RFP was issued on December 15, 2011, for packing, moving, and shipping 

services related to personal property and household goods of Department of 

Defense personnel in the Naples, Italy area. The RFP contemplated award of a 

fixed-price, indefinite-delivery, indefinite-quantity (ID/IQ) contract. Award was to be 

made to the responsible offeror whose offer, conforming to the RFP, was most 

advantageous to the government considering evaluation factors for technical 

capability, past performance, and price. Technical capability was to be rated on an 

acceptable/unacceptable basis. Of particular importance in this regard, the RFP 

required that “[t]he contractor must have an approved DD1811 (Pre-Award Survey of 

Contractors/Carrier’s Facilities and Equipment) on file [with the agency] prior to 

contract award.” RFP (Original) at 45. Form DD1811 includes both a block for entry 

of the “Total Storage Space” and one for a “Narrative Description of Building.” See

Agency Report (AR), Tab 12, Franzosini DD1811, Dec. 19, 2005. 

Five proposals (including those of ITC and Franzosini) were received in response to 

the RFP. Based on its evaluation of proposals, the agency initially awarded a 

contract to ITC on March 23, 2012. On April 3, Franzosini filed a protest (B-406580) 

with our Office, challenging the agency’s determination that its proposal was 

technically unacceptable due to Franzosini’s failure to submit an approved form 

DD1811. The agency subsequently determined that Franzosini’s proposal should 

not have been found technically unacceptable because the company, in fact, had an 

approved DD1811 on file with the agency. Contracting Officer’s Statement (COS) 

at 2; see Agency Letter, Apr. 13, 2012. Upon being advised by the agency that it 

would take corrective action, GAO dismissed Franzosini’s protest. B-406580.1, 

Apr. 17, 2012. The agency then issued amendment No. 0001 to the RFP on 

June 22, 2012. That amendment, inter alia, added a minimum storage area 

requirement of 1,200 square meters (sm) and required offerors to provide an 

“affirmative statement” that they met this requirement. Amend. No. 0001 at 1, 43. 

Four revised proposals were received by the new closing time on July 25. Based 

upon its evaluation of the revised proposals, the agency determined that Franzosini 

had submitted the most advantageous offer and made award to that firm on 

September 11. COS at 3, 6; AR, Tab 18, Post Negotiation Business Clearance 

Memorandum. 

DISCUSSION

ITC raises several challenges to the evaluation of Franzosini’s proposal. We have 

considered all the issues raised by ITC and find that none furnishes a basis for 

questioning the award to Franzosini. In this regard, the evaluation of proposals is a 

matter within the discretion of the contracting agency, since the agency is 

responsible for defining its needs and the best method of accommodating them. 

Encorp-Samcrete Joint Venture, B-284171, B-284171.2, Mar. 2, 2000, 2000 CPD 

¶ 55 at 4. In reviewing an agency’s evaluation, we will not reevaluate proposals, but 
Page 3 B-406924.2, B-406924.3 

instead will examine the agency’s evaluation to ensure that it was reasonable and 

consistent with the solicitation’s stated evaluation criteria and with procurement 

statutes and regulations. Id. We address the most significant issues raised by ITC

below.

1,200 Square Meters Storage Space Requirement

As noted, the RFP as amended provided that “[t]he minimum dedicated, secured 

storage area to be provided by the contractor is 1,200 Square Meters.” Amend. 

No. 0001 at 43. ITC asserts that Franzosini’s proposal should have been found 

technically unacceptable on the basis that, while the RFP required a minimum of 

1,200 sm of dedicated storage space, the Form DD1811 on file for Franzosini 

indicated only 300 sm of available space in the Narrative Description of Building 

block. See Franzosini DD1811, Dec. 19, 2005. 

We find this argument unpersuasive. While the RFP provided that the offeror was 

required to have an “approved DD1811” on file, amend. No. 0001 at 44, and 

Franzosini’s DD1811 on file with the agency indicated a current space availability as 

of the time of the form of only 300 sm, we agree with the agency that this did not 

render Franzosini’s proposal unacceptable. The record indicates that Navy 

contracting personnel, on August 1, 2012, that is, prior to award, conducted an 

on-site inspection of Franzosini’s proposed facility which confirmed that, in fact, 

Franzosini’s facility had over 1,500 sm of secured storage area that could be made 

available and totally dedicated to the government.1

 COS at 3. Based on this 

information, the contracting officer properly determined Franzosini’s proposal to be 

technically acceptable.

Price Realism

The RFP provided that “[u]nrealistically low or high proposed prices may be grounds 

for eliminating a proposal from competition either on the basis that the offeror does 

not understand the requirement or has made an unrealistic proposal.” RFP at 92. 

ITC asserts that the agency’s price realism evaluation of Franzosini’s proposal was 

inadequate. According to the protester, the nature of the work required under the 

RFP does not involve “the type of services that lend themselves to varied and 

creative technical approaches that make such low pricing plausible.” Comments 

at 4. ITC concludes that, given the nature of the work, the large difference between 

 

1 Franzosini’s approved DD1811 on file with the agency, dated December 19, 2005, 

indicated that Franzosini’s facility had 1,600 sm of “Total Storage Space,” of which, 

at that time, 300 sm was available for government requirements. Franzosini 

DD1811, Dec. 19, 2005. 
Page 4 B-406924.2, B-406924.3 

Franzosini’s proposed price (€2,859,795) and ITC’s price (€3,643,457), calls into 

question how Franzosini could realistically offer such low prices.

We find this protest ground to be without merit. First, under a solicitation such as 

this for a fixed-priced contract, there is no prohibition against an agency’s 

acceptance of a low or below-cost offer. SAIC Computer Sys., B-258431.2, Mar. 13, 

1995, 95-1 CPD ¶ 156 at 2, 11-13. While price realism need not be considered in 

evaluating proposals for the award of a fixed-price contract, an agency may, as here,

include in a solicitation a provision that provides for a price realism evaluation for the 

purpose of assessing whether an offeror’s low price reflects on its understanding of 

the contract requirements. General Dynamics One Source, LLC; Unisys Corp., 

B-400340.5, B-400340.6, Jan. 20, 2010, 2010 CPD ¶ 45 at 9. Where a solicitation 

provides for a price realism evaluation, the depth of an agency’s evaluation in this 

regard is a matter within the sound exercise of the agency’s discretion. Citywide 

Managing Servs. of Port Washington, Inc., B-281287.12, B-281287.13, Nov. 15, 

2000, 2001 CPD ¶ 6 at 4-5. In reviewing protests challenging price realism 

evaluations, our focus is on whether the agency acted reasonably and in a manner 

consistent with the solicitation’s requirements. General Dynamics One Source, LLC; 

Unisys Corp., supra, at 9.

Although the agency’s evaluation, at some points, appears to conflate price realism 

and price reasonableness, it is plain from the record that the evaluators recognized 

that Franzosini’s prices were comparatively low, yet considered several factors that 

supported the conclusion that Franzosini had neither failed to understand the

requirement nor submitted an unrealistic proposal. Post Negotiation Business 

Clearance at 14-18. In this regard, the evaluators relied in part on a site visit to 

Franzosini’s facility, which confirmed that Franzosini had available the necessary 

storage facilities and equipment. The evaluators further noted that Franzosini had 

long been active in the primary business line that was the subject of the 

procurement, and that there was no reason to believe that Franzosini’s low price 

was the result of a misunderstanding of the requirement. Id. at 16. Rather, the 

contracting officer concluded that Franzosini’s low prices were a “reflection of 

Franzosini’s attempt to provide competitive pricing enabled by their own 

performance based approach.” Id. In our view, this information and analysis 

constituted a sufficient review of the realism of Franzosini’s prices, and satisfied any 

concerns with regard to possible risk to the government, which is a primary aspect of 

price realism analysis in a fixed price situation. See, e.g., Flight Safety Services 

Corp., B-403831, B-403831.2, Dec. 9, 2010, 2010 CPD ¶ 294 at 7-8; Phacil Inc., 

B-406628, July 5, 2012, 2012 CPD ¶ 202 at __. 

Past Performance Evaluation

ITC challenges the evaluation of Franzosini’s past performance. The protester 

asserts that since the contracts Franzosini cites in its past performance proposal 
Page 5 B-406924.2, B-406924.3 

were significantly less in value than the contract being awarded, they were 

unreasonably viewed as “relevant” to the effort here.

In reviewing a protest challenging an agency’s past performance evaluation, we will 

examine the record to determine whether the agency’s judgment was reasonable 

and consistent with the stated evaluation criteria and applicable statutes and 

regulations. Ostrom Painting & Sandblasting, Inc., B-285244, July 18, 2000, 

2000 CPD ¶ 132 at 4. A protester’s mere disagreement with the agency’s evaluation 

provides no basis to question the reasonableness of the evaluators’ judgments. See

Citywide Managing Servs. of Port Washington, Inc., supra, at 10-11.

The RFP here provided for rating prior contracts for purposes of relevance as 

follows: 

Very relevant: Present/past performance effort involved essentially the 

same scope and magnitude of effort and complexities this solicitation 

requires.

Relevant: Present/past performance effort involved similar scope and 

magnitude of effort and complexities this solicitation requires.

Somewhat Relevant: Present/past performance involved some of the 

scope and magnitude of effort and complexities this solicitation 

requires. 

RFP at 92 (emphasis added). 

Franzosini submitted three contracts. Its first contract, with ITO Mobel Transport, 

was for packing, storage, and transportation of personal property and household 

goods belonging to Department of Defense military/civilian personnel, and had a 

value of €925,235. It was found to be “relevant,” based on a finding that the

services were “essentially the same as the current requirement, but smaller in 

scope and magnitude.” Post Negotiation Business Clearance Memorandum at 9. 

Franzosini’s second contract, with SANRISE LLC, was also for packing, storage, 

and transportation of personal property and household goods belonging to 

Department of Defense military/civilian personnel, and had a value of €734,680. It 

was found to be relevant on the basis that the services were “essentially the same 

as the current requirement, but smaller in scope and magnitude.” Id. Franzosini’s 

third contract, the “U.S. Consulate General” contract, was likewise for packing, 

storage, and transportation of personal property and household goods belonging to 

Department of Defense military/civilian personnel, and had a value of €568,450. 

This contract was also rated relevant. Id. Overall, Franzosini received a “relevant” 

rating for the contracts submitted for the past performance evaluation. Id. at 8.
Page 6 B-406924.2, B-406924.3 

We find the evaluation in this regard to be unobjectionable. The solicitation 

indicated that a “relevant” rating was warranted where the “performance effort 

involved similar scope and magnitude of effort and complexities,” while a “somewhat 

relevant” rating was warranted where the “performance involved some of the scope 

and magnitude of effort and complexities.” RFP at 92. While all three Franzosini 

contracts were of a lesser magnitude (€925,235, €734,680, and €568,450) than the 

current requirement as evidenced by either the agency estimate for this requirement 

(€6,141,650) or Franzosini’s price (€2,859,795), each of the contracts was for 

services that were essentially the same as the current requirement, that is, packing, 

storage, and transportation of personal property and household goods belonging to 

Department of Defense personnel. Further, we note that the RFP provided that, in 

evaluating past performance, the agency may “obtain information for use in the 

evaluation of past performance from any and all sources,” RFP at 91; as the agency 

points out, the references on all three of Franzosini’s contracts rated Franzosini’s 

performance as “Very Relevant” to the current effort. Supp. AR at 7; Post 

Negotiation Business Clearance Memorandum. In these circumstances, we cannot 

conclude that the agency acted unreasonably in rating each of Franzosini’s contracts 

relevant rather than only somewhat relevant. 

In any case, we note that ITC appears not to have been prejudiced by the agency’s 

approach here to determining relevance. ITC’s contract with Panda Transporti Srl

was valued at €170,000, significantly less than any of the contracts submitted by 

Franzosini, yet the agency found this contract to be “relevant” notwithstanding that 

the services performed were plainly “smaller in scope and magnitude.” AR, Tab 18, 

at 10; see Alanna Orr, B-310966.2, May 14, 2008, 2008 CPD ¶ 95 at 3 (prejudice is 

an essential element of every viable protest and, where it is not demonstrated or 

otherwise evident, GAO will not sustain a protest allegation, even where the record 

shows that the agency’s actions arguably were improper).

The protest is denied. 

Susan A. Poling

General Counsel